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HomeMy WebLinkAbout8.a Gas Utility Ordinance First ReadingAGENDA ITEM: Gas Utility Ordinance First Reading AGENDA SECTION: New Business PREPARED BY: Andrew J. Brotzler, P.E., City Engineer/ AGENerfili 08 A ATTACHMENTS: Draft Ordinance, Council Work Session Executive Summary 4- 13 -05, Utility Commission Minutes 3 -7 -05, Utility Commission Executive Summary 3 -7-05, January 10 Letter to Aquila and Xcel, February 16 Letter from Xcel APPROVED BY: RECOMMENDED ACTION: First Reading ACTION: City Council Meeting Date: May 3, 2005 ISSUE: CITY OF ROSEMOUNT EXECUTIVE SUMMARY FOR ACTION Consider ordinance amendment to require gas utility companies to have in place a franchise agreement with the City to secure utility permits. BACKGROUND: At the April 13, 2005 City Council Work Session, the attached draft ordinance amendment that would require gas utility companies to have in place a franchise agreement with the City to be permitted to install new gas service lines was discussed The need for this proposed ordinance amendment is to insure the safe and orderly extension of gas service within newly developing areas of the City. The City of Rosemount currently has three gas utility providers, Aquila, Xcel and Center Point Energy. Up to this time, the three utility companies have extended gas service to areas within the City that were agreed upon in 1989. With a recent development, the previously agreed to service boundaries were dismissed and a situation occurred where two gas utility companies were seeking permits for the same development. As discussed with Council, there is strong concern about maintaining an environment that allows for the planned expansion of gas service within the City to 1) avoid redundant gas lines within limited right -of -way corridors; 2) ensure reliable and accurate mapping of gas service areas for emergency and non emergency events; and 3) allow for efficient administration of gas utility permits. To ensure that a fair and competitive environment is maintained, the proposed ordinance amendment does include language that reserves the right of the City to issue permits to utilities that do not hold a current franchise agreement with the City in the event existing gas franchises cannot or will not extend service. SUMMARY: It is the recommendation of Staff for Council to consider the 1 reading of the proposed ordinance amendment. 2 CITY OF ROSEMOUNT COUNTY OF DAKOTA STATE OF MINNESOTA ORDINANCE NO. AN ORDINANCE RELATING TO GAS PIPELINES; AMENDING CITY CODE SECTION 4 -2 -1 LRA-F Y THE CITY COUNCIL OF THE CITY OF ROSEMOUNT, MINNESOTA, ORDAINS as follows: Section 1. PURPOSE. The City Council recognizes that advantages to the public are secured by the terms of franchise agreements with gas utilities and further recognizes the costs and nsks to the City and its property and to the public health, safety and welfare associated with installation, maintenance, repair and replacement of gas utility lines without the control and protection afforded by franchise terms. This ordinance has the following purposes, among others: 1. To protect public property and the public investment in public streets and unites; 2. To reduce the administrative burdens of oversight of installation, maintenance, repair and replacement of underground utilities; 3. To reduce interruptions to public travel and inconvenience to owners of properties adjacent to the public right of way; 4. To minimize the nsks to the public health, safety and welfare and the risk of exposing the City to civil liability; and 5. To avoid all other adverse effects of unregulated installation of gas facilities on the public grounds and in the public right of way. Section 2. City Code, Section 4 -2 -1, is amended as follows: 2. INSTALLATION APPROVED. a. The location of all underground utilities, including but not limited to natural gas pipes and mains, electrical distnbution and transmission lines and conduits, cable television cables, telephone cables and conduits, and appurtenances laid or constructed within State highways, County roads, City streets, alleys, public grounds and easements, shall be subject to the direction and approval of the City and shall be laid or constructed only after CLL- 26k190v1 1 RS215 -3 ATTEST: receiving written approval from the City Clerk. All private utility companies shall request approval in writing and shall furnish a drawing or plat showing the proposed underground utility. The location of said utilities shall not interfere with other pipes, tunnels or conduits already laid or constructed. All companies requesting approval shall direct four (4) copies of the request and maps or plats to the City Clerk. The City Clerk will direct three (3) copies to the City Engineer for hi-sthe Engineer's recommendation. The City Engmeer shall make such revisions of the drawings as teethe Engineer shall deem necessary, The Engineer will make a written recommendation to the City Clerk, returning two (2) copies of the revised drawings. The City Clerk will then, in writing, issue itsthe Clerk's approval, requests for revisions or denial of the request for approval. b. After the effective date of this Ordinance, no permits will be issued for mstallatron of gas pipes and mains to entities that do not hold a current franchise from the City This prohibition does not apply to installation of gas transmission mains that are not designed, intended or used for local service or local distribution, or to installation of gas pipes and mains to serve areas of the City to which existing gas franchisees cannot or will not extend service. Section 3. This Ordinance shall be in effect following its passage and publication. Underlining indicates new material. Lining through indicates deleted material. ADOPTED this day of 2005, by the City Council of the City of Rosemount. Linda Jentink, City Clerk CLL- 261190v1 2 RS215 -3 CITY OF ROSEMOUNT William H Droste, Mayor CITY OF ROSEMOUNT EXECUTI�/E SUMMARY FOR ACT10N City Council Work Session Date: April 13, 2005 AGENDA ITEM: Gas Utility Ordinance Amendment AGENDA SECTION: � Discussion PREPARED BY: Andrew J. Brotzier, P.E., City Engineer AGE � � ATTACHMENTS: 1) Draft Minutes from Utili ty Commrssion 2) Draft Qrdinance Amendment 3) Utility Commission Agenda Item from AP�'ROVED BY: March 7, 2005 RECOMMENDED ACTION: For Discussion ISSUE: Consider ordinance amendment to require gas utility companies to have in place a franchise agreement with the City to secure utility permits for the installation of new gas senrice tines. BACKGROUND: At the March 7, 2995 Utility Commission meeting, Staff reviewed with the Commission an issue that emerged recently with the development of Harmony (formerly Hrockway) regarding the extension of gas utility serviee to the site. As noted in the attached Executive Summary, the issue is the establishment of service boundaries by utili#y company, in this case Aquila and XceL In response to this matter and based on the recommendation of the Utility Commission, the City Attorney has drafted the attached ordinance amendment. This amendment would require all gas utility providers to have in place a franchise agreement with the City in order to secure utility permits for new gas service lines. - SUMMARY: Staff is requesting Council consideration of this proposed ordinance amendment. RO �R SEMO ��r PUBLIC WORKS D�PARTMENT UTILITY COMMISSSION MINLTTES MARCH 7, 2005 , Pursuant to due call and notice thereof, the Regular Utility Commission meeting of the City of Rosemount was held on Monday,March 7, 2005. President Mulhern called the meeting'to order at 5:32 p.m. with�Commissioner Heimkes and Commissioner Schnieder present. Also in attendance were Mayor Droste, City Engineer Brotzler, City Administrator Verbrugge and Recording Secretary Dorniden. . ADDITIONS OR CORRECTIONS TO THE AGENDA None. , AUDIENCE INPUT None. MOTION by Heimkes to approve the minutes of the January 10, 2005 regular Utility Commission meeting. Second by Mulhern. Ayes: Mulhern,Heimkes, 5chnieder. Nays: None. Motion carried. OLD BUSINESS Sa. LEBANON HILLS REGIONAL PARK STORMWATER UPDATE City Engineer Brotzler apprised the Commission of the meetings he has attended with the City of Eagan,Dakota County Pazks,DNR, Gun Club Watershed and the Vermillion River Watershed regarding the run_off within the Lebanon Hills Regional Park and the City of Eagan. 'I'he Engineering firm of Bonestroo completed a report for the City of Eagan identifying improvement options. Attached to the executive summary is a memo from Bonestroo detailing three different options to alleviate the problems of run-off for Eagan. Option 1 is the lowest cost at$900,000. This cost is based on the assumption that water is from : Rosemount would be held in Rosemount without discharge and does not reflect the cost to - Rosemount to impound this water. Option 3 reflects a project that would require Eagan to expand its work effort within�agan,but would require Rosemount to do only limited improvements. The cost for this option is estimated to range from $1.4 million ta $19 million. . Eagan has preliminarily selected Option 1 as their best choice, and if that option is implemented; would require the City of Rosemount to exgend 1.0 to 1.5 Million to implement improvements in Rosemount ta prevent water from entering Eagan from this area of the City. It was also noted SPIRIT OF PR/DE AND PROGRESS 2875 145th Street West• Rosemount,MN 55068-4997•651-423-4411 •TDDITTY 651-423-6219•Fax fi51-322-2694 www.ci.rosemoun t.mn.us UTILITY COMMISSION MINUTES 1VIARCH 7,2005 that downstream ponds such as Marsh Lake and McDonough Lake would still be flooded and based on comments provided by Dakota County Parks; this plan does not meet their objectives. " Pete Willenbring from WSB &Associates advised the Commission that, to dat'e,no report has been prepared by Dakota County Parks or the City of Eagan that suggests the City of Rasemount should contribute to these downstream improvements. As mentioned above, Bonestroo is the Engineering firm for the City of Eagan and Barr Engineering is the consultant for Dakota County Parks. WSB &Associates has shared all our hydrologic and computer simulation information with Barr&Bonestroo so all the models to be run will be the same. City Administrator Verbrugge asked if anyone could compel the City to do the project. Mr. Willenbring indicated that without the establishment of a special purpose tax district or the development of a joint Powers agreement, it would be difficult for either the City of Eagan or Dakota County parks to force the City of Rosemount to fund or unwillingly cooperate in the implementation of the project. • Future development might also provide the opportunity to improve the downstream situation as the City's Stormwater Management Plan tightens run-off control for new developments. Mr. Willenbring went through the recommendations in his attached mema He highlighted that within Option 1 ther�wouldn't be any condemnation of property and that Qption 3 might be considered justifiable. It was also noted that the City has already diverted 300 acres away from : the regional park as part of the development of the City of Rosemount's Starmwater Plan, so we've actually helped to alleviate the run-off. Rosemount is considered 1/3 of the drainage area. The City is not changing the flow direction; it's just holding what we have. After further discussion, Staff suggested the Commission recommend to the council the adoption of a resolution or letter consistent with the recommendations outlined in the staff inemo,but leaving out the fourth recommendation. The Mayor would also like to make sure that the equity issues are further expanded in the resolution. The Commission also generally agreed the best case scenario would be to spend the$1.9 million in Eagan, and fund the project by getting grant money from the Legislature with DNR support. NEW BUSINESS 6a. 2005 PAVEMENT MANAGEMENT PROJECT CITY PROJECT 392 Council had ordered the project and authorized the plans and specifications to be drawn up for this 7,200 foot project in the southwest project area between Cameo and Chippendale Avenue, south of 145`h Street and north of County Road 42. The northern part of the project has old vitrified clay pipe and is usually replaced with PVC. The sewer lines were televised and shows root intrusion in joints and service connections. The City would like to coordinate full 2 UTILITY COMMISSION MINUTES MARCH 7,2005 replacement of streets with utility replacements, however right now that isn't likely. There is a new technology that uses in place'slip liners within the sewer lines. This gives the lines a little more life, but doesn't replace them. To do a total reconstruction of the 7,200 feet it would cost approximately$730,000 as opposed to the slip line area at$276,004. At this time Staff isn't recommending either: Deficient areas will be spot repaired at this time. The prograrn will have an outside vendor come in and router out the pipes and remove the roots and then monitor them for another 25 years. For the most part t11e project will be leavin curb & g gutter only repairing�yhat is damaged, and then taking the pavement to full depth leaving the sub-grade and replace the full depth pavement. A total reconstruction should coincide with sewer and water replacement in about 25 years. SIip lines are suppose to l�ave a 40-50 year lifetime and would just be in the mainlines. 6b. GAS UTILITY FRANCHISE AGREEMENTS . �ity Engineer Brotzler apprised the Commission that tb.e developer for the Brockway property had asked Xce1 Energy to supply the development. According to a map from 1989,NSP and Peoples Naturai Gas had boundaries set,but because there is no Franchise Agreement in place for the two, the City Attorney advised that there are no statutory requirements for the area. Staff met with both Xcel and Aquila to discuss these boundaries and through a gentlemen's agreement the boundary will be modified to include Brackway for Xcel Energy. The City will maintain the right that if the provider can't provide in a costly and tirnely manner we would recommend the developer not use them. To have the boundaries set is good for emergency personnel to find locations, especially having one service provider.in the main corridors. The City Attomey offered the option of adopting an ordinance to secure franchise agreements with the three different companies. � If Gopher State One call would get a border li,ne on the boundaries they would just have to call both companies. The Commission was supportive of a proposed ordinance to require gas utility companies to have a franchise agreement with the City to secure a Utility Permit. ` EXECUTIVE DIRECTOR'S REPORT 8a. PROJECT UPDATE . Gopher One—MNpPTS is trying new legislation to get cities to locate to houses. Right now our PVC pipe (sanitary sewer)has no method to locate and the as-built records supposedly locate the 3 ' UTILITY COMMISSION MINUTES . MARCH 7,2005 _ lines 3' from the curbstop downstream. Mainlines are usualiy in the street right-of-way and put the shortest distance to the house. President Mulhem mentioned receiving the letter and bid tab for Well#12 Wellhouse. Mayor Droste commented again'on the ugly color of the Chippendale Tower and a brief discussion ensued. . 8d. SET NEXT MEETING AGENDA FOR APRIL 11 2005 No one had anything at this time. The Cornmisaion wished Commissioner Heunkes good luck in l�is future endeavors since this was his last meeting. MOTION by Heimkes to adjourn. Meeting adjourned at 7:17 p.m. Respectfu.ily Submitted, Cindy Domiden Recording Secretary 4 CITY OF ROSEMOUNT , ' EXECUTIVE SUMMARY FOR ACTION UTILITIES COMMISSION MEETING DATE: March 7, 2005 AGENDA ITEM: Gas Utility Franchise Agreements AGENDA SECTION: New Business PREPARED BY: Andrew J. Brotzler, P.E., City Enginee AGENDA NO: ,� 6b. . ATTACHMENTS: January 10, 2�05 Letter; February 16, 2005 Letter RECOMMENDED ACTION: During the development of the Harmony (formerly Brockway) project, Staff encountered an issue regarding the extension of gas service to the development. Prior to this project the City and gas utility companies, Aquila and Xcel, had been following a service area that was developed' in T989 by the City and presumably the utility companies. Based on this 1989 service area map, the Harmony project was within the service area for Aquila. _ � . The issue that developed with the Harmony project was a request by the developer and Xcel to allow the extension of gas service to be completed by Xcel rather than Aquila After reviewing this issue with the City Attorney, it was determined that the City did not have the legal authority to deny a permit to Xcel for the extension of gas service beyond the bou�dary established in 1989. As a result of this situation, Staff met with representatives from Aquila and Xcel to discuss the merits of mutuaNy agreeing to predetermine service areas within the City of Rosemount. The attached January 10, 20Q5 letter summarizes the discussions of this meeting. Since this meeting, Staff has received the attached February 16, 2005 Ietter from Xcel outlining their intention to continue to pursue the expansion of their gas service beyond a predetermined service area. XcePs position as outlined in the attached letter is very concerning to Staff for the following reasons 1. Limiting the number of gas providers with predetermined service areas reduces the likelihood of redundant pipelines being constructed within the same corridors. Based on Xcel's position, the expansion of gas service by Xcel into areas previously planned to be served by Aquila will result in duplicateJines within the City's right-of-way. 2. Currently, the pattern of gas service within the City based on predetermined service areas allows for timely identification of service provides in both emergency and non-emergency situations. For an emergency situation, the existing pattern helps to ensure that the correct service provider is called to G:/gasfranchise/gasutilityfranchiseagreeUC3-7-OS the a��uation. Considering XcePs position, this efficient manay��nent of service areas would be lost. 3. The current system allows for more efficient administration of utility permits by the City. Again, considering XcePs position, a change from this system:will result in guilt like pattern of gas service areas within the City and will increase administra#ion time and costs for utility permits. Based on the concerns outlined above, Staff has worked with the City Attorney to research options for the City on how to move forward with this issue. The City Attorney has indicated that the City Council can adopt an ordinance which requires that a utility company have a franchise agreement in order to be permitted to do work within the City. As the City currently has a franchise agreement with Aquila, Staff is supportive of the concept of developing an ordinance to this effect. - Rt this time, Staff is seeking input from the Utility Commission on this matter to forward to tMe City CounciL , G:/gasfranchise/gasurilityfranchiseagreeU.C3-7-OS � � C 1 TY 0,= RO S E M 0.0 N T Z8�5.`4nn s�t�e5t � - � �`�.� � Rosemount,MN - 55068-4997 ' Phone:651-423-4411 � . . Hearing impaired:651-4Z3-6214 Ja�Ua�y 10, 2005 Fax:651•423•520} Aquila Xcel Energy Attn: Dave Perron Attn: Colette Jurek 2665 145th Street West 3000 Maxwell Avenue PO Box 455 Newport, MN 55055 Rosemount, MN 55068 Re: Gas Seniice Area Map Dear Dave and Colette: _ • I would like to begin by thanking you for taking the time to meet on December 9, 2004 to discuss the continued expansion of gas service within the City of Rosemount. Your participativn in this meeting was greatly appreciated. As discussed at the meeting, the number one priority for all parties involved is the safe, effective and manageable expansion ofi gas service to newly developed areas within#he City. To ensure that the expansion of gas service could be appropriately p(anned for, the City and gas utility companies developed in the late 1980's, a service area map for the City of Rosemount. With the recent devetopment of the 8rockway site and City permitting to Xcel Energy to serve this development with gas service,area formerfy within Aquila service area, the previously developed service area map has been updated. A copy of this updated service area rnap is enclosed for your use and reference. To reiterate our discussion at the Decernber 9, 2Q04 meeting, the City will process gas utility permits in accordance with this updated service area map, dated January, 2005. Should a situation occur where a provider is not able to provide gas utility service in a cost effective and timely manner, a joint meeting wilf be conducted with the City and involved parties to determine the most cost effective and timely manner to provide service to property owners within the City of Rosemount _ Your continued cooperation with the safe, effective and manageable expansion of gas service within the City of Rosemount is greatly appreciated. Should you have questions or,comments, please do not hesitate to contact me. Sincerely, . /1�� � Andrew . Brotz er, P.E. City Engineer Cc: Rosemount Utiiity Commission � Jamie Verbrugge, City Administrator ` Charlie LeFevere, City Attorney Kerry C.Koep XcelEnerg y� Assistani Genera/Counsel 800 Nicollet Mali,Suite 2900 Minneapolis,Minnesota 55402 February 16,2005 Pno�e:s�2z�s.assa Fax:612.215.4544 Mr..Andrew J.Brotzler � City Engineer City of Rosemount 2875 - 145�'Street West Rosemount,MN 55068 . SUBJEC'I': Gras Service Territory Map � Dear Andrew: Colette Jurek forwarded�ur letter and accompanyittg gas territory map da.ted January 10,2005,to my attention. This written response serves as notification that Xcel Energy objects to the cit�s assignment of gas service temtories for the following reasons: 1. Natural gas distribution is a non regulated competitive industxy in our state. 'This competition ultirnaxelyworks to the benefit of the City's residents and businesses. 2. Neither the map of January 10 nor the assigned service territories authored in 1989 under�ichard Hefti, a former cityengineer and public works director,were ever f ormally adopted by city council. 3. Open competiuon for new development projects encourages gas providers to provide better marketing programs and construction pra.ctices. For example, competition required our company to review its previous single main installation pracrice. As a result,dual main installation has become a standard construction practice for Xcel Energy. Dual main installation pmvides year-round access to naturil gas and,simultaneously,has eliminated the need for road boring. Dual main installation benefits developers and the city. � 4. We have an on-going responsibility to Xcel Energy ratepayers and shareholders to expand our natural gas business wherever financially feasible. Mr.Andrew J.Brotzler February 16,20Q5 Page two For the above stated reasons,it is appropriate for us to continue to pursue gas business development oppom�.nities within the City of Rosemount wherever the e�pansion of our gas distribution system cost justifies and product offerings are a viable option for our local developers and future customers. If you have any questions or con�ients regarding the position of our eompany on this matter,please feel free to eontact me directlyat 612-215-4583. Sincerely, -----_..� ._..- Kerry C.Koep Ass�stant General Counsel cc: Colette Jurek,Manager- Community&Local Goverxunent Relations Becky Ha.rasyn- Gas Business Development Jamie Verbrugge -Rosemount City Adntinistrator Charlie I.eFevere- Rosemount City Attorney Dave Perron- Aquila