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HomeMy WebLinkAboutOrd 1998-2747ORDINANCE NO. 2747 AN ORDINANCE GRANTING SAN DIEGO GAS ELECTRIC COMPANY, ITS SUCCESSORS SIGNS, THE FRANCHISE TO INSTALL, MAINTAIN AND ASSIGNS PIPES AND APPURTENANCES FOR TRANSMITTING AND DISTRIBUTING GAS FOR ANY AND ALL PURPOSES UNDER, ALONG, ACROSS, UPON THE PUBLIC STREETS AND PLACES AS THE SAME NOW OR MAY HEREAFTER EXIST WITHIN THE CITY OF CHULA VISTA WHEREAS, in 1972, in accordance with Article XIV (now Article XII) of the City Charter, City granted a gas franchise ("Original Franchise") to San Diego Gas & Electric ("SDG&E") pursuant to Ordinance No. 1426; and WHEREAS, the Original Franchise has expired and City staff and SDG&E representatives have negotiated the terms for an extension of the franchise through June 30, 2003, ("New Franchise"); and WHEREAS, on August 11, 1998, pursuant to City Council Resolution No. 19137, the City approved a resolution of intention to consider the adoption of the new franchise and set a public hearing for such purpose on September 1, 1998, at 4:00 p.m.; and WHEREAS, on September 1, 1998, a duly noticed public hearing was held on the new franchise, and all public testimony was reviewed and considered by the City Council, including the City Manager's recommendation to approve the new franchise, and the City Council approved the placement of this ordinance approving the new franchise on first reading; and WHEREAS, on September 15, 1998, the City Council considered the new franchise for second reading and adoption. NOW, THEREFORE, the City Council of the City of Chula Vista does hereby ordain as follows: A. PROTESTS OVERRULED. Any and all protests or objections presented to the granting of the new franchise are hereby overruled. B. TERMS AND CONDITIONS OF NEW FRANCHISE. SECTION 1. DEFINITIONS Whenever in this ordinance the words or phrases hereinafter in this section defined are used, they shall have the respective meanings assigned to them in the following definitions (unless, in the given instance, the context wherein they are used shall clearly import a different meaning): (a) The word "Grantee" shall mean San Diego Gas & Electric Company, and its lawful successors or assigns; Ordinance 2747 Page 2 (b) The word "City" shall mean the City of Chula Vista, a municipal corporation of the State of California, in its present incorporated form or in any later reorganized, consolidated, enlarged, or reincorporated form; (c) The word "streets" shall mean the public streets, ways, alleys, and places as the same now or may hereafter exist within said City, including state highways, now or hereafter established within said City, and freeways hereafter established within said City; (d) The word "gas" shall mean natural or artificial gas, or a mixture of natural and artificial gas; (e) The phrase "pipes and appurtenances" shall mean pipes, pipelines, mains, services, traps, vents, vaults, manholes, meters, gauges, regulators, valves, conduits, appliances, attachments, appurtenances, and any other property located or to be located in, upon, along, across, under, or over the streets of the city, and used or useful in the transrnitting and/or distributing of gas; (f) The phrase "install, maintain and use" shall mean to lay, construct, erect, install, operate, maintain, use, repair or replace; (g) The phrase "gross receipts" shall mean all gross operating revenues received by grantee from the sale of gas to Grantee's customers with points of service within the corporate limits of the city (including, but not limited to, sales to military reservations with points of service within the City's corporate limits) which are credited in Account Numbers 480, 481, and 482 of the current Uniform System of Accounts of the Federal Power Commission as adopted by the California Public Utilities Commission, or similar superseding accounts, less uncollectible amounts and less any refunds or rebates made by grantee to such customers pursuant to orders or decisions of the California Public Utilities Commission. (h) The phrase "Utility Users' Tax" shall mean the local taxes added to utility bills of residential and commercial utility customers as defined in Chula Vista Municipal Code, Chapter 3.44 entitled "Utility Users' Tax." SECTION 2. GRANT OF FRANCHISE The franchise to install, maintain and use in the streets of said City all pipes and appurtenances for transmitting and distributing gas to the public for any and all purposes within said City is hereby granted to San Diego Gas & Electric Company, its successors and assigns. This franchise is granted upon each and every condition herein contained, and shall ever be strictly construed against grantee. Nothing shall pass by the franchise granted hereby to grantee unless it be granted in plain and unambiguous terms. Each of said conditions is a material and essential condition to the granting of said franchise. SECTION 3. TERM Said franchise shall commence on July 1, 1998, and shall expire on June 30, 2003. Throughout such term said franchise shall endure in full force and effect until the same shall, with the consent of the Public Utilities Commission of the State of California, be voluntarily surrendered or abandoned by the grantee, or until the state or some municipal or public corporation thereunto duly authorized by law shall purchase by voluntary agreement or shall Ordinance 2747 Page 3 condemn and take under the power of eminent domain, all property actually used and useful in the exercise of said franchise and situate in the territorial limits of the state, municipal, or public corporation purchasing or condemning such property, or until said franchise shall be forfeited for non-compliance with its terms by the grantee. SECTION 4. CONSIDERATION (a) Franchise Fees. The Grantee of said franchise shall during the term thereof pay to the City two percent of the gross annual receipts of said grantee, which amount has been held by Decision No. 80432 of the Public Utilities Commission of the State of California to be the normal level paid to other political subdivisions within the utility's territory. It is understood that any administrative, legislative or judicial modification of said franchise fee or the basis of calculating said fee pursuant to Decision No. 80432 shall be cause for review and renegotiation of this amount of franchise fee at any time within the term of this franchise. (b) Utility User's Tax-Collection Services. To the extent permitted by law, and solely for those customers within the corporate limits of the City billed directly by grantee (including customers purchasing power from other electricity providers), grantee agrees to collect the City's Utility Users' Tax and remit same to the City on a monthly basis. (c) Transportation Surcharqe. Grantee shall implement the surcharge provisions of California Public Utilities Code Sections 6351,6352, 6353, and 6354.1 and remit surcharges collected to the City. Grantee agrees to refrain from opposing the applicability of franchise fees (or their equivalent) to retail gas sales using grantee's gas distribution system. Grantee agrees to continue to sul~port some baseline protection for franchise fees (or their equivalent) to ensure that municipalities will continue to receive such fees from all utility providers within their respective municipal boundaries. SECTION 5. REPORTS, DATES OF PAYMENT, AND CITY AUDITS The Grantee shall file with the Director of Finance of said City, within three months after the expiration of the calendar year, or fractional calendar year, following the date of the granting hereof, and within three months after the expiration of each and every calendar year thereafter, a duly verified statement showing in detail the total gross receipts of such grantee during the preceding calendar year, or such fractional calendar year, from the sale of gas within said City. Such grantee sha~l pay to said City by no later than the end of August of the following calendar year, an amount equal to fifty percent of the previous year's annuai payment, and by no later than the end of March of the following calendar year an amount which, when added to the initial fifty percent payment above, constitutes the City's annual franchise fee for the preceding calendar year. By this method of payment, it is contemplated and understood that grantee is in effect calculating the actual gross receipts once each year following the end of each year. Accordingly, grantee shall estimate the percentage due City for the period January through June, based on the previous year's payment and shall calculate the exact amount due for said period and shall remit the adjusted amount to city no later than the end of March of the following year, Transportation surcharges collected by Grantee pursuant to Section 4(c) shall also be paid in accordance with this schedule. Any neglect, omission, or refusal by said grantee to file such verified statement, or to pay said percentage at the time and in the manner specified, shall be grounds for the declaration of a forfeiture of this franchise and all rights of grantee hereunder. Ordinance 2747 Page 4 SECTION 6. COMPLIANCE WITH LAWS All facilities or equipment of grantee that grantee shall construct, maintain and use or remove, pursuant to the provisions of the franchise granted herein shall be accomplished in accordance with the ordinances, rules and regulations of City or as hereafter adopted or prescribed, and such rules or regulations as are promulgated under state law, or orders of the Public Utilities Commission or other governmental authority having jurisdiction in the premises. SECTION 7. ADMINISTRATIVE PRACTICES (a) Installation, Maintenance, Re~air and Removal of Facilities. Grantee is herewith charged with the responsibility of cooperating with City in preparing a manual of administrative practices which shall govern the installation, maintenance, repair and removal of grantee's facilities in the streets of city which shall include, but not be limited to, cathodic protection practices. Once each year, commencing with the first full calendar year of the franchise granted herein, it is to be the joint responsibility of grantee and City to review and update such administrative practices. Both grantee and City are charged with the duty to prepare, review and update such administrative practices by a method of mutual cooperation which shall take into consideration the reasonable needs and convenience of each party; provided that said administrative practices and the terms and conditions thereof shall be at all times subject to approval of the City Council as expressed by appropriate legislative action. Following the preparation of said nnanual, and its approval by the City Council, it shall govern the practices of the grantee in its installation and removal of grantee's facilities in the streets of the City. (b) System UDqrades. Grantee agrees to include the City in the early implementation of system-wide enhancements (e.g. infrastructure upgrades and ancillary services) to the extent such inclusion is consistent with grantee's then policy to prioritize and construct such system enhancements based on the condition of existing infrastructure in grantee's service territory. SECTION 8. CITY RESERVED POWERS (a) City reserves the right for itself to lay, construct, erect, install, use, operate, repair, replace, remove, relocate, regrade, or maintain below surface or above surface improvements of any type or description in, upon, along, across, under, or over the streets of the City. City further reserves the right to relocate, remove, vacate, or replace the streets themselves. If the necessary exercise of the aforementioned reserve rights conflicts with any pipes and appurtenances of grantee constructed, maintained and used pursuant to the provisions of the franchise granted hereby, whether previously constructed, maintained and used or not, grantee shall, without cost or expense to City within ninety (90) days after written notice from the City Manager, or his designated representative, and request so to do, begin the physical field construction of changing the location of all facilities or equipment so conflicting. Grantee shall proceed promptly to complete such required work. (b) Irrespective of any other provision of this ordinance, grantee's right to construct, maintain and use, or remove pipes and appurtenances thereto shall be subject at all times to the right of the City, in the exercise of its police power, to require the removal or relocation, to underground locations, of said pipes and appurtenances thereto at the sole cost and expense of grantee. Ordinance 2747 Page 5 (c) Notwithstanding anything else in this ordinance to the contrary, the City's right to be a gas generator or retailer, to the extent permitted by law, shall not be limited in any manner by the granting of this franchise. SECTION 9. HOLD HARMLESS Except to the extent caused solely by any negligent, grossly negligent or willful misconduct of the City or its officers or employees, grantee of the franchise granted hereby shall indemnify, save, and hold harmless, City and any officers and employees thereof against and from aH damages, judgments, decrees, costs, and expenditures which city, or such officer or employee, may suffer, or which may be recovered from, or obtainable against City, or such officer or employee, for, or by reason of or growing out of or resulting from the exercising by grantee of any or all of the rights or privileges granted hereby, or by reason of any act or acts of grantee or its servants or agents in exercising the franchise granted hereby and Grantee shall defend any suit that may be instituted against City, or any officer or employee thereof by reason of or growing out of or resulting from the exercise by grantee of any or all of the rights or privileges granted hereby, or by reason of any act or acts of grantee, or its servants or agents, in exercising the franchise granted hereby. SECTION 10. REPAIR COSTS Grantee shall pay to City on demand the cost of all repairs to City property made necessary by any of the operations of grantee under the franchise granted hereby, provided, however, that grantee may make repairs to streets, sidewalks, curbs, and gutters itself at its own cost in accordance with City specifications if the same can be done without undue inconvenience to the public use of the streets. SECTION 11. FORFEITURE AND OTHER REMEDIES This franchise is granted upon each and every condition herein contained, and shall ever be strictly construed against grantee. Nothing shall pass by the franchise granted hereby to grantee unless it be granted in plain and unambiguous terms. Each of said conditions is a material and essential condition to the granting of the franchise. If grantee shall fail, neglect or refuse to comply with any of the conditions of the franchise granted hereby, and if such failure, neglect or refusal shall continue for more than thirty (30) days after written demand by the City Manager for compliance therewith, then City, by the City Council, in addition to all rights and remedies allowed by law, thereupon may terminate the right, privilege and franchise granted in and by this ordinance, and all the rights, privileges and the franchise of grantee granted hereby shall thereupon be at an end. Thereupon and immediately, grantee shall surrender all rights and privileges in and to the franchise granted hereby. No provision herein made for the purpose of securing the enforcement of the terms and conditions of the franchise granted hereby shall be deemed an exclusive remedy or to afford the exclusive procedure for the enforcement of said terms and conditions, but the remedies and procedure outlined herein or provided, including forfeiture, shall be deemed to be cumulative. SECTION 12. ACQUISITION AND VALUATION Nothing in this ordinance or in the franchise granted hereby shall be construed as in any way impairing City's rights to acquire property of grantee through the exercise of City's power of eminent domain, or through voluntary agreement between City and grantee. In the event Ordinance 2747 Page 6 that City chooses to exercise its power of eminent domain, it shall do so in accordance with the procedures provided by the general law of the State of California for the condemnation of public utility property. The valuation of such property for condemnation purposes shall be made in accordance with such general law. SECTION 13. AUTHORITY FOR GRANT Notwithstanding any other provision herein contained, this franchise is granted solely and exclusively under Section 1200, 1201, 1202, 1203, 1204, 1205, and 1206 of Article XII of the Charter of the City of Chula Vista, and Chapter 5.30 of the Chula Vista Municipal code and no other authority. This franchise is granted subject to any and all additional terms and conditions contained therein. SECTION 14. EFFECTIVE DATE Subject to the requirements of Section 16, this ordinance shall become effective thirty (30) days after its final passage unless superseded by a referendum petition filed as provided by law. Upon the effectiveness of this ordinance, the commencement of the term shall be July 1, 1998, as provided in Section 3. SECTION 15. PUBLICATION COSTS The grantee of said franchise shall pay to the City a sum of money sufficient to reimburse it for all publication expenses incurred by it in connection with the granting thereof; such payment to be made within thirty (30) days after the city shall have furnished such grantee with a written statement of such expenses. SECTION 16. WRITTEN ACCEPTANCE The franchise granted hereby shall not become effective until written acceptance thereof, in a form approved by the City Attorney, shall have been filed by the grantee with the City Clerk. SECTION 17. PUBLICATION The City Clerk shall cause this ordinance to be published once within fifteen (15) days after its passage in the Chula Vista Star News, a newspaper of general circulation published and circulated in said City. SECTION 18. MISCELLANEOUS OBLIGATIONS (a) Notice of Siqnificant Transactions. Grantee agrees to provide as much reasonable advance notice as is legally permissible to the City regarding any mergers, buyouts, spin-offs or other transactions materially affecting the nature of the entity to which the City grants this franchise. Such notice shall be consistent with grantee's obligations under the law relating to disclosures and the limitations placed upon grantee. (b) Economic Development. To the extent recovery of the expense through rates is allowed by the CPUC regulations, grantee agrees to cooperate, in good faith, on reasonable Ordinance 2747 Page 7 economic development activities which may include, but not be limited to, deferral or waiver of hook-up fees, assistance in the financing of upgraded infrastructure and/or offering of power incentives to companies that meet city-defined economic development or employment criteria. GRANTEE'S ACCEPTANCE: Grantee accepts the franchise granted hereby and agrees to be bound and abide by all covenants, terms and conditions contained herein. Grantee warrants and represents that it is authorized to enter into this Franchise Agreement, a copy of which is on file in the office of the City Clerk Document Number CO98-149, and that the party executing this franchise on its behalf is duly authorized to do so, without the need for any further action. ACKNOWLEDGED AND AGREED SAN DIEGO GAS & ELECTRIC CO. By: Edwin A. Guiles (Original Signature on file with Document No. C098-148) Title: President Presented by Assistant Citv M~'ger Approved as to form by A ~ty ttorney