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Electric FranchiseACCEPTANCE OF FRANCHISE ORDINANCE To the Governing Body of the City of Salina, Kansas. Westar Energy, Inc., for itself, its successors and assigns, hereby accepts in writing the Ordinance and all rights and privileges therein granted, passed by the Governing Body of the City of Salina, Kansas, on the 11th day of July, 2005, designated as Ordinance No. 05-10292, and entitled: AN ORDINANCE, granting to Westar Energy, Inc., its successors and assigns, an electric franchise, prescribing the terms thereof and relating thereto, and repealing all ordinances or parts of ordinances inconsistent with or in conflict with the terms hereof. This acceptance is executed and filed as provided in Section 12 of said Ordinance, and said Company hereby agrees to all the terms and conditions of said Ordinance. Dated at Topeka, Kansas, this c4AA day of .2005. William B. Moore Executive Vice President and Chief Operating Officer Attest: Sec tary State of Kansas County of., SS)g4 IAIC City0f..- SA G/NXT I, _ Llej-L P,,�''` 0se`i , City Clerk of the City of-sl9L//�/q , Kansas, do hereby certify that the foregoing is a true and correct copy of acceptance of Ordinance No. OS -10292 of the City of SAG/NH as therein described, the original of which acceptance was filed in the office of the Clerk of said City on the day of 3044 , 20 S , and is now recorded among the original records thereof, and that I am the keeper of the same. Witness my hand and the official seal of said City, this �_ day of , 20f. City Clerk (Seal) (Published in the Salina Journal on July RL, 2005)_ ORDINANCE NUMBER 05-10292 AN ORDINANCE GRANTING TO WESTAR ENERGY, INC. AN ELECTRIC FRANCHISE INCLUDING THE RIGHT TO CONSTRUCT, OPERATE AND MAINTAIN ELECTRIC TRANSMISSION, DISTRIBUTION AND STREET LIGHTING FACILITIES WITHIN THE CORPORATE LIMITS OF THE CITY OF SALINA, KANSAS. THEREFORE BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF SALINA, KANSAS: Section 1. Definitions. For purposes of this Franchise, the following words and phrases shall have the meanings given herein: City as the Grantor — shall mean the City of Salina, Kansas. Company as the Grantee — shall mean Westar Energy, Inc., a Kansas Corporation. Distributed or Distribution — shall mean all sales, distribution, or transportation to any consumer for use within the City by the Company or by others through the Facilities of the Company in the Right -of -Way. Facilities — shall mean all electric distribution lines, substations, works, and plants together with all necessary appurtenances thereto. Gross receipts — shall mean any and all compensation and other consideration derived directly by the Company from any Distribution of electric energy within the corporate limits of the City to a consumer for any use, including domestic, commercial and industrial purposes, through charges as provided in tariffs filed and approved, and including without limitation interruptible sales and single sales; except that such term shall not include revenues from any operation or use of any or all of the Facilities in the Right -of -Way by others nor shall such term include revenue from certain miscellaneous charges and accounts, including but not limited to delayed or late payment charges, connection and disconnection fees, reconnection fees, customer project contributions, returned check charges, and temporary service charges. Public Improvement — shall mean any existing or contemplated public facility, building, or capital improvement project, financed by the City, including without limitation, streets, alleys, sidewalks, sewer, water, drainage, Right -of -Way improvement, and Public Projects. Public Project — shall mean any project planned or undertaken by the City or any other governmental entity for construction, reconstruction, maintenance, or repair of public facilities or improvements, including without limitation streets, alleys, sidewalks, sewer system, water system, drainage system, Right -of -Way improvement, or any other purpose of a public nature. Public Project for Private Development — shall mean a Public Project, or that portion thereof, arising solely from a request or requirement of a third (3rd) party primarily for the benefit and use of a third (3` ) party. Right -of -Way — shall mean only the area of real property in which the City has a dedicated or acquired right-of-way interest in the real property. It shall include the area on, below, or above the present and future streets, alleys, avenues, roads, highways, or boulevards dedicated or acquired as rights-of-way. The term does not include the airwaves above a right-of-way with regard to wireless telecommunications or other non -wire telecommunications or broadcast service, easements obtained by utilities, or private easements in platted subdivisions or tracts. The term does not include property owned or held by the City but not typically considered right-of-way, including, but not limited to, City parks and reserves and City buildings.' Street Right -of -Way — shall mean the entire width between property lines of land, property, or an interest therein of every way publicly maintained where any part thereof is open to the use of the public for purposes of vehicular traffic, including street, avenue, boulevard, highway, expressway, alley, or any other public way for vehicular travel by whatever name. Utility Easement — shall mean an easement owned by or dedicated to the City for the purpose of providing the Company and other utilities access to customers and users of any utility service. Section 2. Grant. There is hereby granted to Company, the non-exclusive right, privilege, and franchise to construct, maintain, extend, and operate its Facilities in, through, and along the Right -of -Way of the City for the purpose of supplying electric energy to the City and the inhabitants thereof for the full term of this Franchise; subject, however, to the terms and conditions herein set forth. Nothing in this grant shall be construed to franchise or authorize the use of the Company's Facilities or the Right -of -Way by the Company or others, for any purpose not related to the provision of electric energy. The Company may not allow a subsidiary, affiliate, or a third (3rd) party to acquire rights to occupy the Rights -of -Way under this Franchise; provided, that nothing in this section shall prevent Company from allowing the use of its Facilities by others when such use is compensated to the City under the provisions of a franchise granted by the City to any such third party. Section 3. Term. a. The term of this Franchise shall be fifteen (15) years from the effective date of this Ordinance. b. Upon 60 days advance written notice by the City, the franchise fee percentage rate may be changed on the fifth or tenth anniversary of the effective date of this Ordinance. C. Upon written request of either the City or the Company, the franchise shall be reopened and renegotiated at any time upon any of the following events: 1. Change in federal, state, or local law, regulation, or order which materially affects any rights or obligations of either the City or the Company, including but not limited to the scope of the grant to the Company or the compensation to be received by the City; or 2. Change in the structure or operation of the electrical energy industry which materially affects any rights or obligations of either the City or the Company, including but not limited to the scope of the grant to the Company or the compensation to be received by the City; or 3. Any other material and unintended change or shift in the economic benefit to the City or a change the Company did not anticipate upon accepting the grant of this Franchise. d. Amendments under this section, if any, shall be made by ordinance as prescribed by statute. The franchise shall remain in effect according to its terms pending completion of any review or renegotiation pursuant to subsection (c). Section 4. Compensation to the City. a. In consideration of and as compensation for the franchise hereby granted to the Company by the City, the Company shall make an accounting to the City of all electric energy that has been distributed on a monthly basis. The Company shall pay the City: A sum equal to 5 percent (5%) of the Gross Receipts received from the Distribution of electric energy; and The above sum shall be adjusted for uncollectible receivables and for uncollectible receivables which are later collected. b. Payment of the compensation above shall commence on the Effective Date identified in Section 18 as the first day of January, 2006, Prior to the Effective Date, payments shall continue to be calculated and be paid in the manner previously provided in Ordinance 86-9126. Such payments shall be made to the City under procedures, which are mutually agreed to by the Company and the City within thirty (30) days of the last day of the month to which such accounting shall apply. C. In the event the accounting rendered to the City by the Company is found to be incorrect, then payment shall be made on the corrected amount, it being agreed that the City may accept any amount offered by the Company, but the acceptance thereof by the City shall not be deemed a settlement of such item if the amount is in dispute or later found to be incorrect. The Company agrees that all of its books, records, documents, contracts and agreements as may be reasonably necessary for an effective compliance review of this Ordinance shall upon reasonable notice and at all reasonable times be opened to the inspection and examination of the officers of the City and its duly authorized agents, auditor, and employees for the purpose of verifying said accounting. Notwithstanding the obligation herein, the Company shall have the right to require the reasonable protection of proprietary information of the Company. Section 5. Payment and Charges. The payments and compensation herein provided shall be in lieu of all other licenses, taxes, charges, and fees, except that the usual general property taxes and special ad valorem property assessments, sales and excise taxes, charges made for privileges which are not connected with the electric energy business, and any permit fees and charges for pavement cuts or other permit fees and charges based on restoring premises to their previous condition will be imposed on the Company and are not covered by the payments herein. Section 6. Use of Right -of -Way. a. The use of the Right -of -Way under this Franchise by the Company shall be subject to all rules, regulations, policies, resolutions, and ordinances now or hereafter adopted or promulgated by the City in the reasonable exercise of its police power relating to use, placement, location, or management of utilities located in the City's Right-of-way. In addition, the Company shall be subject to all laws, rules, regulations, policies, resolutions, and ordinances now or hereafter adopted or promulgated by the City in the reasonable exercise of its police power relating to permits, fees, sidewalk and pavement cuts, utility location, construction coordination, screening, and other requirements on the use of the Right -of -Way; provided, however, that nothing contained herein shall constitute a waiver of or be construed as waiving the right of the Company to oppose, challenge, or seek judicial review of, in such manner as is now or may hereafter be provided by law, any such rules, regulation, policy, resolution, or ordinance proposed, adopted, or promulgated by the City. Further, the Company shall comply with this following: b. The Company's use of the Right -of -Way shall in all matters be subordinate to the City's use of the Right -of -Way for any public purpose. The Company shall coordinate the installation of its Facilities in the Right -of -Way in a manner which minimizes adverse impact on Public Improvements, as reasonably determined by the City. Where installation is not otherwise regulated, the Facilities shall be placed with adequate clearance from such Public Improvements so as not to conflict with such Public Improvement. c All earth, materials, trees, flowers, shrubs, landscaping, sidewalks, paving, crossings, pavement markings, utilities, Public Improvements, or improvements of any kind located within the Right -of -Way damaged or removed by the Company in its activities under this Franchise shall be fully repaired or replaced promptly by the Company to the reasonable satisfaction of the City and without cost to the City . However, when such activity is a joint project of utilities or franchise holders, the expenses thereof shall be prorated among the participants. Nothing in this Franchise shall require the Company to repair or replace any materials, trees, flowers, shrubs, landscaping or structures located within a Utility Easement, which interfere with the Company's access to any of its Facilities located in a Utility Easement. d. Except in the event of an emergency, as reasonably determined by the Company, the Company shall comply with all laws, rules, regulations, policies, resolutions, or ordinances now or hereinafter adopted or promulgated by the City relating to any construction, reconstruction, repair, or relocation of Facilities which would require any street closure which reduces traffic flow. Notwithstanding the foregoing exception all work, including emergency work performed in the traveled way or which in any way impacts vehicular or pedestrian traffic shall be properly signed, barricaded, and otherwise protected in conformance with the latest edition of the Manual of Uniform Traffic Control Devices, unless otherwise agreed to by the City. e. The Company shall cooperate promptly and fully with the City and take all reasonable measures necessary to provide accurate and complete information regarding the location of its Facilities located within the Right -of -Way when requested by the City or its authorized agents for a Public Project. Such location and identification shall be promptly communicated in writing to the City without cost to the City, its employees, agents, or authorized contractors. The Company shall designate and maintain an agent, familiar with the Facilities, who is responsible for providing timely information needed by the City for the design and replacement of Facilities in the Right -of - Way during and for the design of Public Improvements. At the request of the Company, the City may include design for Facilities in the design of Public Projects. Also at the request of the Company, the City and/or its contractor(s) or agent(s) shall provide accurate and timely field locations of proposed Public Projects in the event the Company is required to install new and/or relocate its Facilities. f. The Company shall coordinate with the City on the design and placement of Facilities in the Right -of -Way during and for the design of Public Projects. At the request and sole expense of the Company, the City may include design for Facilities in the design of Public Projects. Upon request by the City and within the time period specified in the City's request, the Company shall locate, remove, relocate, or adjust any Facilities located in Right -of -Way if reasonably necessary for a Public Project. Such location, removal, relocation, or adjustment for a particular Public Project shall be performed by the Company once without expense to the City, its employees, agents, or authorized contractors and shall be specifically subject to rules and regulations of the City pertaining to such. Such relocation or adjustment shall be completed as soon as possible within the time set forth in any request by the City for such relocation or adjustment. If additional location, removal, relocation, or adjustment becomes necessary as a result of inaccurate or mistaken information provided by the Company or City, the party which provided such inaccurate or mistaken information shall be responsible for costs associated with such additional location, removal, relocation, or adjustment without expense to the other party. The City will use its best efforts, to continue to provide a location in the Right -of -Way for the Company's Facilities as part of a Public Project, provided that the Company has cooperated promptly and fully with the City in the design of its Facilities as part of the Public Project. g. The Company shall not be responsible for the expenses of relocation to accommodate any new Public Project for Private Development initiated after the effective date of this Ordinance. The expenses attributable to such a project shall be the responsibility of the third (3rd) party upon the request and appropriate documentation of the Company. Before such expenses may be billed to the third (3rd) party, the Company shall be required to coordinate with the third (3rd) party and the City on the design and construction to ensure that the work required is necessary and done in a cost effective manner. Upon the request of the Company or the third party, the allocation of expenses attributable to the project shall be made in the reasonable determination of the City. Eligible third parties may request to have the City specially assess those expenses billed by the Company under this section. h. The City may continue to provide a location in the Right -of -Way for the Company's Facilities as part of a Public Project, provided that the Company has cooperated promptly and fully with the City in the design of its Facilities as part of the Public Project. i. It shall be the responsibility of the Company to take adequate measures to protect and defend its Facilities in the Right -of -Way from harm or damage. If the Company fails to accurately locate Facilities when requested, it shall have no claim for costs or damages against the City. The Company shall be responsible to the City and its agents, representatives, and authorized contractors for all damages including, but not limited to, delay damages, repair costs, down time, construction delays, penalties or other expenses of any kind arising out of the failure of the Company to perform any of its obligations under this Ordinance. The above general provisions notwithstanding, the City and its authorized contractors shall take reasonable precautionary measures including calling for utility locations through Kansas One Call and exercising due caution when working near the Company's Facilities. j. All technical standards governing construction, reconstruction, installation, operation, testing, use, maintenance, and dismantling of the Facilities in the Right -of -Way shall be in accordance with applicable present and future federal, state, and City laws and regulations, including but not limited to the most recent standards of the Kansas Corporation Commission and U.S. Department of Transportation. It is understood that the standards established in this paragraph are minimum standards and the requirements established or referenced in this Franchise may be additional to or stricter than such minimum standards. k. The City encourages the conservation of the Right -of -Way by the sharing of space by all utilities. Notwithstanding provisions of this Franchise prohibiting third (3rd) party use, to the extent required by federal or state law, the Company will permit any other franchised entity by an appropriate grant, or a contract, or agreement negotiated by the parties, to use any and all Facilities constructed or erected by the Company. 1. Permission is hereby granted to the Franchisee to trim trees upon and overhanging the right-of-way and utility easements. Franchisee shall perform line clearance work in accordance with regulations established under OSHA 29 CFR 1910.269. All pruning operations shall be performed by personnel qualified to perform the work and in accordance with the latest versions of ANSI Z133.1 (Safety Requirements for Pruning, Repairing, Maintaining and Removing Trees, and Cutting Brush) and ANSI A300 (Part 1) (Standard Practices for Tree, Shrub, and Other Woody Plant Maintenance). For routine trimming operations, customers shall be contacted at least one (1) week in advance by either personal contact or by informational door hanger. Section 7. Indemnity and Hold Harmless. The Company shall indemnify and hold and save the City, its officers, employees, agents, and authorized contractors, harmless from and against all claims, damages, expense, liability, and costs including reasonable attorney fees, to the extent occasioned in any manner by the Company's occupancy of the Right -of -Way. In the event a claim shall be made or an action shall be instituted against the City growing out of such occupancy of the Right -of -Way by Facilities of the Company, then upon notice by the City to the Company, the Company shall assume responsibility for the defense of such actions at the cost of the Company, subject to the option of the City to appear and defend at its own cost, any such case. Section 8. Notice of Property Annexed by City Notwithstanding anything to the contrary in this Franchise, the fee provided for in Section 4 above shall not become effective within any area annexed by the City until 30 days after that the City provides the Company with a certified copy of the annexation ordinance, proof of publication as required by law and a map of the city detailing the annexed area. Section 9. Right of Assignment. This Franchise shall be assignable only in accordance with the laws of the State of Kansas, as the same may exist at the time when any assignment is made; provided, however, that the franchise may be assigned by the Company without action by the City to any entity which succeeds to all or substantially all of the electric utility business of the Company. Provided, however, in the event that the Company is no longer required to obtain the approval of the Kansas Corporation Commission for an assignment, such assignment shall be subject to the consent of the City, which consent shall not be unreasonably withheld. In the event of an assignment to a successor that has been documented by a written assumption of the Franchise executed by the successor, the Company shall be released from all obligations which are assumed in writing by such successor. Section 10. Termination and Forfeiture of Franchise. (a) In addition to all other rights and powers retained by the City under this franchise, the City reserves the right to terminate the franchise and all rights and privileges of the Company hereunder, in the event of a material failure on the part of the Company, its successors or assigns, to comply with any of the provisions of this ordinance, or if the Company, its successors or assigns, should do or cause to be done any material act or thing prohibited by or in violation of the terms of the ordinance. In such event, the Company, its successors and assigns, shall forfeit all rights and privileges granted by this ordinance and all rights hereunder shall cease, terminate and become null and void, provided that said forfeiture shall not take effect until the City shall carry out the following proceedings: (i) Before the City terminates the franchise, it shall first mail to the Company written notice setting forth in detail the neglect or failure of the Company. (ii) The Company shall have sixty (60) calendar days thereafter in which to comply with the conditions of this franchise. (iii) If, at the end of such sixty (60) day period, the City determines that the Company has not complied with the conditions of this franchise and this franchise is subject to termination for that reason, the City, in order to terminate this franchise, shall enact an ordinance setting out the grounds upon which the franchise is to be terminated (the "Termination Ordinance"). (iv) If, within thirty (30) calendar days after the effective date of the Termination Ordinance, the Company has not filed an action in the Saline County District Court seeking the determination of whether the Company has violated the terms of this franchise and that the franchise is subject to termination for that reason, the franchise shall be terminated as of thirty (30) days following the effective date of the Termination Ordinance. (v) If within thirty (30) days after the effective date of the Termination Ordinance, the Company does file an action to determine whether the Company has violated the term of this franchise and that the franchise is subject to termination for that reason, and the court rules that this franchise is subject to termination by reason of the violation of its terms, this franchise shall terminate thirty (30) calendar days after such final judgment is rendered. (b) In the event of a final adjudication of bankruptcy of the Company under Title 11 of the United States Bankruptcy Code, the City shall have full power and authority to terminate, revoke, and cancel any and all rights granted under this franchise. (c) The failure of the Company to comply with any of the provisions of this franchise or the doing or causing to be done by the Company of anything prohibited by or in violation of the terms of this franchise shall not be a ground for the termination of this franchise when such act or omission on the part of the Company is due to any cause or delay beyond the control of the Company, its successors and assigns, or bona fide legal proceedings. Section 11. Rights and Duties of Company Upon Expiration or Termination of Franchise. Upon expiration of this franchise, whether by lapse of time, by agreement between the Company and the City, or by forfeiture, the Company shall have the right to remove any and all of its Facilities used in its Electric Utility Service within a reasonable time after such expiration or termination, unless the City notifies the Company in writing that the City or third party intends to purchase the Facilities. In the event the City notifies the Company that the Facilities are to be purchased, the Facilities shall be sold to the City or the third party by the Company, its successors or assigns, for the compensation provided by applicable law. In the event the City notifies the Company that the Facilities can be removed by the Company, it shall be the duty of the Company, immediately upon such removal, to restore the streets, avenues, alleys, parks and other public ways and grounds from which the Facilities are removed to as good condition as existed before the removal. Section 12. Acceptance of Terms by Company. Within thirty (30) days after the final passage and approval of this Ordinance, the Company shall file with the City Clerk of the City its acceptance in writing of the provisions, terms and conditions of this Ordinance, this Ordinance shall constitute a non-exclusive contract between the City and the Company Section 13. Conditions of Franchise. This non-exclusive franchise, grant, and privilege is granted under and subject to all applicable laws and under and subject to all of the orders, rules, and regulations now or hereafter adopted by governmental bodies now or hereafter having jurisdiction. Section 14. Notices. Except in Emergencies, all notices by either the City or the Company to the other shall be made by depositing such notice in the U.S. Mail or by other mutually agreed upon method. Emergency notices shall be provided by telephone, with written notice immediately following by U.S. Mail. All notices shall be addressed as follows: City: City Clerk City of Salina, Kansas P.O. Box 736 Salina, KS 67402-0736 Company: Senior Director Customer and Community Support Box 208 Wichita, KS 67201 Section 15. Non -waiver Provision The failure of either party to insist in any one or more instances upon; the strict performance of any one or more of the terms or provisions of this ordinance shall not be construed as a waiver or relinquishment for the future of any such term or provision, in the same shall continue in full force and in effect. No waiver or relinquishment shall be deemed to have been made by either party unless the waiver or relinquishment is in writing and signed by the parties. Section 16. Invalidity of Ordinance. If any clause, sentence, or section of this Ordinance shall be held to be invalid by a court of competent jurisdiction, such decision shall not affect the validity of the remainder, as a whole or any part thereof, other than the part declared to be invalid; provided, however, the City may elect to declare that this entire ordinance is invalidated if the portion declared invalid is, in the judgment of the City, an essential part of this Ordinance. Section 17. Governing Law; Venue (a) The rights and privileges granted to the Company by this Franchise shall at all times be subordinate and inferior to the rights of the public in and to the ordinary use of the Right -of - Way, and nothing in this franchise shall be considered as a surrender by the City of its right and power to us and relocate the use of its Right -of Way. (b) The franchise and the right herein granted are subject to the provisions of existing federal and state laws, including those hereafter enacted, pertaining to the granting of franchises. (c) The obligations and undertakings of both parties hereto shall be performed at Salina, Saline County, Kansas. In the event that any legal proceeding is brought to enforce the terms of this franchise, the proceeding shall be brought in State or Federal courts, as appropriate, having jurisdiction for Saline County, Kansas. Section 18. Effective Date of Ordinance. After its passage and approval by the City, acceptance by the Company, and publication in the official city newspaper, this Ordinance shall take effect and be in force on the first day of January, 2006 (the "Effective Date of this ordinance"). Section 19. Repeal of Conflicting Ordinances. Ordinance No. 86-9125, which heretofore granted a non-exclusive franchise to the Company, and which became a contract between the City and the Company in accordance with its terms, and all other ordinances and resolutions or parts thereof inconsistent or in conflict with the terms hereof, are hereby canceled, annulled, repealed, and set aside as of the Effective Date of this ordinance. Introduced: June 27, 2005 Passed: July 11, 2005 Deborah Divine, Mayor [SEAL] ATTEST: Lieu Ann Elsey, CMC, Citj Clerk