TO: Members of the City Council
FROM: Mayor Angela Birney
DEPARTMENT DIRECTOR CONTACT(S):
|
Public Works |
Aaron Bert |
425-556-2786 |
DEPARTMENT STAFF:
|
Public Works |
Vangie P. Garcia |
Deputy Director |
|
Public Works |
Paul Cho |
Traffic Operations and Safety Engineering Manager |
|
Public Works |
Patty S. Criddle |
Transportation Engineering Supervisor |
TITLE:
title
Adoption of an Ordinance for PSE Power and Gas Franchise Agreement
1. Ordinance No. 3207: An Ordinance Granting Puget Sound Energy, Inc., a Washington Corporation, its Successors and Assigns, the Right, Privilege, Authority and Franchise to Set, Erect, Lay, Construct, Extend, Support, Attach, Connect, Maintain, Repair, Replace, Enlarge, Operate and Use Facilities In, Upon, Over, Under, Along, Across and Through the Franchise Area to Provide for the Transmission, Distribution, and Sale of Gas and Energy for Power, Heat, Light, and Such Other Purposes for Which Gas and Energy May be Used
OVERVIEW STATEMENT:
recommendation
The City of Redmond (COR) and Puget Sound Energy (PSE) wish to enter into a new franchise agreement that grants PSE the right to construct, operate, and maintain power and gas facilities within the city’s right of way (ROW). The current franchise agreement expired in 2018.
On November 4, 2024, the proposed PSE Franchise Agreement to continue to provide gas and electric service with the City was introduced for City Council consideration.
The PSE Franchise Agreement has been modified to include the word “remove” at the request of a council member at the November 19, 2024, regular business meeting. The word “remove” has been added to Section 3.1 as follows:
The City hereby grants to PSE the right, privilege, authority and franchise to set, erect, lay, construct, extend, support, attach, connect, maintain, repair, replace, remove, enlarge, operate and use Facilities in, upon, over, under, along, across and through the Franchise Area to provide for the transmission, distribution and sale of gas and energy for power, heat, light, and such other purposes for which gas and energy may be used.
body
☐ Additional Background Information/Description of Proposal Attached
REQUESTED ACTION:
☐ Receive Information ☐ Provide Direction ☒ Approve
REQUEST RATIONALE:
• Relevant Plans/Policies:
RCW 35A.47.040 authorizes the City to permit and regulate under such restrictions and conditions as it may set by charter or ordinance and to grant nonexclusive franchises for the use of public streets, bridges or other public ways, structures or places above or below the surface of the ground for railroads and other routes and facilities for public conveyances, for poles, conduits, tunnels, towers and structures, pipes and wires and appurtenances thereof for transmission and distribution of electrical energy, signals and other methods of communication, for gas, steam and liquid fuels, for water, sewer and other private and publicly owned and operated facilities for public service.
RCW 80.01.040 outlines the powers and duties of the Washington Utilities and Transportation Commission (WUTC) and includes responsibility to “Regulate in the public interest, as provided by the public service laws, the rates, services, facilities, and practices of all persons engaging within this state in the business of supplying any utility service or commodity to the public for compensation.”
RCW 80.28 outlines the regulations of gas, electrical, and water companies. PSE has tariffs on file with the WUTC which govern their gas operations. See PSE | Natural Gas Tariffs & Rules <https://www.pse.com/en/pages/rates/gas-tariffs-and-rules>.
There are additional preemption arguments centered around the federal Energy Policy & Conservation Act, or EPCA, which preempts state and local governments from setting standards “concerning the energy efficiency, energy use, or water use of” products regulated by EPCA. The 9th circuit recently invalidated a Berkeley, CA ordinance seeking to prohibit new building construction with gas connections under these preemption grounds.
• Required:
Franchises are required to have a majority of Council vote in the affirmative (RCW 35A.47.040).
• Council Request:
N/A
• Other Key Facts:
The existing PSE electric franchise agreements has expired.
OUTCOMES:
An updated franchise agreement sets the expectations for a transparent process and partnership between the City and PSE when it comes to operations, restoration, and relocations within the City’s rights-of-way. Under the advice of the attorneys, the language regulating to extend and enlarge gas facilities within the City has remained unchanged as the franchise agreement cannot regulate the utility. Staff will be at the Study Session to answer any further questions the Council may have.
COMMUNITY/STAKEHOLDER OUTREACH AND INVOLVEMENT:
• Timeline (previous or planned):
N/A
• Outreach Methods and Results:
N/A
• Feedback Summary:
N/A
BUDGET IMPACT:
Total Cost:
N/A
Approved in current biennial budget: ☐ Yes ☐ No ☒ N/A
Budget Offer Number:
N/A
Budget Priority:
N/A
Other budget impacts or additional costs: ☐ Yes ☐ No ☒ N/A
If yes, explain:
N/A
Funding source(s):
N/A
Budget/Funding Constraints:
N/A
☐ Additional budget details attached
COUNCIL REVIEW:
Previous Contact(s)
|
Date |
Meeting |
Requested Action |
|
11/4/2024 |
Business Meeting |
Receive Information |
|
11/19/2024 |
Business Meeting |
Provide Direction |
Proposed Upcoming Contact(s)
|
Date |
Meeting |
Requested Action |
|
N/A |
None proposed at this time |
N/A |
Time Constraints:
The previous franchise agreement with PSE has expired and both parties have been working on the updated agreement to minimize the time of working in partnership under terms of an expired agreement. Franchise Agreement approval is requested immediately after the City and PSE have agreed to any proposed language changes.
ANTICIPATED RESULT IF NOT APPROVED:
Continue operating without an executed franchise agreement is not beneficial to the City or its right-of-way.
ATTACHMENTS:
Attachment A: Redline of Proposed PSE Power and Gas Franchise Ordinance
Attachment B: Proposed PSE Power and Gas Franchise Ordinance