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Consent
Item No. 7.
| MEETING DATE: 09/18/2023 |
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| TO: | HONORABLE MAYOR AND COUNCILMEMBERS |
| FROM: | JIM SADRO, CITY MANAGER By: Elias Saykali, Public Works Director |
| SUBJECT: | APPROVE A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LA HABRA, ORANGE COUNTY, CALIFORNIA DECLARING ITS INTENTION TO GRANT A PIPELINE FRANCHISE TO CRIMSON CALIFORNIA PIPELINE, L.P., AND SETTING A PUBLIC HEARING TO RECEIVE ANY OBJECTIONS THERETO
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RECOMMENDATION:
That the City Council "APPROVE AND ADOPT RESOLUTION NO. ____ ENTITLED: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LA HABRA, ORANGE COUNTY, CALIFORNIA DECLARING ITS INTENTION TO GRANT A PIPELINE FRANCHISE TO CRIMSON CALIFORNIA PIPELINE, LC, AND SETTING A PUBLIC HEARING TO RECEIVE ANY OBJECTIONS THERETO" for Monday, October 16, 2023, at 6:30 p.m. in accordance with the California Public Utilities Code.
DISCUSSION:
Ordinance No. 1698 granted a pipeline franchise to Crimson California Pipeline, L.P. in August 2008, which expires in September 2023. In March 2023, Crimson filed an application for a new pipeline franchise agreement and remitted the required $5,000 application fee to the City. Under the California Public Utilities Code and Chapter 5.48 of the City of La Habra Municipal Code, companies seeking franchise agreements must first file an application with the City, and then the City must notice and hold a Public Hearing prior to the granting of the franchise agreement.
If the City Council grants the franchise, Crimson will be required to submit a surety bond to the City in the amount of $100,000, proof of specified insurance coverage, and provide the City with 24-hour emergency contact information. The proposed franchise agreement is for a 10-year term with a five-year renewal option solely at the City’s discretion. This pipeline runs generally from the intersection of La Habra Boulevard and Palm Street south on Palm Street to Lambert Road, east on Lambert Road to the La Habra/Brea City Limits and beyond into the City of Brea. The portion within the City of La Habra has an active portion of 2,868.39 linear feet, an idle portion of 299.81 linear feet for a total length of 3,169.20 linear feet.
If the City Council grants the franchise, Crimson will be required to submit a surety bond to the City in the amount of $100,000, proof of specified insurance coverage, and provide the City with 24-hour emergency contact information. The proposed franchise agreement is for a 10-year term with a five-year renewal option solely at the City’s discretion. This pipeline runs generally from the intersection of La Habra Boulevard and Palm Street south on Palm Street to Lambert Road, east on Lambert Road to the La Habra/Brea City Limits and beyond into the City of Brea. The portion within the City of La Habra has an active portion of 2,868.39 linear feet, an idle portion of 299.81 linear feet for a total length of 3,169.20 linear feet.
FISCAL IMPACT/SOURCE OF FUNDING:
Crimson will be responsible for payment of annual franchise fees by April 1st of each year. Franchise fees are set by the Public Utilities Commission based on the diameter and linear feet of the pipeline. Based on the PUC formula, and including future estimated CPI increases, the annual franchise fees on this pipeline will be approximately $1,268 per year.
GENERAL PLAN RELEVANCE/CITY COUNCIL GOALS & OBJECTIVES:
GENERAL PLAN RELEVANCE
SM 2.1 Compatible Design and Operations.
CITY COUNCIL GOALS AND OBJECTIVES:
Goal 2 – Management of Public Revenues and Fiscal Assets
Objective A – Closely monitor revenues, expenditures, and fiscal trends to ensure the City’s long-term fiscal stability.
SM 2.1 Compatible Design and Operations.
CITY COUNCIL GOALS AND OBJECTIVES:
Goal 2 – Management of Public Revenues and Fiscal Assets
Objective A – Closely monitor revenues, expenditures, and fiscal trends to ensure the City’s long-term fiscal stability.