HomeMy WebLinkAboutReso 2004-342
RESOLUTION NO. 2004-342
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA APPROVING A RESOLUTION OF
INTENTION TO CONSIDER GRANTING A GAS FRANCHISE
AND ELECTRIC FRANCHISE, UNDER CERTAIN
CONDITIONS, TO SAN DIEGO GAS & ELECTRIC, AND
SETTING A PUBLIC HEARING FOR NOVEMBER 9, 2004 TO
CONSIDER GRANTING THE FRANCHISES
WHEREAS, SDG&E has held the City's gas & electric franchise since 1972; and
WHEREAS, the initial twenty-five-year tenn expired on November 30, 1997; and
WHEREAS, the City granted SDG&E a five-year franchise on September I, 1998; and
WHEREAS, in July, 2002, the City began fonnal negotiations with SDG&E regarding
municipal energy issues and implementation of electricity deregulation; and
WHEREAS, the City has concluded negotiations with SDG&E, and Council adopted a
Memorandum of Understanding (MOU) outlining the conceptual framework between the City
and SDG&E on October 12,2004; and
WHEREAS, the following represents a summary of the proposed tenns and conditions
applicable to both franchise agreements:
Franchise Fee: Franchise fee for the electric franchise will be 1.25%. The gas
franchise fee will remain at 2.0%. If the statutory franchise fees for general law cities are
increased during the tenn of the franchise, SDG&E will pay the higher rate to the City as
soon as authorized for collection by the California Public Utilities Commission.
Tenn: The initial tenn for both the electric and gas franchises shall be for a ten-
year period commencing on January I, 2005. Provided all of SDG&E's obligations
under the MOU are materially satisfied SDG&E will automatically receive a new 20-year
tenn upon expiration of the initial tenn.
Utility Users Tax (VUT): To the extent allowed by law, SDG&E shall collect
Utility Users Tax (UUT) from other electricity providers for remittance to the City.
California Municipal Lands Use: SDG&E shall implement the provisions of
California Public Utilities Code Sections 6351,6352,6353,6354 and 6354.1 and remit
funds collected to the City.
Administrative Practices: SDG&E and City will cooperate to prepare a manual to
govern the pennitting, installation, maintenance, repair and removal of SDG&E's
facilities in the streets of the City.
System Upgrades: SDG&E agrees to include the City in the early implementation
of system-wide enhancements (e.g. infrastructure upgrades and ancillary services) to the
extent it is consistent with SDG&E' s policy to prioritize and construct such system
enhancements.
Resolution 2004-342
Page 2
Indemnity: SDG&E will indemnity the City for liabilities resulting from the
exercising of any and all rights or privileges granted in the franchise agreements.
WHEREAS, the following represents additional tenns and conditions applicable only to
the electric franchise:
Rule 20A - Undergrounding: SDG&E agrees to expend the City's existing Rule
20A allocation of approximately $5 million towards the completion of undergrounding
projects identified in the MOU or as directed by the City. In addition, new allocations of
monies that may be drawn down for future undergrounding projects shall be made at the
rate of $2 million per year.
WHEREAS, in accordance with Section 1201 of the Chula Vista City Charter, the City
Council shall adopt a resolution declaring its intention to grant a franchise and shall schedule a
public hearing for the consideration of such grant; and
WHEREAS, by adoption of the proposed resolution, the City Council will set a public
hearing date that will provide notice to the public, provide the opportunity for further public
input, and establish November 9, 2004 at 6:00 p.m. as the date for Council's consideration of
granting electric and natural gas franchise agreements to SDG&E under the tenns and conditions
described herein.
NOW THEREFORE BE IT RESOLVED that the City Council of the City ofChula Vista
does hereby approve this resolution of intention to consider granting gas and electric franchises
to SDG&E.
BE IT FURTHER RESOLVED that the City Council of the City of Chula Vista does
hereby set a public hearing for November 9, 2004 at 6:00 p.m. in the Council Chambers, 276
Fourth Avenue, Chula Vista, CA, at which time the City Council intends to consider granting gas
and electric franchises to SDG&E on the tenns and conditions set forth above or as may be
modified by the Council in their discretion.
BE IT FURTHER RESOLVED that the City Council of the City of Chula Vista does
hereby authorize and direct the City Clerk to publish, at least once within fifteen days after the
passage of this resolution, and at least ten days prior to the date of the hearing, appropriate notice
of such hearing.
Presented by
Approved as to fonn by
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City Manager
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Ann Moore
City Attorney
Resolution 2004-342
Page 3
PASSED, APPROVED, and ADOPTED by the City Council of the City ofChula Vista,
California, this 26th day of October, 2004, by the following vote:
AYES:
Councilmembers:
Davis, McCann, Rindone, Salas and Padilla
NAYS:
Councilmembers:
None
ABSENT:
Councilmembers:
None
ATTEST:
su~ Big:!o~, ~~~, Ci:)1er~ II.
)
STATE OF CALIFORNIA )
COUNTY OF SAN DIEGO )
CITY OF CHULA VISTA )
I, Susan Bigelow, City Clerk of Chula Vista, California, do hereby certifY that the foregoing
Resolution No. 2004-342 was duly passed, approved, and adopted by the City Council at a
regular meeting of the Chula Vista City Council held on the 26th day of October, 2004.
Executed this 26th day of October, 2004.
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.., I .
Susan Bigelow, MMC, City k