HomeMy WebLinkAbout1971-06-30 Council Packet - Special MeetingKenai
City Council
Speci.al
Counc i i Meet i ng
June 30, 1971
HEA
Sale of K.C.L.
(C i ty E I ectr i c System) to
(Homer Electric A~~ociation)
MINUTES OF KENAI~ CITY COUNCIL
SPECIAL MEETING
JUNE 30, 1971
8:00 P.M. KENAI LIBRARY
ROLL CALL: M~mbers..,present - Robert Bielefeld~ James Doyle
'~ RObert Norene and .... ~a~r 'John 'steinbeck.
Members absent Hugh Malone and Tru McGrady
Excused absence ~ James Hornaday
A- i:
Publi~c. Heariq_g ....
Ordinance 199-71- An, Ordinance relatin~ .._tOi.._the~ ~.
sale of K~ C.L. to Homer E. lectric AsSoc.
The clerki read OrdinanCe 199-71 by title.
The Mayor called for a recess and opened the
meeting to the public.
W. R. Jahrig spoke from the floor against the~
sale of K.C.L. to H~E.A. He feels the City has
too much money invested in the system to sell it
and feels K.C.L. is 'an asset. He further stated
the City'.s electric bill alone would run $200,000
per year without the demand factor. He stated with
the present tie-in set up that service is available
with H.E.A. in case of an outage.
The City Manager stated that Mr. Jahrig has bad or
wrong information. That the rates negotiated will
be the same as they are now then will go on the
lowest industrial rate. There will be no demand·
charges except on the airport. H.E.A. is a back-up
now only at the City's expense as C.U.L. has failed
to pay for tie-ins in the past. Wildwood is not
on H.E.A. but on our distribution system. The City
cannot afford to operate the utility unless they
could come up with $1,000,000 worth of improvements.
The cost of buying~C.U.L, is completely out of the
picture. · ·
There was no more public participation so the Mayor
declared the public hearing closed.
The meeting was brought back t~o the Council table.
The Mayor recessed the Council Meeting until 5:00
PoM. Thursday, July. 1, 1971 in the City Manager's
office.
The meeting recessed at 8:25 P.M.
MINUTES OF KENAI CITY COUNCIL SPECIAL MEETING,
July 1, 1971
Page two
Mayor Steinbeck called the meeting~ back to order.
ROLL CALL: Members pres'ent - Robert Bielefeld, James Doyle,
James Hornaday', ~Hugh Mal0ne, RObert Norene and
Mayor John ..... Steinbeck.
Members absent- Tru McGrady~..
After some discussion Bielefeld..mOved-and Doyle
seconded to declare an. emergency for.. Ordinance
199-71 providing' for 'submission to the voters
the sale of K.C.L. to H,E.A.
The motion carried"unanimou~s-ty~.~by~ roll call vote.
Doyle moved .and · Malone ~ seconded· to adopt .Ordinance
199-71 - Providing for.".s.nbmission to the voters
the sale of K.C.L. to H.E.A~.
The motion carried, unan~i~..nsl.~ ~.~by roll call vote.
Voting yes: Bielefeld, .Doyle, Hornaday, MalOne
Norene and Mayor S teinbeck.
The Council authorized the City .Manager to here
an accountant for the period .of ~one .month o
Council would like the City Manager to report
at the next council meeting ~where the funds Will
come from fOr his salary..
MEETING ADJOURNED 5-45 P. M.
Respectfully submitted,
Sharon Sterling,
Acting City Clerk
CITY OF KENAI, ALASKA
ORDINANCE NO. 199-71
AN ORDINANCE 'of the' City of Kenai, Alaska, providing
for the submission to the qualified electors
of th~ City at a special election to be held
therein on-3 August, 1971 of a proposition
of whether the ~Ci"ty 'sh0-~Id enter into an agree-
ment with Homer Electric Association, Inc. which
would provide for the .operation of the City's
electric system by Homer Electric Association,
Inc. and would further provide for the transfer
.
of the ownership of the electrical system from
the City to HOmer Electric Association, Inc.
upon the successful consumation of the agreement
and would authorize, as a part of such agreement,
a franchise or permit-wherein "HOmer Electric
Association, Inc. would be authorized to construct,
direct, .operate 'and maintain in, upon, along,
across, above, over and under the streets, alleys,
public ways and public places now laid out or
dedicated and all extensions thereof and additions
·
thereto in the City, poles, wires, cables,
undergrOund conduits, manholes and other electric
fixtures necessary or proper for the maintenance
and operation in the City of.an electric
distribution system and wires connected 'therewith
and declaring an .emergency.
.WHEREAS, the City has established and is presently maintainh
ing and operating a municipal electric power system, and in connection
therewith owns and operates properties for the purchase, transmission,
distribution, supply and sale of electric power and energy; and is
engaged in the business of selling and supplying electric power and
energy to residential, commercial, industrial and governmental con-
sumers within and about the City of Kenai, Alaska; and
WHEREAS, Homer Electric Association, Inc. (hereinafter
called "HEA"), as an electric cooperative creat~ed and existing under
the laws of the State of Alaska, engages, among other utility activities,
in the business of purchasing, transmitting, distributing, supplying,
and selling electric energy wi.thin the State of Alaska; and
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WHNREA$, HEA's e~c~r~ca~ system ~s or' can
connected w£~h ~h~ system of ~he City for ~he purpose of fUrnishin~
standby electric power; and
WHEREAS, the City Council of the City of Kenai ('Council')
deems that the operation by HEA of City's electric system would
be beneficial to the City and to City's users and consumers of
electric~ energy; and
WHEREAS, the Council has resolved that such operation
of the C~tY'~s electric system can be accomplished by means of
an operating agreement between the C~ty and. HEA; and
WHEREAS, the Board of Directors of HEA has determined
that it is ~t:o the interest of HEA that an agreement should be
entered into for the operation of the City's electrical system
u~er the"~erms and conditions hereinafter set forth; and
~ERKAS, the parties have reached a basic understandin~
ooncern~ng '~he terms and conditions relative to the transfer of
the operation and management of the 'electric system 'to REA and
..
the conveyance of .the C~ty's electrical system to HEA and the
City Council desires to have the voters approve their entry into
such Agreement within the guidelines set forth herein; and
· WHEREAS, the Board .of Directors of HEA desire to .have
a franch~se .... or permit to operate within the City of Kenai and
, .
the Coun~i 'has resolved that SuCh a franchise or' permit should
be granted as is more fullY Set forth' hereinafter; and
_
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~REAS, the charter of'the City requires that the question
·
of.Whethe~the City .ShOUld enter. into 'the Agreement for the'
operation ~nd transfer of its electric'sYstem to HEA and whether
as a part-of such Agreement a franchise or permit to operate
, .
an electrical distribution System should be granted to HEA
should be 'Submitted to the qualified electors of the City
for their ratification or rejection;
NOW, THEREFORE BE IT ORDAINED by the Council of the
City of Kenai, Alaska as follows..
Section 1. Definitions.
1. The "System" means all tangible properties and
property rights which, (as of the effective date of the Agreement)
are being USed by the' City for, or are' useful for, the transmission
and distribution of electric energy and' power within the ~imits
of the Ci~- and in such area adjacent thereto as may be presently
served by sai~ System. Sa~ tangible property shall include
=esl property, rights-of-way, easements, poles and pole lines,
crossarms, 's~b-stations, transformers, station equipment,
meters, and other tangible property of every kind and description
...
.which are now used, owned and operated by the City in the
oper&t~on ~f" sa~d System, together with any and ail additions,
· .
betterment~*,'"improvements and eXtensions thereof which may hereafter
be acqui~ed~'and made a part of .said System under the 'terms of
this &gr6~ent; the System shall also include all rights and obligations
which th~ ~ity. shall have under that certain contract existing
.
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between ~he ti'fy and Consolidated Utilities, Ltd., dated September
11, 1963, Covering the generation by Consolidated and the purchase
by the City of electric energy. The aforesaid definition of the
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System sh~il not include cash in the Revenue Fund of the Syste~
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· as of the ~ffect~ve date of the agreement, nor shall ~t include
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any of the funds, securities, investments or assets in any of
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the Bond Redemption Funds or Reserve Accounts of the Bond Redemption
Funds or~ ~ny. s~tnking fund pertaining, theretO, proVided, however ~
.
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that .fun~s, seCurit~es, investments or. assets ~n any such Bond
Redemption~Funds, Reserve Accounts or sinking funds shall be held
:and applied by' the City for the pUrpose 'of redeeming· Electric
.
Light and Power Bonds of the City as herein defined in accordance
with the provisions of said bonds and the ordinances of the City.
2. 'Outstanding Bonds# shall mean the City of Kenai,
Alaska Electric Light and Power Revenue Bonds issued as follows=
the 1963 City of Kenai, Alaska, Electric Light and Power Revenue
Bond8 in the original Principal amountrof $425,0.00, authorized
by Or~na~e No. 54 of the City, passed and approved on October
10, 19631 the City of Kenai, Alaska, Electric Light and Power Revenue
Bonds, 196~, in the original principal amount of $25,000, author-
tzed by O~dtnance No.. 70 of the City, passed and approved on the
26~h day of' August, 1964; the City of Kenai, Alaska, Electric
L~ght an~'~Power Revenue Bonds, 1967, in the original principal
amount of $300,000, authorized by Ordinance No. 124 of the C~ty,
passed an~'~Pproved on September 20, 1967; the City of Kenai,
Alaska, Ei~ctric Light and Power Revenue Bonds, 1969, in the original
princip&l amount of $25,000, authorized by Ordinance No. 174, passed
.o~..
and approved February 4, 1970; the City of Kenai, Alaska, EleCtric
L~ght and POwer Revenue Bonds, 1970, in the original prin¢~pal
amount of. '$~75,000, authorized by Ordinance No. 180 of the CLty,
._
passed and approved on May 20, ~970. Attached hereto, marked Exhibit
C, is a schedule showing (1) the total amount of outstanding indebtedness
upo.n..each 'o~ the aforesaid Electric Light' and Power Revenue Bond'
,
issues, and"(2) the' amounts, of principal 'and interest payments
required~''to::be made each year hereafter upon each 'such issue of
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revenue b~nds from the date. hereof to the final maturity date
Of. the bo~& of each such is.sue.. ·
3. The "Kenai 1963 Electric Light and Power RevenUe
FUnd" shall mean'the fund Of that "name created by Ordinance No.
,
54 into W~ch are paid' all gross "earnings and revenue derived
·
by the City f, rom the operation of its system and all additions
and improvements thereto and extensions thereof.
Section 2. The City shall, if 'approved by the voters,
at the special election herein provided for, enter 'into an
Agreement (hereinafter Agreement) with HEA which Agreement shall
prov~e substantially as follows..
1. For HEA to manage and operate the System for and on
behalf of the City of Kenai.
2. For the maintenance of the Kenai 1963 EIectri¢. Light
and Power Revenue Fund as a trust fund for the payment of the
Outstanding Bonds.
3. For HEA to assume and agree to perform all of the
se=vices and to provide all supplies and mate~.ials necessary
to maintain and operate the System and for HEA to covenant and
agree to maintain the System in good condition and repair and
to meet all of the covenants heretofore 'made .by the. City with
· the ".~O~derm of the Outstanding Bonds.
4. For HEA to interconnect its existing electrical
d~stribution system with that of. the C~ty to the extent tha~
the same may become necessary to provide continuous uninter-
rupted service for the' .inhabitants of the City of Ken&~.
5. For HEA to provide for additions, improvements,
betterments and extensions of the System which, in its judg-
ment, w~11 provide for the full, complete, efficient operation
of electric power, l~ght a~d energy as may be required from 'time
to time by such consumers and users.
6.. For HEA to pay' into. such accounts as may be created'
·
by the Agreement, sufficient sums to ..pay the OutStand~n~ Bo~ds,
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· ~a~ntenance 'and operation cOsts, protection of &11 reserve accounts
a~d payment of any other necessary costs and expenses for. ma~ntaining
'and operating the SYstem and for the payment of any 'balance to
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REA as reimbursement for wholesale power costs (as defined in
the Agreement)~ its normal costs 'of mainten'ance and operation~
costs of renewals an~ replacements of th&-,~ystem and ad~itions,
and betterments thereto and as payment for the services of HEA
rendered in the management and operation of the System.
7. For HEA to p~y to the City upon the effective date
of the A~reement (1) a sum in cash equal to the money in value
on such date of the investments in the several reserve accounts-
now held in the' several bond funds, (2) a sum 'in cash sufficient
to rebOrn=se the City for moneys expended from. the City Genera1
l~d for purposes of the system and (3) a. Sum equal to the value
of all personal property used in the operation of the System
Which may be payable according to the terms of a negotiable 'note
~ equal ~onthly installment's to bear interest at the rate of
per annum upon dimin~sh~ng balances.
8. For HEA to account tO the City for. the Operations
Of the System during each month it operates the System, inClud-
.i~g an itemized statement of all receipts and disbursements~
including amounts expended' for maintenance, labor cost, addi-
tions, improvements, betterments and extensions. The City
shall reserve the righ't to' inspect books and records of HEA
~n. so far as they pertain to t~e' operation of the system
· For the C: to grant'~o REA a "franch or
',e an electical distribu~: sys ~hin the
of 30 years the effect: of th~s reement.
.
il..:i~.i..-.~.?ii'.!!!'i.~.~...~, i~'~'711. For HEA to make any .and ail renewals and replace-I ..~-,.~,~.::~.iil-~!ii~iii. i.. _
extensions, additions, ~prov~ents, a~ bette~ents , .
..
to the System in accordance with the same standards and criteria
which HEA would operate its own electric properties and business.
12. For HEA to render an accounting to the City
each year, showing in reasonable-detail all retirements and
renewals, replacements, additions, betterments, extension
and improvements to the System made during the preceding calendar
year.
13. For HEA to seek and secure the approval of the
:
admin~strator for the Rural Electrification Administration
Department of A~riculture, United States of America to 'the
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Agreement,
14. For HEA to endeavor to. take into its employ
all of the .emPloyees of the .City,s electrical system, excepting
supervisory employees, at 'the same wage scale which are applicable
t° present employees of HEA .in the same classification of employment
and the Seniority measurment 'by their continuous e~ployment
by' the C~tY imme~ately priOr'to the begin,~ng of the Agre~ent.
For H~ to base a working crew Within the 'City
-....-~lufficient and ade~ate to properly se~ice the Syst~.
16. For HEA to agree not to discriminate in-the sale
of electrical energy between, those who live within the City of
Kenai and ~ose ~o l~Ve w~oUt the City of Kenai unless there
~;~::~~~ Agre~ent d=inq ~he tlme"'i/.::::.iS:';".'-~eVented" from do~'a~"
zdes, li htntn ear es .......................
:;~:.:.~i]~~.~~~re.~train}~~er~ent. ~d p~ple, civ~l disturbances,
~..d~.:~iO'slbns, breakd~n of ..maghznery or e~ipment and 'any'o~er
cause not within the control of the party claiming suspension.
18. For the City to retain the right to terminate the
Agreement should HP~ become insolvent Or become default in any
of its 'obligations, or ask for a receiver or file a petition
in bankruptcy or under the reorganization provisions of the
Bankruptcy Act of the United States.
· .
19. For the City to retain title and ownership of
the System until the full performance of the Agreement.
20. For transfer of the System to H~A'upon full
performance of' the Agreement according to its terms and upon
p&~aent of or provision for payment of all principal and interest
on all of the Outstanding Bonds.
21. For the Agreement to'become-effective upon the
f~rst day of the calendar month af'ter the voters have approved
the entry by the C~ty Council into the A~'~~~t a~. af~
Agreement shall have been ratified and approved by the Board of
. .
D~rectors of HEA and by the Rural Electrification Administration
of the Department of ~griculture, United States of America
·
which ever ~ate shall last occur. ' .... - '
22. For the C£ty to .continue to operate the System for
· the sole account and benefit of the:. 'City... until" the.' Agreement
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effecti ~
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../ :.:'.',:::,'-_ _ .: : ." .:_... .. -:--';:~, . .
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.... .... .~:.~. ,?: :' -::.::::. .. ,::,~... 23 . For such other terms and condtt~ons to be made
.... . ~..: ..-. ... ~_ ,,.:. ._ . ' ~,:, ': ,., .
pa~t of the Agreement :: '-'
as the Council shall deem necessary Or
de'o~::'~able for' ~he pr0te'ct£°n 'of. th~ c'~¥ and'~"~he System.
3. If t~e v~te~s'~;'aPp
e entry into the
.i'..':..:~:?!ii:~',~,~.''~ · ~ ........... i:"-~-~'~;~;!~h~i::~'~i"~::;~:~ :'i~"" ~?'·~.: ~:':~'::~'~"~"':' ':":~'~'~':?'"'"':~:~:.. '-':: ~' .':_i:-':;ii:"..~)¢~::' -,. :. -:
..?~!:i?Agreement .between'the City and HEA as hereinabove set forth,
':'the City will be obligated ....... t° 'grant""a franchise or permit
to HEA, and HEA' desires ..... :(~h~Ve .-a'~:~anchtse 'or.' Permit to °pe~ate
an electrical distribution system during the time the Agreement
·
·
is in force, and thereafter when the System will be transferred
·
to HEA as provided in the Agreement. The City there~re does
grant to H-~A, a. franchise or permit to operate an electrical
distribution system within the City on the terms and conditions
· .
set forth hereinafter.
, ,.
During the time HEA is operating the System an~ ~rior
to the time the System is transferred to HEA, HEA shall maintain
the System, and HEA's system as separate entities, an~ maintain
separate books and accounts, and the provisions of this or~£nance
relative to the franchise shall not be applicable to the system
as distinguished from HEA~s system. Following the transfer of the
System to HEA, all of the provisions of this ordinance relative to
the franchise or permit shall be applicable to any extension of the'
HEA~s System into the City.
Secti0n 4. Grant of Authority
There is hereby granted by the City to HEA' the.right
and privilege to construct, erect, operate and maintain, in,
upon, along, across, above, over and under the streets, alleys,
public ways and public places now laid out or dedicated, and
all extensions thereof, and additions thereto, in the City,
poles, wires, cables, underground conduits, manholes and other
electric fixtures necessary .or .proper for the maintenance and
operation in the City of an electric distributuion 'system and
wires connected therewith.
The right, to use and occupy said streets, alleys, public·
ways and places for the purposes herein set forth .shall not be
exclusive, and the City reserves, the right to grant a similar
use' of said Streets, alleys, public ways and places, to any
person at any. period of 'this franchise.
Section 5. Compliance with Applicable Laws and Ordinances.
, ,
HEA shall, at all times during the life of this franchise,
be subject to all lawful exercise of the~.police power .by the
City, and to such reasonable regulation as the City shall hereafter
by resolution or ordinance provide.
Section 6. HEA Liability - Indemnification.
It is expressly, understood and agreed by and between
HEA and the City that HEA shall save the City harmless from all
loss sustained by the City on account of any suit, judgment,
execution, claim, or demand whatsoever, resulting from negligence
on the part of HEA i~ the construction, operation or maintenance
of its electric system in the City. The City shall notify HEA's
representatiVe. in the City within ten (10) days after the presentation
of any claim or demand, either by suit or otherwise, made against
the City on account of any negligence as aforesaid on the part
of HEA.
Section 7. Serv,ce Standards.
HEA shall maintaxn and operate its plant and system
and render efficient serv,ce in accordance with the rules and
regulations as are, or may be', set forth by the Council as
provided in Section 5 of this ordinance, or by the Public Utilities
.Commission of the State of Alaska.
1. Meter Accuracy. All electric service shall be
supplied through meters which shall accurately measure
the amount of electricity supplied to any .consumer.
a.. Request for Meter' Check. HEA shall at any
time when requested by a consumer make a test of
the accuracy of any electrical service meter..
b. Result' of Meter check. If, upon test, it is
found that such-meter overruns to' the extent of
2 percent or more, HEA shall pay the cost of
such tests and shall make a refund for overcharges
collected since the last known date of accuracy
but for not longer than 60 months, on the basis
of the inaccuracy found to exist at the time of
the tests. If the meter is found to be accurate
or slow or less than 2 per cent fast, the customer
shall pay the reasonable cost of such testing.
c. Compulsory Check. Every meter~ whether com-
plained of or otherwise, shall be removed from
service at least once each seven years and thoroughly
tested for its accuracy. Any meter found inaccurate
upon any test beyond a tolerance of 2 percent
shall not be returned to service until properly
adjusted.
2. Notice of Interruption for Repairs. Whenever it
is necessary to shut .off or interrupt-service for the
purpose of making repairs, adjustments, or installation,
HF.~ shall do so at such time as will cause the least
amount of inconvenience to its Customers, and unless
· such repairs are unforeseen and immediately necessary,
it.shall give reasonab19 notice thereof to the consumers.
Section 8. HEA Rules.
HEA shall' have the authority to promulgate such rules,
regulations, 'terms and conditions governing the. conduct of its
business as shall be reasonably necessary to enable HEA to ex-
ercise its rights and per.form its'obligations under this franchise,
and to assure an uninterrupted service to. each and alI of its
customers. Such rules, regulations, terms and conditions shall
n~'t be in conflict with the provisions hereof or of 'laws of the
State of Alaska, and shall be subject to approval by the Public
Utilities Commission of the State of Alaska.
Section... 9.~ Conditions on Street Occupancy.
1. Use. All transmission and distribution structures,
lines and equipment erected by HEA within the City
shall be so located as to cause minimum interference
with the proper use of streets, alleys and other public
ways and places, and to' cause minumum interference
with the rights or reasonable convenience of property
owners who adjoin any of the said streets, alleys
or other public ways and places.
2. Restoration. In case of any disturbance of pavement,
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sidewalk, driveway or other surfacing, HEA shall,
at its own cost and expense and in a manner approved
·
by the City Inspector, replace and restore all paving
sidewalks, driveway or surface of any street' or alley
disturbed, in as good condition as before said work
was co~enced .
3. Relocation. In event that at any time during the
period of this franchise the City shall lawfully elect
to alter, .or change the grade of, any street, alley or
other P~.b~ic way, HEA, upon reasonable notice by the
City, shall remove, re~ay, and relocate its poles,
· wires, cables and other electrical fixtures at its own
expense.
4. Placement of Fixtures. HEA shall not place poles
or other fixtures where the same will interfere with
..
any electric l~ght, telephone wire or conduit, water
hydrant or water main, and all such poles or Other
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fixtures shall be placed at the outer edge of the side-
walk and inside the curb line, and those placed in alleys
shall be placed close to the line of the lot abutting
on said alley, and then in such a manner as not to
interfere with the usual travel on said streets, alleys
and public'ways.
5. Temporary' Removal of Wire for Building Moving.
HEA shall, on the request of any person holding a
building moving permit issued by the City temporarily
raise or lower its wires to permit the moving of
buildings. The expense of such temporary removal,
raising or lowering of wires shall be paid' by the
person requesting the same, and HEA shall have the
authority to require such payment in advance. HEA
shall be given not less than forty-eight hours'
advance notice to arrange for sUch temporary wire changes.
6. Tree Trimming. HEA shall have the authority to
trim trees upon and overhanging streets, alleys,
sidewalks and public places of the City so as to prevent
the branches of such trees. from coming in contact with
the wires and cables of HEA, all trimming to be done
under, the supervision and direction of" the City and at
the expense of' HEA.
S~¢tion 10. ~referent£al or Discriminatory Practices
Prohibited. HEA shall not, as to rates, charges, service fa¢il-
ities, rules, regulations, or in any other respect, make or grant
any preference or. advantage to any person, nor subject any person
to any prejudice or. disadvantage, provided that nothing in this
franchise shall be deemed to prohibit the establishment, of' a
graduated scale of charges and classified rate schedules to which
any cus=omer coming within such classification would be en=itled.
Section 11. Extension Policy. HEA shall file with
the City Clerk its extension policy as filed, with, and approved
by, the City Council and the Public Utilities Commission of the
State of Alaska and HEA shall not make or refuse to make any
extension except as permitted by this ordinance.
1. Publication. Upon acceptance of this franchise,
HEA at its own expense, shall cause to have published
in a newspaper of general circulation in the City its
extension policy as filed with, and approved by, the City
Council and the Public Utilities Commission of the
State of Alaska and shall annually send to each of its
customers living within the corporate limits of the
City a copy of such extension policy.
Section 12. Approval of Transfer. HEA shall not sell
or transfer its plant or system to another, nor transfer any
rights under this franchise to another without Council a~proval.
No sale or transfer shall be effective until the vendee, assignee
or lessee has filed in the office of the City Clerk an instrument,
duly executed, reciting the fact of such sale, assignment or
lease, accepting 'the terms of the franchise, and agreeing to
perform all .the conditions thereof.
SectiOn 13. City Rights in Franchise.
1. City Rules. The right is hereby reserved to the
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City to adopt, in addition to the provisions herein
contained and existing applicable ordinances, such
additional regulations as it shall find necessary in
the exercise of the police power, provided that such
,
regulations, by ordinance or otherwise, sha~l not be
in conflict with. the laws of the State of A~.
2. Use of System by City. The City shall have the.
right, during the life of this franchise, free of charge,
where aerial construction exists, of maintaining upon
the poles of the City within the City limits wire and
pole fixtures necessary for a police and fire alarm
system, such wires and fixtures to be constructed and
maintained to the satisfaction of the City and in
accordance with its specifications.
a. Complian.~e with HEA Rules. The C'~ty in its
use and maintenance of such wires an fixtures,
shall at all times comply with the rules and reg-
ulations of HEA so that there may be a minimum
danger of contact or conflict between the wires and
fixtures of HEA and the wires and fixtures used
by the City.
b. Liability. The City shall be solely responsible
for all damage to persons or property arising out
of the construction or maintenance of said wires
and fixtures authorized by this Section and shall
save HEA harmless from all claims and demands
whatsoever arising out of the attachment, main-
tenance, change or r'emoval of said wires and fixtures
to the poles of HEA. In case of rearrangement of
HEA plant or removal of poles or fixtures the City
shall save HEA harmless from any damage to persons
or property, arising out of the removal or construction:.
of its wires or other fixtures.
3. Supervision and Inspection. The City shall have
the right to supervise all construction or installa-
tion work performed subject to the provisions of this
ordinance and 'to make such inspections as it shall find
necessary to insure compliance with governing ordinances.
4. Procedure after Termination or Revocation. Upon
the revocation of this franchise by the Council, or at
the end of the term of this franchise, the City shall
have the right to determine whether HEA shall continue
to operate and maintain its plant and distributing system
pending the decisions of the City as to the future
maintenance and operation of the plant and distribution
system.
5. Right of Acquisition by the City. At the expir-
ation of the term for which this franchise is granted,
·
the City, at its election, and upon the payment of an
amount which shall be determined by a valuation provided
by the Alaska Public Utilities Commission or its successor,
shall have the right to purchase and take over the property
of HEA within the City limits of Kenai. Upon the exercise
of this option by the City by the service of an official
notice upon HEA to that effect, HEA shall immediately
execute such deeds or instruments of conveyance to
the City as shall be required to convey to the City.
title to the property in fee simple, free from any
and all liens and encumbrances. HEA shall make it
a condition of each contract entered into by it with
reference to operations under this franchise that the
contract shall be subject to the exercise of this
option by the City and that the City shall have the
right to be substituted for 'HEA as a party to any such
contract and shall have the right to succeed to all
privileges and the obligations thereof at its option.
6. Payment to City. HEA shall pay to the City for the
privilege of operating its system under this franchise
a sum equivalent to _____per cent ( %) of the annual
gross operating revenues taken in and received by it
on all retail sales of electricity with the City.
7. Rates. Rates charged by HEA for service
hereunder shall be fair and reasonable and designed
to meet all necessary costs of the service, including
a fair rate of return on the net valuation of its prop-
erties devoted thereto, under efficient and economical
management. When this franchise takes effect HEA
shall have the authority to charge and collect not
to exceed the rates presently in effect or as approved
by the Public Utilities Commission of the State of
Alaska.
1. Savings to Customers. If during the term of
this franchise HEA purchases electric energy, other
than dump or emergency energy, for distribution,
any savings which accrue to HEA by reason of such
purchase of the electric energy used in the City
shall be forthwith passed on to its consumers.
If during the term of the franchise HEA receives
refunds, or if the cost to HEA of providing electric
service is reduced, 'by order of any regulatory
body having competent jurisdiction the Company shall
pass on to its customers such refunds or any savings
resulting therefrom.
8. Records and Reports. The City shall have access
at all reasonable hours to HEA's plans, contracts, and
engineering, accounting, financial statistical, cus-
tomer and service records relating to the property
and the operation of HEA and to all other records
required' to be kept hereunder. The following records
and .reports shall be filed with the City Clerk and
in the local office of HEA.
1. Rules and Regulations. Copies of such rules,
regulations, terms and conditions adopted by it
for the conduct of its business.
2. Meter Checks. Reports of the results of all
requested and compulsory' meter checks.
3. Gross Revenue. An annual summary report showing
gross revenues received by HEA from its operations
with the City during the preceding year and such
other information as the City shall request with
respect to properties and expenses related to HEA
service within the City.
9. Term of Franchise. The franchise and rights herein
granted shall take effect and be in force from and after
the approval by the voters of the City of this franchise
at a special election to be called and; upon final
execution and approval-of the Agreement between HEA
and the City which is set forth hereinabove.and; upon
filing of .the required acceptance by HEA with the
City Cl~rk and shall continue in force and effect
for a term of thirty (30) years from the effective
date of the Agreement.
10. Publication Costs. HEA shall assure the cost
of publication of 'this franchise ordinance as such
publication is required by law. A bill for publication
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costs shall be presented to HEA by the City Treasurer
upon the Company's filing of acceptance and shall be
paid at that time.
11. Penalties. Any violation by HEA, its vendee,
lessee or successors of the provisions of this franchise
or any material portions thereof, or the failure promptly
to perform any of the provisions thereof, shall be
cause for the forfeiture of this franchise and all rights
hereunder and the City, after written notice to HEA,
a4vising of the default and continuation of such
violation, failure or default for a period of sixty
(60) days following sai4 written notice, may declare
this franchise void.
Sect~..on-14. A copy of this ordinance shall be filed
in the office of the City Clerk and subject to public inspection
for thirty (3~) days after it is filed.
Section 1,5._ A public hearing on whether or not this
ordinance should, be adopted shall be held at 8:00 o'clock
·
P.M. at City Libr.ary 30 _J..une~ .19.7.1 and the City Clerk is
hereby directed to give notice of such public hearing by ~l~cation
in the Cook Inlet Courier at least one week prior to the time
set for the hearing.
Sec.tion ..1.6. Within tWO (2). weeks after this ordinance
has been 'finally adopted, HEA must file with the City Clerk its
unconditional acceptance of all terms of the franchise or permit
as set forth herein. HEA further must deposit with the Department
of Finance of the City, an amount of money estimated by
Clerk to be adequate to pay all expenses of holding the special
election provided for' herein.
·
..
Section 17. The proposition of whether or not the
City shall be authorized to enter into the Agreement with HEA
on the terms and conditions set forth herein, or terms and con-
ditions substantially similar thereto, and whether the City shall,
as a part of such Agreement, adopt the franchise provisions of
this ordinance, as described hereinabove, shall be submitted
to the qualified electors of the City at a special election to be
held therein on 3 Au~us.t, 1971. Said proposition shall be in the
following form:
PROPOSITION NO.
ELECTRIC LIGHT AND POWER
OPERATING AND FRANCHISE AGREEMENT
Shall the City of Kenai, Alaska enter into an
Agreement with Homer Electric Association, Inc.
(HEA) for the operation and management of the City's
Electrical distribution system by HEA and if all the
terms of the Agreement are met, provide for the transfer
of all of the City's electrical distribution system to
HEA and will as a part of said Agreement, grant a fran-
chise or permit to HEA to operate and maintain an electri-
cal distribution system on the p~b~c 'streets and alleys
and other p~blic places of the City of Kenai, for a
period of thirty (30) years all as is more specifically
provided in Ordinance No. 199 adopted June 30, 1971,
which ordinance is hereby SUbmitted for ratification?
OPERATING AND FRANCHISE ORDINANCE YES . . . /~~7
OPERATING AND FRANCHISE ORDINANCE NO . . . ./--.__/
Section 18. Those eligible to vote at said special
_
election must possess the following qualifications:
1. They must be at least 19 years of age.
2. They must be citizens, of the United States, and
for at least one (1) year preceding the election citizens
of the State of Alaska, and for thirty (30) days immedia-
tely preceding the election residents of the City of
Kenai, Alaska.
3. They must be able to read and write the English
language, as prescribed by law.
4. They must not be barred from voting by any other
provision of law.
5. They must be registered in the manner prescribed
in Section 6-3, 6-4, 6-5, 6-6, 6-7 and 6-8 of the
Kenai Code, 1963.
sec..tion..19. For elector or voter registration the
book will be open daily in the office of the City Clerk, City
Administration Building, 'Kenai, Alaska, from 9: 00 o'clock A.M.
until 5:00 o'clock P.M. daily, except Saturdays, Sundays and
holidays. Registration shall be closed five (5) days preceding
the Special election.
A duplicate registration index shall be furnished by
the City Clerk-Registrar to the precinct judges, and clerks of
the election.
sec.tion. 2.0.... Notice of this special election shall
'be p~blished once. a week for not less than two (2) consecutive
weeks in a newspaper of general circulation in the City, and
the first publication thereof shall be not less than fourteen (14)
days prior to said election date. Said notice shall be published
in the '"Cook Inlet Courier" which is hereby determined to be a
newspaper of general circulation within the City.
Notice of this special election shall also be posted
on the official City bulletin board in or on the City Administration
Building and in two (2) other conspicuous" places with the City.
Section 21. The designated polling places will be the
City Administration BUilding, and the Kenai' Airport Terminal
Building. Said polls shall be open from 8:00 o.'clock A.M. to
8:00 o'clock P.M. on the 3_ day of Aug.ust, 1971.
Section 22. The following qualified electors of the
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City are hereby designated and appointed to serve as judges and
clerks at said special election:
Judges Clerks
Precinct No. 1
Chairman
Precinct No. 2
, Chairman
If a replacement shall be required for any of the above-
named officials, such replacement may be appointed at any'meeting
of the City Council.
Section. 2_3,.. This ordinance shall be published in full
after its passage not more than four (4) weeks and at least two
(2) weeks before the election-hereinabove called is held.
Sec_tion 2.4,.. An emergency is hereby declared and the rules
governing the introduction, reading, passage, and approval of this
ordinance are hereby suspended and this ordinance will be immediately
effective upon its passage and approval.
PASSED AND APPROVED this
.... day of . . . ,
1971.
CITY OF KENAI, ALASKA
ATTEST:
By_
ACting'-~ity