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HomeMy WebLinkAbout2.b. Gas Utility Ordinance AmendmentAGENDA ITEM: Gas Utility Ordinance Amendment AGENDA SECTION: Discussion PREPARED BY: Andrew J. Brotzler, P.E., City Engineer AGE i 7 I At 2 f ATTACHMENTS: 1) Draft Minutes from Utility Commission 2) Draft Ordinance Amendment 3) Utility Commission Agenda Item from March 7, 2005 APPROVED BY RECOMMENDED ACTION: For Discussion City Council Work Session Date: April 13, 2005 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 service hues. BACKGROUND: SUMMARY: CITY OF ROSEMOUNT EXECUTIVE SUMMARY FOR ACTION At the March 7, 2995 Utility Commission meeting, Staff reviewed with the Commission an issue that emerged recently with the development of Harmony (formerly Brockway) regarding the extension of gas utility service to the site. As noted in the attached Executive Summary, the issue is the establishment of service boundaries by utility 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. Staff is requesting Council consideration of this proposed ordinance amendment. 4ROSEMOUNT UTILITY COMMISSSION MINUTES 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 Mulhem 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 Domiden. 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: Mulhem, Heimkes, Schnieder. Nays: None. Motion earned. OLD BUSINESS 5a. LEBANON HILLS REGIONAL PARK STORMWATER UPDATE DRAFT PUBLIC WORKS DEPARTMENT City Engineer Brotzler apprised the Commission of the meetings he has attended with the City of Eagan, Dakota County Parks, DNR, Gun Club Watershed and the Vermillion River Watershed regarding the run -off within the Lebanon Hills Regional Park and the City of Eagan. The 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 Eagan, but would require Rosemount to do only limited improvements The cost for this option is estimated to range from S1.4 million to $1.9 million. Eagan has preliminarily selected Option 1 as their best choice, and if that option is implemented, would require the City of Rosemount to expend 1.0 to 1.5 Million to implement improvements in Rosemount to prevent water from entering Eagan from this area of the City. It was also noted SPIRIT OF PRIDE AND PROGRESS 2875 145th Street West Rosemount, MN 55068 -4997 651- 423 -4411 TDD/TTY 651- 423 -6219 Fax 651- 322 -2694 www ctrosemount.mn.us UTILITY COMMISSION MINUTES MARCH 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 date, no report has been prepared by Dakota County Parks or the City of Eagan that suggests the City of Rosemount 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 distnct 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 memo. He highlighted that within Option 1 there wouldn't be any condemnation of property and that Option 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 Stormwater 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 memo, 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 authonzed 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 Street and north of County Road 42. The northern part of the project has old vitnfied 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 $276,000. At this time Staff isn't recommending either. Deficient areas will be spot repaired at this time. The program 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 the project will be leaving curb gutter only repairing what 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. Slip lines are suppose to have a 40 -50 year lifetime and would just be in the mainlines. 6b. GAS UTILITY FRANCHISE AGREEMENTS City Engineer Brotzler appnsed the Commission that the developer for the Brockway property had asked Xcel Energy to supply the development. According to a map from 1989, NSP and Peoples Natural Gas had boundaries set, but because there is no Franchise Agreement in place for the two, the City Attomey 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 Brockway for Xcel Energy. The City will maintain the right that if the provider can't provide in a costly and timely 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 Attorney 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 line 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 MNOPTS 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 usually 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 Commission wished Commissioner Heimkes good luck in his future endeavors since this was his last meeting. MOTION by Heimkes to adjourn. Meeting adjourned at 7:17 p.m. Respectfully Submitted, Cindy Dorniden Recording Secretary 4 CITY OF ROSEMOUNT COUNTY OF DAKOTA STATE OF MINNESOTA ORDINANCE NO. AN ORDINANCE RELATING TO GAS PIPELINES; AMENDING CITY CODE SECTION 4 -2 -1 DRA-FT 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 risks 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 utilites; 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 risks to the public health, safety and welfare and the risk of exposing the City to civil habihty, 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 distribution 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- 261190v1 1 RS215 -3 ATTEST: receiving written approval from the City Clerk. All private utility companies shall request approval in wnting and shall famish a drawing or plat showing the proposed underground utility. The location of said utihties 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 histhe Engineer's recommendation. The City Engineer 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, m wnting, 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 installation 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 as 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 AGENDA ITEM: Gas Utility Franchise Agreements AGENDA SECTION: New Business PREPARED BY: Andrew J. Brotzler, P.E., City Engineer AGENDA NO: 6b. ATTACHMENTS: January 10, 2005 Letter; February 16, 2005 Letter RECOMMENDED ACTION: CITY OF ROSEMOUNT EXECUTIVE SUMMARY FOR ACTION UTILITIES COMMISSION MEETING DATE: March 7, 2005 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 1989 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 boundary established in 1989. As a result of this situation, Staff met with representatives from Aquila and Xcel to discuss the merits of mutually agreeing to predetermine service areas within the City of Rosemount. The attached January 10, 2005 letter summarizes the discussions of this meeting. Since this meeting, Staff has received the attached February 16, 2005 letter from Xcel outlining their intention to continue to pursue the expansion of their gas service beyond a predetermined service area. Xcel's 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 duplicate lines 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 t gasfranchiseigasutilityfranchiseagreeUC3 -7 -05 the s Luation. Considering Xcel's position, this efficient manay_1nent of service areas would be lost. 3. The current system allows for more efficient administration of utility permits by the City. Again, considering Xcel's position, a change from this system will result in guilt like pattern of gas service areas within the City and will increase administration 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. At this time, Staff is seeking input from the Utility Commission on this matter to forward to the City Council. G gasfranchise /gasutihtyfranchrseagreeUC3 -7 -05 January 10, 2005 Aquila Attn. Dave Perron 2665 145 Street West PO Box 455 Rosemount, MN 55068 Re' Gas Service Area Map Dear Dave and Colette: CITY OF ROSEMOUNT Xcel Energy Attn, Colette Jurek 3000 Maxwell Avenue Newport, MN 55055 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 participation 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 of gas service to newly developed areas within the City. To ensure that the expansion of gas service could be appropriately planned 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 development of the Brockway site and City permitting to Xcel Energy to serve this development with gas service, area formerly within Aquila service area, the previously developed service area map has been updated. A copy of this updated service area map is enclosed for your use and reference To reiterate our discussion at the December 9, 2004 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 will 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, Andrew J' Brotzler, P.E. City Engineer Cc Rosemount Utility Commission Jamie Verbrugge, City Administrator Charlie LeFevere, City Attorney CITY FtALL 2875 145th Street West Rosemount, MN 55068 -4997 Phone, 651- 423 -4411 Hearing Impaired, 651- 423 -6219 Fax 651 -423 -5203 Xcel Energy February 16, 2005 Mr. Andrew J. Brot7ler City Engineer City of Rosemount 2875 145t Street West Rosemount, MN 55068 Dear Andrew: SUBJECT: Gas Service Territory Map Kerry C. Koep Assistant General Counsel 800 Nicollet Mall, Suite 2900 Minneapolis, Minnesota 55402 Phone: 612 215.4583 Fax. 612 215 4544 Colette Jurek forwarded your letter and accompanying gas territory map dated January 10, 2005, to my attention. This written response serves as notification that Xcel Energy objects to the city's assignment of gas service territories for the following reasons: 1. Natural gas distribution is a non regulated competitive industry in our state. This competition ultimately works 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 Richard Hefti, a former city engineer and public works director, were ever formally adopted by city council. 3. Open competition for new development projects encourages gas providers to provide better marketing programs and construction practices. For example, competition required our company to review its previous single main installation practice. As a result, dual main installation has become a standard construction practice for Xcel Energy. Dual main installation provides year -round access to natural 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, 2005 Page two For the above stated reasons, it is appropriate for us to continue to pursue gas business development opportunities within the City of Rosemount wherever the expansion 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 comments regarding the position of our company on this matter, please feel free to contact me directly at 612 215 -4583. Kerry C. Koep Assistant General Counsel cc: Colette Jurek, Manager Community Local Government Relations Becky Harasyn Gas Business Development Jamie Verbrugge Rosemount City Administrator Charlie LeFevere Rosemount City Attorney Dave Perron Aquila