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(5) In tile . event that the City requests additional operation and maintenance y' `° the water supply stor. p over and above that determined by the Contracting; Officer and over and alcove that which formed the basis for determination as set out in Exhibit A, the City shall bear the entire co ,t of such additional expense. C. Major Capital Replacement Cots. (1) Present Use. The City shall pay 4.22 percent 'o€ the cost of major capital replacements and sedimentation resurvey., when incurred. ' (2) Future Use. As the storage for future water .supply demands is used, the share of the major capital replacements and sedimen- Cation resurveys, which tine City will be required to _ ray, trill be increased cor..merts.urate with the percentage of.- the future.water supply storage being; used, ur to a total of 10.526 percent of such costs. (3) Pa npnt. Payment shall be made either in lump sum on demand at the time costs are incurred or annually with interest on the unpaid. balance. If paid annually,- the Cityt.s share -shall be paid within the life of the Project in not to exceed.25 . consecutive annual installments'with - the first payment to be made with the first annual payment on the Project investment costs becoming due .after the date said major capital replacement costs are incurred. Annual payrents thereafter will be due and payable on said anniversary date._ All annual payments for replacement of joint use items- shall include accrued interest on the unpaid balance. at the interest rate computed in accordance with the Water ` supply Act of 1953 as of -tile beginning of the fiscal year in which_ the major capital replacement is initiated. The last annual payment shall be adjusted upward or_ downi-iard wh en . r it h in the assure repayment. of all the Xncurred c ost. w - . repayment period.'... d.. Delinquent Payments. if the City shall fail to make any of the aforesaid payments when due, then the delinquent payments shall bear interest, conT.ounded' annually, until paid. The interest-- rate to % be used for delinquent payments shall be as established by the Secretary of the Treasury'on the basis of the slater Supply Act of 1958, as amended, as of the beginnin- of the Government fiscal year in which each period of delinquency occurs. The amount charged on payments overdue for a period of less than one year shall be figured on a monthly basis. For ex-ample, it the payr -ent is made within the first month after being overdue (31. to 60 days after the anniversary date) ,