HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 01/16/2018 - SECOND READING OF ORDINANCE NO. 006, 2018, GRANTINAgenda Item 6
Item # 6 Page 1
AGENDA ITEM SUMMARY January 16, 2018
City Council
STAFF
Andres Gavaldon, Financial Policy & Project Manager
John Duval, Legal
SUBJECT
Second Reading of Ordinance No. 006, 2018, Granting a Non-Exclusive Franchise to the Public Service
Company of Colorado for the Right to Make Reasonable Use of City Streets, Public Utility Easements and
Other City Property to Install, Maintain, Locate and Operate Its Facilities Used to Provide Natural Gas Services
to Customers within the City.
EXECUTIVE SUMMARY
This Ordinance, unanimously adopted on First Reading on January 2, 2018, approves a natural gas Franchise
Agreement between the City of Fort Collins and the Public Service Company of Colorado (Public Service).
Without a change in the financial burden to residents, this Franchise Agreement grants a non-exclusive
franchise to Public Service to make reasonable use of City streets, public utility easements and other City
property for Public Service’s provision of natural gas utility services within the City. The franchise fee will be
equivalent to the current occupation tax imposed (1.07%) to compensate the City for the use of its property.
The franchise fee rate can be increased by the City Council in the future by ordinance but at a rate not to
exceed 3% of gross revenues.
STAFF RECOMMENDATION
Staff recommends adoption of the Ordinance on Second Reading.
ATTACHMENTS
1. First Reading Agenda Item Summary, January 2, 2018 (w/o attachments) (PDF)
2. Ordinance No. 006, 2018 (PDF)
Agenda Item 11
Item # 11 Page 1
AGENDA ITEM SUMMARY January 2, 2018
City Council
STAFF
Andres Gavaldon, Financial Policy & Project Manager
John Duval, Legal
SUBJECT
Public Hearing and First Reading of Ordinance No. 006, 2018, Granting a Non-Exclusive Franchise to the
Public Service Company of Colorado for the Right to Make Reasonable Use of City Streets, Public Utility
Easements and Other City Property to Install, Maintain, Locate and Operate Its Facilities Used to Provide
Natural Gas Services to Customers within the City.
EXECUTIVE SUMMARY
The purpose of this item is to consider approval of a natural gas Franchise Agreement between the City of Fort
Collins and the Public Service Company of Colorado (“Public Service”). Without a change in the financial burden
to residents, this Franchise Agreement grants a non-exclusive franchise to Public Service to make reasonable
use of City streets, public utility easements and other City property for Public Service’s provision of natural gas
utility services within the City. The franchise fee will be equivalent to the current occupation tax imposed (1.07%)
to compensate the City for the use of its property. The franchise fee rate can be increased by the City Council
in the future by ordinance but at a rate not to exceed 3% of gross revenues.
STAFF RECOMMENDATION
Staff recommends adoption of the Ordinance on First Reading.
BACKGROUND / DISCUSSION
The current relationship between the City of Fort Collins and Xcel Energy (aka Public Service Company of
Colorado) has been in effect since 1987. Activities and revenue generation are governed by two separate
portions of the City Code: Gas Company Occupation Tax and Gas Company Facilities Regulations (also called
Right-of-Way Regulations).
The original occupation tax was set in 1987 at $445k/year and not governed by TABOR at that time. Soon after
establishment of the original occupation tax, TABOR was put into effect and required any changes to be subject
to citizen vote. The original amount has never been changed or brought to a vote and thereby has not increased
with increases in gross revenues, population and inflation.
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The issue has been noted and brought to management many times over the past 30 years for investigation. On
September 21, 2015 and September 18, 2017, Council Finance Committee gave staff feedback that supported
moving forward. The City, in cooperation with Public Service, has drafted a Franchise Agreement that includes
the flexibility to adjust the applicable franchise fee. The Franchise Agreement sets the franchise fee rate at
1.07%, which equates to the original amount of $445k/year for the occupation tax, but also gives the City Council
the ability to adjust the franchise fee rate up to 3% by ordinance (equating to approximately $1.2M/year).
The franchise fee at 1.07% is revenue neutral without impact to citizens and any future increases may still be
revenue neutral depending on decreases with concurrent taxes. The maximum rate of 3% is consistent with
other communities across the front range under the master franchise agreement Xcel Energy has entered into
ATTACHMENT 1
Agenda Item 11
Item # 11 Page 2
with those communities. Other benefits include: partnership language to address energy conservation; and
construction communication and coordination.
CITY FINANCIAL IMPACTS
The City will not incur any financial impacts at this time. The proposed Franchise Agreement does allow for
changes to the franchise fee (within certain restrictions) which the current occupational tax does not allow
without citizen vote.
The financial difference between the two options are as follows:
Occupational Tax:
Governed by TABOR
Citizen vote requirement to change
Occupational tax amount set in 1987 at $445k/year
Tax amount does not adjust with inflation, population or provider gross revenue
Franchise Fee:
Franchise rate set as % of provider gross revenue
Fee revenue increases with volume
Franchise fee 1.07% rate would generate $445k/year
Franchise fee rate can be increased by Council by ordinance up to a maximum 3% rate.
With the new franchise rate set as a percentage, revenues will grow with usage instead of the static $445k/year
per the Occupation Tax.
BOARD / COMMISSION RECOMMENDATION
The issue has been reviewed in Council Finance Committee. (Attachment 2)
PUBLIC OUTREACH
Proper legal steps have been followed with Notice of Public Hearing being posted in the Coloradoan for 3 weeks
prior to this reading. The Charter authorizes City Council to approve franchises by ordinance after conducting a
public hearing.
ATTACHMENTS
1. Staff memo re: Natural Gas Franchise Fee Agreement, November 3, 2014 (PDF)
2. Council Finance Committee minutes, November 18, 2017 (PDF)
3. Triple Bottom Line (PDF)
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ORDINANCE NO. 006, 2018
OF THE COUNCIL OF THE CITY OF FORT COLLINS
GRANTING A NON-EXCLUSIVE FRANCHISE TO THE PUBLIC SERVICE COMPANY
OF COLORADO FOR THE RIGHT TO MAKE REASONABLE USE OF CITY STREETS,
PUBLIC UTILITY EASEMENTS AND OTHER CITY PROPERTY TO INSTALL,
MAINTAIN, LOCATE AND OPERATE ITS FACILITIES USED TO PROVIDE NATURAL
GAS SERVICES TO CUSTOMERS WITHIN THE CITY
WHEREAS, the Public Service Company of Colorado, a Colorado corporation, (the
“Company”) currently owns, maintains and operates a natural gas utility within the boundaries of
the City of Fort Collins (the “City”) that provides natural gas services to customers throughout the
City (the “Utility”); and
WHEREAS, the facilities the Company uses to operate the Utility are currently located
within, over, under and through various City-owned and controlled real properties, such as City
streets, public utility easements and other City properties (collectively, “City Property”); and
WHEREAS, City Charter Article XI, Section 1 authorizes the City Council to grant a non-
exclusive franchise for the use of City streets, alleys and other City property, but it must do so by
ordinance after conducting a noticed public hearing; and
WHEREAS, the Company does not currently have a formal franchise from the City to
operate its Utility facilities on City Property; and
WHEREAS, the Company has, however, previously operated the Utility within the City
under a formal franchise, with the last such franchise being granted in 1967 and expiring in 1987;
and
WHEREAS, since 1987, the Company has operated the Utility in the City without a formal
franchise, but in its place the City Council adopted Ordinance No. 133, 1987, in which it added
what is now Article VI in City Code Chapter 25 to impose an annual occupation tax of $445,000
on all natural gas companies doing business in the City and using City Property to do so (the
“Occupation Tax”), which the Company has paid over the years; and
WHEREAS, in 1989, the City Council also adopted Ordinance No. 21, 1989, to add Article
II to Code Chapter 6 to regulate the use of City Property by natural gas companies for their facilities
(the “Gas Facilities Regulations”); and
WHEREAS, City and Company representatives have been in discussions during the past
year or so to negotiate a formal franchise agreement for the Company to continue using City
Property in the operation of the Utility and for the Company to begin paying a franchise fee to be
applied as a credit against the Occupation Tax; and
WHEREAS, provisions in the franchise agreement have also been negotiated to address
issues relating to the Company’s and City’s cooperation and coordination with each other
concerning the construction, maintenance and operation of their respective utility facilities within
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City Property, which provisions are in addition to the provisions of the Gas Facilities Regulations
regulating the Company’s use of City Property; and
WHEREAS, these negotiations have resulted in the proposed franchise agreement that is
attached as Exhibit “A” and incorporated by reference (the “Franchise Agreement”); and
WHEREAS, the Franchise Agreement includes the following major terms and conditions:
(1) a term of twenty years beginning February 1, 2018, (2) the Company’s payment of a franchise
fee of 1.07% of the gross revenues the Company receives from its operation of the Utility within
City, (3) the City, upon sixty days prior written notice to the Company, may increase the rate of
the franchise fee up to no more than 3.0% of the Company’s gross revenues, (4) new agreements
relating to the cooperation and coordination of both parties’ in their respective provision of utility
services and concerning the Company’s use of City Property, and (5) a commitment by the parties
to cooperate on issues related to the environment and energy conservation; and
WHEREAS, Charter Article XI, Section 1 requires that notice of the Council’s public
hearing on the grant of franchise must be published by the franchise applicant in a local newspaper
of general circulation once a week for three successive weeks immediately before the date of the
hearing; and
WHEREAS, the Company has satisfied this notice requirement by having the notice of
public hearing attached as Exhibit “B” and incorporated by reference published in the Fort Collins
Coloradoan each day beginning on December 12, 2017, and ending on January 2, 2018; and
WHEREAS, the City Council hereby finds that the Franchise Agreement is necessary for
the public’s health, safety and welfare and is in the bests interests of the City and its residents.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
FORT COLLINS, COLORADO, as follows:
Section 1. That the City Council hereby makes and adopts the determinations and
findings contained in the recitals set forth above.
Section 2. That the City Council hereby approves the Franchise Agreement and the
non-exclusive franchise granted in it.
Section 3. That the rate of the franchise fee established in § 4.1.A. of the Franchise
Agreement shall not be increased as provided in that section without the City Council’s prior
ordinance approval.
Section 4. That the Mayor is hereby authorized to enter into the Franchise Agreement,
in substantially the form attached hereto as Exhibit “A”, together with such additional terms and
conditions as the City Manager, in consultation with the City Attorney, determines to be necessary
and appropriate to protect the interests of the City or to effectuate the purposes of this Ordinance.
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Section 5. That if any portion of this Ordinance is held to be unconstitutional or invalid
for any reason, such decision shall not affect the constitutionality or validity of the remaining
portions of this Ordinance. The City Council hereby declares that it would have passed this
Ordinance and each part hereof irrespective of the fact that any one part may be declared
unconstitutional or invalid.
Introduced, considered favorably on first reading, and ordered published this 2nd day of
January, A.D. 2018, and to be presented for final passage on the 16th day of January, A.D. 2018.
__________________________________
Mayor
ATTEST:
_____________________________
City Clerk
Passed and adopted on final reading on this 16th day of January, A.D. 2018.
__________________________________
Mayor
ATTEST:
_____________________________
City Clerk
FRANCHISE AGREEMENT BETWEEN THE CITY OF FORT COLLINS, COLORADO
AND PUBLIC SERVICE COMPANY OF COLORADO
ARTICLE 1 DEFINITIONS
ARTICLE 2 GRANT OF FRANCHISE
ARTICLE 3 CITY POLICE POWERS
ARTICLE 4 FRANCHISE FEE
ARTICLE 5 ADMINISTRATION OF FRANCHISE
ARTICLE 6 SUPPLY, CONSTRUCTION, AND DESIGN
ARTICLE 7 RELIABILITY
ARTICLE 8 COMPANY PERFORMANCE OBLIGATIONS
ARTICLE 9 BILLING AND PAYMENT
ARTICLE 10 USE OF COMPANY FACILITIES
ARTICLE 11 UNDERGROUNDING OF OVERHEAD FACILITIES
ARTICLE 12 PURCHASE OR CONDEMNATION
ARTICLE 13 MUNICIPALLY PRODUCED UTILITY SERVICE
ARTICLE 14 ENVIRONMENT AND CONSERVATION
ARTICLE 15 TRANSFER OF FRANCHISE
ARTICLE 16 CONTINUATION OF UTILITY SERVICE
ARTICLE 17 INDEMNIFICATION AND IMMUNITY
ARTICLE 18 BREACH
ARTICLE 19 AMENDMENTS
ARTICLE 20 EQUAL OPPORTUNITY
ARTICLE 21 MISCELLANEOUS
EXHIBIT A
TABLE OF CONTENTS
ARTICLE 1 DEFINITIONS ....................................................................................................... 1
§1.1 “City” ........................................................................................................................ 1
§1.2 “Clean Energy” ......................................................................................................... 1
§1.3 “Company”. .............................................................................................................. 1
§1.4 “Company Facilities”. ............................................................................................... 1
§1.5 “Council” or “City Council”. .................................................................................... 1
§1.6 “Energy Conservation” ............................................................................................. 1
§1.7 “Energy Efficiency” t. ............................................................................................... 1
§1.8 “Force Majeure”........................................................................................................ 1
§1.9 “Gross Revenues” ..................................................................................................... 1
§1.10 “Industry Standards” ................................................................................................. 2
§1.11 “Open Space” ............................................................................................................ 2
§1.15 “Parks” ...................................................................................................................... 2
§1.16 “Private Project”. ...................................................................................................... 2
§1.17 “Public Project”. ....................................................................................................... 2
§1.18 “Public Utilities Commission” or “PUC” ................................................................. 3
§1.19 “Public Utility Easement” or “PUE”. ....................................................................... 3
§1.20 “Relocate,” “Relocation,” or “Relocated”. ............................................................... 3
§1.21 “Renewable Energy Resources” ............................................................................... 3
§1.22 “Residents”. .............................................................................................................. 3
§1.23 “Streets” or “City Streets” ........................................................................................ 3
§1.24 “Supporting Documentation”.................................................................................... 3
§1.25 “Tariffs”. ................................................................................................................... 3
§1.26 “Utility Service”........................................................................................................ 3
ARTICLE 2 GRANT OF FRANCHISE .................................................................................... 4
§2.1 Grant of Franchise..................................................................................................... 4
§2.2 Conditions and Limitations. ...................................................................................... 5
§2.3 Effective Date and Term.. ......................................................................................... 5
ARTICLE 3 CITY POLICE POWERS ...................................................................................... 5
§3.1 Police Powers ............................................................................................................ 5
§3.3 Compliance with Laws ............................................................................................. 6
§3.4 Industry Standards. ................................................................................................... 6
ARTICLE 4 FRANCHISE FEE ................................................................................................. 6
§4.1 Franchise Fee. ........................................................................................................... 6
§4.2 Remittance of Franchise Fee. .................................................................................... 7
§4.3 Franchise Fee Payment Not in Lieu of Permit or Other Fees ................................... 8
ARTICLE 5 ADMINISTRATION OF FRANCHISE ................................................................ 9
§5.1 City Designee ............................................................................................................ 9
§5.2 Company Designee ................................................................................................... 9
§5.3 Coordination of Work. .............................................................................................. 9
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ARTICLE 6 SUPPLY, CONSTRUCTION, AND DESIGN.................................................... 10
§6.1 Purpose .................................................................................................................... 10
§6.2 Supply ..................................................................................................................... 10
§6.3 Charges to the City for Service to City Facilities.. ................................................. 10
§6.4 Restoration of Service. ............................................................................................ 10
§6.5 Obligations Regarding Company Facilities. ........................................................... 10
§6.6 As-Built Drawings. ................................................................................................. 11
§6.7 Excavation and Construction .................................................................................. 12
§6.8 Restoration .............................................................................................................. 13
§6.9 Relocation of Company Facilities. .......................................................................... 13
§6.10 New or Modified Service Requested by City ......................................................... 15
§6.11 Service to New Areas.............................................................................................. 15
§6.12 City Not Required to Advance Funds ..................................................................... 15
§6.13 Technological Improvements.................................................................................. 15
ARTICLE 7 RELIABILITY ..................................................................................................... 16
§7.1 Reliability ................................................................................................................ 16
§7.2 Franchise Performance Obligations ........................................................................ 16
§7.3 Reliability Reports .................................................................................................. 16
ARTICLE 8 COMPANY PERFORMANCE OBLIGATIONS ............................................... 16
§8.1 New or Modified Service to City Facilities ............................................................ 16
§8.2 Adjustments to Company Facilities ........................................................................ 17
§8.3 Third Party Damage Recovery................................................................................ 17
ARTICLE 9 BILLING AND PAYMENT ................................................................................ 18
§9.1 Billing for Utility Services. ..................................................................................... 18
§9.2 Payment to City....................................................................................................... 18
ARTICLE 10 PURCHASE OR CONDEMNATION............................................................... 19
§10.1 Municipal Right to Purchase or Condemn. ............................................................. 19
ARTICLE 11 MUNICIPALLY PRODUCED UTILITY SERVICE ....................................... 19
§11.1 Municipally Produced Utility Service. ................................................................... 19
ARTICLE 12 ENVIRONMENT AND CONSERVATION..................................................... 19
§12.1 Environmental Leadership ...................................................................................... 20
§12.2 Conservation ........................................................................................................... 20
§12.3 Continuing Commitment.. ...................................................................................... 21
§12.4 PUC Approval ......................................................................................................... 21
ARTICLE 13 TRANSFER OF FRANCHISE .......................................................................... 21
§13.1 Consent of City Required........................................................................................ 21
§13.2 Transfer Fee ............................................................................................................ 21
ARTICLE 14 CONTINUATION OF UTILITY SERVICE ..................................................... 22
§14.1 Continuation of Utility Service ............................................................................... 22
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ARTICLE 15 INDEMNIFICATION AND IMMUNITY ........................................................ 22
§15.1 City Held Harmless ................................................................................................. 22
§15.2 Immunity ................................................................................................................. 23
ARTICLE 16 BREACH ........................................................................................................... 23
§16.1 Change of Tariffs .................................................................................................... 23
§16.2 Breach. .................................................................................................................... 23
ARTICLE 17 AMENDMENTS ............................................................................................... 24
§17.1 Proposed Amendments ........................................................................................... 24
§17.2 Effective Amendments............................................................................................ 24
ARTICLE 18 EQUAL OPPORTUNITY ................................................................................. 24
§18.1 Economic Development .......................................................................................... 24
§18.2 Employment. ........................................................................................................... 25
§18.3 Contracting. ............................................................................................................. 26
§18.4 Coordination ........................................................................................................... 26
ARTICLE 19 MISCELLANEOUS .......................................................................................... 26
§19.1 No Waiver ............................................................................................................... 26
§19.2 Successors and Assigns........................................................................................... 26
§19.3 Third Parties ............................................................................................................ 27
§19.4 Notice ...................................................................................................................... 27
§19.5 Examination of Records .......................................................................................... 28
§19.6 Confidential or Proprietary Information. ................................................................ 29
§19.7 List of Utility Property ............................................................................................ 29
§19.8 PUC Filings ............................................................................................................. 29
§19.9 Information ............................................................................................................. 29
§19.10 Payment of Taxes and Fees. .................................................................................... 30
§19.11 Conflict of Interest .................................................................................................. 30
§19.12 Certificate of Public Convenience and Necessity ................................................... 30
§19.13 Authority ................................................................................................................. 30
§19.14 Severability ............................................................................................................. 30
§19.15 Force Majeure ......................................................................................................... 31
§19.16 Earlier Franchises Superseded ................................................................................ 31
§19.17 Titles Not Controlling ............................................................................................. 31
§19.18 Applicable Law ....................................................................................................... 31
§19.19 Payment of Expenses Incurred by City in Relation to Franchise Agreement......... 31
§19.20 Costs of Compliance with Franchise ...................................................................... 31
§19.21 Conveyance of City Streets or Other City Property................................................ 31
§19.22 Audit ....................................................................................................................... 31
Signature Page ..................................................................................................................... 32
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ARTICLE 1
DEFINITIONS
For the purpose of this franchise agreement (“Franchise”), the following words and
phrases shall have the meaning given in this Article. When not inconsistent with context, words
used in the present tense include the future tense, words in the plural include the singular, and
words in the singular include the plural. The word “shall” is mandatory and “may” is
permissive. Words not defined in this Article shall be given their common and ordinary
meaning.
§1.1 “City” refers to the City of Fort Collins, a home rule municipality in the State of Colorado.
§1.2 “Clean Energy” means energy produced from Renewable Energy Resources, eligible energy
sources, and by means of advanced technologies that cost-effectively capture and sequester
carbon emissions produced as a by-product of power generation. For purposes of this definition,
“cost” means all those costs as determined by the PUC.
§1.3 “Company” refers to Public Service Company of Colorado, a Colorado corporation, and an Xcel
Energy company and its successors and assigns including affiliates or subsidiaries that undertake
to perform any of the obligations under this Franchise.
§1.4 “Company Facilities” refers to all facilities of the Company reasonably necessary or desirable to
provide gas service into, within and through the City, including but not limited to plants, works,
systems, transportation and distribution structures and systems, lines, equipment, pipes, mains,
conduit, underground lines, gas compressors, meters, meter reading devices, communication and
data transfer equipment, control equipment, gas regulator stations, as well as all associated
appurtenances.
§1.5 “Council” or “City Council” refers to and is the governing body of the City.
§1.6 “Energy Conservation” means the decrease in energy requirements of specific customers during
any selected time period, resulting in a reduction in end-use services.
§1.7 “Energy Efficiency” means the decrease in energy requirements of specific customers during any
selected period with end-use services of such customers held constant.
§1.8 “Force Majeure” means the inability to undertake an obligation of this Franchise due to a cause
that could not be reasonably anticipated by a party or is beyond its reasonable control after
exercise of best efforts to perform, including but not limited to fire, strike, war, riots, terrorist
acts, acts of governmental authority, acts of God, floods, epidemics, quarantines, labor disputes,
unavailability or shortages of materials or equipment or failures or delays in the delivery of
materials. Neither the City nor the Company shall be in breach of this Franchise if a failure to
perform any of the duties under this Franchise is due to a Force Majeure condition.
§1.9 “Gross Revenues” refers to those amounts of money that the Company receives from the sale of
gas within the City under rates authorized by the Public Utilities Commission, as well as from the
transportation of gas to its customers within the City, as adjusted for refunds, net write-offs of
uncollectible accounts, corrections, or regulatory adjustments. Regulatory adjustments include,
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but are not limited to, credits, surcharges, refunds, and pro-forma adjustments pursuant to federal
or state regulation. “Gross Revenues” shall exclude any revenues from the sale or transportation
of gas to the City.
§1.10 “Industry Standards” refers to standards developed by government agencies and generally
recognized organizations that engage in the business of developing utility industry standards for
materials, specifications, testing, construction, repair, maintenance, manufacturing, and other
facets of the electric and gas utility industries. Such agencies and organizations include, but are
not limited to the U.S. Department of Transportation, the Federal Energy Regulatory Commission
(FERC), the Pipeline and Hazardous Materials Safety Administration (PHMSA), the Colorado
Public Utilities Commission, the American National Standards Institute (ANSI), the American
Society for Testing and Materials (ASTM), the Pipeline Research Council International, Inc.
(PRCI), the American Society of Mechanical Engineers (ASME), the Gas Technology Institute
(GTI), and the National Fire Protection Association (NFPA).
§1.11 “Open Space” refers to privately-owned property protected by real covenant, or publicly-
owned property protected by covenant and/or designated by ordinance or resolution of
the City Council, which covenant or designation designates the property for use as one
(1) or more of the following: a natural area not open to the public; a community buffer; a
wildlife corridor and habitat area; a wetland; a view corridor; agricultural land; an area of
archeological, historical, geologic or topographic significance; an area containing
significant renewable and/or nonrenewable natural resources; and/or other undesignated,
typically non-irrigated, undeveloped land uses. Open Space shall not include Parks.
§1.14 “Other City Property” refers to the surface, the air space above the surface and the area
below the surface of any property owned by the City or directly controlled by the City
due to the City’s real property interest in the same or hereafter owned by the City, that
would not otherwise fall under the definition of “Streets,” but which provides a suitable
location for the placement of Company Facilities as specifically approved in writing by
the City. Other City Property does not include Public Utility Easements.
§1.15 “Parks” refers to land area owned by the City, either independently or with another
governmental or quasi-governmental entity, that is developed and maintained for active
or passive recreational use and is open for the general public’s use and enjoyment; which,
by way of example only, may include public playfields, courts, and other recreation
facilities, or may include greenways, water features, picnic areas, or natural areas.
§1.16 “Private Project” refers to any project which is not covered by the definition of Public Project.
§1.17 “Public Project” refers to (1) any public work or improvement within the City that is wholly
owned by the City; or (2) any public work or improvement within the City where fifty percent
(50%) or more of the funding is provided by any combination of the City, the federal government,
the State of Colorado, or any Colorado county, but excluding all entities established under Title
32 of the Colorado Revised Statutes, except for the East Larimer County Water District, the Fort
Collins-Loveland Water District, the South Fort Collins Sanitation District, the West Fort Collins
Water District, the Boxelder Sanitation District, the Cherry Hills Sanitation District and the
Sunset Water District, but only to the extent that the projects undertaken by any of the foregoing
entities are necessary to provide water or sanitation services to the City or to Residents of the
City.
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§1.18 “Public Utilities Commission” or “PUC” refers to the Public Utilities Commission of the State of
Colorado or other state agency succeeding to the regulatory powers of the Public Utilities
Commission.
§1.19 “Public Utility Easement” or “PUE” refers to any platted easement over, under, or above public
or private property, expressly dedicated to, and accepted by, the City for the use of public utility
companies for the placement of utility facilities, including but not limited to Company Facilities.
“Public Utility Easement” shall not include easements within Streets.
§1.20 “Relocate,” “Relocation,” or “Relocated” refers to the definition assigned such terms in Section
6.9.A of this Franchise.
§1.21 “Renewable Energy Resources” means wind, solar, and geothermal resources; energy produced
from biomass from nontoxic plant matter consisting of agricultural crops or their byproducts,
urban wood waste, mill residue, slash, or brush, or from animal wastes and products of animal
wastes, or from methane produced at landfills or as a by-product of the treatment of wastewater
residuals; new hydroelectricity with a nameplate rating of ten (10) megawatts or less; and
hydroelectricity in existence on January 1, 2005, with a nameplate rating of thirty (30) megawatts
or less; fuel cells using hydrogen derived from a Renewable Energy Resource; and recycled
energy produced by a generation unit with a nameplate capacity of not more than fifteen (15)
megawatts that converts the otherwise lost energy from the heat from exhaust stacks or pipes to
electricity and that does not combust additional fossil fuel, and includes any eligible renewable
energy resource as defined in §40-2-124(1)(a), C.R.S., as the same shall be amended from time to
time.
§1.22 “Residents” refers to all persons, businesses, industries, governmental agencies, including the
City, and any other entity whatsoever, presently located or to be hereinafter located, in whole or
in part, within the territorial boundaries of the City.
§1.23 “Streets” or “City Streets” refers to the surface, the air space above the surface and the area below
the surface of any City-dedicated or City-maintained streets, alleys, bridges, roads, lanes, access
easements, and other public rights-of-way within the City, which are primarily used for vehicle
traffic. Streets shall not include Public Utility Easements and Other City Property.
§1.24 “Supporting Documentation” refers to all information reasonably required or needed in order to
allow the Company to design and construct any work performed under the provisions of this
Franchise. Supporting Documentation may include, but is not limited to, construction plans, a
description of known environmental issues, the identification of critical right-of-way or easement
issues, the final recorded plat for the property, the date the site will be ready for the Company to
begin construction, the date gas service and meter set are needed, and the name and contact
information for the City’s project manager.
§1.25 “Tariffs” refer to those tariffs of the Company on file and in effect with the PUC or other
governing jurisdiction, as amended from time to time.
§1.26 “Utility Service” refers to the sale of gas to Residents by the Company under rates and Tariffs
approved by the PUC, as well as the delivery of gas to Residents by the Company.
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ARTICLE 2
GRANT OF FRANCHISE
§2.1 Grant of Franchise.
A. Grant. The City hereby grants to the Company, subject to all conditions,
limitations, terms, and provisions contained in this Franchise, the non-exclusive right to
make reasonable use of City Streets, Public Utility Easements (as applicable) and Other
City Property:
(1) to provide Utility Service to the City and to its Residents under the Tariffs;
and
(2) to acquire, purchase, construct, install, locate, maintain, operate, upgrade
and extend into, within and through the City all Company Facilities reasonably necessary
for the sale, storage, purchase, exchange, transportation, transmission and distribution of
Utility Service within and through the City.
B. New Company Facilities in Other City Property, Excluding Parks and Open
Space. For all Other City Property that is not a Park or Open Space, the City’s grant to
the Company of the right to locate Company Facilities in, on, over or across such Other
City Property shall be subject to: (1) the Company already having or first receiving from
the City approval of the location of such Company Facilities, in the City’s reasonable
discretion; and (2) the terms and conditions of the use of such Other City Property shall
be governed by this Franchise as may be reasonably supplemented to account for the
unique nature of such Other City Property; by way of illustration and example only, the
City may want to condition the use of Other City Property that is a golf course upon the
Company not constructing Company Facilities in fairways or greens or during peak golf
season. Nothing in this subsection B shall modify or extinguish pre-existing Company
property rights. Further, this paragraph shall not prohibit the Company from modifying,
replacing or upgrading Company Facilities already located in Parks or Open Space in
accordance with the terms and conditions of the City license agreement, permit or other
agreement that granted the Company the right to use such Other City Property or, if there
is no such license agreement, permit or other agreement, in accordance with this
Franchise.
C. New Company Facilities in Other City Property that are Parks or Open Space. The City’s
grant to the Company of the right to locate Company Facilities in, on, over or across Other City
Property that is a Park or Open Space shall be subject to (1) the Company’s already having or
first receiving from the City a revocable license, permit or other agreement approving the location
of such Company Facilities, which the City may grant or deny in its sole discretion; and (2) the
terms and conditions of such revocable license agreement, permit or other written agreement.
Nothing in this subsection C shall modify or extinguish pre-existing Company property rights.
Further, this paragraph shall not prohibit the Company from modifying, replacing or upgrading
Company Facilities already located in Parks or Open Space in accordance with the terms and
conditions of the City license agreement, permit or other agreement that granted the Company the
right to use such Parks or Open Space or, if there is no such license agreement, permit or other
agreement, in accordance with this Franchise.
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§2.2 Conditions and Limitations.
A. Scope of Franchise. The grant of this Franchise shall extend to all areas of the
City as it is now or hereafter constituted that are within the Company’s PUC-certificated
service territory; however, nothing contained in this Franchise shall be construed to
authorize the Company to engage in activities other than the provision of Utility Service.
B. Subject to City Usage. The Company’s right to make reasonable use of City
Streets and Other City Property to provide Utility Service to the City and its Residents
under this Franchise is subject to and subordinate to any City usage of said Streets and
Other City Property.
C. Prior Grants Not Revoked. This grant and Franchise is not intended to revoke any
prior license, grant, or right to use the Streets, Other City Property or Public Utility
Easements and such licenses, grants or rights of use are hereby affirmed.
D. Franchise Not Exclusive. The rights granted by this Franchise are not, and shall
not be deemed to be, granted exclusively to the Company, and the City reserves the right
to make or grant a franchise to any other person, firm, or corporation.
E. Mutual Reservation of Rights Concerning Public Utility Easements. Subject to
the rights expressly granted to the Company in subsection 2.1 and in other provisions of
this Agreement concerning its non-exclusive right to make reasonable use of Public
Utility Easements, nothing in this Agreement shall be construed to be a waiver by the
City or the Company of any rights, interests, causes of action or claims that either may
have under the law concerning the use of Public Utility Easements.
§2.3 Effective Date and Term. This Franchise shall take effect on February 1, 2018, (the “Effective
Date”) and shall supersede any prior franchise grants to the Company by the City. This Franchise
shall terminate on January 31, 2038, unless extended by agreement of the parties.
ARTICLE 3
CITY POLICE POWERS
§3.1 Police Powers. The Company expressly acknowledges the City’s right to adopt, from time
to time, in addition to the provisions contained herein, such laws, including Charter
provisions, ordinances and regulations, as it may deem necessary in the exercise of its
governmental powers. If the City considers making any substantive changes in its local
codes or regulations that in the City’s reasonable opinion will significantly impact the
Company’s operations in the City’s Streets, Public Utility Easements and Other City
Property, it will make a good faith effort to advise the Company of such consideration;
provided, however, that lack of notice shall not be justification for the Company’s non-
compliance with any applicable local requirements.
§3.2 Regulation of Streets and Other City Property. The Company expressly acknowledges
the City’s right to enforce regulations concerning the Company’s access to or use of the
Streets and Other City Property. In addition, the Company acknowledges the City’s right
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to require the Company to obtain permits for work in Streets, Other City Property and
Public Utility Easements.
§3.3 Compliance with Laws. The Company shall promptly and fully comply with all laws,
regulations, permits and orders lawfully enacted by the City. Nothing herein provided
shall prevent the Company from legally challenging or appealing the enactment or
applicability of any laws, regulations, permits and orders enacted by the City. To the
extent that the Company believes that any City regulations, permits and orders are
inconsistent with Industry Standards, the City agrees to meet with the Company upon the
Company’s written request for consideration of the matters at issue within a reasonable
period of time.
§3.4 Industry Standards. In enacting laws and regulations and issuing permits that affect the
Company’s access to or use of the Streets, Other City Property and Public Utility Easements, the
City agrees, without limiting the City’s police powers, to make good faith efforts to make its
regulations and permit conditions consistent with Industry Standards to the extent practicable, and
the Company agrees to make good faith efforts to advise the City of Industry Standards that affect
the Company’s operations within the City. In addition, without limiting the City’s police power,
the City will take into consideration any input from the Company on new regulations and permit
conditions that the Company believes unnecessarily increase its cost of operations within the
City.
ARTICLE 4
FRANCHISE FEE
§4.1 Franchise Fee.
A. Fee. In consideration for this Franchise, which provides the certain terms related
to the Company’s use of City Streets, Public Utility Easements and Other City Property,
which are valuable public properties acquired and maintained by the City at the expense
of its Residents, and in recognition of the fact that the grant to the Company of this
Franchise is a valuable right, the Company shall initially pay the City a sum not to exceed
one and seven hundredths percent (1.07%) of all Gross Revenues (the “Franchise Fee”).
However, the City may elect at any time to increase or decrease the percentage amount
used to calculate the Franchise Fee, but any new percentage amount shall not exceed
three percent (3%) of Gross Revenues. To so increase or decrease the percentage amount,
the City shall provide the Company with prior written notice stating the new percentage
and the date it will become effective. Such notice shall be given not less than sixty (60)
days before the stated effective date. To the extent required by law, the Company shall
collect the Franchise Fee from a corresponding surcharge upon City Residents who are
customers of the Company.
B. Obligation in Lieu of Fee. In the event that the Franchise Fee specified herein is
declared void for any reason by a court of competent jurisdiction, unless prohibited by
law, the Company shall be obligated to pay the City, at the same times and in the same
manner as provided in this Franchise, an aggregate amount equal to the amount that the
Company would have paid as a Franchise Fee as partial consideration for use of the City
Streets, Public Utility Easements and Other City Property. Such payments shall be made
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in accordance with applicable provisions of law. Further, to the extent required by law,
the Company shall collect the amounts agreed upon through a surcharge upon Utility
Service provided to City Residents who are customers of the Company.
C. Changes in Utility Service Industries. The City and the Company recognize that
utility service industries are the subject of restructuring initiatives by legislative and
regulatory authorities, and are also experiencing other changes as a result of mergers,
acquisitions, and reorganizations. Some of such initiatives and changes may have an
adverse impact upon the Franchise Fee revenues provided for herein. In recognition of
the length of the term of this Franchise, the Company agrees that in the event of any such
initiatives or changes and to the extent permitted by law, upon receiving a written request
from the City, the Company will cooperate with and assist the City in making reasonable
modifications of this Franchise in an effort to provide that the City receives an amount in
Franchise Fees or some other form of compensation that is the same amount of Franchise
Fees paid to the City as of the date that such initiatives and changes adversely impact
Franchise Fee revenues.
D. Utility Service Provided to the City. No Franchise Fee surcharge shall be charged
to the City for Utility Service provided directly or indirectly to the City for its own
consumption, unless otherwise directed by the City in writing and in a manner consistent
with Company policy.
§4.2 Remittance of Franchise Fee.
A. Remittance Schedule. Franchise Fee revenues shall be remitted by the Company
to the City as directed by the City in monthly installments not more than thirty (30) days
following the close of each month.
B. Correction of Franchise Fee Payments. In the event that either the City or the
Company discovers that there has been an error in the calculation of the Franchise Fee
payment to the City, either party shall provide written notice of the error to the other
party. Subject to the following sentence, if the party receiving written notice of the error
does not agree with the written notice of error, that party may challenge the written notice
of error pursuant to Section 4.2.D of this Franchise; otherwise, the error shall be
corrected in the next monthly payment. However, if the error results in an overpayment
of the Franchise Fee to the City, and said overpayment is in excess of Five Thousand
Dollars ($5,000.00), correction of the overpayment by the City shall take the form of a
credit against future Franchise Fees and shall be spread over the same period the error
was undiscovered or the City may make a full refund payment to the Company. If such
period would extend beyond the term of this Franchise, the Company may elect to require
the City to provide it with a full refund instead of a credit, with such refund to be spread
over the same period the error was undiscovered, even if the refund will be paid after the
termination date of this Franchise. All Franchise Fee underpayments shall be corrected in
the next monthly payment, together with interest computed at the rate set by the PUC for
customer security deposits held by the Company, from the date when due until the date
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paid. Subject to the terms of the Tariffs, in no event shall either party be required to fund
or refund more than five(5) years of any overpayment or underpayment made as a result
of a Company error which occurred more than five (5) years prior to the discovery of the
error.
C. Audit of Franchise Fee Payments.
(1) At the request of the City, every three (3) years commencing at the end of
the third year of this Franchise, the Company shall conduct an internal audit, in
accordance with the Company’s auditing principles and policies that are applicable to gas
utilities that are developed in accordance with the Institute of Internal Auditors, to
investigate and determine the correctness of the Franchise Fee paid to the City. Such
audit shall be limited to the previous three (3) calendar years. The Company shall
provide a written report to the City Manager summarizing the audit procedures followed
along with any potential findings.
(2) If the City disagrees with the results of the audit, and if the parties are not
able to informally resolve their differences, the City may conduct its own audit at its own
expense, in accordance with generally accepted auditing principles applicable to gas
utilities, and the Company shall cooperate by providing the City’s auditor with non-
confidential information that would be required to be disclosed under applicable state
sales and use tax laws and applicable PUC rule and regulations.
(3) If the results of a City audit conducted pursuant to subsection C(2)
concludes that the Company has underpaid the City by two percent (2%) or more, in
addition to the obligation to pay such amounts to the City, the Company shall also pay all
reasonable costs of the City’s audit. The Company shall not be responsible for the costs
of the City’s audit when the underpayment is caused by errors from information provided
by an entity certified by the Colorado Department of Revenue as a “hold harmless entity”
or other similar entity recognized by the Colorado Department of Revenue.
D. Fee Disputes. Either party may challenge any written notification of error as
provided for in Section 4.2.B of this Franchise by filing a written notice to the other party
within thirty (30) days of receipt of the written notification of error. The written notice
shall contain a summary of the facts and reasons for the party’s notice. The parties shall
make good faith efforts to resolve any such notice of error before initiating any formal
legal proceedings for the resolution of such error.
E. Reports. To the extent allowed by law, upon written request by the City, but not
more than once per year, the Company shall supply the City with the names and
addresses of registered gas suppliers and brokers of natural gas that utilize Company
Facilities to sell or distribute natural gas in Colorado. The Company shall not be required
to disclose any confidential or proprietary information.
§4.3 Franchise Fee Payment Not in Lieu of Permit or Other Fees. Payment of the Franchise Fee
does not exempt the Company from any other lawful tax or fee imposed generally upon
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persons doing business within the City, except that the Franchise Fee provided for herein
shall be in lieu of or a credit against any City occupation, occupancy or similar tax or fee
in existence on the Effective Date of this Franchise Agreement for the use of City Streets,
Public Utility Easements and Other City Property under the terms set forth in this
Franchise.
ARTICLE 5
ADMINISTRATION OF FRANCHISE
§5.1 City Designee. The City Manager shall designate in writing to the Company an official
having full power and authority to administer this Franchise. The City Manager may also
designate one or more City representatives to act as the primary liaison with the
Company as to particular matters addressed by this Franchise and shall provide the
Company with the names and telephone numbers of said City representatives. The City
Manager may change these designations by providing written notice to the Company.
The City’s designee shall have the right, at all reasonable times, to inspect any Company
Facilities in City Streets and Other City Property.
§5.2 Company Designee. The Company shall designate a representative to act as the primary
liaison with the City and shall provide the City with the name, address, and telephone
number for the Company’s representative under this Franchise. The Company may
change its designation by providing written notice to the City. The City shall use this
liaison to communicate with the Company regarding Utility Service and related service
needs for City facilities.
§5.3 Coordination of Work.
A. The Company agrees to coordinate its activities in City Streets, Public Utility
Easements and Other City Property with the City. The City and the Company will meet
biannually upon the written request of the City designee to exchange their respective
short-term (three years or less) and long-term (more than three years) forecasts and/or
work plans for construction and other similar work which may affect City Streets, Other
City Property and PUEs, including but not limited to any planned City Streets paving
projects. The City and Company shall hold such meetings as either deems necessary to
exchange additional information with a view toward coordinating their respective
activities in those areas where such coordination may prove beneficial and so that the
City will be assured that all applicable provisions of this Franchise, applicable building
and zoning codes, and applicable City air and water pollution regulations are complied
with, and that aesthetic and other relevant planning principles have been given due
consideration.
B. In addition to the foregoing meetings, the Company and the City agree to use
good faith efforts to provide notice to one another whenever: (a) the Company initiates
plans to significantly upgrade its infrastructure within the City; (b) third party applicants
within the City initiate private land uses and projects requiring a significant installation of
gas utility infrastructure; or (c) the City initiates a Public Project that requires significant
9
upgrade to future gas utility development by the Company, in order to allow for mutual
City and Company input and consultation for beneficial coordination of activities.
ARTICLE 6
SUPPLY, CONSTRUCTION, AND DESIGN
§6.1 Purpose. The Company acknowledges the critical nature of the municipal services
performed or provided by the City to the Residents that require the Company to provide
prompt and reliable Utility Service and the performance of related services for City
facilities. The City and the Company wish to provide for certain terms and conditions
under which the Company will provide Utility Service and perform related services for
the City in order to facilitate and enhance the operation of City facilities. They also wish
to provide for other processes and procedures related to the provision of Utility Service to
the City.
§6.2 Supply. Subject to the jurisdiction of the PUC, the Company shall take all reasonable and
necessary steps to provide a sufficient supply of gas to Residents at the lowest reasonable
cost consistent with reliable supplies.
§6.3 Charges to the City for Service to City Facilities. No charges to the City by the Company for
Utility Service (other than gas transportation which shall be subject to negotiated contracts) shall
exceed the lowest charge for similar service or supplies provided by the Company to any other
similarly situated customer of the Company. The parties acknowledge the jurisdiction of the
PUC over the Company’s regulated intrastate gas rates. All charges to the City shall be in accord
with the Tariffs.
§6.4 Restoration of Service.
A. Notification. The Company shall provide to the City daytime and nighttime
telephone numbers of a designated Company representative from whom the City
designee may obtain status information from the Company on a twenty-four (24) hour
basis concerning interruptions of Utility Service in any part of the City.
B. Restoration. In the event the Company’s gas system within the City, or any part
thereof, is partially or wholly destroyed or incapacitated, the Company shall use due
diligence to restore such system to satisfactory service within the shortest practicable
time, or provide a reasonable alternative to such system if the Company elects not to
restore such system.
§6.5 Obligations Regarding Company Facilities.
A. Company Facilities. All Company Facilities within City Streets and Other City
Property shall be maintained in good repair and condition.
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B. Company Work within the City. All work within City Streets and Other City
Property performed or caused to be performed by the Company shall be done:
(1) in a high-quality manner that is in accordance with Industry Standards;
(2) in a timely and expeditious manner;
(3) in a manner that reasonably minimizes inconvenience to the public;
(4) in a cost-effective manner, which may include the use of qualified
contractors; and
(5) in accordance with all applicable laws, ordinances and regulations.
C. No Interference with City Facilities. Company Facilities shall not unreasonably
interfere with any City facilities, including without limitation electric facilities, water
facilities, sanitary and storm sewer facilities, communications facilities, or other City uses
of the Streets, Public Utility Easements or Other City Property. Company Facilities shall
be installed and maintained in City Streets and Other City Property so as to reasonably
minimize interference with other property, trees, and other improvements and natural
features in and adjoining the Streets and Other City Property in light of the Company’s
obligation under Colorado law to provide safe and reliable utility facilities and services.
In addition, Company Facilities shall be located or relocated in manner that satisfies all
applicable City standards and Industry Standards for separation from existing and
planned City facilities.
D. Permit and Inspection. The installation, renovation, and replacement of any
Company Facilities in the City Streets or Other City Property by or on behalf of the
Company shall be subject to permit, inspection and approval by the City in accordance
with applicable laws. Such permitting, inspection and approval may include, but shall
not be limited to, the following matters: location of Company Facilities, cutting and
pruning of trees and shrubs and disturbance of pavement, sidewalks and surfaces of City
Streets or Other City Property; provided, however, the Company shall have the right to
cut, prune, and/or remove vegetation in accordance with its standard vegetation
management requirements and procedures. The Company agrees to cooperate with the
City in conducting inspections and shall promptly perform any remedial action lawfully
required by the City pursuant to any such inspection.
E. Compliance. Subject to the provisions of Section 3.3, the Company and all of its
contractors shall comply with the requirements of applicable municipal laws, ordinances,
regulations, permits, and standards lawfully adopted, including but not limited to
requirements of all building and zoning codes, and requirements regarding curb and
pavement cuts, excavating, digging, and other construction activities. The Company
shall use commercially reasonable efforts to require that its contractors and
subcontractors working in City Streets or Other City Property hold the necessary licenses
and permits required by law.
§6.6 As-Built Drawings.
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A. Within thirty (30) days after written request of the City designee, but no sooner
than fourteen (14) days after project completion, the Company shall commence its
internal process to permit the Company to provide, on a project by project basis, as-built
drawings of any Company Facility installed within the City Streets or Other City
Property or contiguous to the City Streets or Other City Property. The Company shall
provide the requested documents no later than forty-five (45) days after it commences its
internal process.
B. If the requested information must be limited or cannot be provided pursuant to
regulatory requirements or Company Tariffs, the Company shall promptly notify the City
of such restrictions. The City reserves the right to challenge the Company’s position. The
City acknowledges that the requested as-built drawings are confidential information of
the Company and the Company asserts that disclosure to members of the public would be
contrary to the public interest. Accordingly, the City shall deny the right of inspection of
the Company’s confidential information as set forth in C.R.S. §24-72-204(3)(a)(IV), as
may be amended from time to time. If an Open Records Act request is made by any third
party for confidential or proprietary information that the Company has provided to the
City pursuant to this Franchise, the City will notify the Company of the request and shall
allow the Company to defend such request at its sole expense, including filing a legal
action in any court of competent jurisdiction to prevent disclosure of such information.
In any such legal action the Company shall join the person requesting the information and
the City. In no circumstance shall the City provide to any third-party confidential
information provided by the Company pursuant to this Franchise without first conferring
with the Company. Provided the City complies with the terms of this Section, the
Company shall defend, indemnify and hold the City harmless from any claim, judgment,
costs or attorney fees incurred in participating in such proceeding.
C. As used in this Section, as-built drawings refers to hard copies of the facility
drawings as maintained in the Company’s business records and shall not include
information maintained in the Company’s geographical information system. However,
once the Company has developed the capability to create digital or electronic versions of
its as-built drawings, the Company agrees to provide those versions to the City. The
Company shall not be required to create drawings or data that do not exist at the time of
the request.
§6.7 Excavation and Construction. Subject to Section 3.3, the Company shall be responsible for
obtaining, paying for, and complying with all applicable permits, in the manner required
by the laws, ordinances, and regulations of the City. Although the Company shall be
responsible for obtaining and complying with the terms of such permits, when
performing Relocations requested by the City under Section 6.9 of this Franchise, the
City will not require the Company to pay the fees charged for such permits. Upon the
Company submitting a construction design plan, the City shall promptly and fully advise
the Company in writing of all requirements for restoration of affected City Streets and
Other City Property in advance of Company’s excavation projects in those areas, based
upon the design submitted, if the City’s restoration requirements are not addressed in
publicly available standards.
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§6.8 Restoration. Subject to the provisions of Section 6.5.D, when the Company does any
work in or affecting City Streets or Other City Property, it shall, at its own expense,
promptly remove any obstructions placed thereon or therein by the Company and within
a reasonable period of time restore such City Streets or Other City Property to a condition
that is substantially the same as existed before the work, and that meets applicable City
standards. If weather or other conditions do not permit the complete restoration required
by this Section, the Company may with the approval of the City, temporarily restore the
affected City Streets and Other City Property, provided that such temporary restoration is
not at the City’s expense and provided further that the Company promptly undertakes and
completes the required permanent restoration when the weather or other conditions no
longer prevent such permanent restoration. Upon the request of the City, the Company
shall restore the Streets and Other City Property to a better condition than existed before
the Company work was undertaken, provided that the City shall be responsible for any
incremental costs of such restoration not required by then-current City standards, and
provided the City seeks and/or grants, as applicable, any additional required approvals. If
the Company fails to promptly restore City Streets or Other City Property as required by
this Section, and if, in the reasonable discretion of the City immediate action is required
for the protection of public health, safety or welfare, the City may restore such Streets or
Other City Property or remove the obstruction therefrom; provided however, City actions
do not interfere with Company Facilities. The Company shall be responsible for the
actual cost incurred by the City to restore such City Streets or Other City Property or to
remove any obstructions therefrom. In the course of its restoration of City Streets, Public
Utility Easements or Other City Property under this Section, the City shall not perform
work on Company Facilities unless specifically authorized by the Company in writing on
a project-by-project basis and subject to the terms and conditions agreed to in such
authorization.
§6.9 Relocation of Company Facilities.
A. Relocation Obligation. The Company shall temporarily or permanently remove,
relocate, change or alter the position of any Company Facility (collectively,
“Relocate(s),” “Relocation(s),” or “Relocated”) in (i) City Streets or (ii) in Other City
Property at no cost or expense to the City whenever the City determines such Relocation
is necessary for the completion of any Public Project. In the case of Relocation that is
necessary for the completion of any Public Project in a Public Utility Easement that is not
in a City Street or Other City Property (to the extent the City is not requesting a
relocation for service to the City as a customer of the Company), the Company shall not
be responsible for any relocation costs. For all Relocations, the Company and the City
agree to cooperate on the location and Relocation of the Company Facilities in the City
Streets or Other City Property in order to achieve Relocation in the most efficient and
cost-effective manner possible. Notwithstanding the foregoing, once the Company has
Relocated any Company Facility at the City’s direction, if the City requests that the same
Company Facility be Relocated within two (2) years, the subsequent Relocation shall not
be at the Company’s expense. Nothing provided herein shall prevent the Company from
recovering its Relocation costs and expenses from third parties.
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B. Private Projects. Subject to Section 6.9.F, the Company shall not be responsible
for the expenses of any Relocation required by Private Projects, and the Company has the
right to require the payment of estimated Relocation expenses from the party causing, or
responsible for, the Relocation before undertaking the Relocation.
C. Relocation Performance. The Relocations set forth in Section 6.9.A of this
Franchise shall be completed within a reasonable time, not to exceed one hundred twenty
(120) days from the later of the date on which the City designee requests, in writing, that
the Relocation commence, or the date when the Company is provided all Supporting
Documentation. The Company shall notify the City within twenty (20) days of receipt of
the request it the Supporting Documentation is insufficient to complete the project. The
Company shall receive an extension of time to complete a Relocation where the
Company’s performance was delayed due to Force Majeure or the failure of the City to
provide adequate Supporting Documentation. The Company has the burden of presenting
evidence to reasonably demonstrate the basis for the delay. Upon written request of the
Company, the City may also grant the Company reasonable extensions of time for good
cause shown and the City shall not unreasonably withhold or condition any such
extension.
D. City Revision of Supporting Documentation. Any revision by the City of
Supporting Documentation provided to the Company that causes the Company to
substantially redesign and/or change its plans regarding Company Facility Relocation
shall be deemed good cause for a reasonable extension of time to complete the Relocation
under this Franchise.
E. Completion. Each such Relocation shall be complete only when the Company
actually Relocates the Company Facilities, restores the Relocation site in accordance with
Section 6.7 of this Franchise or as otherwise agreed with the City, and removes from the
site or properly abandons on site all unused Company Facilities, equipment, material and
other impediments. Any abandonment of Company Facilities as contemplated in this
section shall comply with Industry Standards.
F. Scope of Obligation. Notwithstanding anything to the contrary in this Franchise,
the Company shall not be required to Relocate any Company Facilities from property (a)
owned by the Company in fee; or (b) in which the Company has a property right, grant or
interest, including without limitation an easement but excluding Public Utility Easements,
which are addressed in Section 6.9.A.
G. Underground Relocation. Underground Company Facilities shall be Relocated
underground. Above ground Company Facilities shall be Relocated above ground unless
the Company is paid for the incremental amount by which the underground cost would
exceed the above ground cost of Relocation.
H. Coordination.
(1) When requested in writing by the City designee or the Company,
representatives of the City and the Company shall meet to share information regarding
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anticipated projects which will require Relocation of Company Facilities in City Streets
and Other City Property. Such meetings shall be for the purpose of minimizing conflicts
where possible and to facilitate coordination with any reasonable timetable established by
the City for any Public Project.
(2) The City shall make reasonable best efforts to provide the Company with
one (1) year’s advance notice of any planned Street repaving. The Company shall make
reasonable best efforts to complete any necessary or anticipated repairs or upgrades to
Company Facilities that are located underneath the Streets within the one-year period if
practicable.
I. Proposed Alternatives or Modifications. Upon receipt of written notice of a
required Relocation, the Company may propose an alternative to or modification of the
Public Project requiring the Relocation in an effort to mitigate or avoid the impact of the
required Relocation of Company Facilities. The City shall in good faith review the
proposed alternative or modification. The acceptance of the proposed alternative or
modification shall be at the discretion of the City. In the event the City accepts the
proposed alternative or modification, the Company agrees to promptly compensate the
City for all additional costs, expenses or delay that the City reasonably determines
resulted from the implementation of the proposed alternative.
§6.10 New or Modified Service Requested by City. The conditions under which the Company
shall install new or modified Utility Service to the City as a customer shall be governed
by this Franchise and the Company’s Tariffs and the Tariffs shall control in the event of a
conflict.
§6.11 Service to New Areas. If the territorial boundaries of the City are expanded during the
term of this Franchise, the Company shall, to the extent permitted by law, extend service
to Residents in the expanded area at the earliest practicable time if the expanded area is
within the Company’s PUC-certificated service territory. Service to the expanded area
shall be in accordance with the terms of the Tariffs and this Franchise, including the
payment of Franchise Fees.
§6.12 City Not Required to Advance Funds. Upon receipt of the City’s authorization for billing
and construction, the Company shall install Company Facilities to provide Utility Service
to the City as a customer, without requiring the City to advance funds prior to
construction. The City shall pay for the installation of Company Facilities once
completed in accordance with the Tariffs. Notwithstanding anything to the contrary, the
provisions of this Section to allow the City to not advance funds prior to construction
shall apply unless prohibited by PUC rules or the Tariffs. The parties agree that as of the
date of execution of this Agreement, Company Tariff Sheet R120 governs the terms of
installation of Company Facilities for the City and allows installation of Company
Facilities without the City advancing funds prior to construction.
§6.13 Technological Improvements. The Company shall use its best efforts to incorporate, as
soon as practicable, technological advances in its equipment and service within the City
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when such advances are technically and economically feasible and are safe and beneficial
to the City and its Residents.
ARTICLE 7
RELIABILITY
§7.1 Reliability. The Company shall operate and maintain Company Facilities efficiently and
economically, in accordance with Industry Standards, and in accordance with the
standards, systems, methods and skills consistent with the provision of adequate, safe and
reliable Utility Service.
§7.2 Franchise Performance Obligations. The Company recognizes that, as part of its obligations
and commitments under this Franchise, the Company shall carry out each of its
performance obligations in a timely, expeditious, efficient, economical and workmanlike
manner.
§7.3 Reliability Reports. Upon written request, the Company shall provide the City with a
report regarding the reliability of Company Facilities and Utility Service.
ARTICLE 8
COMPANY PERFORMANCE OBLIGATIONS
§8.1 New or Modified Service to City Facilities. In providing new or modified Utility Service to
City facilities, the Company agrees to perform as follows:
A. Performance. The Company shall complete each project requested by the City
within a reasonable time. The parties agree that a reasonable time shall not exceed one
hundred eighty (180) days from the date upon which the City designee makes a written
request and provides the required Supporting Documentation for all Company Facilities,
including a copy to the Area Manager as designated in Section 21.4 below. Provided that
the City provides the Company’s designated representative with a copy of the Supporting
Documentation, the Company shall notify the City within twenty (20) days of receipt of
the request if the Supporting Documentation is sufficient to complete the project. The
Company shall be entitled to an extension of time to complete a project where the
Company’s performance was delayed due to Force Majeure. Upon request of the
Company, the City designee may also grant the Company reasonable extensions of time
for good cause shown and the City shall not unreasonably withhold any such extension.
B. City Revision of Supporting Documentation. Any revision by the City of
Supporting Documentation provided to the Company that causes the Company to
substantially redesign and/or substantially change its plans regarding new or modified
service to City facilities shall be deemed good cause for a reasonable extension of time to
complete the Relocation under this Franchise.
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C. Completion/Restoration. Each such project shall be complete only when the
Company actually provides the service installation or modification required, restores the
project site in accordance with the terms of this Franchise or as otherwise agreed with the
City and removes from the site or properly abandons on site any unused Company
Facilities, equipment, material and other impediments. “Unused” for purposes of this
Franchise shall mean that the Company is no longer using the Company Facilities in
question and has no plans to use the Company Facilities in the foreseeable future.
§8.2 Adjustments to Company Facilities. The Company shall perform adjustments to Company
Facilities that are consistent with Industry Standards, including manhole rings and other
appurtenances in Streets and Other City Property, to accommodate City Street
maintenance, repair and paving operations at no cost to the City. In providing such
adjustments to Company Facilities, the Company agrees to perform as follows:
A. Performance. The Company shall complete each requested adjustment within a
reasonable time, not to exceed thirty (30) days from the date upon which the City makes
a written request and provides to the Company all information reasonably necessary to
perform the adjustment. The Company shall be entitled to an extension of time to
complete an adjustment where the Company’s performance was delayed due to Force
Majeure. Upon request of the Company, the City may also grant the Company
reasonable extensions of time for good cause shown and the City shall not unreasonably
withhold any such extension.
B. Completion/Restoration. Each such adjustment shall be complete only when the
Company actually adjusts and, if required, readjusts, Company Facilities to accommodate
City operations in accordance with City instructions following City maintenance, repair
or paving operations.
C. Coordination. As requested by the City or the Company, representatives of the
City and the Company shall meet regarding anticipated Street maintenance operations
which will require such adjustments to Company Facilities in Streets or Other City
Property. Such meetings shall be for the purpose of coordinating and facilitating
performance under this Section.
§8.3 Third Party Damage Recovery.
A. Damage to Company Interests. If any individual or entity damages any Company
Facilities, to the extent permitted by law the City will notify the Company of any such
incident of which it has knowledge and will provide to the Company within a reasonable
time all pertinent information within its possession regarding the incident and the
damage, including the identity of the responsible individual or entity.
B. Damage to Company Property for which the City is Responsible. If any
individual or entity damages any Company Facilities for which the City is obligated to
reimburse the Company for the cost of the repair or replacement, to the extent permitted
by law, the Company will notify the City of any such incident of which it has knowledge
and will provide to the City within a reasonable time all pertinent information within its
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possession regarding the incident and the damage, including the identity of the
responsible individual or entity.
C. Meeting. The Company and the City agree to meet periodically upon written
request of either party for the purpose of developing, implementing, reviewing,
improving and/or modifying mutually beneficial procedures and methods for the efficient
gathering and transmittal of information useful in recovery efforts against third parties for
damaging Company Facilities.
ARTICLE 9
BILLING AND PAYMENT
§9.1 Billing for Utility Services.
A. Monthly Billing. Unless otherwise provided in the Tariffs, the rules and
regulations of the PUC, or the Public Utility Law, the Company shall render bills
monthly to the offices of the City for Utility Service and other related services for which
the Company is entitled to payment.
B. Address for Billing. Billings for service rendered during the preceding month
shall be sent to the person(s) designated by the City and payment for same shall be made
as prescribed in this Franchise and the applicable Tariffs.
C. Supporting Documents. To the extent requested by the City, the Company shall
provide all billings and any underlying Supporting Documentation reasonably requested
by the City in an editable and manipulatable electronic format that is acceptable to the
Company and the City.
D. Annual Meetings. The Company agrees to meet with the City designee on a
reasonable basis at the City’s request, but no more frequently than once a year, for the
purpose of developing, implementing, reviewing, and/or modifying mutually beneficial
and acceptable billing procedures, methods, and formats which may include, without
limitation, electronic billing and upgrades or beneficial alternatives to the Company’s
current most advanced billing technology, for the efficient and cost effective rendering
and processing of such billings submitted by the Company to the City.
§9.2 Payment to City. In the event the City determines after written notice to the Company that
the Company is liable to the City for payments, costs, expenses or damages of any nature,
and subject to the Company’s right to challenge such determination, the City may deduct
all monies due and owing the City from any other amounts currently due and owing the
Company. Upon receipt of such written notice, the Company may request a meeting
between the Company’s designee and a designee of the City to discuss such
determination. The City agrees to attend such a meeting. As an alternative to such
deduction and subject to the Company’s right to challenge, the City may bill the
Company for such assessment(s), in which case, the Company shall pay each such bill
within thirty (30) days of the date of receipt of such bill unless it challenges the validity
of the charge. If the Company challenges the City determination of liability, the City
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shall make such payments to the Company for Utility Service received by the City
pursuant to the Tariffs until the challenge has been finally resolved.
ARTICLE 10
PURCHASE OR CONDEMNATION
§10.1 Municipal Right to Purchase or Condemn.
A. Right and Privilege of City. The right and privilege of the City to construct, own
and operate a municipal utility, and to purchase pursuant to a mutually acceptable
agreement or condemn any Company Facilities located within the territorial boundaries
of the City, and the Company’s rights in connection therewith, as set forth in applicable
provisions of the City Charter and of the constitution, statutes and case law of the State of
Colorado relating to the acquisition of public utilities, are expressly recognized. The City
shall have the right, within the time frames and in accordance with the procedures set
forth in such provisions, to condemn Company Facilities, land, rights-of-way and
easements now owned or to be owned by the Company located within the territorial
boundaries of the City. In the event of any such condemnation, no value shall be ascribed
or given to the right to use City Streets or Other City Property granted under this
Franchise in the valuation of the property thus condemned.
B. Notice of Intent to Purchase or Condemn. The City shall provide the Company
no less than one (1) year’s prior written notice of its intent to purchase or condemn
Company Facilities. Nothing in this Section shall be deemed or construed to constitute a
consent by the Company to the City’s purchase or condemnation of Company Facilities,
nor a waiver of any Company defenses or challenges related thereto.
ARTICLE 11
MUNICIPALLY PRODUCED UTILITY SERVICE
§11.1 Municipally Produced Utility Service.
A. City Reservation. The City expressly reserves the right to engage in providing
natural gas as a utility service to the full extent permitted by law.
B. Franchise Not To Limit City’s Rights. Nothing in this Franchise prohibits the
City from becoming an aggregator of natural gas utility service or from selling natural
gas as a utility service to customers should it be permissible under law.
ARTICLE 12
ENVIRONMENT AND CONSERVATION
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§12.1 Environmental Leadership. The City and the Company agree that sustainable development,
environmental excellence and innovation shall form the foundation of the Utility Service
provided by the Company under this Franchise. The Company shall continue to cost-
effectively monitor its operations to mitigate environmental impacts; shall meet or exceed
the requirements of environmental laws, regulations and permits; shall invest in cost-
effective environmentally-sound technologies; shall consider environmental issues in its
planning and decision-making; and shall support environmental research and
development projects and partnerships in our communities through various means,
including but not limited to corporate giving and employee involvement. The Company
shall continue to explore ways to reduce water consumption at its facilities and to use
recycled water where feasible. On or before December 1 of each year, the Company
shall provide the City a written report describing its progress in carbon reduction and
other environmental efforts, and the parties shall meet at a mutually convenient time and
place for a discussion of such. In meeting its obligation under this Section, the Company
is not precluded from providing existing internal and external reports that may be used
for other reporting requirements.
§12.2 Conservation. The City and the Company recognize and agree that Energy Conservation
programs offer opportunities for the efficient use of energy and possible reduction of
energy costs. The City and the Company further recognize that creative and effective
Energy Conservation solutions are crucial to sustainable development. The Company
recognizes and shares the City’s stated objectives to advance the implementation of cost-
effective Energy Efficiency and Energy Conservation programs that direct opportunities
to residential and non-residential customers to manage more efficiently their use of
energy and thereby create the opportunity to reduce their energy bills. The Company
commits to offer programs that attempt to capture market opportunities for cost-effective
Energy Efficiency improvements such as municipal specific programs that provide cash
rebates for efficient heating, energy design programs to assist architects and engineers to
incorporate energy efficiency in new construction projects, and recommissioning
programs to analyze existing systems to optimize performance and conserve energy
according to current and future demand side management (“DSM”) programs. In doing
so, the Company recognizes the importance of (i) implementing cost-effective programs
the benefits of which would otherwise be lost if not pursued in a timely fashion; and (ii)
developing cost-effective programs for the various classes of the Company’s customers,
including low-income customers. The Company shall advise the City and its Residents
of the availability of assistance that the Company makes available for investments in
Energy Conservation through newspaper advertisements, bill inserts and Energy
Efficiency workshops and by maintaining information about these programs on the
Company’s website. Further, the Company will designate a conservation representative
to act as the primary liaison with the City who will provide the City with information on
how the City may take advantage of reducing energy consumption in City facilities and
how the City may participate in Energy Conservation and Energy Efficiency programs
sponsored by the Company as provided in the Tariffs. As such, the Company and the
City commit to work cooperatively and collaboratively to identify, develop, implement
and support programs offering creative and sustainable opportunities to Company
customers and Residents, including low-income customers and Residents. The Company
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agrees to help the City participate in Company programs and when opportunities exist to
partner with others, such as the State of Colorado, the Company will help the City pursue
those opportunities. To assist the City in pursuing such opportunities, the Company shall,
upon request of the City, provide the City usage data in aggregate form that the City can
use in pursuing such opportunities provided the same is not prohibited from disclosure
under applicable Tariffs or PUC rules.
§12.3 Continuing Commitment. It is the express intention of the City and the Company that the
collaborative effort provided for in this Article continue for the entire term of this Franchise. The
City and the Company also recognize, however, that the programs identified in this Article may
be for a limited duration and that the regulations and technologies associated with Energy
Conservation are subject to change. Given this variability, the Company agrees to maintain its
commitment to sustainable development and Energy Conservation for the term of this Franchise
by continuing to provide leadership, support and assistance, in collaboration with the City, to
identify, develop, implement and maintain new and creative programs similar to the programs
identified in this Franchise in order to help the City achieve its environmental goals.
§12.4 PUC Approval. Nothing in this Article shall be deemed to require the Company to invest
in technologies or to incur costs that it has a good faith belief the PUC will not allow the
Company to recover through the ratemaking process.
ARTICLE 13
TRANSFER OF FRANCHISE
§13.1 Consent of City Required. The Company shall not transfer or assign any rights under this
Franchise to an unaffiliated third party, except by merger with such third party, or, except
when the transfer is made in response to legislation or regulatory requirements, unless the
City approves such transfer or assignment in writing. The City may impose reasonable
conditions upon the transfer, but Approval of the transfer or assignment shall not be
unreasonably withheld, conditioned or delayed. Except as referenced above, any transfer
or assignment by the Company of any or all of its rights and obligations under this
Franchise without the City’s required prior written consent shall be deemed null and void
and of no effect.
§13.2 Transfer Fee. In order that the City may share in the value this Franchise adds to the
Company’s operations, any transfer or assignment of rights granted under this Franchise
requiring City approval, as set forth herein, shall be subject to the condition that the
Company shall promptly pay to the City a transfer fee in an amount equal to the
proportion of the City’s then-population provided Utility Service by the Company to the
then-population of the City and County of Denver provided Utility Service by the
Company multiplied by one million dollars ($1,000,000.00). Except as otherwise
required by law, such transfer fee shall not be recovered from a surcharge placed only on
the rates of Residents.
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ARTICLE 14
CONTINUATION OF UTILITY SERVICE
§14.1 Continuation of Utility Service. In the event this Franchise is not renewed at the expiration
of its term or is terminated for any reason, and the City has not provided for alternative
utility service, the Company shall have no obligation to remove any Company Facilities
from Streets, Public Utility Easements or Other City Property or discontinue providing
Utility Service unless otherwise ordered by the PUC, and shall continue to provide Utility
Service within the City until the City arranges for utility service from another provider.
The City acknowledges and agrees that the Company has the right to use Streets, Other
City Property and Public Utility Easements during any such period. The Company
further agrees that it will not withhold any temporary Utility Services necessary to protect
the public. The City agrees that in the circumstances of this Article, the Company shall
be entitled to monetary compensation as provided in the Tariffs and the Company shall
be entitled to collect from Residents and, upon the City’s compliance with applicable
provisions of law, shall be obligated to pay the City, at the same times and in the same
manner as provided in this Franchise, an aggregate amount equal to the amount which the
Company would have paid as a Franchise fee as consideration for use of the City’s
Streets and Other City Property. Only upon receipt of written notice from the City stating
that the City has adequate alternative utility service for Residents and upon order of the
PUC shall the Company be allowed to discontinue the provision of Utility Service to the
City and its Residents.
ARTICLE 15
INDEMNIFICATION AND IMMUNITY
§15.1 City Held Harmless. The Company shall indemnify, defend and hold the City harmless
from and against claims, demands, liens and all liability or damage of whatsoever kind on
account of or directly arising from the grant of this Franchise, the exercise by the
Company of the related rights, but in both instances only to the extent caused by the
Company, and shall pay the costs of defense plus reasonable attorneys’ fees. The City
shall (a) give prompt written notice to the Company of any claim, demand or lien with
respect to which the City seeks indemnification hereunder; and, (b) unless in the City’s
judgment a conflict of interest may exist between the City and the Company with respect
to such claim, demand or lien, shall permit the Company to assume the defense of such
claim, demand, or lien with counsel reasonably satisfactory to the City. If such defense is
assumed by the Company, the Company shall not be subject to liability for any settlement
made without its consent. If such defense is not assumed by the Company or if the City
determines that a conflict of interest exists, the parties reserve all rights to seek all
remedies available in this Franchise against each other. Notwithstanding any provision
hereof to the contrary, the Company shall not be obligated to indemnify, defend or hold
the City harmless to the extent any claim, demand or lien arises out of or in connection
with any negligent or intentional act or failure to act of the City or any of its officers,
agents or employees or to the extent that the City is acting in its capacity as a customer of
record of the Company.
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§15.2 Immunity. Nothing in this Section or any other provision of this Franchise shall be
construed as a waiver of the notice requirements, defenses, immunities and limitations of
liability the City may have under the Colorado Governmental Immunity Act (§24-10-101,
C.R.S., et. seq.) or of any other defenses, immunities, or limitations of liability available
to the City by law.
ARTICLE 16
BREACH
§16.1 Change of Tariffs. The City and the Company agree to take all reasonable and necessary
actions to assure that the terms of this Franchise are performed. The Company reserves
the right to seek a change in its Tariffs, including but not limited to the rates, charges,
terms, and conditions of providing Utility Service to the City and its Residents, and the
City retains all rights that it may have to intervene and participate in any such
proceedings.
§16.2 Breach.
A. Notice/Cure/Remedies. Except as otherwise provided in this Franchise, if a party
(the “Breaching Party”) to this Franchise fails or refuses to perform any of the terms or
conditions of this Franchise (a “Breach”), the other party (the “Non-Breaching Party”)
may provide written notice to the Breaching Party of such Breach. Upon receipt of such
notice, the Breaching Party shall be given a reasonable time, not to exceed thirty (30)
days in which to remedy the Breach or, if such Breach cannot be remedied in thirty (30)
days, such additional time as reasonably needed to remedy the Breach, but not exceeding
an additional thirty (30) day period, or such other time as the parties may agree. If the
Breaching Party does not remedy the Breach within the time allowed in the notice, the
Non-Breaching Party may exercise the following remedies for such Breach:
(1) specific performance of the applicable term or condition to the extent
allowed by law; and
(2) recovery of actual damages from the date of such Breach incurred by the
Non-Breaching Party in connection with the Breach, but excluding any special, punitive
or consequential damages.
B. Termination of Franchise by City. In addition to the foregoing remedies, if the
Company fails or refuses to perform any material term or condition of this Franchise (a
“Material Breach”), the City may provide written notice to the Company of such Material
Breach. Upon receipt of such notice, the Company shall be given a reasonable time, not
to exceed sixty (60) days in which to remedy the Material Breach or, if such Material
Breach cannot be remedied in sixty (60) days, such additional time as reasonably needed
to remedy the Material Breach, but not exceeding an additional sixty (60) day period, or
such other time as the parties may agree. If the Company does not remedy the Material
Breach within the time allowed in the notice, the City may, in its sole discretion,
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terminate this Franchise. This remedy shall be in addition to the City’s right to exercise
any of the remedies provided for elsewhere in this Franchise. Upon such termination, the
Company shall continue to provide Utility Service to the City and its Residents (and shall
continue to have associated rights and grants needed to provide such service) until the
City makes alternative arrangements for such service and until otherwise ordered by the
PUC and the Company shall be entitled to collect from Residents and, upon the City
complying with applicable provisions of law, shall be obligated to pay the City, at the
same times and in the same manner as provided in this Franchise, an aggregate amount
equal to the amount which the Company would have paid as a Franchise Fee as
consideration for use of the City Streets and Other City Property. Unless otherwise
provided by law, the Company shall be entitled to collect such amount from Residents.
C. Company Shall Not Terminate Franchise. In no event does the Company have the
right to terminate this Franchise.
D. No Limitation. Except as provided herein, nothing in this Franchise shall limit or
restrict any legal rights or remedies that either party may possess arising from any alleged
Breach of this Franchise.
ARTICLE 17
AMENDMENTS
§17.1 Proposed Amendments. At any time during the term of this Franchise, the City or the
Company may propose amendments to this Franchise by giving thirty (30) days written
notice to the other of the proposed amendment(s) desired, and both parties thereafter,
through their designated representatives, will, within a reasonable time, negotiate in good
faith in an effort to agree upon mutually satisfactory amendment(s). However, nothing
contained in this Section shall be deemed to require either party to consent to any
amendment proposed by the other party.
§17.2 Effective Amendments. No alterations, amendments or modifications to this Franchise
shall be valid unless executed in writing by the parties, which alterations, amendments or
modifications shall be adopted with the same formality used in adopting this Franchise, to
the extent required by law. Neither this Franchise nor any term herein may be changed,
modified or abandoned, in whole or part, except by an instrument in writing, and no
subsequent oral agreement shall have any validity whatsoever. Any amendment of the
Franchise shall become effective only upon the approval of the PUC, if such PUC
approval is required.
ARTICLE 18
EQUAL OPPORTUNITY
§18.1 Economic Development. The Company is committed to the principle of stimulating,
cultivating and strengthening the participation and representation of persons of color,
women and members of other under-represented groups within the Company and in the
local business community. The Company believes that increased participation and
representation of under-represented groups will lead to mutual and sustainable benefits
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for the local economy. The Company is committed also to the principle that the success
and economic well-being of the Company is closely tied to the economic strength and
vitality of the diverse communities and people it serves. The Company believes that
contributing to the development of a viable and sustainable economic base among all
Company customers is in the best interests of the Company and its shareholders.
§18.2 Employment.
A. Programs. The Company is committed to undertaking programs that identify,
consider and develop persons of color, women and members of other under-represented
groups for positions at all skill and management levels within the Company.
B. Businesses. The Company recognizes that the City and the business community
in the City, including women and minority owned businesses, provide a valuable resource
in assisting the Company to develop programs to promote persons of color, women and
members of under-represented communities into management positions, and agrees to
keep the City regularly advised of the Company’s progress by providing the City a copy
of the Company’s annual affirmative action report upon the City’s written request.
C. Recruitment. In order to enhance the diversity of the employees of the Company,
the Company is committed to recruiting diverse employees by strategies such as
partnering with colleges, universities and technical schools with diverse student
populations, utilizing diversity-specific media to advertise employment opportunities,
internships, and engaging recruiting firms with diversity-specific expertise.
D. Advancement. The Company is committed to developing a world-class
workforce through the advancement of its employees, including persons of color, women
and members of under-represented groups. In order to enhance opportunities for
advancement, the Company will offer training and development opportunities for its
employees. Such programs may include mentoring programs, training programs,
classroom training and leadership programs.
E. Non-Discrimination. The Company is committed to a workplace free of
discrimination based on race, color, religion, national origin, gender, age, military status,
sexual orientation, marital status, or physical or mental disability or any other protected
status in accordance with all federal, state or local laws. The Company shall not, solely
because of race, creed, color, religion, gender, sexual orientation, marital status, age,
military status, national origin or ancestry, or physical or mental disability, refuse to hire,
discharge, promote, demote or discriminate in matters of compensation, against any
person otherwise qualified.
F. Board of Directors. The Company shall identify and consider women, persons of
color and other under-represented groups to recommend for its Board of Directors,
consistent with the responsibility of boards to represent the interests of the Shareholders,
customers and employees of the Company.
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§18.3 Contracting.
A. Contracts. It is the Company’s policy to make available to minority and women
owned business enterprises and other small and/or disadvantaged business enterprises the
maximum practical opportunity to compete with other service providers, contractors,
vendors and suppliers in the marketplace. The Company is committed to increasing the
proportion of Company contracts awarded to minority and women owned business
enterprises and other small and/or disadvantaged business enterprises for services,
construction, equipment and supplies to the maximum extent consistent with the efficient
and economical operation of the Company.
B. Community Outreach. The Company agrees to maintain and continuously
develop contracting and community outreach programs calculated to enhance
opportunity and increase the participation of minority and women owned business
enterprises and other small and/or disadvantaged business enterprises to encourage
economic vitality. The Company agrees to keep the City regularly advised of the
Company’s programs.
C. Community Development. The Company shall maintain and support partnerships
with local chambers of commerce and business organizations, including those
representing predominately minority owned, women owned and disadvantaged
businesses, to preserve and strengthen open communication channels and enhance
opportunities for minority owned, women owned and disadvantaged businesses to
contract with the Company.
§18.4 Coordination. City agencies provide collaborative leadership and mutual opportunities or
programs relating to City based initiatives on economic development, employment and
contracting opportunity. The Company agrees to review Company programs and mutual
opportunities responsive to this Article with these agencies, upon their request, and to
collaborate on best practices regarding such programs and coordinate and cooperate with
the agencies in program implementation.
ARTICLE 19
MISCELLANEOUS
§19.1 No Waiver. Neither the City nor the Company shall be excused from complying with any
of the terms and conditions of this Franchise by any failure of the other, or any of its
officers, employees, or agents, upon any one or more occasions, to insist upon or to seek
compliance with any such terms and conditions.
§19.2 Successors and Assigns. The rights, privileges, and obligations, in whole or in part,
granted and contained in this Franchise shall inure to the benefit of and be binding upon
the Company, its successors and assigns, to the extent that such successors or assigns
have succeeded to or been assigned the rights of the Company pursuant to Article 15 of
this Franchise. Upon a transfer or assignment pursuant to Article 15, the Company shall
be relieved from all liability from and after the date of such transfer, except as otherwise
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provided in the conditions imposed by the City in authorizing the transfer or assignment
and under state and federal law.
§19.3 Third Parties. Nothing contained in this Franchise shall be construed to provide rights to
third parties.
§19.4 Notice. Both parties shall designate from time to time in writing representatives for the
Company and the City who will be the persons to whom notices shall be sent regarding
any action to be taken under this Franchise. Notice shall be in writing and forwarded by
certified mail, reputable overnight courier or hand delivery to the persons and addresses
as hereinafter stated, unless the persons and addresses are changed at the written request
of either party, delivered in person or by certified mail. Notice shall be deemed received
(a) three (3) days after being mailed via the U.S. Postal Service, (b) one (1) business day
after mailed if via reputable overnight courier, or (c) upon hand delivery if delivered by
courier. Until any such change shall hereafter be made, notices shall be sent as follows:
To the City:
City Manager
300 LaPorte Ave.
P.O. Box 580
Fort Collins, Colorado 80522
With a copy to:
City Attorney
300 LaPorte Ave.
P.O. Box 580
Fort Collins, Colorado 80522
To the Company:
Regional Vice President, Customer and Community Relations
Public Service Company of Colorado
P.O. Box 840
Denver, Colorado 80201
With a copy to:
Legal Department
Public Service Company of Colorado
P.O. Box 840
Denver, Colorado 80201
and
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Area Manager
Public Service Company of Colorado
1500 6
th
Ave
Greeley, Colorado 80632
Any request involving any audit specifically allowed under this Franchise shall also be
sent to:
Audit Services
Public Service Company of Colorado
P.O. Box 840
Denver, Colorado 80201
§19.5 Examination of Records. The parties agree that any duly authorized representative of the
City shall have access to and the right to examine any books, documents, papers, and
records of the Company reasonably related to the Company’s compliance with the terms
and conditions of this Franchise. Information shall be provided within thirty (30) days of
any written request. Any books, documents, papers, and records of the Company in any
form that are requested by the City, that contain confidential information shall be
conspicuously identified as “confidential” or “proprietary” by the Company. In no case
shall any privileged communication be subject to examination by the City pursuant to the
terms of this Section. “Privileged Communication” means any communication that
would not be discoverable due to the attorney client privilege or any other privilege that
is generally recognized in Colorado, including but not limited to the work product
doctrine. The work product doctrine shall include information developed by the
Company in preparation for PUC proceedings.
(1) The City will maintain the confidentiality of the information by keeping it
under seal and segregated from information and documents that are
available to the public;
(2) The information shall be used solely for the purpose of determining the
Company’s compliance with the terms and conditions of this Franchise;
(3) The information shall only be made available to City employees and
consultants who represent in writing that they agree to be bound by the
provisions of this subsection;
(4) The information shall be held by the City for such time as is reasonably
necessary for the City to address the Franchise issue(s) that generated the
request, and shall be returned to the Company when the City has
concluded its use of the information. The parties agree that in most cases,
the information should be returned within one hundred twenty (120) days.
However, in the event that the information is needed in connection with
any action that requires more time, including, but not necessarily limited
to litigation, administrative proceedings and/or other disputes, the City
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may maintain the information until such issues are fully and finally
concluded.
§19.6 Confidential or Proprietary Information. If an Open Records Act (§§24-72-201 et seq. C.R.S.)
request is made by any third party for confidential or proprietary information that the Company
has provided to the City pursuant to this Franchise, the City will promptly notify the Company of
the request and shall allow the Company to defend such request at its sole expense, including
filing a legal action in any court of competent jurisdiction to prevent disclosure of such
information. In any such legal action the Company shall join the person requesting the
information and the City. In no circumstance shall the City provide to any third party
confidential information provided by the Company pursuant to this Franchise without first
conferring with the Company. The Company shall defend, indemnify and hold the City harmless
from any claim, judgment, costs or attorney fees incurred in participating in such proceeding.
Unless otherwise agreed between the parties, the following information shall not be provided by
the Company: confidential employment matters, specific information regarding any of the
Company’s customers, information related to the compromise and settlement of disputed claims
including but not limited to PUC dockets, information provided to the Company which is
declared by the provider to be confidential, and which would be considered confidential to the
provider under applicable law.
§19.7 List of Utility Property. The Company shall provide the City, upon request not more than
once every two (2) years, a list of electric and gas utility-related real property owned in
fee by the Company within the County in which the City is located. The list shall include
the legal description of the real property, and where available on the deed, the physical
street address. If the physical address is not available on the deed, if the City requests the
physical address of the real property described in this Section 19.7, to the extent that such
physical street address is readily available to the Company, the Company shall provide
such address to the City. All such records must be kept for a minimum of three (3) years
or such shorter duration if required by Company policy.
§19.8 PUC Filings. Upon written request by the City, the Company shall provide the City non-
confidential copies of all applications, advice letters and periodic reports, together with
any accompanying non-confidential testimony and exhibits, filed by the Company with
the Public Utilities Commission. Notwithstanding the foregoing, notice regarding any
gas filings that may affect Utility Service rates in the City shall be sent to the City upon
filing.
§19.9 Information. Upon written request, the Company shall provide the City Manager or the
City Manager’s designee with:
A. A copy of the Company’s or its parent company’s consolidated annual financial
report, or alternatively, a URL link to a location where the same information is available
on the Company’s website;
B. Maps or schematics indicating the location of specific Company Facilities
(subject to City executing a confidentiality agreement as required by Company policy),
including gas or electric lines, located within the City, to the extent those maps or
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schematics are in existence at the time of the request and related to an ongoing project
within the City. The Company does not represent or warrant the accuracy of any such
maps or schematics; and
C. A copy of any report required to be prepared for a federal or state agency
detailing the Company’s efforts to comply with federal and state air and water pollution
laws.
§19.10 Payment of Taxes and Fees.
A. Impositions. Except as otherwise provided herein, the Company shall pay and
discharge as they become due, promptly and before delinquency, all taxes, assessments,
rates, charges, license fees, municipal liens, levies, excises, and imposts, whether general
or special, or ordinary or extraordinary, of every name, nature, and kind whatsoever,
including all governmental charges of whatsoever name, nature, or kind, which may be
levied, assessed, charged, or imposed, or which may become a lien or charge against this
Franchise (“Impositions”), provided that the Company shall have the right to contest any
such Impositions and shall not be in breach of this Section so long as it is actively
contesting such Impositions.
B. City Liability. The City shall not be liable for the payment of late charges, interest or
penalties of any nature other than pursuant to applicable Tariffs.
§19.11 Conflict of Interest. The parties agree that no official, officer or employee of the City shall
have any personal or beneficial interest whatsoever in the services or property described
herein and the Company further agrees not to hire or contract for services any official,
officer or employee of the City to the extent prohibited by law, including ordinances and
regulations of the City.
§19.12 Certificate of Public Convenience and Necessity. The City agrees to support the Company’s
application to the PUC to obtain a Certificate of Public Convenience and Necessity to
exercise its rights and obligations under this Franchise.
§19.13 Authority. Each party represents and warrants that except as set forth below, it has taken
all actions that are necessary or that are required by its ordinances, regulations,
procedures, bylaws, or applicable law, to legally authorize the undersigned signatories to
execute this Franchise on behalf of the parties and to bind the parties to its terms. The
persons executing this Franchise on behalf of each of the parties warrant that they have
full authorization to execute this Franchise. The City acknowledges that notwithstanding
the foregoing, the Company requires a Certificate of Public Convenience and Necessity
from the PUC in order to operate under the terms of this Franchise.
§19.14 Severability. Should any one or more provisions of this Franchise be determined to be
unconstitutional, illegal, unenforceable or otherwise void, all other provisions
nevertheless shall remain effective; provided, however, to the extent allowed by law, the
parties shall forthwith enter into good faith negotiations and proceed with due diligence
to draft one or more substitute provisions that will achieve the original intent of the
parties hereunder.
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§19.15 Force Majeure. Neither the City nor the Company shall be in breach of this Franchise if a
failure to perform any of the duties under this Franchise is due to Force Majeure, as
defined herein.
§19.16 Earlier Franchises Superseded. This Franchise shall constitute the only franchise between
the City and the Company related to the furnishing of Utility Service, and it supersedes
and cancels all former franchises between the parties hereto.
§19.17 Titles Not Controlling. Titles of the paragraphs herein are for reference only, and shall not
be used to construe the language of this Franchise.
§19.18 Applicable Law. Colorado law shall apply to the construction and enforcement of this
Franchise. The parties agree that venue for any litigation arising out of this Franchise
shall be in the District Court for Larimer County, State of Colorado.
§19.19 Payment of Expenses Incurred by City in Relation to Franchise Agreement. The Company
shall pay for expenses reasonably incurred by the City for the adoption of this Franchise,
limited to the publication of notices, publication of ordinances, and photocopying of
documents and other similar expenses.
§19.20 Costs of Compliance with Franchise. The parties acknowledge that PUC rules, regulations
and final decisions may require that costs of complying with certain provisions of this
Franchise be borne by customers of the Company who are located within the City.
§19.21 Conveyance of City Streets or Other City Property. In the event the City vacates, releases,
sells, conveys, transfers or otherwise disposes of a City Street or Other City Property in
which Company Facilities are located, the City shall reserve an easement in favor of the
Company over that portion of the Street or Other City Property in which such Company
Facilities are located. The Company and the City shall work together to prepare the
necessary legal description to effectuate such reservation. For the purposes of Section
6.8.A of this Franchise, the land vacated, released, sold, conveyed, transferred or
otherwise disposed of by the City shall no longer be deemed to be a Street or Other City
Property from which the City may demand the Company temporarily or permanently
Relocate Company Facilities at the Company’s expense.
§19.22 Audit. For any audits specifically allowed under this Franchise, such audits shall be
subject to the applicable Tariff and PUC rules and regulations. Audits in which the
auditor is compensated on the basis of a contingency fee arrangement shall not be
permitted.
(Signature page follows.)
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IN WITNESS WHEREOF, the parties have caused this Franchise to be executed as of
the ______ day of _______________, 2017.
CITY OF FORT COLLINS
ATTEST:
____________________________________
_______________________________ Mayor, City of Fort Collins
Clerk, City of Fort Collins
APPROVED AS TO FORM:
_______________________________
Deputy City Attorney, City of Fort Collins
PUBLIC SERVICE COMPANY OF
COLORADO, a Colorado corporation
By:_________________________________
Jerome Davis, Regional Vice President,
Customer and Community Relations
STATE OF COLORADO )
)SS.
COUNTY OF DENVER )
The foregoing instrument was acknowledged before me this _ day of ___________,
2017 by Jerome Davis, Regional Vice President, Customer and Community Relations of Public
Service Company of Colorado, a Colorado corporation.
WITNESS MY HAND AND OFFICIAL SEAL.
Notary Public
My Commission expires: ______________
(SEAL)
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Text of Ad: 12/11/2017 EXHIBIT B