HomeMy WebLinkAboutOrdinance 1459 ORDINANCE NO. 1459
GAS FRANCHISE ORDINANCE
CITY OF COLUMBIA HEIGHTS, ANOKA COUNTY, MINNESOTA
AN ORDINANCE GRANTING CENTER.POINT ENERGY MINNEGASCO, A NATURAL
GAS UTILITY, A DIVISION OF CENTER.POINT ENERGY RESOURCES CORP., A
DELAWARE CORPORATION, ITS SUCCESSORS AND ASSIGNS, A NONEXCLUSIVE
FRANCHISE TO CONSTRUCT, OPERATE, REPAIR AND MAINTAIN FACILITIES
AND EQUIPMENT FOR THE TRANSPORTATION, DISTRIBUTION, MANUFACTURE
AND SALE OF GAS ENERGY FOR PUBLIC AND PRIVATE USE AND TO USE THE
PUBLIC GROUND OF THE CITY OF COLUMBIA HEIGHTS, MINNESOTA, FOR
SUCH PURPOSE; AND, PRESCRIBING CERTAIN TERMS AND CONDITIONS
THEREOF.
THE CITY COUNCIL OF THE CITY OF COLUMBIA HEIGHTS, ANOKA COUNTY,
MINNESOTA, ORDAINS:
SECTION 1. DEFINITIONS.
For purposes of this Ordinance, the following capitalized terms listed in alphabetical order
shall have the following meanings:
City. The City of Columbia Heights, County of Anoka, State of Minnesota.
City Utility System. Facilities used for providing public utility service owned or operated
by City or agency thereof, including sewer, storm sewer, water service, street lighting and traffic
signals, but excluding facilities for providing heating, lighting, or other forms of energy.
Commission. The Minnesota Public Utilities Commission, or any successor agency or
agencies, including an agency of the federal government, which preempts all or part of the authority
to regulate gas retail rates now vested in the Minnesota Public Utilities Commission.
Company. CenterPoint Energy Minnegasco, a Division of CemerPoint Energy Resources
Corp., a Delaware Corporation, its successors and assigns including all successors or assigns that
own or operate any part or parts of the Gas Facilities subject to this fi'anchise.
Gas. Natural gas, manufactured gas, mixture of natural gas and manufactured gas or other
forms of natural energy.
Gas Facilities. Gas transmission and distribution pipes, lines, ducts, fixtures, and all
necessary equipment and appurtenances owned or operated by the Company for the purpose of
providing gas energy for public or private use.
Non-Betterment Costs. Costs incurred by Company fi.om relocation, removal or
rearrangement of Gas Facilities that do not result in an improvement to the Gas Facilities.
Notice. A written notice served by any party or parties on any other party or parties. Notice
to Company shall be mailed to CenterPoint Energy Minnegasco, V.P. of Regulatory and Supply
Service, 800 laSalle Avenue, Minneapolis, Minnesota 55402. Notice to the City shall be mailed to
the City Manager, City of Columbia Heights, 590 - 40th Avenue NE, Columbia Heights, MN
55421-3835. Any party may change its respective address for the purpose of this Ordinance by
written notice to the other parties.
Public Ground. Land owned or otherwise controlled by the City for park, open space or
similar public purpose, which is held for use in common by the public.
Public Way. Public right-of-way within the City as defined in MN Stat. § 237.163 subd. 3.
SECTION 2. ADOPTION OF FRANCHISE.
2.1 Grant of Franchise. City hereby grants Company, for a period of 20 years from the
date this Ordinance is passed and approved by the City, the right to import, manufacture, distribute
and sell gas for public and private use within and through the limits of the City as its boundaries
now exist or as they may be extended in the future. This fight includes the provision of Gas that is
(i) manufactured by the Company or its affiliates and delivered by the Company, (ii) purchased and
delivered by the Company or (iii) purchased from another source by the retail customer and
delivered by the Company. For these purposes, Company may construct, operate, repair and
maintain Gas Facilities in, on, over, under and across the Public Ways and Public Grounds, subject
to the provisions of this Ordinance. Company may do all reasonable things necessary or customary
to accomplish these purposes, subject however, to such lawful regulations as may be adopted by
separate ordinance and as currently exist under City Right of Way (RO~ Ordinan~ i~6. The
Company shall be notified 60 days in advance of proposed changes to City Ordinance (ROW)
1446. The City and Company shall negotiate in good faith to reach mutually acceptable changes. If
the City and Company are unable to agree, disputes will be handled under the terms of Section 2.5
of this ordinance
2.2 Effective Date[ Written Acceptance. This franchise shall be in force and effect
from and after its passage of this Ordinance and publication as required by law and its acceptance
by Company. If Company does not file a written acceptance with the City within 60 Days after the
date the City Council adopts this ordinance, or otherwise places the City on written notice, at any
time, that the Company does not accept all terms of this franchise, the City Council by resolution
may either repeal this ordinance or seek its enforcement in a court of competent jurisdiction.
2.3. Service and Gas Rates. The service to be provided and the rates to be charged by
Company for gas service in City are subject to the jurisdiction of the Commission.
2.4. Publication Expense. Company shall pay the expense of publication of this
Ordinance.
2.5. Dispute Resolution. If either party asserts that the other party is in default in the
performance of any obligation hereunder, the complaining party shall notify the other party of the
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default and the desired remedy. The notification shall be written. Representatives of the parties
must promptly meet and attempt in good faith to negotiate a resolution of the dispute. If the dispute
is not resolved within 30 days of the written notice, the parties may jointly select a mediator to
facilitate further discussion. The parties will equally share the fees and expenses of this mediator.
Ifa mediator is not used or if the parties are unable to resolve the dispute within 30 days after first
meeting with the selected mediator, either party may commence an action in District Court to
interpret and enforce this franchise or for such other relief as may be permitted by law or equity.
2.6. Continuation of Franchise. If the City and the Company are unable to agree on the
terms of a new franchise by the time this franchise expires, this franchise will remain in effect until
a new franchise is agreed upon, or until 90 days after the City or the Company serves written Notice
to the other party of its intention to allow the franchise to expire. However, in no event shall this
franchise continue for more than one year after expiration of the 20-year term set forth in Section
2.1.
SECTION 3. LOCATION~ OTHER REGULATIONS.
3.1. Location of Facilities. Gas Facilities shall be located, constructed, and maintained
so as not to interfere with the safety and convenience of ordinary travel along and over Public Ways
and so as not to disrupt normal operation of any City Utility System. Gas Facilities may be located
on Public Grounds as determined by the City. Company's construction, reconstruction, operation,
repair, maintenance, location and relocation of Gas Facilities shall be subject to other reasonable
regulations of the City consistent with authority granted the City to manage its Public Ways and
Public Grounds under state law, to the extent not inconsistent with a specific term of this franchise.
3.2. Street Ooenines. Company shall not open or disturb the surface of any Public Way
or Public Ground for any purpose without first having obtained a permit from the City, if required
by a separate ordinance, for which the City may impose a reasonable fee. Permit conditions
imposed on Company shall not be more burdensome than those imposed on other utilities for
similar facilities or work. Company may, however, open and disturb the surface of any Public Way
or Public Ground without a permit if (i) an emergency exists requiting the immediate repair of Gas
Facilities and (ii) Company gives telephone, email or similar notice to the City before
commencement of the emergency repair, if reasonably possible. Within two business days after
commencing the repair, Company shall apply for any required permits and pay any required fees.
3.3. Restoration. After undertaking any work requiring the opening of any Public Way,
the Company shall restore the Public Way in accordance with City Ordinance (ROW) #1446, and
other applicable City ordinances consistent with law. Company shall restore the Public Ground to
as good a condition as formerly existed, and shall warranty the surface in good condition for
twenty-four months thereafter. If Company shall not promptly perform and complete the work,
remove all dirt, rubbish, equipment and material, and put the Public Ground in the said condition
and after demand to Company to cure, City shall, after passage of a reasonable period of time
following the demand, but not to exceed ten days, have the right to make the restoration of the
Public Ground at the expense of Company. Company shall pay to the City the cost of such work
done for or performed by the City. This remedy shall be in addition to any other remedy available
to the City for noncompliance with this Section. The Company shall also post a construction
performance bond consistent with the provisions City ordinance (ROW) #1446.
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3.4. Avoid Damage to Gas Facilities. The Company must take reasonable measures to
prevent the Gas Facilities fi.om causing damage to persons or property. The Company must take
reasonable measures to protect the Gas Facilities fi.om damage that could be inflicted on the
Facilities by persons, property, or the elements. The Company must take protective measures when
the City performs work near the Gas Facilities, if given reasonable notice by the City of such work
prior to its commencement.
3.5. Notice of Improvements to Streets. The City will give Company reasonable
written Notice of plans for improvements to Public Ways where the City has reason to believe that
Gas Facilities may affect or be affected by the improvement. The notice will contain: (i) the nature
and character of the improvements, (ii) the Public Ways upon which the improvements are to be
made, (iii) the extent of the improvements, (iv) the time when the City will start the work, and (v) if
more than one-Public Way is involved, the Contractor's Schedule for the order in which the work is
to proceed. The notice will be given to Company with a sufficient length of time, considering
seasonal working conditions, in advance of the actual commencement of the work to pcrrnit
Company to make any additions, alterations or repairs to its Gas Facilities the Company deems
necessary, but so as not to delay the planned City Improvements.
3.6 Maooint~ Information. The Company must promptly provide complete and
accurate mapping information for any of its Gas Facilities in accordance with the requirements of
City Ordinance (ROW) #1446.
SECTION 4. RELOCATIONS.
4.1. Relocation of Gas F.~ci!ities. Relocation of Gas Facilities in Public Ways shall be
subject to City Ordinance(ROW) 1446. City may require Company at Company's expense to
relocate or remove its Gas Facilities fi.om Public Grounds upon a finding by City that the Gas
Facilities have become or will become a substantial impairment to the existing or proposed public
use of the Grounds. Relocation Gas Facilities in Public Ground shall comply with applicable City
ordinances consistent with law.
4.2. Proiects with Federal Fundim~. Relocation, removal, or rearrangement of any
Company Gas Facilities made necessary because of the extension into or through City of a federally
aided highway project shall be governed by the provisions of Mirmesota Statutes Section 161.46, as
supplemented or amended. City shall not order Company to remove or relocate its Gas Facilities
when a Public Way is vacated, improved or realigned because of a renewal or a redevelopment plan
which is financially subsidized in whole or in part by the Federal Government or any agency
thereof, unless agreement is made that the reasonable Non-Betterment Costs of such relocation and
the loss and expense resulting there fi.om will be paid to Company when available to the City. The
City is not obligated to pay Company for those portions of its relocation costs for which City has
not received federal funding.
4.3. No Waiver. The provisions of Section 4 apply only to Gas Facilities constructed
in reliance on a permit or fi.anchise fi'om City and Company does not waive its rights under an
easement or prescriptive right or State or County permit.
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SECTION 5. INDEMNIFICATION.
5.1. Indemnity of Ci .ty. Company shall indemnify, keep and hold the City, its elected
officials, officers, employees and agents flee and harmless fi.om any and all claims and actions on
account of injury or death to persons or damage to property occasioned by the construction,
maintenance, operation, repair, inspection, removal, the issuance of permits, or the operation of the
Gas Facilities located in the Public Ways and Public Grounds, unless such injury or damage is the
result of negligence of the City, its elected officials, employees, officers, or agents.
5.2. Defense of City. In the event a suit is brought against the City under circumstances
where this agreement to indemnify applies, Company at its sole cost and expense shall defend the
City in such suit if written notice thereof is promptly given to Company within a period wherein
Company is not prejudiced by lack of such notice. If Company is required to indemnify and
defend, it will thereafter have control of such litigation, but Company may not settle such litigation
without the consent of the City, which consent shall not be unreasonably withheld. This section is
not, as to third parties, a waiver of any defense or immunity otherwise available to the City. The
Company, in defending any action on behalf of the City, shall be entitled to assert in any action
every defense or immunity that the City could assert in its own behal£ This fi.anchise agreement
shall not be interpreted to constitute a waiver by the City of any of its defenses of immunity or
limitations on liability under Minnesota Statutes, Chapter 466.
SECTION 6. VACATION OF PUBLIC WAYS.
The City shall give Company at least two weeks prior written notice of a proposed vacation
of a Public Way. The City and the Company shall comply with Minnesota Rules, 7819.3200 and
applicable ordinances consistent with law.
SECTION 7. CHANGE IN FORM OF GOVERNMENT.
Any change in the form of government of the City shall not affect the validity of this
Ordinance. Any governmental unit succeeding the City shall, without the consent of Company,
succeed to all of the rights and obligations of the City provided in this Ordinance.
This ordinance and the fi.anchise it confers may not be assigned by the Company without the
express written consent of the City.
SECTION 8. FRANCHISE FEE.
8.1. Form, During the term of the fi.anchise hereby granted, and in addition to any
permit, licensing, or other fees, charges or costs being imposed that the City has a right by statute to
impose on the Company for providing gas service or performing work necessary to provide gas
service in the City during the terms of this franchise, the City may charge the Company a fi.anchise
fee. The fee may be (i) a percentage of gross revenues received by the Company for its operations
within the City, or (ii) a flat fee per customer based on metered service to retail customers within
the City or on some other similar basis, or (iii) a fee based on units of energy delivered to any class
of retail customers within the corporate limits of the City. The method of imposing the franchise
fee, the percentage of revenue rate, or the flat rate based on metered service may differ for each
customer class or combine the methods described in (i) - (iii) above in assessing the fee. The City
shall seek to use a formula that provides a stable and predictable amount of fees, without placing
the Company at a competitive disadvantage. If the Company claims that the City required fee
formula is discriminatory or otherwise places the Company at a competitive disadvantage, the
Company shall provide a formula that will produce a substantially similar fee amount to the City
and reimburse the City's reasonable fees and costs in reviewing and implementing the formula.
The City will attempt to accommodate the Company but is under no franchise obligation to adopt
the Company-proposed franchise fee formula and each review will not delay the implementation of
the City-imposed fee.
8.2. Separate Ordinance. The franchise fee shall be imposed by separate ordinance
duly adopted by the City Council, which ordinance shall not be adopted until at least thirty (30)
days after written notice enclosing such proposed ordinance has been served upon the Company.
The fee shall become effective ten (10) days after written notice enclosing such adopted ordinance
has been served upon the Company by certified mail.
8.3. Collection o[ Fee. The franchise fee shall be payable not less than quarterly during
complete billing months of the period for which payment is to be made. The franchise fee formula
may be changed from time to time, however, the change shall meet the same notice requirements
and the fee may not be changed more often than annually. Such fee shall not exceed any amount
that the Company may legally charge to its customers prior to payment to the City. Such fee is
subject to subsequent reductions to account for uncollectibles and customer refunds incun'ed by the
Company. The Company agrees to make available for inspection by the City at reasonable times all
records necessary to audit the Company's determination of the franchise fee payments.
8.4. Continuation of,Franchise Fee. If this franchise expires and the City and the
Company are unable to agree upon terms of a new franchise, the franchise fee, if any being imposed
by the City at the time this franchise expires, will remain in effect until a new franchise is agreed
upon.
SECTION 9. ABANDONED FACILITIES.
The Company shall comply with City ordinances, Minnesota Statutes, Section 216D.01 et
seq. and Minnesota Rules Part 7819.3300, as they may be amended from time to time. The
Company shall maintain records describing the exact location of all abandoned and retired
Facilities within the City, produce such records at the City's request and comply with the location
requirements of Section 216D.04 with respect to all Facilities, including abandoned and retired
Facilities.
SECTION 10. pROVISIONS oF.ORDINANCE.
10.1. Severability. Every section, provision, or part of this Ordinance is declared
separate from every other section, provision, or part; and if any section, provision, or part shall be
held invalid, it shall not affect any other section, provision, or part. Where a provision of any
other City ordinance conflicts with the provisions of this Ordinance, the provisions of this
Ordinance shall prevail.
10.2. Limitation on Applicabili.ty. This Ordinance constitutes a franchise agreement
between the City and Company as the only parties and no provision of this franchise shall in any
way inure to the benefit of any third person (including the public at large) so as to constitute any
such person as a third party beneficiary of the agreement or of any one or more of the terms
hereof, or otherwise gige rise to any cause of action in any person not a party hereto.
SECTION 11. AMENDMENT-PROCEDURE.
Either party'to this franchise agreement may at any time propose that the agreement be
mended. This Ordinance may be mended at any time by the City passing a subsequent ordinance
declaring the provisions of the amendment, which amendatory ordinance shall become effective
upon the filing of Company's written consent thereto with the City Clerk within 60 days after the
effective date of the amendatory ordinance.
This Ordinance shall be in full force and effect from and after thirty days (30) after its passage.
First Reading:
Second Reading:
Date of Passage:
August 25, 2003
September 8, 2003
September 8, 2003
Offered by:
Second by:
Roll call:
Williams
Nawrocki
Ayes: Wyckoff, Williams, Nawrocki, Ericson, Kelzenberg
Attest:
PatficiaMusc6vit~, CMC (
Deputy City Clerk/Council Secretary