HomeMy WebLinkAboutOrdinance No. 2016-36 (Title: An ordinance granting a franchise for electricity transmission and delivery services
to Texas-New Mexico Power Company)
ORDINANCE NO.2016-36
AN ORDINANCE OF THE CITY OF FRIENDSWOOD,
TEXAS, GRANTING AN ELECTRICAL FRANCHISE TO
TEXAS-NEW MEXICO POWER COMPANY PURSUANT
TO TITLE 28, ART: 1175, V.A.T.S. AND SECTION 181.043,
TEXAS UTILITIES CODE; STATING A PURPOSE;
PROVIDING FOR A TERM OF THIRTY YEARS;
PROVIDING FOR THE LOCATION OF FACILITIES;
PROVIDING FOR REPAIR OF EXCAVATIONS AND
OBSTRUCTIONS; PROVIDING FOR INDEMNITY TO THE
CITY OF FRIENDSWOOD; PROVIDING FOR STREET
RENTAL; REPEALING THE FORMER FRANCHISE,
WHICH IS ORDINANCE NUMBER 85-22 OF THE CITY OF
FRIENDSWOOD AS AMENDED BY BOTH ORDINANCE
NUMBER 95-10 AND ORDINANCE NUMBER 96-8; AND
PROVIDING FOR FORMAL ADOPTION.
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BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FRIENDSOOD,
TEXAS:
Section 1. Parties. The City of Friendswood, Texas, herein called the City, a
municipal corporation created under Article XI, Sec. 5, Texas Constitution, hereby grants the
nonexclusive right, privilege, and franchise herein stated to Texas-New Mexico Power
Company, a corporation, its successors and assigns,herein called Grantee or Company.
Section 2. Nature of Grant. The City, acting pursuant to Title 28, Art. 1175,
V.A.T.S. and Section 181.043, Texas Utilities Code, hereby grants to Grantee a nonexclusive
right, privilege, and franchise to erect, maintain, operate, and remove electric lines and pertinent
facilities over, under, across, upon, and along the streets, alleys, and other public property in the
City.
Section 3. Purpose. The prior franchise granted by Ordinance 85-22 (as amended by
Ordinances 95-10 and 96-8) having expired, this franchise is granted for the purpose of
providing electric service within the City and adjacent areas and transporting electric energy to,
from, and beyond the City.
Section 4. Term. Upon the filing with the City by the Company of the acceptance
required hereunder, this franchise shall be in full force and effect for a term and period of thirty
(30) years.
Section 5. Location of Facilities. All poles erected by Grantee pursuant to the
authority herein granted shall be of sound material and reasonably straight, and shall not be set in
any gutter, drain, or drainage ditch. Grantee' s poles and other facilities shall be placed and
erected in such a manner as not to interfere with traffic, and the location, relocation,
construction, and manner of erection of such poles and facilities shall at all times be subject to
the police power of the City. Grantee, whenever ordered to do so by the governing body of the
City, shall at its own expense, relocate, alter or remove its facilities placed or maintained by
Grantee under this franchise when the relocation, altering or removal thereof may be reasonably
necessary in the reconstruction or construction of any public work or project or public
improvement undertaken or directed by the City. The City acknowledges that any modifications
to the Grantee's facilities may affect the safety and reliability of electric transmission and
delivery within the City and the City hereby agrees to consult with Grantee on any such
rearrangement, relocation, alteration or removal before ordering Grantee to do so.
Notwithstanding the foregoing, Grantee shall not be responsible for relocation costs:
a. where by City application, specific monies can be and are obtained from federal and
state sources for relocation costs, provided that no City matching funds would be
required, the scope of the City project would not be diminished, and the City would
not be required to spend additional monies;
b. if the specific excavation, construction or relocation is done to accommodate the
actions or plans of private individuals or entities, then such private individuals or
entities shall be responsible for the relocation costs,provided that in no event shall the
City be liable for such relocation costs; or
c. State or Federal law requires the City to pay for such relocation.
Section 6. Excavations and Obstructions. Any and all excavations and obstructions
in and upon the streets, alleys and other public places in the City caused by Grantee's operations
under this Ordinance shall be repaired and removed by Grantee as quickly as is reasonably
possible, under the circumstances.
Ord 2016-36 2
Section 7. Quality of Service. The service furnished hereunder to City and its
inhabitants shall be, considering all circumstances, consistent with the Tariff issued to TNMP by
the Public Utility Commission of Texas as well as applicable state and federal regulations.
Grantee will maintain its facilities in reasonable operating condition in accordance with the
foregoing Tariff and applicable state and federal regulations during the continuance of this
Franchise.
Section 8. Indemnity. Grantee shall fully indemnify and save harmless the City from
any and all damage, loss, action or loss, action or cause of action arising in whole or in part from
Grantee's exercise of any of its rights, privileges, franchises and obligations hereunder, except to
the extent arising out of the City's sole negligence or willful misconduct. In the event of joint
and concurrent negligence or fault of both Grantee and the City, responsibility and indemnity, if
any, shall be apportioned comparatively in accordance with the laws of the State of Texas
without, however, waiving any governmental immunity available to the City under Texas law
and without waiving any of the defenses of the parties under Texas law. It is understood that it is
not the intention of the parties hereto to create liability for the benefit of third parties, but that
this section shall be solely for the benefit of the parties hereto and shall not create or grant any
rights, contractual or otherwise,to any person or entity.
Section 9. Street Rents. Until completion of the Grantee's next general rate
proceeding at the Public Utility Commission of Texas, the Grantee shall report and pay each
calendar quarter during the term of the franchise ordinance a street rent equal to all kilowatt
hours (kWh) delivered within the City limits regardless of customer class. The charge per
delivered kWh shall be determined by (i) dividing the total electric franchise fee revenue for
calendar year 1998 by the total number of kWh delivered to all customers within the City limits
in 1998 and (ii) multiplying the charge per kilowatt hour determined for 1998 by the number of
kilowatt hours delivered within the City during each calendar quarter. Grantee calculates that
charge to be $0.0018743 per KWh.
Company and City have agreed that franchise fee payments should be increased to a
level equivalent to a 4% franchise fee as calculated prior to deregulation. More specifically,
Company and City agree that the fee shall be calculated using a revised billing factor of
$0.0037486 per KWh which is two (2) times the current factor of $0.0018743 per KWh. In
TNMP's next general rate case, TNMP will seek approval of rates that will provide for recovery
Ord 2016-36 3
of franchise fee payments based on the revised factor. Payment for the increase in franchise fees
initiated under this agreement shall not be due until after the conclusion of the Company's next
general rate case; and, then, shall be due and payable only if the Public Utility Commission of
Texas provides a method for the Company to recover those fees for service provided after the
effective date for implementing modified rates.
Company and City further agree that in the event the Public Utility Commission does not
approve recovery of the revised factor (i.e., $0.0037486 per KWh) equivalent to a 4% franchise
fee at the conclusion of the Company's next general rate case, the Company shall continue to pay
to City a franchise fee based on the calculated current factor of $0.0018743 per kWh as
determined by the formula set forth above.
The charge herein made shall be in lieu of, to the extent permitted by law, any other
charges or fees of any kind by the City based on, connected with, or incident to the exercise of
the non-exclusive rights, privilege, and franchise herein granted.
The parties agree to meet to discuss adjustments to franchise fee either upon the request
of one of the parties or on a periodic basis as the parties may agree. The franchise fee shall be
adjusted provided that parties agree to reasonable increase in the fee. Grantee obtains all
necessary and final approvals for the recovery of any proposed increase of the franchise fee and
the increased fee or its recovery is not otherwise prohibited or disallowed by a regulatory body or
court having jurisdiction.
Section 10. Reservation of Powers. In granting this Franchise, the City does not
surrender or to any extent lose, waive, impair or lessen the lawful powers, claims and rights, now
or hereafter vested in the City under the Constitution and statutes of the State of Texas or other
applicable law,to regulate public utilities within the City and to regulate the use of the Streets by
the Grantee.
Section 11. Prior Franchise Repealed. This franchise ordinance, upon acceptance by
the Grantee, shall replace and supercede that certain Electric Franchise Ordinance No. 85-22,
heretofore granted by the City to the Grantee, adopted on the 23rd day of September, 1985, and
any and all amendments thereto found in Ordinance Nos. 95-10 and 96-8.
Section 12. Acceptance by Company. The Company shall, within thirty (30) days
from the date this Ordinance is passed and approved, file with the City a written statement signed
in its name and behalf, in the following form:
Ord 2016-36 4
"To the City of Friendswood, Texas:
"The Company for itself, its successors and assigns, hereby accepts the above and
foregoing Ordinance and agrees to be bound by all of its terms and provisions.
Texas-New Mexico Power Company
By:
"Dated the day of , 2016
Section 13. Severability Clause. Should any article, section, part, paragraph, sentence,
phrase, clause, or word of this ordinance, for any reason be held illegal, inoperative, or invalid, or
if any exception to or limitation upon any general provision herein contained be held to be
unconstitutional or invalid or ineffective, the remainder shall, nevertheless, stand effective and
valid as if it had been enacted and ordained without the portion held to be illegal, inoperative,
unconstitutional, invalid, or ineffective.
Section 14. Adoption. Passed and adopted with all necessary procedural formalities
by the City Council of the City of Friendswood, Texas at a regular meeting held at the regular
place, at which meeting a quorum was present throughout. This Ordinance shall take effect and
be in force from and after its passage and approval, and upon acceptance by the Company, the
term of this franchise shall begin and continue in accordance with Section 4 hereof.
PASSED AND APPROVED on first reading the 12th day of September,2016.
PASSED AND APPROVED on second and final reading the 3rd day of October,
2016.
Kevin M. Ho l a
Mayor
Attest: +0 r..®4.
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Melinda Welsh, TRMC :O
City Secretary r
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CO
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Ord 2016-3 6 ®•�OF - i o
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THE STATE OF TEXAS §
COUNTIES OF HARRIS AND GALVESTON §
1, Melinda Welsh, the duly appointed, qualified and acting City Secretary of the City of
Friendswood, Texas, hereby certify that the above and foregoing ordinance of the City of
Friendswood was passed at the regular meeting of the City Council of the City of Friendswood
held on the 3rd day of _or t-oh, , 2016; that written notice of the date, hour,
place and subject of said meeting was posted for at least seventy-two (72) hours preceding the
scheduled time of said meeting on a bulletin board located in a place in the city hall which is
convenient and readily accessible to the general public at all times; that the Mayor and
Councilmen Steve Rockey, Billy J. Enochs, Mike Foreman, Jim Hill, John H. Scott, and Carl W.
Gustafson were present at said meeting and acted as the City Council throughout; that the same
has been approved by the Mayor and is duly attested by the City Secretary; and that the same has
been duly engrossed and enrolled in the records of the City of Friendswood, Texas.
EXECUTED UNDER MY HAND and the official seal of the City of Friendswood,
Texas on this 3rd day of s)c t ohe r , 2016.
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Melinda Welsh, TRMC
City Secretary
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Ord 2016-36 6
To the City of Friendswood, Texas:
The Company for itself, its successor and assigns, hereby accepts the above and
foregoing ordinance and agrees to be bound by all of its terms and provisions.
TEXAS-NEW MEXICO POWER COMPANY
By: - ox 41
Neal Walker, President
Dated the day of p ' 2016.
THE STATE OF TEXAS §
COUNTIES OF HARRIS AND GALVESTON §
I, Melinda Welsh, the duly appointed, qualified and acting City Secretary of the City of
Friendswood, Texas, hereby certifies that the above and foregoing Acceptance was received and
filed in the office of the City Secretary of the City of Friendswood, on the t day of
O` , 2016.
EXECUTED UNDER MY HAND and the office seal of the City of Friendswood, Texas,
this day of , 2016.
Melinda Welsh TRMC ♦®-� °°'' ���
City Secretary ♦C� °
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City of Friendswood, Texas
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Ord 2016-36 7