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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 04/06/2010 - ITEMS RELATING TO THE AUTHORIZATION OF UTILITY ENT DATE: April 6, 2010 STAFF: Bill Freeman _ Chuck Seest Items Relating to the Authorization of Utility Enterprises to Have and Exercise Certain Powers. A. First Reading of Ordinance No. 038, 2010, Amending Section 26-392 of the City Code Regarding the City's Electric Utility Enterprise. B. First Reading of Ordinance No. 039, 2010, Amending Section 26-209 of the City Code Regarding the City's Wastewater Utility Enterprise. EXECUTIVE.SUMMARY These Ordinances clarify the powers of the Enterprises. The revisions are consistent with the authorizations given in the City Code for the Water and Stormwater Utility Enterprises. BACKGROUND / DISCUSSION A. First Reading of Ordinance No. 038, 2010, Amending Section 26-392 of the City Code Regarding the City's Electric Utility Enterprise. Article X, Section 20 of the State Constitution provides the ability to create enterprises. The City of Fort Collins acted to establish its electric,water,wastewater and stormwater utilities as enterprises subsequent to the passage of Article X. Legal interpretations of this section suggest that the City amend the Code to clarify the powers of the enterprises. In 1997,prior to issuing bonds for the water and stormwater utilities,corresponding sections of the Code were modified to add the clarifying provisions. These changes were made by Ordinance No. 137, 1997, and Ordinance No. 097, 1997. Now,as the Electric Utility is proposing to issue revenue bonds,staff and the City's bond counsel recommends similar changes to the Code relating to the Electric Utility Enterprise. The changes to the Electric Utility Enterprise affect Section 26-392 of the City Code. A new paragraph(c)authorizes the following powers to the Electric Utility Enterprise: • To hold meetings concurrent with City Council meetings • To have and use a seal • To issue revenue bonds for purposes related to the electric system • To pledge revenue to pay debt service on the bonds • To enter into contracts for system improvements • To comply with provisions of Article X, Section 20 A new paragraph (d) provides that all revenues and expenditures of the City or the Electric Utility Enterprise relating to the electric system shall be considered revenues and expenditures of the Enterprise. B. First Reading of Ordinance No. 039, 2010, Amending Section 26-209 of the City Code Regarding the City's Wastewater Utility Enterprise. This section of the City Code related to the Wastewater Utility Enterprise was modified in 1995 and 1996 with the powers contained in paragraph (c). (Ordinance No. 062, 1995, and Ordinance No. 111, 1996) The provisions of paragraph(d), however,were never added to Section 26-209. To provide consistency between the Utility Enterprises, staff recommends that the Code be modified to add a paragraph (d). Paragraph (d) provides that all revenues and expenditures of the City or the Wastewater Utility Enterprise relating to the wastewater c system shall be considered revenues and expenditures of the Enterprise. April 6, 2010 -2- ITEM 14 FINANCIAL IMPACT The changes authorized by the Ordinances have no direct financial impact. The changes clarify sections of the City Code and strengthen the legal basis on which the City's Electric Utility and Wastewater Utility Enterprise revenue bonds may be issued. SUSTAINABILITY: ECONOMIC, ENVIRONMENTAL AND SOCIAL IMPACTS The clarifications to City Code will support the Utilities' ability to issue debt for future capital projects including the Smart Grid project. These projects and bond issues will be evaluated on a triple bottom line basis and by their contribution toward the Utilities' mission: inspiring community leadership by reducing environmental impact while benefitting customers, the economy, and society. STAFF RECOMMENDATION Staff recommends adoption of the Ordinances on First Reading. ORDINANCE NO . 038, 2010 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING SECTION 26-392 OF THE CODE OF THE CITY OF FORT COLLINS REGARDING THE CITY ' S ELECTRIC UTILITY ENTERPRISE WHEREAS , by Ordinance No. 060, 1993 , the City has heretofore established the City of Fort Collins, Colorado, Electric Utility Enterprise (the "Enterprise") , as an enterprise of the City within the meaning of Article X, §20 of the Colorado Constitution; and WHEREAS , the City Council desires to authorize the Enterprise to have and exercise certain powers in furtherance of its purposes. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS, COLORADO, as follows : Section 1 . That Section 26-392 of the Code of the City of Fort Collins is hereby amended by the addition of two new subparagraphs (c) and (d) which read in their entirety as follows : Sec. 26-392 . Utility considered a City-owned enterprise. (c) The enterprise shall also be authorized to have and exercise the following powers in furtherance of its purposes : to hold meetings concurrently with regular or special meetings of the City Council ; to have and use a seal; to issue its revenue bonds for purposes related to the electrical utility system in the manner in which City revenue bonds may be issued; to pledge any revenues of the City's electrical utility system to the payment of such revenue bonds and to pay such revenue bonds therefrom; to enter into contracts relating to the electrical utility system in the manner in which City contracts may be entered into ; to make representations, warranties and covenants relating to the electrical utility system on behalf of the City; to exercise rights and privileges of the City relating to the electrical utility system; and to bind the City to perform any obligation relating to the electrical utility system other than any multiple-fiscal year direct or indirect debt or other financial obligation of the City without adequate present cash reserves pledged irrevocably and held for payments in all future years . (d) All revenues and expenditures of the City or the Enterprise relating to the electrical utility system shall be considered revenues and expenditures of the Enterprise. Section 2 . That all action not inconsistent with the provisions of this Ordinance heretofore taken by the City or its officers and otherwise directed toward the authorization of the Enterprise to have and exercise certain powers in furtherance if its purposes is hereby ratified, approved and confirmed. Section 3 . That all ordinances, resolutions, bylaws, order and other instruments, or parts thereof, inconsistent herewith are hereby repealed to the extent only of such inconsistency. This repealer shall not be construed to revive any ordinance, resolution, bylaw, order, or other instrument, or part thereof, heretofore repealed. Section 4 . That, if any section, subsection, paragraph, clause or other provisions of this Ordinance shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability thereof shall not affect any of the remaining sections, subsections , paragraphs, clauses or provisions of this Ordinance. Introduced, considered favorably on first reading, and ordered published this 6th day of April, A.D . 2010, and to be presented for final passage on the 20th day of April, A.D . 2010 . Mayor ATTEST : City Clerk Passed and adopted on final reading on the 20th day of April, A.D . 2010 . Mayor ATTEST : City Clerk ORDINANCE NO, 039, 2010 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING SECTION 26-209 OF THE CODE OF THE CITY OF FORT COLLINS REGARDING THE CITY ' S WASTEWATER UTILITY ENTERPRISE WHEREAS , by Ordinance No . 060, 1993 , the City established the City of Fort Collins, Colorado, Wastewater Utility Enterprise (the "Enterprise"), as an enterprise of the City within the meaning of Article X, §20 of the Colorado Constitution; and WHEREAS , the City Council desires to authorize the Enterprise to have and exercise certain powers in furtherance of its purposes. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS, COLORADO, as follows : Section 1 . That Section 26-209 of the Code of the City of Fort Collins is hereby amended by the addition of a new subparagraph (d) which reads in its entirety as follows : Sec. 26-209 . Utility considered a City-owned enterprise. (d) All revenues and expenditures of the City or the Enterprise relating to the wastewater utility system shall be considered revenues and expenditures of the Enterprise. Section 2 . That all action not inconsistent with the provisions of this Ordinance heretofore taken by the City or its officers and otherwise directed toward the authorization of the Enterprise to have and exercise certain powers in furtherance if its purposes is hereby ratified, approved and confirmed. Section 3 . That all ordinances, resolutions, bylaws, order and other instruments, or parts thereof, inconsistent herewith are hereby repealed to the extent only of such inconsistency. This repealer shall not be construed to revive any ordinance, resolution, bylaw, order, or other instrument, or part thereof, heretofore repealed. Section 4. That, if any section, subsection, paragraph, clause or other provisions of this Ordinance shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability thereof shall not affect any of the remaining sections, subsections, paragraphs, clauses or provisions of this Ordinance. Introduced, considered favorably on first reading, and ordered published this 6th day of April, A.D . 2010, and to be presented for final passage on the 20th day of April, A.D . 2010 . Mayor ATTEST : City Clerk Passed and adopted on final reading on the 20th day of April, A . D . 2010 . Mayor ATTEST : City Clerk