HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 05/19/2009 - ITEMS RELATING TO RICHARDS LAKE SUBSTATION MODIFIC ITEM NUMBER: 15 A-B
AGENDA ITEM SUMMARY DATE: May 19, 2009
FORT COLLINS CITY COUNCIL STAFF: Steve Catanach
Brian Pederson
Bob Hover
SUBJECT
Items Relating to Richards Lake Substation Modifications.
RECOMMENDATION
Staff recommends adoption of the Resolution and the Ordinance on First Reading.
The Electric Board recommended approval of the Platte River license agreement at its meeting on
March 4, 2009.
FINANCIAL IMPACT
No adverse financial impact is anticipated. Tri-State will compensate the City a total of$17,171 for
the proposed easement. The compensation includes $12,171 for the fair market value of the
easement as determined by an appraisal by Foster Valuation Company, LLC, $4,000 for the value
of four Austrian Pines trees and hedges within the easement area which will be removed by Tri-
State, and $1,000 to the City's Real Estate Services Department to process the easement request.
Tri-State will be responsible for all costs of installation and restoring the construction area.
Additionally,under the terms of the license agreement,Platte River will reimburse the City$14,500
for the use of the City property. In turn, Tri-State will reimburse Platte River for the $14,500
expenditure.
EXECUTIVE SUMMARY
A. Resolution 2009-047 Authorizing the City Manager to Execute a License Agreement with
Platte River Power Authority.
B. First Reading of Ordinance No. 060, 2009, Authorizing the Conveyance of a Utility
Easement to Tri-State Generation and Transmission Association, Inc.
Tri-State Generation and Transmission Association, Inc. ("Tri-State") has requested a connection
for transmission facilities between Platte River's transmission system and Tri-State. To facilitate
this connection,two new breakers and associated equipment must be installed in the City's Richards
Lake Substation. In order for this connection to occur, the City must grant Platte River a License
May 19, 2009 -2- Item No. 15 A-B
to install facilities that are not specifically designated to provide service to the City and must grant
Tri-State an easement to cross the substation property with its connection.
BACKGROUND
For many years, transmission utilities along the Front Range have shared transmission lines,
substation space, and rights-of-way in an effort to keep electric costs down by eliminating
duplication of facilities in the same area. Tri-State Generation and Transmission Association has
asked Platte River to add two circuit breakers and other associated minor equipment at the City's
Richard Lake Substation to create a connection point for a new transmission line. This new line is
being built to improve the reliability of electric service in the Waverly—Wellington area for Poudre
Valley REA, which is a member of the Tri-State organization.
The City owns the Richard Lake Substation property. Platte River has the right to occupy City
property in this substation as part of its responsibilities under the Amended and Restated Contract
with Platte River Power Authority for the Supply of Electric Power and Energy approved by City
Council on March 24, 2009 (the"Power Supply Agreement"). The Power Supply Agreement does
not address a situation where Platte River would use space inside a City substation to support
transmission service to a third party like Tri-State. Platte River is therefore asking approval from
the City to locate the high voltage breakers and associated equipment at the Richard Lake Substation
to support Tri-State's transmission connection request.
Platte River staff have reviewed the proposed layout of the Richard Lake Substation additions with
City staff and they are in agreement that the substation space to be occupied by the additional Platte
River equipment for Tri-State will not affect the ability to safely and reliably operate the substation
and will not affect the space needed for expansion inside the substation for future City needs. Tri-
State staff will need to have access to the substation periodically to verify the meter readings for
energy flow through Platte River's transmission system to the Tri-State transmission line. Under
the license agreement, additional equipment in the substation will be owned and maintained by
Platte River and will not affect the reliability of the delivery of electric energy to the City facilities
in the substation. Tri-State will pay for the use of the space in the Richard Lake Substation and to
compensate the City for the costs of land, grading, fencing, and rock surfacing that were expended
to create the Substation.
In addition to the revocable license for Platte River, it is also necessary for Tri-State to obtain a
permanent, non-exclusive utility easement across a portion of the City's Richards Lake Substation
property in order to complete this project. The proposed easement consists of a 50-foot wide strip
of land, covering a 12,171 square foot area of the substation property. The Substation property is
generally located approximately 1/4 mile west of Interstate 25,and 1/4 mile south of Richards Lake
Road, directly west of the Anheuser Busch brewery.
The easement shall be contingent upon the City's approval of the proposed License agreement with
Platte River. The City shall reserve the right to terminate the easement to Tri-State if the easement
is not used, if it is abandoned, or if the City revokes the license to Platte River for any reason in the
future. The City shall be named as an additional insured on Tri-State's general liability insurance,
environmental/pollution insurance, and automobile liability insurance policies while the easement
is in effect.
May 19, 2009 -3- Item No. 15 A-B
ATTACHMENTS
1. Location Map.
2. Excerpt of Minutes from the Electrical Utility Board meeting on March 9, 2009.
ATTACHMENT 1
Tri-State Utilit Easement at
Richard's La e Substation
Location Map
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ATTACHMENT
Excerpt: Electric Board Minutes of Regular Meeting
March 4,2009
Taken by Board Secretary, Meagan Peil
Richards Lake Substation
Mike Dahl with Platte River Power Authority (Platte River) presented a request by Platte
River for additions to the Richards Lake Substation from the City of Fort Collins in order
to supply additional services to Tri-State Generation.
Tri-State would like to augment their service to northern Larimer County, and currently,
their system has experienced issues with weather and outages. They have gone through
the County and City process for this and will be asking for a utility easement from the
City soon. Tri-State would like the City to add two circuit breakers and a transmission
line. Platte River has permission to be in the substation, but because we would be putting
a new service in for someone else, Platte River is asking the City for the equipment in
order to extend service to Tri-State. Currently, Tri-State distributes to customers in Red
Feather Lakes, and this would be the first step to distribute to household voltage. Platte
River will be using their funds for this and will be reimbursed by Tri-State. The benefit is
to increase reliability and provide lines.
What is the configuration? The configuration is a donut.
Is this a radial system, and is there any generation?
This is a radial system. They will have the ability for some switching and use,of the
substation. Tri-State needs this to be a back up for their current system.
Board Member Barnish would like to clarify that there are no conflicts of interest with his
affiliation with PRPA, because this arrangement does not benefit PRPA.
The motion was recommended to read:
The Electric Board recommends approval by the City Council of a resolution authorizing
the City Manager to execute the license agreement between Platte River Power Authority
and the City for the installation of facilities necessary to provide transmission
interconnection to Tri-State Generation.
Discussion and Vote:
There was no further discussion on the motion. It passed with a unanimous vote.
RESOLUTION 2009-047
OF THE COUNCIL OF THE CITY OF FORT COLLINS
AUTHORIZING THE CITY MANAGER TO EXECUTE A LICENSE AGREEMENT
WITH PLATTE RIVER POWER AUTHORITY
WHEREAS,Platte River Power Authority("Platte River")provides electric generation and
transmission service to the City, and to three other municipal members and owners of Platte River;
and
WHEREAS,the City owns a certain parcel of real estate known as the Richards Lake electric
substation in the NW '/4 of Section 33, Township 8 North, Range 68 West of the 6`h Principal
Meridian (the "City Property"); and
WHEREAS,on March 24,2009,the City Council approved the issuance of a license to Platte
River to occupy the City Property pursuant to an Amended and Restated Contract with Platte River
Power Authority for the Supply of Electric Power and Energy; and
WHEREAS,Platte River occupies the City Property and maintains extensive equipment on
the property that is critical to its mission to provide the City with electric generation and transmission
service; and
WHEREAS,Tri-State Generation and Transmission Association,Inc.("Tri-State")provides
electric service to customers in northern Larimer County and has concerns about the reliability of
its service to that area; and
WHEREAS,Tri-State is proposing to construct an overhead electric transmission line project
known as the Richards Lake Substation to Waverly Electrical Transmission Line Project (the
"Project"); and
WHEREAS,as part of the Project,Tri-State has requested that Platte River install two circuit
breakers and a transmission line on the City Property to be owned by Platte River and used for the
benefit of Tri-State so that Tri-State may provide more reliable service to its customers; and
WHEREAS,the City and Platte River have negotiated the terms and conditions of a second
license agreement (the "New License Agreement") that would allow for the installation of the
foregoing equipment, a copy of which is attached hereto as Exhibit"A"and incorporated herein by
this reference; and
WHEREAS, Platte River will pay the City for the value of this additional license in the sum
$14, 500 and Tri-State will, in turn, reimburse Platte River for the same; and
WHEREAS, at its meeting on March 4, 2009, the City's Electric Board recommended
approval of the New License Agreement to Platte River and the installation of the facilities necessary
to provide interconnection to Tri-State at the Richards Lake Substation; and
WHEREAS, Article XI, Section 10 of the City Charter authorizes the City Council to
authorize the use or occupation of any street, alley, or public place,provided that such license shall
be revocable by the City Council at its pleasure, whether or not such rights to revoke is expressly
reserved in such license.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT
COLLINS that the City Manager is hereby authorized to execute the New License Agreement, in
substantially the form shown on Exhibit "A", with such modifications or additional terms and
conditions as the City Manager, in consultation with the City Attorney, deems necessary or
appropriate to protect the interests of the City or to effectuate the purposes of this Resolution.
Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 19th
day of May A.D. 2009.
Mayor
ATTEST:
Chief Deputy City Clerk
EXHIBIT A
LICENSE AGREEMENT
This License Agreement ("Agreement") is entered into as of
2009, by and between THE CITY OF FORT COLLINS, a Colorado municipal
corporation (hereinafter called the "City"), and PLATTE RIVER POWER
AUTHORITY, a political subdivision organized and existing under and by virtue the
laws of the State of Colorado (hereinafter called "Platte River").
1. Revocable license: The City grants a non-exclusive revocable license to Platte
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River upon and in consideration of the agreements, covenants,',terms and
conditions described below.
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2. Description of License Property A portion of a,parcel of landaying entirely
within the City's electric substation known.asichard Lake,as more particularly
described in Exhibit A, attached hereto (`,'License Property").
3. Use of License Property Platte River may�use the&:icense Property,.to construct,
install, alter, maintain, reconstruct, remove andarepair improvements (hereinafter
referred to as the "Improvements') as more fullfzl6scribed below in paragraph 11
and in Exhibits B and C, both attached hereto and incorporated by reference. The
purpose of the Improvements is the ff6vision of a transmission interconnection
Nvl _ 91
for the benefit of Tri-State Generation andTransmission Association, Inc.
(hereinafter referred,to`as "Tri-State,%)x:L,yWlatte River will cooperate with Tri-State
in order to allow?Tri`State to obtain any meter information Tri-State requires. If
Platte Riverseek, s to modify or add additional equipment to the Improvements,
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Platte River m y%d�o so p o�vided that the City first determines in writing that the
modifications will�fiot inter-ferexwith City operations.
4. Construction,alldvmalntenance: Platte River will, at its expense, construct the
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ti.,wImprovements in�a�cordanee���wiih the plans and specifications described in
EXlbits B and C and shall be solely responsible to maintain the License Property
anNinprovements i a safe manner to insure the City's usage of the surrounding
substati`on,property and facilities for their original purpose. Platte River may
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temporarri.y utiilize*the northeast corner of the substation, an area not included in
the License Property, to store construction-related materials during construction
of the Impro ements. When the Improvements are energized by Tri-State, any
materials stored in the corner of the substation shall be removed.
5. Commencement Date: The date that this Agreement is made and entered into by
the parties.
6. Termination: This is a revocable license that may be terminated at the discretion
the Fort Collins City Council at any time. Upon termination of the revocable
license contemplated by this Agreement, Platte River shall promptly remove all
Improvements and other equipment or facilities placed on the License Property
and restore the property to its original condition, all at Platte River's sole expense.
7. License Fees: Platte River will pay fourteen thousand, five hundred dollars
($14,500.00) to the City as full payment for the rights and privileges described
herein.
8. Assignment: Platte River's privileges under this Agreement shall not be
assignable by Platte River, in whole or in part, without obtaining the City's prior
written approval.
9. City's Address:
Original to: City of Fort Collins Utilities
P.O. Box 580
Fort Collins, CO 80522 � 6
ATTN: Utilities Executive�F,,irector
With a copy to: City of Fort Collins
City Attorney's Office'
P.O. Box 580
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Fort CoIlins;,C0 80522
10. Licensee's Address:
ti General Manager
. Platte River Power Authority
x 20.0.0 East Horsefooth Road
Fort Collins, CO t880525
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H. Improvements. e following is a general description of the Improvements: the
&ddition of two V eircu t�8breakers, four switches, associated bus work, and
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INK and control systems. A diagram reflecting the intended design and
configuration of theNlinprovements is illustrated on Exhibit B.
12. Insurance: During the term of this Agreement, Platte River shall purchase and
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maintain goffdal�\liability coverage in connection with the Licensed Property,
including all improvements thereon, in the amount of One Million Dollars
($1,000,000.00). The City shall be named as an additional insured on all such
policies. All insurance required hereunder shall be issued by an insurance
company authorized to do business in Colorado which meets all of the
requirements of the Division of Insurance for that purpose. Upon execution of
this Agreement, Platte River shall provide to the City proof of the required
insurance and thereafter, at such times as the City requests proof of the required
insurance. Additionally, if insurance coverage is modified or switched to a
different carrier, Platte River shall notify the City in writing ten days in advance
of such action.
13. Indemnification: Platte River agrees, to the extent authorized by law, to
indemnify the City and its respective officers, employees, agents, contractors,
invitees, licensees, customers, and visitors (individually and collectively,
"Indemnitees") from and against all losses, liabilities, claims, demands, suits,
damages, costs and expenses that are incurred by or asserted against Indemnitees
arising out of or connected in any manner with the acts or omissions of Platte
River or Tri-State, their officers, agents, contractors, or employees or such
persons' presence upon or performance of activities with respect to the License
Property.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized representatives as of the date first wrifiten above,
THE CITY OF FORT COLLINS, COLORADO
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By: '. .
Name: Darin Atteberry
Title: City Manager
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APPROVED AS TO FORM BY:
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Assistant City Attorney
City of Fort Collins
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`.' City of Fort Collins
LICENSEE:
PLATTE RIVER .'
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By:
Name: Brian Moeck
Title: General Manager of Platte River Power Authority
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ORDINANCE NO. 060, 2009
OF THE COUNCIL OF THE CITY OF FORT COLLINS
AUTHORIZING THE CONVEYANCE OF A UTILITY EASEMENT TO TRI-STATE
GENERATION AND TRANSMISSION ASSOCIATION, INC.
WHEREAS, the City owns a certain parcel of real estate in the NW '/4 of Section 33,
Township 8 North, Range 68 West of the 6th Principal Meridian,-which is commonly known as
the Richards Lake Substation (the "City Property"); and
WHEREAS, the City Property is primarily used for electric power distribution activities
by the Platte River Power Authority("Platte River"); and
WHEREAS, Tri-State Generation and Transmission Association, Inc. ("Tri-State") is
proposing to construct an overhead electric transmission line project known as the Richards Lake
Substation to Waverly Electrical Transmission Line Project (the "Project"); and
WHEREAS, as part of the Project, Tri-State has requested a permanent, non-exclusive
utility easement (the "Easement") over the City Property; and
WHEREAS, Tri-State would construct a portion of the proposed overhead electrical
transmission line and connect the new line to Platte River's high voltage substation equipment
within the Easement; and
WHEREAS, the Easement is approximately 50 feet wide and covers approximately
12,171 square feet of the City Property; and
WHEREAS, as consideration for the Easement, Tri-State would pay $12,171 to the
City's Utilities Department, which represents the fair market value of the Easement as
determined by an appraisal by Foster Valuation Services, LLC; and
WHEREAS, Tri-State would also pay $4,000 to the City's Utilities Department for the
value of four Austrian Pine trees and hedges that would be removed from the Easement area by
Tri-State, and pay $1,000 to the City's Real Estate Services Department for processing the
Easement; and
WHEREAS, Tri-State would be required to maintain liability insurance coverage for the
City's protection while the easement is in effect; and
WHEREAS, the City would reserve the right to terminate the easement if the proposed
overhead line is not built, if it is abandoned, or if the related license agreement from the City to
Platte River is terminated; and
WHEREAS, City staff has identified no negative impacts to the City resulting from the
grant of the requested Easement; and
WHEREAS, to create the connection to Tri-State's new transmission line, Platte River
will add two new circuit breakers to the Richards Lake Substation; and
WHEREAS, adding these new circuit breakers will also increase the reliability of
electrical service to the citizens of Fort Collins; and
WHEREAS, at its meeting on March 4, 2009, the City's Electrical Utility Board
recommended approval of the related license agreement to Platte River and the installation of the
facilities necessary to provide interconnection to Tri-State at the Richards Lake Substation and,
by the adoption of Resolution 2009-047, the City Council has approved the same; and
WHEREAS, Section 23-111 of the City Code states that the City Council is authorized to
sell, convey, or otherwise dispose of an interest in real property owned by the City, that is a part
of the City's utility system, provided that the City Council first finds, by ordinance, that such
sale or disposition will not materially impair the viability of the City utility system as a whole,
will be for the benefit of the City's citizens, and is in the best interests of the City.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF
FORT COLLINS as follows:
Section 1. That the conveyance of the permanent, non-exclusive utility easement on
the City Property to Tri-State as provided herein is in the best interests of the City, will not
materially impair the viability of the City's electrical utility system as a whole, and will be for
the benefit of the citizens of the City.
Section 2. That the Mayor is hereby authorized to execute such documents as are
necessary to convey the easement to Tri-State, on terms and conditions consistent with this
Ordinance, together with such additional terms and conditions as the City Manager, in
consultation with the City Attorney, determines are necessary or appropriate to protect the
interests of the City, including, but not limited to, any necessary changes to the legal description
of the easement, as long as such changes do not materially increase the size or change the
character of the easement.
Introduced, considered favorably on first reading, and ordered published this 19th day of
May, A.D. 2009, and to be presented for final passage on the 2nd day of June, A.D. 2009.
Mayor
ATTEST:
Chief Deputy City Clerk
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Passed and adopted on final reading on the 2nd day of June, A.D. 2009.
Mayor
ATTEST:
City Clerk
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