HomeMy WebLinkAboutItem 1d: Ordinance 2290: Franchise to Golden State Water Company for Water Distribution in the City ti4 oFF RN,_If,
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°°jty°s�s STAFF REPORT
Public Works Services Department
DATE: October 18, 2011
TO: Mayor and City Council
FROM: Tom Tait, Public Works Services Director
Prepared by: Maria A. Taylor, Senior Management Analyst
SUBJECT: ORDINANCE NO. 2290 TO GRANT A FRANCHISE TO THE GOLDEN
STATE WATER COMPANY TO USE OR TO LAY AND USE PIPES,
CONDUITS AND APPURTENANCES FOR TRANSMITTING AND
DISTRIBUTING WATER FOR ANY AND ALL PURPOSES IN, ALONG,
ACROSS, UPON AND UNDER THE PUBLIC STREETS, WAYS,
ALLEYS AND PLACES WITHIN THE CITY OF ARCADIA
Recommendation: Adopt
SUMMARY
Pursuant to the City Charter Article XIII Section 1303 and the State of California Public
Utilities Code Section 6234, on October 4, 2011 the City Council conducted a Public
Hearing to receive public comments and introduce Ordinance No. 2290 for the purpose
of granting a franchise Agreement to Golden State Water Company (GSWC).
Staff recommends that the City Council adopt Ordinance No. 2290 to grant a franchise
Agreement to the Golden State Water Company to use or to lay and use pipes, conduits
and appurtenances for transmitting and distributing water for any and all purposes in,
along, across, upon and under the public streets, ways, alleys and places within the City
of Arcadia serviced by GSWC. A map or the areas in Arcadia served by GSWC is
attached.
DISCUSSION
The City's franchise Agreement with the Golden State Water Company (GSWC) will
expire on November 22, 2011 after a ten (10) year Agreement approved by the City
Council in 2001. GSWC would like to renew the franchise Agreement and has
requested a 20-year term. However, at the September 6, 2011 Council meeting, the
City Council adopted Resolution No. 6794 approving a ten (10) year term instead, which
is similar to the current Agreement's contractual term; additionally, a ten (10) year term
is a more reasonable and prudent time frame than 20 years for a franchise Agreement.
Also a Public Hearing Notice for the proposed franchise Agreement was published in
the local newspaper as required by the City Charter Article XIII and the state of CA
Public Utilities Code Section 6232.
Page 1 of 2
Mayor and City Council
October 18, 2011
The Golden State Water Company has 237 active service connections in the
southeastern and eastern portion of Arcadia and is currently paying a franchise fee to
the City of Arcadia. The franchise Agreement requires GSWC to pay the City the sum
equivalent to 2% of the gross annual receipts from GSWC that arise from the use,
operation or possession of the franchisee in the City of Arcadia. The franchise
Agreement has been in effect since 1961.
The consequence of not granting the franchise Agreement with GSWC would be for the
City Council to initiate a formal condemnation process and pay for the infrastructure that
GSWC already has in place. Considering the small number of services and averaging
$2,450 in annual franchise fees to the City during the past two (2) years including the
legal costs of the condemnation process and payment for the existing infrastructure,
staff does not consider this as a fiscally prudent option.
Subsequently, on October 4, 2011, pursuant to the City Charter Article XIII Section 1303
and the state of California Public Utilities Code Section 6234, the City Council
conducted a Public Hearing and introduced Ordinance 2290 to grant a franchise
Agreement to the Golden State Water Company. Following the Public Hearing, there
were no objections or public comments received. Therefore, staff recommends that the
City Council adopt Ordinance 2290 to grant a franchise Agreement to the Golden State
Water Company to use or to lay and use pipes, conduits and appurtenances for
transmitting and distributing water for any and all purposes in, along, across, upon and
under the public streets, ways, alleys and places within the City of Arcadia.
FISCAL IMPACT
According to the Administrative Services Department, the City of Arcadia received
approximately $2,220 in revenues from the Golden State Water Company in 2010. The
California Public Utilities Code Section 6231(c) adopted a franchise fee of up to 2%, but
not less than 1%, of a utility's gross annual revenue to be paid to municipalities where
those utilities use or lay pipes, conduits and appurtenances in the public right-of-way.
RECOMMENDATION
Adopt Ordinance No. 2290 to grant a franchise to the Golden State
Water Company to use or to lay and use pipes, conduits and
appurtenances for transmitting and distributing water for any and all
purposes in, along, across, upon and under the public streets, ways,
alleys, and places within the City of Arcadia
Approved by: J -h., ,v }�e�► ,,.�,,�
Donald Penman, City Manager
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Attachments
Page 2 of 2
ORDINANCE NO. 2290
(UNCODIFIED)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ARCADIA,
CALIFORNIA, GRANTING TO GOLDEN STATE WATER COMPANY, ITS
SUCCESSORS AND ASSIGNS, A FRANCHISE TO USE OR TO LAY
AND USE, PIPES, CONDUITS AND APPURTENANCES FOR
TRANSMITTING AND DISTRIBUTING WATER FOR ANY AND ALL
PUPOSES IN, ALONG, ACROSS, UPON AND UNDER THE PUBLIC
STREETS, WAYS, ALLEYS AND PLACES WITHIN THE CITY OF
ARCADIA (PER ARTICLE XIII OF THE ARCADIA CITY CHARTER)
THE CITY COUNCIL OF THE CITY OF ARCADIA, CALIFORNIA, DOES
ORDAIN AS FOLLOWS:
SECTION 1. Whenever in this ordinance the words or phrases hereinafter in this
section defined are used, it is intended that 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 "Act" means the Franchise Act of 1937 set forth in Sections 6201-
6302 of the Code.
(b) The "City" means the City of Arcadia, a municipal corporation of the State
of California, in its present incorporated form or in any later reorganized, consolidated of
reincorporated form.
(c) The "Streets" shall mean the public streets, ways, alleys and places,
except state freeways and highways, as the same now or may hereafter exist within the
City.
(d) The `Pipes and Appurtenances" shall mean pipe, pipelines, main, service,
trap, vent, vault, manhole, meter, gauge, regulator, valve, conduit, ditch, flume,
appliance, attachment and other appurtenances located or to be located in, upon, along,
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across or under the streets of the City, and used or useful in transmitting or distributing
water.
(e) The "Lay and Use" shall mean to lay, construct, erect, install, operate,
maintain, use, repair, replace, relocate or remove.
(f) The "Franchise" shall mean and include any authorization granted
hereunder in terms of a franchise, privilege, permit, license or otherwise to lay and use
pipes and appurtenances for transmitting and distributing water for any and all purposes
under, along, across or upon the public Streets, ways, alleys, and places in the City,
and shall include and be in lieu of any existing or future City requirement to obtain a
license or permit for the privilege of transacting and carrying on a business within the
City.
SECTION 2. The right, privilege and franchise, subject to each and all of the
terms and conditions contained in this ordinance, and pursuant to Article XIII of the
Arcadia City Charter and subject to the terms and conditions of Division 3, Chapter 2, of
the Public Utilities Code of the State of California, be and the same is herby granted to
GOLDEN STATE WATER COMPANY, a corporation organized and existing under and
by virtue of the laws of the State of California, to lay and use pipes and appurtenances
for transmitting and distributing water for any and all purposes, under, along, across or
upon the Streets.
SECTION 3. The term of this franchise shall be from November 23, 2011 to and
including November 22, 2021. During the term hereof, this Franchise shall endure in full
force and effect until, with the consent of the Public utilities Commission of the State of
California, it is voluntarily surrendered or abandoned by the Grantee, or until the State
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or some municipal or public corporation thereunto duly authorized by law shall purchase
by voluntary agreement or shall condemn and take under the power of eminent domain;
all property actually used and useful in the exercise of this Franchise and situated within
the territorial limits of the State, municipal, or public corporation purchasing or
condemning such property, or until this Franchise is forfeited for noncompliance with its
terms by the Grantee.
SECTION 4. For each full or fractional calendar year of the life of this
Franchise, the Grantee shall pay to the City at the times hereinafter specified, in lawful
money of the United Sates, a sum annually which shall be equivalent to two percent
(2%) of the gross annual receipts of Grantee arising from the use, operation or
possession of this Franchise; provided, however, that such payment shall in no event be
less than one percent (1%) of the gross annual receipts of the Grantee derived from the
sale of water within the limits of the City.
SECTION 5. The Grantee shall file with the Clerk of the City, within three (3)
months after the expiration of the calendar year, or fractional calendar year, following
the date of the granting of this Franchise, and within three (3) months after the
expiration of each subsequent calendar year or fraction thereof during which this
Franchise is in effect, a verified statement showing in detail for the term of the Franchise
in such calendar or fractional year, as the case may be, the total gross receipts for the
Grantee arising from the use, operation or possession of this Franchise and the total
gross receipts of the Grantee derived from the sale of water within the City. The
Grantee shall pay to the City within thirty (30) days after the time for filing said
statement, in lawful money of the United States, the above required percentage of its
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gross receipts for the calendar year, or fractional calendar year, covered by said
statement. Any neglect, omission or refusal by the Grantee to file such verified
statement, or to pay said percentage, at the times or in the manner hereinbefore
provided, shall be grounds for the declaration of forfeiture of this Franchise and of all
rights thereunder.
SECTION 6. Except with respect to franchises existing or derived under
Section 19 of Article XI of the Constitution of the State of California as that section
existed prior to the amendment thereof adopted on October 10, 1911, this grant is made
in lieu of all other franchises, rights, or privileges that have been granted by the State or
some municipal or public corporation now owned by the Grantee to lay and use pipes
and appurtenances in the streets of the City for transmitting and distributing water and
the acceptance of the Franchise hereby granted shall operate as (i) an abandonment
within the limits of the City of all such other franchises, rights and privileged that have
been granted by the State of some municipal or public corporation in lieu of which this
franchise is granted and (ii) an agreement to comply with the terms and conditions
hereof.
SECTION 7. The Franchise granted hereunder shall not become effective until
written acceptance thereof shall have been filed by the Grantee thereof with the Clerk of
the City. When so filed, such acceptance shall constitute a continuing agreement of the
Grantee that if and when the City shall thereunder annex or consolidate with additional
territory, any and all franchises, rights and privileges owned by the Grantee therein shall
likewise deemed to be abandoned as to all streets within the limits of such territory.
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SECTION 8. The City reserves the right to improve any street or portion thereof
over and within the area for which said Franchise is granted, including the change of
grade, relocation of right-of-way, realignment of right-of way, change in width,
construction of reconstruction of any such street, or any portion thereof. Within ninety
(90) days after receipt by Grantee of a notice in writing from the City of the fact that
work is to be done pursuant to any such reserved right and specifying the general
nature of the work and the area in which the same is to be performed, the Grantee shall
do all things necessary to protect its Franchise property during the progress of such
work and if ordered by the Public Works Services Director or City Engineer, the Grantee
shall disconnect, remove, or relocate its pipes and appurtenances within the street to
such extent, in such manner and for such period as shall be necessary to permit the
performance of such work in an economical manner, and in accordance with the
general recognized engineering and construction methods, and to permit the
maintenance, operation and use of such public improvement of the street as so
improved. All of such things shall be done and the work shall be performed by the
Grantee at its sole cost and expense. In the event the City shall hereafter construct,
install, reconstruct or repair any bridge or artificial support in or underlying any street in
which any pipes of appurtenances of the Grantee are located, and in the event that the
cost thereof be increased in order to provide for the installation, maintenance or
operation of any such pipes or appurtenances in or on the street area which said bridge
or other artificial support covers or underlies, then the Grantee shall pay to the City the
full amount of such increase of cost, upon completion of such construction, installation
or repair. Any damage done directly or indirectly to any such public improvement by the
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Grantee, in exercising directly or indirectly any right, power of privilege under this
Franchise, or in performing any duty under or pursuant to the provisions of this
Franchise, shall be promptly repaired by the Grantee, at its sole cost and expense.
SECTION 9. The Grantee of this Franchise shall:
(a) construct, install and maintain all Pipes and Appurtenances in accordance
and in conformity with all of the applicable ordinances, rules and regulations heretofore
or hereafter adopted by the City Council in the exercise of its police powers and not to
conflict with the authority of the State of California, and, as to State highways, subject to
the provisions of general laws relating to the location and maintenance of such facilities
therein; in constructing, installing and maintaining the Pipes and Appurtenances the
Grantee shall make and backfill all excavations in such a manner and way as to leave
the surface of the public street, alley, highway, or public place in a good condition as it
was prior to said excavation, as well as to conform to the statutes of the State of
California and the ordinances of the City of Arcadia as they now exist or may hereafter
be amended with respect to the securing of permits for excavations filling and
obstructions of City and State highways. In case of public utilities subject to the
jurisdiction of the Public Utilities Commission of the State of California, the rules,
regulations and orders of the Public Utilities Commission shall govern whenever any
conflict may exist between them and the ordinances, codes, rules and regulations
adopted or prescribed by the City. Notwithstanding any provision hereinabove, in the
event that the City determines that a greater or better repair method is reasonable and
appropriate for the long term integrity of any applicable street, alley, highway or public
place, the City shall notify the Grantee of the City's determination prior to or at the time
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of issuance of an applicable permit or approval for the Grantee to proceed. The City
shall have the right to determine, in its discretion, the scope, extent and quality of any
repair required to be undertaken by the Grantee hereunder.
(b) pay to the City, on demand the cost of all repairs to public property made
necessary by any operations of the Grantee under this Franchise.
(c) indemnify and hold harmless the City and its officers, officials, employees,
agents and volunteers from any and all liability for damage proximately resulting from
the failure of the Grantee well and faithfully to observe and perform each and every
provision of this Franchise and each and every applicable provision of Division 3,
Chapter 2 of the Public Utilities Code of the State of California. Nothing contained in the
foregoing indemnity provision shall be construed to require the Grantee to indemnify the
City against any responsibility or liability as may be caused by the sole negligence or
willful misconduct of City or its officers, agents, employees or independent contractors.
(d) maintain general liability insurance for personal injury and property
damage, naming the City of Arcadia as an additional insured. This insurance shall be in
a form, content and amount that is customarily provided by Franchisee to other cities
and counties granting a franchise to Franchisee pursuant to the Act.
(e) remove or relocate, without expense to the City, any facilities installed,
used and maintained under this Franchise if and when made necessary by any lawful
change in grade, alignment or width of any street, or the construction therein or
thereunder of any subway, viaduct, sewer, storm drain, pipeline or other improvement,
made by the City. This Franchise shall not constitute an agreement or undertaking by
the City, nor impose upon the City any obligation, to pay any part of the costs of
removal or relocation of any of the Pipes and Appurtenances when required in order to
accommodate construction of any state freeway; provided, however, that the Grantee
shall not be required to bear the expense of any removal or relocation made at the
request of the City on behalf or for the benefit of any private developer or other non-
government third party.
(f) file with the City Council within ninety (90) days after any sale, transfer,
assignment, or lease of this Franchise, or any part thereof, or of any of the rights or
privileges granted thereby, written evidence of the same, certified thereto by the grantee
of its duly authorized officers.
(g) promptly repair, at the sole cost and expense of the Grantee and to the
complete satisfaction of the City, any damage to any street or public improvement
caused directly or indirectly by the Grantee in exercising, directly or indirectly, any right,
power or privilege under this Franchise or in performing any duty under or pursuant to
any of the provisions of this Franchise.
SECTION 10. Relocation of pipelines, appurtenances and facilities — state
highway or freeway restrictions. Nothing in this Franchise shall require the Grantee to
relocate its pipelines, appurtenances and facilities in a state highway or freeway to any
greater extent otherwise obliged to do, by state law, if at all.
SECTION 11. The Franchise granted hereunder shall not in any way to any
extent impair or affect the right of the City to acquire the property of the Grantee hereof
either by purchase or through the exercise of the power of eminent domain, and nothing
herein contained shall be construed to contract away or to modify or abridge, either for a
term or in perpetuity, the City's right of eminent domain in respect to the Grantee or any
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of its property before any court or other public authority in any proceeding of any
character.
SECTION 12.
(a) If the Grantee shall fail, neglect or refuse to comply with any of the
provisions or conditions hereof, and shall not, within ninety (90) days after written
demand for compliance, begin the work of compliance, or after such beginning shall not
prosecute the same with due diligence to completion, then the City Council may declare
this Franchise forfeited.
(b) The City may sue in its own name for the forfeiture of this Franchise, in the
event of non-compliance by the Grantee, its successors or assigns, with any of the
conditions thereof.
SECTION 13. The Grantee shall pay to the City a sum of money sufficient to
reimburse it for all publication and posting expenses incurred by it in connection with the
granting of this Franchise; such payment to be made within ninety (90) days after the
City shall furnish such Grantee with a written statement of such expenses.
SECTION 14. This Ordinance shall remain an uncodified ordinance of the City
of Arcadia for the term of this Franchise.
SECTION 15. The City Clerk shall certify to the adoption of this Ordinance and
shall cause a copy of the same to be published in the official newspaper of said City
within fifteen (15) days after its adoption. This Ordinance shall take effect on the thirty
first (31) day after its adoption.
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Passed, Approved and adopted this day of , 2011.
Mayor of the City of Arcadia
ATTEST:
City Clerk
APPROVED AS TO FORM:
ge,- k 6.( 9-el
Stephen P. Deitsch
City Attorney
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G•LDEN STATE WATER COMPANY e ,,....-_,)
ERIC AREA IN THE CIT'Y'' OF AF),CADIA so-
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Golden State
• • • WATER COMPANY
• • • •
• • • • • A Subsidiary of American States Water Company
July 25, 2011
City of Arcadia and its City Council
11800 Goldring Rd.
P.O. Box 60021
Arcadia, California,91066
Re: Golden State Water Company Franchise Application
Ladies and Gentlemen:
Golden State Water Company, a California corporation (Formerly known as Southern California
• Water Company), as Applicant, hereby applies for a franchise (the "Franchise") pursuant to Article XIII
of the Arcadia City Charter:
(I) Name and Address of Applicant.Applicant's name and address is:
Golden State Water Company
630 East Foothill Blvd.
San Dimas, California,91773-9016
(2) Purpose. The purpose of the Franchise is to use or lay and use pipes, ditches, flumes, conduits
and appurtenances for transmitting and distributing water for any and all purposes in, along,
across, upon and under public streets, ways, alleys and places as they now exist or may
hereafter exist within the City of Arcadia.
(3) Term. The term of the Franchise shall be from November 23, 2011 to and including
November 22, 2031. The Franchise shall terminate prior to the end of the term if: (i)
Applicant voluntarily surrenders or abandons the Franchise with the consent of the California
Public Utilities Commission, (ii) the State, municipal or public corporation duly authorized
by law purchases by voluntary agreement or condemns and takes under the power of eminent
domain all property actually used and useful in the exercise of the Franchise and located
within its territorial limits,or(iii)the Franchise is forfeited for noncompliance with its terms
by Applicant.
(4) Franchise Fee. If the Franchise is granted to Applicant, Applicant will pay to the City of
Arcadia for each full or fractional calendar year during the life thereof, in lawful money of
the United States, a sum equivalent to two percent (2%) of the gross annual receipts of
Applicant arising from the use, operation or possession of the Franchise; provided, however,
that such payment shall in no event be less than a sum equivalent to one percent (1%) of the
gross annual receipts derived by Applicant from the sale of water within the limits of the City
of Arcadia.
Si erel , '
.�:
enJa . Lewis,.1 . �I
District anager
401 S.San Dimas Canyon Road,San Dimas,CA 91773
Tel:(909)592-4271 Fax:(909)592-6690