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Ord 2376 - Gas Utility Franchise COUNCIL BILL NO: 2541 ORDINANCE NO: 2376 AN ORDINANCE GRANTING A NON-EXCLUSIVE GAS UTILITY FRANCHISE TO NORTHWEST NATURAL GAS COMPANY, AND FIXING TERMS, CONDITIONS AND COMPENSATION OF SUCH FRANCHISE. THE CITY OF WOODBURN ORDAINS AS FOLLOWS: Section 1: Definitions and Explanations. (1) As used in this ordinance. (a) "City" means the City of Woodburn and the areas within its boundaries, including its boundaries as extended in the future. (b) "Council" means the legislative body of the City. (c) "Grantee" means the corporation referred to in Section 2 of this ordinance. (d) "Gas" means natural methane-based gas. (e) "Gas facilities" means Grantee's gas transmission and distribution facilities, including pipes, pipe lines, mains, laterals, conduits, feeders, regulators, reducing and regulating stations, meters, fixtures, connections and all attachments, appurtenances, and all accessories necessary and incidental thereto located within the City Limits, whether the facilities are located above or below ground. (f) "Person" includes an individual, corporation, association, firm, partnership and joint stock company. (g) "Public place" means any City-owned property within the City that is open to the public that is not a right-of-way, including public squares and parks. (h) "Right-of-way" means the space in, upon, above, or under the public streets, roads, highways, lanes, courts, ways, alleys, boulevards, sidewalks, bicycle lanes, bridges, and places used or intended to be used by the general public for travel as the same Page 1 - COUNCIL BILL NO. 2541 ORDINANCE NO. 2376 . r T now or may hereafter exist, that the City has the right to allow Grantee to use. (2) As used in this ordinance, the singular number may include the plural and the plural number may include the singular. Section 2: Riahts Granted. (1) Subject to the conditions and reservations contained in this ordinance, the City hereby grants to NORTHWEST NATURAL GAS COMPANY, a corporation, the right, privilege and franchise to: (a) Construct, maintain and operate a natural gas utility system within the City; (b) Install, maintain and operate gas facilities on, in and under the rights-of-way of the City, residents, agencies and businesses in the City and to territory beyond the limits of the City; and (c) Transmit, distribute and sell gas within the City and to territory beyond the limits of the City. (2) The rights granted herein shall not confer on Grantee any right, title or interest in any public way beyond that expressly conferred by the provisions of this Section 2, nor shall it confer any right or privilege to use or occupy any other property of the City or any other entity. Section 3: Use of Riahts-of-Way by Grantee. (1) Before the Grantee may use or occupy any right-of-way, the Grantee shall first obtain permission from the City to do so and shall comply with any special conditions the City may impose on such use or occupation. (2) The compensation paid by Grantee for this franchise includes all compensation for the use of rights-of-way located within the City as authorized. The City may charge additional compensation for the use of any public place. Section 4. Duration. This franchise is granted for a period of 10 years from and after the effective date of this ordinance. Page 2 - COUNCIL BILL NO. 2541 ORDINANCE NO. 2376 ,.'" T' Section 5. Franchise Not Exclusive. This franchise is not exclusive, and shall not be construed as a limitation on the City in: (1) Granting rights, privileges and authority to other persons similar to or different from those granted by this ordinance. (2) Constructing, installing, maintaining or operating any City-owned public utility. Section 6. Public Works and Improvements Not Affected by Franchise. The City reserves the right to: (1) Construct, install, maintain and operate any public improvement, work or facility in, on or over the rights-of-way. (2) Do any work that the City may find desirable on, over or under any right- of-way. (3) Vacate, alter or close any street. Whenever the City shall vacate any Right-of-way or public place for the convenience or benefit of any person or governmental agency or instrumentality, Grantee's rights under this Franchise shall be preserved as to any of its Gas facilities then existing in the Right-of-way or public place if reasonably practicable. To the extent Grantee's rights in the Right-of-way cannot be preserved in any street vacation, City shall where reasonably practicable provide an alternative Right-of-way for the location of Grantee's Gas facilities. If Grantee's Gas facilities must be relocated from a vacated Right-of-way, the petitioners of such vacation shall bear the costs of relocating the Gas facilities. Upon receipt of a notice of a petition for vacation, Grantee shall as soon as practicable investigate and advise the City and petitioners in writing whether the Gas facilities must be relocated, the estimated costs of relocation and the time needed for this relocation. (4) Whenever the City shall perform, cause or permit any work in any present or future right-of-way of the City on its behalf, where such work may disturb Grantee's gas facilities, the City shall, or require its permittee to, notify Grantee in writing, sufficiently in advance of such contemplated work to enable Grantee to take such measures, as Grantee may deem necessary to protect such facilities, at its own expense. Page 3 - COUNCIL BILL NO. 2541 ORDINANCE NO. 2376 .. ",u 1 Section 7: Continuous Service. Grantee shall maintain and operate an adequate system for the distribution of gas in the City. Grantee shall use due diligence to maintain continuous and uninterrupted 24-hour a day service which shall at all times conform at least to the standards common in the business and to the standards adopted by state authorities and to standards of the City which are not in conflict with those adopted by the state authorities. Under no circumstances shall Grantee be liable for an interruption or failure of service caused by an act of God, unavoidable accident or other circumstances beyond the control of Grantee through no fault of its own. Section 8: Safety Standards and Work Specifications. (1) The facilities of Grantee shall at all times be maintained in a safe, substantial and workmanlike manner. (2) For the purpose of carrying out the provisions of this section, the City may provide such specifications relating thereto as may be necessary or convenient for public safety or the orderly development of the City. The City may amend and add to such specifications from time to time. Section 9: Control of Construction. (1) Before commencing any construction, extension or relocation of facilities in a City right-of-way, Grantee shall file with the City drawings, in such form as may be acceptable to the City Engineer, showing the location of existing facilities and facilities to be constructed, maintained, or relocated and shall obtain from the City approval of the location and plans prior to commencement of the work. (2) All work done within a City right-of-way shall be done in the location approved by the City Engineer and in accordance with plans and specifications approved by the City Engineer. The City Engineer's approval of the plans and specifications may include conditions and the conditions shall be binding on Grantee. Such construction work shall be done in a safe manner subject to the approval of the City Engineer and in accordance with requirements of applicable Federal and State laws and City ordinances. All work done shall be subject to the rejection or correction requirements of the City Engineer and subject to the City Engineer's approval. Page 4 - COUNCIL BILL NO. 2541 ORDINANCE NO. 2376 .. T , Section 10: Street Excavations and Restorations. (1) Subject to the provisions of this ordinance, the Grantee or its subcontractor may make necessary excavations for the purpose of constructing, installing, maintaining and operating its gas facilities. In all circumstances pertinent to this agreement, any action by Grantee's subcontractors shall be the responsibility of Grantee. Any subcontractor of Grantee shall be bound to the requirements of this agreement. (2) Except in emergencies, and in the performance of routine service connections and ordinary maintenance, on private property, prior to making an excavation in the traveled portion of any right-of-way, and, when required by the City, in any untraveled portion of any right-of-way, Grantee shall obtain from the City approval of the proposed excavation and of its location. (3) Grantee shall give notice to the City by telephone, electronic data transmittal or other appropriate means prior to the commencement of service or maintenance work and as soon as is practicable after the commencement of work performed under emergency conditions. (4) When Grantee does any work in the unimproved portion of a right-of-way, Grantee or its subcontractor, shall promptly restore the affected portion of right-of-way to the same condition in which it was prior to the excavation. When Grantee does any work in an improved portion of a right-of-way, Grantee or its subcontractor shall promptly restore the affected portion of the right-of-way in compliance with the conditions in any permit issued by the City or any specifications, requirements and regulations of the City in effect at the time of the work. All work done shall be subject to the rejection and correction requirements of the City Engineer's approval. If Grantee or its subcontractor fails to restore promptly the affected portion of a right-of-way in accordance with City Standard Construction specifications in effect at the time of the work, the City may make the restoration, and the cost thereof shall be paid by Grantee. Section 11: Location and Relocation of Facilities. (1) All gas facilities of Grantee shall be placed so that they do not interfere unreasonably with the use of the right-of way by the City and the public and in accordance with any specifications adopted by the City governing the location of facilities. Page 5 - COUNCIL BILL NO. 2541 ORDINANCE NO. 2376 .. T T (2) The City may require the removal or relocation, temporarily or permanently, of facilities maintained by Grantee in the streets of the City. Grantee shall remove and relocate such facilities within 120 days after receiving notice so to do from the City. The cost of such removal or relocation shall be paid by Grantee. In the event that the removal, relocation, change or alteration is needed to accommodate private development or other private use of the right-of-way, the developer or other private party requiring the action shall be responsible for the cost of removal, relocation, change or alteration. Construction of public improvements by a private party within the right-of-way as a condition of City approval shall be considered installation of public improvements of the City if the improvement is not needed to provide service to the private party. In the event of a dispute as to whether the removal, relocation, change or alteration is a public improvement or accommodates private development, the dispute shall be referred to the City Administrator, whose decision shall be final and binding. Section 12: Compensation. (1) As compensation for the franchise granted by this ordinance, the grantee shall pay to the City an amount equal to three percent (3%) of the gross revenue collected by the Grantee from its customers for gas consumed within the City. "Gross revenue" as used in this ordinance shall be deemed to include any revenue earned within the City from the sale of natural gas after deducting from the total billings of the Grantee the total net writeoff of uncollectible accounts. Gross revenues shall include revenues from the use, rental or lease of operating facilities of the utility other than residential-type space and water heating equipment. Gross revenues shall not include proceeds from the sale of bonds, mortgage or other evidence of indebtedness, securities or stocks, revenues derived from the sale or transportation of gas supplied under an interruptible tariff schedule, sales at wholesale to a public utility when the utility purchasing the service is not the ultimate consumer, or revenue paid directly by the United states of America or any of its agencies. (2) The City shall retain the right, as permitted by Oregon Law, to charge a privilege tax in addition to the franchise fee set forth herein based on the gross revenues of the company, payable on the same terms and conditions as the franchise fee itself. (3) The compensation required by this section shall be due for each calendar year, or fraction thereof, within thirty (30) days after the close of such calendar year, or fraction thereof. Within thirty (30) days after the termination of this franchise, compensation shall be paid for the period Page 6 - COUNCIL BILL NO.2541 ORDINANCE NO. 2376 T" 1 elapsing since the close of the last calendar year for which compensation has been paid. (4) Grantee shall furnish to the City Finance Director with each payment of compensation required by this section a written statement, showing the amount of gross revenue of the Grantee within the City for the period covered by the payment computed on the basis set out in subsection (1) of this section. If Grantee fails to pay the entire amount of compensation due the City through error or otherwise, the difference due to City shall be paid by the Grantee within fifteen (15) days from discovery of the error or determination of the correct amount. Any overpayment to the City through error or otherwise, shall be offset against the next payment due from Grantee. (5) Acceptance by the City of any payment due under this section shall not be deemed to be a waiver by the City of any breach of this franchise occurring prior to the acceptance, nor shall the acceptance by the City of any such payments preclude the City from later establishing that a larger amount was actually due, or from collecting any balance due to the City. Section 13: Books of Account and Reports. On an annual basis, upon thirty (30) days prior written notice, the City or its agent shall have the right to conduct an audit or review of Grantee's records reasonably related to the administration or enforcement of this ordinance. If an audit or review of the records determines that franchise fees have been underpaid, Grantee shall reimburse the City for the total cost of the audit or review within thirty (30) days of City's written demand for same. All amounts underpaid shall accrue interest at the statutory rate from the effective date of the underpayment. Section 14. Classification of Fees. The City Council determines that any fees imposed by this franchise are not taxes subject to the property tax limitations of Article XI, Section 11 (b) of the Oregon Constitution. Section 15: As-Built DrawinQs. Subject to the confidentiality limitations of this section, Grantee shall provide City with available maps of the location of its facilities and operational data requested by the City. The Grantee shall also provide as-built plans for those portions of the system that are added to or modified during the year. These Page 7 - COUNCIL BILL NO. 2541 ORDINANCE NO. 2376 ',." T records are submitted in confidence, and the City will keep those records in confidence and not allow others to view or copy them. The City agrees to keep the documents confidential and to take the position that they are exempt from public disclosure. The City shall limit access to the as-built drawings to City employees or City contractors with a need to know where the Grantee's facilities are located and shall review the as-built drawings only as necessary to plan City projects, coordinate the use of the rights of way, and to protect the public health and safety. Section 16. Indemnification. Grantee shall indemnify and save harmless the City and its officers, agents and employees from any and all loss, cost and expense arising from damage to property and/or injury to, or death of, persons due to any wrongful or negligent act or omission of Grantee, its agents or employees in exercising the rights, privileges and franchise hereby granted. Section 17: Sale or Assianment of Franchise. Grantee shall not during the term of this Franchise sell, assign, transfer or convey this franchise without first obtaining the consent of the City Council, by ordinance, which consent shall not be unreasonably withheld. All of the provisions of this ordinance shall inure to and bind the successors and assigns of the Grantee. Whenever Northwest Natural shall be mentioned in this ordinance, it shall be understood to include such successors or assigns in interest of Northwest Natural as shall have been so consented to by the City Council. Section 18: Termination of Franchise for Cause. The City may terminate this franchise as provided in this Section, subject to Grantee's right to a court review of the reasonableness of such action, upon the willful failure of the Grantee to perform promptly and completely each and every material term, condition or obligation imposed upon it under or pursuant to this ordinance. The City shall provide the Grantee written notice of any such failure and the Grantee shall have sixty (60) days from receipt of notice to cure such failure, or if such failure cannot reasonably be cured within sixty (60) days, to commence and diligently pursue curing such failure. Section 19: Reneaotiation of the Franchise. If the State of Oregon or the PUC amends or adopts a state statute or administrative rule that would affect a term, condition, right or obligation under this agreement, either party may reopen the franchise agreement at any time with regard to such term, conditions, right or obligation in order to address the Page 8 - COUNCIL BILL NO. 2541 ORDINANCE NO. 2376 yo. T change required or allowed by the new or amended state statute or administrative rule. Section 20: Remedies Not Exclusive, When Requirement Waived. All remedies and penalties under this ordinance, including termination of the franchise, are cumulative, and the recovery or enforcement of one is not a bar to the recovery or enforcement of any other such remedy of penalty. The remedies and penalties contained in this ordinance, including termination of the franchise, are not exclusive and the City reserves the right to enforce the penal provisions of any ordinance or resolution and to avail itself of any and all remedies available at law or in equity. Failure to enforce shall not be construed as a waiver of a breach of any term, condition or obligation imposed upon the Grantee by or pursuant to this ordinance. A specific waiver of a particular breach of any term, condition or obligation imposed upon Grantee by or pursuant to this ordinance shall not be a waiver of any other or subsequent or future breach of the same or of any other term, condition or obligation, or a waiver of the term, condition or obligation itself. Section 21: Acceptance. The Grantee shall, within thirty (30) days from the date this ordinance takes effect, file with the City its written unconditional acceptance of this franchise, and if the Grantee fails so to do, this ordinance shall be void. Section 22: Prior Ordinance Repealed. Ordinance no. 2133 is hereby repealed. Section 23: EmerQency Clause. This ordinance being necessary for the immediate preservation of the public peace, health and safety, an emergency is declared to exist and this ordinance shall take effect immediately upon passage by the Council and approval by the Mayor, and shall be valid for a term of franchise as stated in Section 4 and provided that Grantee files its acceptance as stated in Section 21 . City A Horn y Approved as to form: Page 9 - COUNCIL BILL NO. 2541 ORDINANCE NO. 2376 T' 1 Passed by the Council Submitted to the Mayor Approved by the Mayor Filed in the Office of the Recorder ATTEST: /)'1 c--c,~ -~~1./1'Lq-r-;.-I__ Mary Tenndnt City Recorder City of Woodburn, Oregon Page 10 -COUNCIL BILL NO. 2541 ORDINANCE NO. 2376 November 8, 2004 November 10, 2004 November 10, 2004 November 10, 2004 'W,. y'