Loading...
HomeMy WebLinkAbout2018.10.29 Council Special Meeting PacketSpecial Meeting AGENDA PASCO CITY COUNCIL 7:00 p.m. October 29, 2018 Page 1. CALL TO ORDER: 2. ROLL CALL: (a) Pledge of Allegiance 3. HEARINGS AND COUNCIL ACTION ON ORDINANCES AND RESOLUTIONS RELATING THERETO: 3 - 16 (a) 2019 Ad Valorem Tax Levy CONDUCT PUBLIC HEARING MOTION: I move to adopt Ordinance No. 4398, providing for the 2019 Ad Valorem Tax Levy in the City of Pasco in accordance with State Law and, further, authorize publication by summary only. 4. ORDINANCES AND RESOLUTIONS NOT RELATING TO HEARINGS: 17 - 33 (a) Pacific Power Franchise Extension MOTION: I move to adopt Ordinance No. 4399, extending the franchise for Pacific Power Corporation for a period of six months. 5. NEW BUSINESS: 34 - 41 (a) *Bid Award: 1800059 Wastewater Treatment Plant PLC and Controls Upgrade MOTION: I move to award the Wastewater Treatment Plant (WWTP) PLC and Controls Upgrade project to Townsend Controls and Electric, LLC. in the amount of $814,172.48 and, further, authorize the City Manager to execute the contract documents. 42 - 43 (b) *Performance of a City Official MOTION: I move to accept the final report by Kenbrio Inc. reflecting the City Council's corporate view of the City Manager's performance for the period June 2017 - June 2018. Page 1 of 43 Special Meeting October 29, 2018 6. ADJOURNMENT. Page 2 of 43 AGENDA REPORT FOR: City Council October 18, 2017 TO: Dave Zabell, City Manager Special Meeting: 10/29/18 FROM: Richa Sigdel, Director Finance SUBJECT: 2019 Ad Valorem Tax Levy I. REFERENCE(S): Recommended Ad Valorem Tax Ordinance White Paper on Property Tax Levy II. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS: CONDUCT PUBLIC HEARING MOTION: I move to adopt Ordinance No. ____________, providing for the 2019 Ad Valorem Tax Levy in the City of Pasco in accordance with State Law and, f urther, authorize publication by summary only. III. FISCAL IMPACT: Sets the City share of the property tax rate. IV. HISTORY AND FACTS BRIEF: As part of the annual budget process, per RCW 84.55.120, cities are required to conduct a public hearing on General Fund revenue sources for the coming year's budget, including possible increases in property tax revenues. Following the hearing, Council may choose to pass an ordinance at the same meeting authorizing the property tax levy for the ensuing year, consistent with statutory limitations. State statue limits the property tax rate the City can levy to $3.60 per $1,000 of assessed valuation. Other general fund revenue includes sales tax, fees and charges, utility taxes, fines and forfeitures, and transfers. Property tax, however, requires a public hearing and vote separate from the budget and is the primary focus of this narrative. Page 3 of 43 Revenues generated through the City property tax levy represent a major source of funding for essential government services such as: police, fire, parks, community development, finance, administration, as well as a significant portion of streets and other services deemed necessary by the Council through the budget process. In 2001, the voters approved Initiative 747 limiting the amount taxing districts could increase the total property tax levy over the previous year by the lesser of 1% or the Implicit Price Deflator (IPD) without voter approval. In November 2007, that initiative was challenged and ruled unconstitutional by the Washington State Supreme Court; the Court's ruling returned the limit to the lesser of 6% or IPD. The Legislature subsequently placed into law those limits suggested by I-747. The current legal limit is the lesser of 1% or IPD. The IPD differs significantly from a regional Consumer Price Index (CPI) in that, unlike the CPI, the IPD is not based on a fixed basket of goods and services in a region. The IPD basket spans the nation and is based on changes from year to year with people's consumption and investment patterns. The IPD figure for the 2019 tax calculation is 1.0%. Since final tax levy data has yet to be issued by Franklin County Assessor’s Office, including information on any increases to State-assessed utilities, the calculations provided herein are estimates. Furthermore, because the Assessor’s Office is not allowed to set the levy to exceed what is shown in the City’s budget, we are p roviding information on both our estimated calculations and the rounded amount to be used for presentation in the budget. V. DISCUSSION: CITY PROPERTY TAX LEVY OPTIONS FOR 2019 Based on the rationale provided within the attached white paper and provided at the previous City Council Workshop, the City Manager's recommended budget has been prepared using an estimated property tax levy of $10,491,963, less $179,498.06 to account for delinquency, and is represented by Option C below. Option A reflects an estimated increase of $418,928 over the 2018 levy amount. The proposed increase in property tax revenue is derived by a combination of enacting the recommended and statutorily allowed 1.0% increase in the City property tax levy, and an estimated increase in assessed valuation due to new construction and annexation in 2018. The effect of the new construction and annexation adds to the overall assessed valuation of the City, which in turn serves to reduce the levy rate for 2019 by $0.121 from the $1.746 per $1,000 of assessed valuation in 2018 to $1.625 in 2019. Option B depicts the amount the City would collect if the Council chose to adopt the statutorily allowed 1.0% increase, plus an estimated increase due to new construction Page 4 of 43 and annexation in 2018, and banked capacity of $1,500,000. $1,500,000 is the estimated debt service cost to relocate and build two fire stations as discussed previously. This alternative would increase the levy rate for 2019 by $0.156 per $1,000 of assessed valuation from $1.746 in 2018 to $1.902 in 2019 and facilitate progress of the Council goal to maintain the recent improvement in the City's community rating by the Washington State Rating Bureau. Option C depicts the amount the City would collect if the Council chose to adopt the statutorily allowed 1.0% increase, plus an estimated increase due to new construction and annexation in 2018, and the full banked capacity of $1,860,000. This alternative would increase the levy rate for 2019 by $0.222 per $1,000 of assessed valuation from $1.746 in 2018 to $1.968 in 2019 and facilitate the progress of Council goals requiring significant capital investments like fire stations, levee lowering and a community center. A more thorough explanation and rationale for the three options is provided in the attached white paper. For 2019, the Franklin County Assessor has provided a preliminary City assessed valuation of $5,422,601,412, which will be used as the basis to calculate the 2019 property taxes. This amount includes new construction of $186,110,300 and an estimated State-assessed utility of $7,000. RECOMMENDATION As staff presented during the October 22, 2018 Council Workshop, Staff recommended that Council implement Option C explained above. STATUTORY DEADLINE FOR PROPERTY TAX DETERMINATION Finally, for the Franklin County Assessor to levy property taxes, the City is required to certify property tax levies with the County by November 30th of each year. Page 5 of 43 1 | Page    Introduction Council has been briefed previously on the need to replace Fire Stations 83 and temporary Station 84, along with possible funding alternatives. To summarize, relocation of Fire Station 83 to the vicinity of Road 68 and Sandifur Parkway will significantly lessen response times to homes and businesses within the station service area and accommodate for response times within adopted standards for the developing areas in the Road 100 area. While the repurposing of an old volunteer station and modification of an adjacent single-family home on Road 48 south of Court Street as a temporary Fire Station (84) greatly accelerated the City’s ability to improve response times in the Riverview area, a permanent Fire Station 84, designed for the mission and located closer to Court Street arterial is necessary. Both stations are proposed to be located on property the City currently owns. Background The recently adopted Emergency Services Master Plan identified the relocation of Fire Station 83 to the area of Road 68 and Sandifur Parkway, and the construction of a permanent Fire Station 84, which will be located near Court Street in the Riverview area. This action was recommended as the most efficient and effective manner in which to meet the travel time recommendations of 6 minutes to 90% of incidents experienced within the City limits. While beneficial on all levels to residents, businesses and property owners within the City, these proposed stations represent a significant financial investment which will necessitate the issuance of debt and the need for a funding source to service the debt. The City has a few options for the Council to consider in funding such a significant investment which are listed immediately below. Fire Station Projected Costs The City Council was provided a briefing on August 27, 2018 on the Station 83 and 84 projects, with estimated costs reported at approximately $21 million dollars for both facilities. In the interim, Staff has worked closely with the pre-design team and has been able to reduce projected costs to $18 million dollars without sacrificing the quality or utility of either station. Assuming a 20-year loan with an interest rate of 5.0%, the annual debt service needed to fund these two projects is approximately $1.5 million. Page 6 of 43 2 | Page    Funding Alternatives Options: As discussed during the September briefing, there are essentially three means by which to finance a project like the Fire Station replacement. As a refresher, below is a description of each of the available options and pertinent background information. Unlimited Tax General Obligation Bond (UTGO) A common method of financing capital improvements for local governments is through the issuance of municipal bonds known as “Unlimited Tax General Obligation Bonds” or “UTGO Bonds.” The voters of the local government must approve UTGO Bonds. UTGO Bonds are secured by and payable out of annual property taxes, in excess of regular property taxes, unlimited as to rate or amount. In other words, a local government is obligated to levy excess property taxes at whatever rate is necessary to repay the UTGO Bonds. Further, UTGO Bonds constitute a general obligation of the local government, and, as such, the full faith, credit and resources of the local government are pledged for their repayment. The approval process requires the local government voters to approve the bond ballot proposition at a properly conducted election. UTGO Bonds must be approved by 60% of the qualified voters within the local government. In addition, the total number of voters casting ballots at the election cannot be less than 40% of the number of votes cast in the last State general election. Further, a local government may only place a bond ballot proposition before its voters twice in any calendar year. Voted indebtedness for cities may not exceed 2.5% of Assessed Value (AV) for general municipal purposes (any outstanding non-voted or councilmanic debt is counted against this 2.5%), 2.5% for certain utility purposes, and 2.5% for certain parks, open space and economic development purposes. The total amount of voted and non-voted debt may not exceed 7.5%. The City has significant bonding capacity, with voted indebtedness being 0.2588% in 2017. The City has no UTGO bonds outstanding. The last UTGO bond issued by the City was in 1999 to fund a Library and a Fire Station (Station 81). The graph below illustrates the City’s total net debt as a percentage of debt limit for general municipal purposes since the high point of 1994. Page 7 of 43 3 | Page    Limited Tax General Obligation Bond (LTGO) Another often utilized method of financing capital improvements is through the issuance of Limited Tax General Obligation Bonds, also called “councilmanic” bonds or non-voted debt. These bonds may be issued by a majority vote of the legislative body. Because the voters have not been asked to approve a tax increase to pay for the principal and interest, existing general fund revenues must be pledged to pay the debt service on a LTGO Bond. It is important to note that unlike the UTGO process, LTGO debt does not provide any additional revenue to fund debt service payments, but must be paid from existing revenue sources. As an example, the City issued $8,795,000 of LTGO bond in 2015 to build the Pasco Police and Community Services Building, which is being serviced by a voted Public Safety Tax. 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% TOTAL  NET DEBT AS A  PERCENTAGE OF DEBT  LIMIT Page 8 of 43 4 | Page    Fire Tax Levy Municipalities are authorized to levy an additional property tax of $0.225 per thousand dollars of assessed value against all taxable property. The graph below illustrates a rapidly declining property tax rate for the City since 2006. This decline is primarily due to the statutory limit of a 1% increase on prior year’s property tax, rising home and property values, and the addition of assessed valuation through new construction within the City and annexations. The City has been levying a Fire Tax Levy for at least the last five decades. Once the rate was incorporated into the property tax, it became subject to the same restrictions as the City’s general levy. Thus, this levy rate has been significantly diluted as the assessed valuation of the City has grown. Upon consultation with numerous property tax law experts, Municipal Research and Services Center (MRSC), and Department of Revenue (DOR), it has been determined that there is no way under current law to restore the original levy rate to the statutory $0.225 per thousand dollars of assessed valuation. Page 9 of 43 5 | Page    Debt Service Whether a bond is voter approved (UTGO) or councilmanic (LTGO), the debt on that bond requires servicing for the length of the bond. As noted above, a UTGO bond is serviced by revenue generated from voter-approved increased property taxes. However, existing financial resources can service councilmanic bonds, such as an increase in revenues through property taxes, increased utility taxes, or other stable sources of revenue. A quick feasibility of these alternatives concludes the following:  Use of current resources. The City lacks existing General Fund revenues on a level to service the amount of debt necessary to fund development and construction of the aforementioned Fire Stations.  Increase in utility tax on all utilities. The voters previously approved an increase in utility taxes to 8.5% several years ago to fund pavement preservation and public safety. While it is possible to ask the electorate to increase the utility tax, this would create a revenue source that will increase over time for a cost that is fixed for the term of the bond.  Increase in utility tax on city-owned utilities. Similar to the option above, with a significant difference being that Council can unilaterally increase the utility tax on city-owned utilities, such as water, sewer, stormwater, and irrigation. A difference being that this source could be adjusted by Council periodically to match debt service needs or other purposes approved by Council.  Use of banked capacity. Beginning in 1986, local governments have been allowed to levy less than the maximum increase in property taxes allowed under law without losing the ability to levy higher taxes later, if necessary. This provision encouraged districts to levy only what they needed rather than the maximum allowable with the confidence that, when additional revenues were needed, they would be available, subject to a vote of the legislative body. The banked capacity concept allowed municipalities to be more fiscally conservative and strategic without being penalized. The City has taken advantage of the flexibility allowed by law and has opted to bank the capacity over the years as part of a long-term strategy. The banked capacity for the City as of 2010 was $1,525,000 annually. However, a Department of Revenue (DOR) audit of Franklin County Assessor’s Office conducted in 2010 reduced the City’s banked capacity to $114,000. In evaluating the history of this transition over the past couple of years, Staff came to believe that this reduction by DOR was based on a clerical error and that the adverse annual financial impact of $1,411,000 was not proportional to the error. Staff has been working with the Franklin County Assessor’s office and DOR to resolve this issue for the past two years. As of October 16, 2018, both DOR and Franklin County Assessor’s office are in agreement with the City’s assessment of the situation. DOR has provided the Franklin County Assessor’s office a path forward for reinstatement of the City’s banked capacity to an amount of $1,859,000. This Page 10 of 43 6 | Page    process is expected to be completed by end of November 2018. Without this action, the City’s banked capacity was slated to be just over $400,000 annually. To provide a frame of reference, $1,859,000 (implementation of the full-banked capacity available to the City) represents a potential increase from $1.746 to $1.968 per $1,000 assessed valuation, an increase of $0.222 per $1,000 of assessed valuation. This increase adds up to about $44 a year for a home valued at $200,000. Fire Station Funding Strategies Given the above, the most plausible courses of action to establish a reliable source of funding for the Fire Stations are: 1) UTGO, or 2) LTGO, with the strategic use of banked capacity. Should Council choose to build the new Fire Stations, the UTGO bond option provides the City with new revenue in the form of an additional tax levy to service the debt. However, as mentioned above, UTGO Bonds must be approved by 60% of the voters within the local government. In addition, the total number of voters casting ballots at the election cannot be less than 40% of the number of votes cast in the last State general election. The City would put the UTGO bond vote to the people in 2019 with the hope that the bond will not only get 60% of the votes, but also that 40% of the number of votes cast in the 2018 General Election will be cast in 2019. If the bond is approved, the construction of the fire stations will be moved to 2020-2021, and Staff estimates the cost escalation for this project to be about $900,000 each year due to construction cost inflation plus the cost of the election. If Council chooses to issue a LTGO bonds through a majority vote of the Council, construction could commence in 2019 and the construction inflation referenced above would be avoided. The $1.86 million in banked capacity is the result of Council choosing to save the statutorily allowed increase to property taxes over many years. Due to this, the only action needed to implement banked capacity is majority Council approval during the yearly Ad Valorem Tax Levy process. An LTGO bond without taking the banked capacity will necessitate at least $1.5 million dollars of yearly cost reductions to the General Fund which could not occur without immediate major program reductions that would be difficult to implement and more difficult to sustain over the life of the bond. As noted above, projected debt service for the Fire Stations is approximately $1.5 million annually. However, should Council choose to implement all of the available banked capacity, projects like the Community Center and Levy Lowering, with potential for uniform benefit across the community, could be partially funded through this process with the excess. Additionally, Council has approved seven full-time equivalent (FTE) positions to strengthen public safety: three in Fire and four in Police. Currently these positions are being partially reimbursed through grants; however, the City will incur full costs upon completion of the three-year period of performance for both grants. Page 11 of 43 7 | Page    Recommendation Staff recommends that Council implement all of the banked capacity available to the City and authorize the issuance of LTGO bonds to be serviced with the banked capacity for following reasons: 1. Council had been banking the levy authority to fund future capital projects like Fire Stations and the Community Center. 2. The McCleary Act creates a one-time windfall of historic proportions for all property taxpayers in the City by reducing the property tax for residents by approximately $2.44 per $1,000 assessed value. This provides the City a rare opportunity to take the banked capacity without significantly impacting the tax burden of its residents. The graph below illustrates the actual property tax amounts collected in 2016, 2017, projected for 2018 based on current levy rates, and estimated for 2019. The increase in the 2018 tax is due to the increase in State taxes to fund basic education, whereas the drop in 2019 represents the decrease in the School Maintenance and Operation Bond from the current amount of $3.94 to $1.50 per $1,000 assessed value. This drop represents a significant decrease of $488 a year for a home with an assessed value of $200,000. As previously mentioned, the estimated increase in property tax due to the City taking the banked capacity is estimated at $44 annually for the same home. The property owner will still benefit from a substantial decrease in property tax. 3. Council has made a significant investment to the public safety services in last five years. This includes an increase in staffing, investment in infrastructure – for example, the temporary Fire Station and Burn Training Prop – consolidation of emergency dispatch services, and the addition of programs such as Community Risk Reduction. This long-term vision and commitment to the community has made a significant impact; the City has been recognized as the third safest City in Washington and the Washington State Rating Bureau has improved the community rating from Class 5 to Class 3. The improvement to the City’s community rating class alone equates to an estimated savings of $100 per year Page 12 of 43 8 | Page    for a typical household within the City, more than double the impact of the increased City levy, should the Council implement all of the City’s banked capacity. 4. Finally, Staff spent a considerable amount of effort to reinstate the banked capacity from $400,000 to the current $1,859,000. There are lingering concerns over the future of the current capacity and any subsequent audits that might reduce it further. Staff is confident that the City and the Franklin County Assessor’s Office have been correctly banking the capacity. The City is not the primary party to certify levies to the State; the County does. As we have experienced, the risk of any mistake, not just by the City, but by the County or the State can negatively affect the official banked capacity of the City. In this case, the tenacity of the Finance Director is what brought life back to this alternative. Staff is requesting Council to consider the following options: Option A: Council would fund the fire stations through a UTGO and have a voted bond pay for the resulting debt service. This option increases the property tax rate by $.29 or $59 per year for a home assessed at $200,000. Option B: Council would opt to take $1.5 million of levy capacity banked by the Council in previous years to fund debt service for the fire stations and leave the remaining banked capacity to be implemented, or not, at some point in the future. This option increases the property tax rate by $.156 or $31 per year for a home assessed at $200,000 Option C: Recommended option, Council would implement all of the levy capacity banked by the Council in the previous years. This will help the City fund debt service for the Fire Stations, the Community Center, Levee Lowering, and other large infrastructure projects, if Council decides to undertake them. This option increases the property tax rate by $.222 or $44 per year for a home assessed at $200,000. As an alternative to the options outlined above, Council could opt not to construct the new stations at this time. This would result in limiting growth in the Broadmoor area due to the limited reach of Station 83 in its current location, and the continued use of temporary Station 84 which was built for another time and purpose and does not meet standards. Conclusion and Recommendation In summary,  A voted UTGO Bond will conservatively add nearly $1.8 million in construction costs to the project due to a two-year delay in the construction schedule.  Implementation of banked capacity, Options B and C, will potentially generate similar concerns as the difference in impact between the two is minimal.  Through Council’s prior actions in the area of fire protection and community safety, the resulting Class 3 designation will save the example $200,000 home an estimated $100 annually on homeowners insurance. All properties across the community will enjoy a $2.44 per thousand of assessed valuation decrease in Page 13 of 43 9 | Page    overall property taxes equating to an annual reduction of $488 for the example $200,000 home.  Finally, the need for the Fire Stations, but also the Community Center, and possible backfill for the police and fire grants as they time out, are all justified needs of the community. This writer does not take the topic of property tax increases or the exercise of unilateral authority of City Council lightly; however, the aforementioned factors coexisting at one point in time represent a minimal impact on the community tax-wise, while providing a maximum benefit service-wise and are a set of circumstances one could only imagine. If there is ever a time to use banked capacity, in my experience, and based on the unique circumstances at-hand, such an action could not be more easily explained, justified and defended. For these reasons, Staff will be recommending that the Council opt to exercise Option C by levying the full $1,859,000 of banked capacity during the Ad Valorem Tax discussion Monday evening. Council is not anticipated to take potential action on this recommendation until the October 29th Special Meeting. Page 14 of 43 -1- ORDINANCE NO. ________ AN ORDINANCE of the City of Pasco, Washington, providing for an increase in the regular property taxes of the City for levy in 2018 and collection in the 2019 tax year; preserving levy capacity for future years; and providing for related matters. THE CITY COUNCIL OF THE CITY OF PASCO, WASHINGTON DO ORDAIN AS FOLLOWS: §1. Findings and Determinations. The City Council (the “City Council”) of the City of Pasco, Washington (the “City”), makes the following findings and determinations: (a) RCW 84.55.120(1) provides that the City Council must hold a public hearing on revenue sources for the following year’s current expense budget and that the hearing must include consideration of possible increases in property tax revenues and must be held prior to the time the City levies the taxes. (b) RCW 84.55.120(3) provides that the City may not authorize an increase in property tax revenue from the previous year except by adoption of a separate ordinance or resolution, pursuant to notice, specifically authorizing the increase in terms of both dollars and percentage. (c) Pursuant to proper notice, the City Council held a public hearing on October 30, 2018 (the “Hearing”), to consider the City’s 2019 current expense budget and its revenue sources, along with consideration of possible increases in property tax revenues. (d) The City’s actual levy amount from the previous year was $8,392,576. (e) The City has a population that is greater than 10,000. (f) The City Council, after the Hearing and after duly considering all relevant evidence and testimony presented, determined that the City requires an increase in property tax revenue from the previous year, in addition to that resulting from the addition of new construction and improvements to property, newly constructed wind turbines, solar, biomass and geothermal facilities, if the facilities are not state assessed, any increase in the value of state-assessed property, any annexations that have occurred and any refunds made, in order to discharge the expected expenses and obligations of the City and in its best interest. §2. Property Tax Increase Authorized. An increase in the regular property tax levy of the City is authorized for the levy to be collected in the 2019 tax year. The dollar amount of the increase over the actual levy amount from the previous year is $1,943,883 (one million nine hundred forty-three thousand eight hundred eighty-three dollars), which is a percentage increase of 23.16% (twenty three and sixteen one hundredths of one percent) from the previous year. This increase is exclusive of additional revenue resulting from new construction, improvements to property, any increase in assessed value due to construction of wind turbine, solar, biomass and geothermal facilities, if the facilities are not state assessed, any increase in the value of state assessed property, any annexations that have occurred and any refunds made. Page 15 of 43 -2- §3. Transmittal. The City Clerk is authorized and directed to transmit a certified copy of this ordinance to the Franklin County Assessor on or before November 30, 2018. §4. General Authorization and Ratification. The City Manager, the Finance Director of the City, the City Clerk and other appropriate officers of the City, and each of them acting alone, are authorized and directed to take any action and to execute any document as in their judgment may be necessary or desirable to effectuate the provisions of this ordinance. All prior actions in furtherance of and consistent with the terms of this ordinance are ratified and confirmed. §5. Effective Date. This Ordinance takes effect five (5) days after passage and publication. Adopted by the City Council of the City of Pasco this ___ day of ____________, 2018. _____________________________ Matt Watkins Mayor ATTEST: APPROVED AS TO FORM: _____________________________ ___________________________ Daniela Erickson Leland B. Kerr City Clerk City Attorney Page 16 of 43 AGENDA REPORT FOR: City Council October 18, 2018 TO: Dave Zabell, City Manager Special Meeting: 10/29/18 FROM: Stan Strebel, Deputy City Manager Executive SUBJECT: Pacific Power Franchise Extension I. REFERENCE(S): Proposed Ordinance Vicinity Map Ordinance 3882 II. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS: I move to adopt Ordinance No. ________, extending the franchise for Pacific Power Corporation for a period of six months. III. FISCAL IMPACT: IV. HISTORY AND FACTS BRIEF: Pacific Power Corporation operates an electrical transmission line which runs from Pasco east to Highway 12 and into Walla Walla County. Pacific Power's substation is located near the Port of Pasco dock on the Columbia River, west of the railroad bridge. Pacific has a franchise with the City in order to place its lines within the rights -of-way. The franchise has been in place for decades. The current franchise, for a 10 year term, was approved by Council in October 2008 (Ordinance No. 3882). Staff is working with Pacific to come to agreement on a franchise document to be presented to Council. In the interim, Staff recommends an extension of the existing franchise until a replacement agreement is complete. The attached proposed Ordinance provides for an extension of 6 months, until April 25, 2019. V. DISCUSSION: Page 17 of 43 Ordinance - 1 ORDINANCE NO._______________ An ORDINANCE of the City of Pasco, Washington, Extending the Electrical Power Franchise Agreement with PacifiCorp an Oregon Corporation Doing Business as Pacific Power and Light Through April 25, 2019 WHEREAS, the provision of electric power services is a critical service for many Columbia Basin residents, businesses and the public at large; and WHEREAS, provision of electrical power services necessitates an agreement for use of public right-of-way between the City of Pasco (“City”) and all electrical power service providers operating facilities within the City limits; and WHEREAS, the current electrical power franchise agreement was entered into pursuant to Ordinance No. 3882 on October 20, 2008; and WHEREAS, said Franchise has a date of expiration on October 25, 2018; and WHEREAS, Grantee and the City have been unable to complete negotiations on terms for a Franchise renewal prior to the Franchise expiration date; and WHEREAS, the City is willing to grant an extension of the current Franchise until April 25, 2019 while it considers provisions within the renewal request, if PacifiCorp agrees to abide by the terms and conditions of the existing Franchise during any such extension, and neither party is otherwise prejudiced by the extension; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PASCO, WASHINGTON, DO ORDAIN AS FOLLOWS: Section 1. Extension of the Term of the Franchise Agreement through April 25, 2019. The Franchise rights granted under the above-mentioned Franchise Agreement, dated October 20, 2008 under the authority of Ordinance 3882, as amended, are hereby extended subject to the terms and condition set forth below until the earlier of April 25, 2019 or when a new Franchise Agreement is enacted by the City. Section 2. Terms and Conditions of Extension of the Agreement. The City’s consent to the extension, described above, is subject to, and conditioned upon, the following terms and conditions: A. All terms and conditions of the existing Franchise Agreement shall remain in full force and effect beginning on the expiration date of the Franchise Agreement entered into pursuant to Ordinance No. 3882 and during the extension period. Page 18 of 43 Ordinance - 2 B. The extension shall have no adverse effect on Grantee’s compliance, nor shall the extension be grounds for any change or modification in the remaining terms, conditions and obligations of the Franchise Agreement. Further, the extension of the franchise agreement will not affect, diminish, impair or supercede the binding nature of the existing ordinances and agreements applicable to operation of the electric system. C. The City and Grantee’s agreement to extend the Franchise Agreement, as set forth herein, shall not be construed, in any manner whatsoever, to constitute a waiver or release of any rights that the City or the Grantee may have under the Franchise Agreement. D. Nothing herein shall be deemed or construed as a waiver, release or surrender of any right that either party may have under any applicable law. Section 3. This Ordinance shall take full force and effect five (5) days after its approval, passage and publication as required by law. PASSED by the City Council of the City of Pasco, Washington, and approved as provided by law this ____ day of October, 2018. __________________________________ Matt Watkins, Mayor ATTEST: APPROVED AS TO FORM: __________________________________ __________________________________ Daniela Erickson, City Clerk Leland B. Kerr, City Attorney Page 19 of 43 V :I11 u....{.‘,. Ir ‘ ‘ I ‘—1 --I ‘L __ '"l M ‘I _....-._J -.v39" I’' ‘1 _ “ ,"9“rr-.-.r,.nr.‘1..-.-.‘2 ‘ Mm 1 —m .1‘,y .1 _____‘_.‘_54?:V)—‘.—-«—A_g _'-' —-—.._ i 9 »“'___.-...- .w.‘.; am: 7 ’!‘mm. m.» M ! r~......'\4 ..M72 ,\ \~—M»:‘um.-n'.‘..\ _m.:um:.3 aw \ .~1. ‘.;'‘ ~—-. “ M. -3..__ F-a m ' A sn 1‘ ,1‘r ... ‘ —nuuvru ~..._rnnum.+:w..a ‘--A-<-> m«r "n »,.,,_,“-, mm |\-in n -.".'«ArkPasco,WA A V_‘*C"VL‘"'”VPACIFICORP 1 .T I515snwaxrsnvus »-1 Pacificorp Transmission Line Daalsprmertedin > Sdvm?v-w ‘ ' um Zone 11,NADE2,m2Iers '.4-W ‘ ,___Paci?corp Distribution Line Pzd?carvmakesnuvevresentahonsurwzrranllesistolhe r_-:-'-yr‘. I’m__\accuracy,completeness er mnesslora panmnarpurpnse , VwithrespectIntheinformationuenramedinthismap '.__Pici?cnrpsha?hav:nu mpansubuny nrhzbxlitym aw -,,_,A pauflcorp gubstatmn pssan or enmyresullmg fmm thzuseufanvlnfarmntlun . furnished In thts map .7 N00512 M ' Miles A '»‘ ' ""‘‘ -" _ -1’_ my (_.-...1 . oum/zru:nzusvzzGwmzpz ,m<.»:mrp.:om \\w ram us\rifs\PDXCO\5H|?C7\TC omIs\r=.,-ns\zo1s\»a—z1o\P.~.scn or Ivlew mxnPage 20 of 43 ORDINANCE NO. g AN ORDINANCE OF THE CITY OF PASCO, WASHINGTON, GRANTING TO PACIFICORP, AN OREGON CORPORATION DOING BUSINESS AS PACIFIC POWER& LIGHT COMPANY, A NON-EXCLUSIVE FRANCHISE TO CONSTRUCT, INSTALL, OPERATE, AND MAINTAIN AN ELECTRICAL POWER TRANSMISSION AND DISTRIBUTION SYSTEM IN, ON, OVER, UPON, ALONG, AND ACROSS CERTAIN DESIGNATED PUBLIC RIGHTS-OF-WAY OF THE CITY OF PASCO, WASHINGTON, PRESCRIBING CERTAIN RIGHTS, DUTIES, TERMS, AND CONDITIONS WITH RESPECT THERETO, AND ESTABLISHING AN EFFECTIVE DATE WHEREAS, PacifiCorp, an Oregon Corporation, d.b.a. Pacific Power ("PacifiCorp"), is a regulated public utility that provides electric power and energy to the citizens of the City of Pasco (the "City") and other surrounding areas shown in Exhibit A; and WHEREAS, providing electrical power and energy requires the installation, operation and maintenance of power poles and other related facilities to be located within the public ways of the City shown in Exhibit A; and WHEREAS, the City desires to set forth the terms and conditions by which PacifiCorp shall use the public ways of the City; and WHEREAS, the City Council has the authority under RCW 35A.47.040 to grant franchises for the use of its streets and other public properties. NOW, THEREFORE, be it ordained by the City: SECTION 1. Grant of Franchise and General Utility Easement. The City hereby grants to PacifiCorp the right, privilege and authority to construct, maintain, operate, upgrade, and relocate its electrical distribution and transmission lines and related appurtenances, including underground conduits and structures, poles, towers, wires, guy anchors, vaults, transformers, transmission lines, and communication lines (collectively referred to herein as "Electric Facilities") in, under, along, over and across the present and future streets, alleys, and public ways (collectively referred to herein as "Public Ways") within the City, for the purpose of supplying and transmitting electric power and energy to the inhabitants of the City and persons and corporations beyond the limits thereof. PacifiCorp shall apply for and obtain a Construction Permit pursuant to PMC Chapter 12.2 prior to site-specific location and installation of any and all such electrical power facilities. All other Franchises heretofore granted by the City to PacifiCorp or its predecessors in interest of which it has acquired for utilization of streets, avenues, right-of-way, roads, alleys, lands or other public places within the City for electrical power, are cancelled and superseded in their entirety by this Franchise 1 Page 21 of 43 SECTION 2. Term. The term of this Franchise and General Utility Easement is for 10 (ten) years commencing on the date of acceptance by the Company as set forth in Section 3 below. SECTION 3. Acceptance by PacifiCorp. Within sixty (60) days after the passage of this ordinance by the City, PacifiCorp shall file an unqualified written acceptance thereof, with the City Recorder, otherwise the ordinance and the rights granted herein shall be null and void. SECTION 4. Non-Exclusive Franchise. The right to use and occupy the Public Ways of the City shall be nonexclusive and the City reserves the right to use the Public Ways for itself or any other entity that provides water or sewerage service to City residences; provided, however, that such use shall not unreasonably interfere with PacifiCorp's Electric Facilities or PacifiCorp's rights granted herein. SECTION 5. City Rezulatory Authority. In addition to the provision herein contained, the City reserves the right to adopt such additional ordinances and regulations as may be deemed necessary in the exercise of its police power for the protection of the health, safety and welfare of its citizens and their properties or exercise any other rights, powers, or duties required or authorized, under the Constitution of the State of Washington, the laws of Washington or City Ordinances. SECTION 6. Indemnification/Insurance. 6.1 Indemnification. The City shall in no way be liable or responsible for any loss or damage to property or any injury to, or death, of any person that may occur in the construction, operation or maintenance by PacifiCorp of its Electric Facilities. PacifiCorp 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 PacifiCorp's use of the Public Ways within the City, and shall pay the costs of defense plus reasonable attorneys' fees for any claim, demand or lien brought thereunder. The City shall: (a) give prompt written notice to PacifiCorp 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 exists between the City and PacifiCorp with respect to such claim, demand or lien, permit PacifiCorp to assume the defense of such claim, demand, or lien with counsel satisfactory to City. If such defense is not assumed by PacifiCorp, PacifiCorp shall not be subject to liability for any settlement made without its consent. Notwithstanding any provision hereof to the contrary, PacifiCorp 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 willful act or failure to act of the City or any of its officers or employees. 6.2 Insurance. During the term of this Franchise, PacifiCorp shall maintain in full force and effect, at its own cost and expense, insurance against claims for injuries to persons or damage to property which may arise from or in connection with the performance of the work hereunder by PacifiCorp, its agents, representatives, employees, or subcontractors. 2 Page 22 of 43 PacifiCorp shall provide a certificate of insurance naming the City, its officials, boards, commissions, agents, and/or employees as additional insureds evidencing: (1) automobile liability insurance with limits no less than $2,000,000.00 combined single limit per accident for bodily injury and property damage; and (2) commercial general liability insurance written on a claims first-made basis with limits no less than $2,000,000.00 per claim and $4,000,000.00 general aggregate for personal injury, bodily injury, and property damage. Coverage shall include, but not be limited to blanket contractual, products/completed operation, broad form property damage, explosion, collapse and underground (XCU) if applicable, and employer's liability. PacifiCorp's insurance shall contain a clause stating that coverage shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability. PacifiCorp's insurance shall be primary insurance with respect to the City, and any insurance maintained by the City shall not contribute with it. PacifiCorp shall file a certificate of insurance required by this Section with the City upon acceptance of this Franchise. The insurance policy and certificate shall contain a provision stating that it may not be canceled, suspended, or reduced in coverage without thirty (30) days advance written notice to the City. In the event that the policy is canceled, suspended, or reduced in coverage, PacifiCorp shall provide a replacement certificate evidencing the insurance coverage required by this Section at least fifteen (15) days prior to the cancellation, suspension, or reduction in coverage of the existing policy. PacifiCorp shall have the right to satisfy the insurance obligations set forth above through a program of self-insurance. SECTION 7. Annexation. 7.1 Extension of City Limits. Upon the annexation of any territory to the City, the rights granted herein shall extend to the annexed territory to the extent the City has such authority. All Electrical Facilities owned, maintained, or operated by PacifiCorp located within any public ways of the annexed territory shall thereafter be subject to all of the terms hereof. 7.2 Annexation. When any territory is approved for annexation to the City, the City shall, not later than ten (10) working days after passage of an ordinance approving the proposed annexation, provide by certified mail to PacifiCorp: (a) each site address to be annexed as recorded on county assessment and tax rolls; (b) a legal description of the proposed boundary change; and (c) a copy of the City's ordinance approving the proposed annexation. The notice shall be mailed to: PacifiCorp Customer Contact Center Attn: Annexations P.O. Box 400 3 Page 23 of 43 Portland, Oregon 97202-0400With a copy to: PacifiCorp Attn: Office of the General Counsel Suite 2000 825 N E Multnomah Portland, Oregon 97232 Additional or increased fees or taxes, other than ad valorem taxes, imposed on PacifiCorp as a result of an annexation of territory to the City shall become effective on the effective date of the annexation if notice is given to PacifiCorp by certified mail not later than ten (10) working days after the effective date of the annexation. However, if notification of the effective date of the annexation is provided to PacifiCorp later than the tenth (10` h) working day after the effective date of the annexation, the additional or increased fees or taxes will become effective on the date of the notification. SECTION 8. Planning, Design, Construction and Installation of Company Facilities. 8.1 All Electric Facilities installed or used under authority of this Franchise shall be used, constructed and maintained in accordance with applicable federal, state and city laws, codes and regulations. 8.2 Except in the case of an emergency, PacifiCorp shall, prior to commencing new construction or major reconstruction work in the public way or street or other public places, apply for a permit from the City which permit shall not be unreasonably withheld, conditioned, or delayed. PacifiCorp will abide by all applicable ordinances and all reasonable rules, regulations and requirements of the City, and the City may inspect the manner of such work and require remedies as may be necessary to assure compliance. Notwithstanding the foregoing, PacifiCorp shall not be obligated to obtain a permit to perform emergency repairs. 8.3 All Electric Facilities shall be located so as to cause minimum interference with the Public Ways of the City and shall be constructed, installed, maintained, cleared of vegetation, renovated or replaced in accordance with applicable rules, ordinances and regulations of the City. 8.4 If, during the course of work on its Electrical Facilities, PacifiCorp causes damage to or alters the Public Way or public property, PacifiCorp shall (at its own cost and expense and in a manner approved by the City) replace and restore it to a condition comparable to that which existed before the work commenced. 8.5 In addition to the installation of underground electric distribution lines as provided by applicable state law and regulations, PacifiCorp shall, upon payment of all charges provided in its tariffs or their equivalent, place newly constructed electric distribution lines underground as may be required by City ordinance. 4 Page 24 of 43 8.6 The City shall have the right without cost to use all poles and suitable overhead structures owned by PacifiCorp within Public Ways for City wires used in connection with its fire alarms, police signal systems, or other communication lines used for governmental purposes; provided, however, any such uses shall be for activities owned, operated or used by the City for a public purpose and shall not include the provision of CATV, internet, or similar services to the public. Provided further, that PacifiCorp shall assume no liability nor shall it incur, directly or indirectly, any additional expense in connection therewith, and the use of said poles and structures by the City shall be in such a manner as to prevent safety hazards or interferences with PacifiCorp's use of same. Nothing herein shall be construed to require PacifiCorp to increase pole size, or alter the manner in which PacifiCorp attaches its equipment to poles, or alter the manner in which it operates and maintains its Electric Facilities. City attachments shall be installed and maintained in accordance with the reasonable requirements of PacifiCorp and the current edition of the National Electrical Safety Code pertaining to such construction. Further, City attachments shall be attached or installed only after written approval by PacifiCorp. 8.7 PacifiCorp shall have the right to excavate the Public Ways subject to reasonable conditions and requirements of the City. Before installing new underground conduits or replacing existing underground conduits, PacifiCorp shall first notify the City of such work and shall allow the City, at its own expense, to share the trench of PacifiCorp to lay its own conduit therein, provided that such action by the City will not unreasonably interfere with PacifiCorp's Electric Facilities or delay project completion. 8.8 Before commencing any street improvements or other work within a Public Way that may affect PacifiCorp's Electric Facilities, the City shall give written notice to PacifiCorp. 8.9 No structures, buildings or signs shall be erected below PacifiCorp's facilities or in a location that prevents PacifiCorp from accessing or maintaining its facilities. SECTION 9. Relocation of Electric Facilities. 9.1 The City reserves the right to require PacifiCorp to relocate overhead Electric Facilities within the Public Ways in the interest of public convenience, necessity,health, safety or welfare at no cost to the City. Within a reasonable period of time after written notice, PacifiCorp shall promptly commence the overhead relocation of its Electrical Facilities. Before requiring a relocation of Electric Facilities, the City shall, with the assistance and consent of PacifiCorp, identify a reasonable alignment for the relocated Electric Facilities within the Public Ways of the City. The City shall assign or otherwise transfer to Company all right it may have to recover the cost for the relocation work and shall support the efforts of PacifiCorp to obtain reimbursement. 9.2 PacifiCorp shall not be obligated to pay the cost of any relocation that is required or made a condition of a private development. If the removal or relocation of facilities is caused directly or otherwise by an identifiable development of property in the area, or is made for the convenience of a customer, PacifiCorp may charge the expense of removal or relocation to the 5 Page 25 of 43 developer or customer. For example, PacifiCorp shall not be required to pay relocation costs in connection with a road widening or realignment where the road project is made a condition or caused by a private development. In such event, the City shall require the developer to pay PacifiCorp for such relocation costs as part of its approval procedures. SECTION 10. Subdivision Plat Notification. Before the City approves any new subdivision and before recordation of the plat, the City shall mail notification of such approval and a copy of the plat to PacifiCorp: PacifiCorp Attn: Property Management/ Right-of-Way Department 825 NE Multnomah, Suite 1700 Portland, Oregon 97232 SECTION 11. Vegetation Management. PacifiCorp or its contractor may prune all trees and vegetation which overhang the Public Ways, whether such trees or vegetation originate within or outside the Public Ways, to prevent the branches or limbs or other part of such trees or vegetation from interfering with PacifiCorp's Electrical Facilities. Such pruning shall comply with the American National Standard for Tree Care Operation (ANSI A300) and be conducted under the direction of an arborist certified with the International Society of Arboriculture. A growth inhibitor treatment may be used for trees and vegetation species that are fast-growing and problematic. Nothing contained in this Section shall prevent PacifiCorp, when necessary and with the approval of the owner of the property on which they may be located, from cutting down and removing any trees which overhang streets. SECTION 12. Renewal. At least 180 days prior to the expiration of this Franchise, PacifiCorp and the City shall agree to either extend the term of this Franchise for a mutually acceptable period of time or the parties shall use best faith efforts to renegotiate a replacement Franchise, SECTION 13. No Waiver. Neither the City nor PacifiCorp 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. SECTION 14. Transfer of Franchise. PacifiCorp shall not transfer or assign any rights under this Franchise to another entity, except transfers and assignments by operation of law, unless the City shall first give its approval in writing, which approval shall not be unreasonably withheld; provided, however, inclusion of this Franchise as property subject to the lien of PacifiCorp's mortgage(s) shall not constitute a transfer or assignment. SECTION 15. Amendment. At any time during the term of this Franchise, the City, through its City Council, or PacifiCorp 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 6 Page 26 of 43 an effort to agree upon mutually satisfactory amendment(s). No amendment or amendments to this Franchise shall be effective until mutually agreed upon by the City and PacifiCorp and formally adopted as an ordinance amendment. SECTION 16. Non-Contestability--Breach of Contract. 16.1 Neither the City nor PacifiCorp will take any action for the purpose of securing modification of this Franchise before either the Washington Utility and Transportation Commission or any Court of competent jurisdiction; provided, however, that neither shall be precluded from taking any action it deems necessary to resolve difference in interpretation of the Franchise nor shall PacifiCorp be precluded from seeking relief from the Courts in the event Washington Utility and Transportation Commission orders, rules or regulations conflict with or make performance under the Franchise illegal. 16.2 In the event PacifiCorp or the City fails to fulfill any of their respective obligations under this Franchise, the City, or PacifiCorp, whichever the case may be, will have a breach of contract claim and remedy against the other in addition to any other remedy provided by law, provided that no remedy which would have the effect of amending the specific provisions of this Franchise shall become effective without such action which would be necessary to formally amend the Franchise. SECTION 17. Recovery of Costs. PacifiCorp shall be subject to all applicable permit fees associated with activities undertaken through the authority granted in this Franchise or under the laws of the City as set forth in the Pasco Municipal Code and/or City ordinance. The City reserves the right to impose and collect from PacifiCorp all taxes, fees and charges permitted by RC W 3 5.21.860 as currently or hereafter amended or otherwise provided by state law. SECTION 18. Abandonment and Removal of PacifiCorA's Electrical Power Distribution Facilities. Upon the expiration or termination of this Franchise and consistent with the provisions of PMC Section 15.70.260, PacifiCorp shall remove all of its electrical power distribution facilities from the public ways of the City within one hundred eighty (180) days of receiving written notice from the Public Works Director. Except as specifically provided by PMC Title 15, PacifiCorp shall not be allowed to abandon any of its electrical power distribution facilities within the public ways of the City or upon public property subject to this Franchise. SECTION 19. Forfeiture and Revocation. The rights granted under this Franchise may be revoked or forfeited as provided in Chapter 15.90 of the Pasco Municipal Code; provided, that the City may elect, in lieu of the above and without any prejudice to any of its other legal rights and remedies, to obtain an order from the superior court having jurisdiction compelling PacifiCorp to comply with the provisions of this Franchise and to recover damages and costs incurred by the City by reason of PacifiCorp's failure to comply. 7 Page 27 of 43 SECTION 20. Dispute Resolution. Should any dispute arise concerning the enforcement, breach or interpretation of this Agreement, the parties shall first meet in good faith effort to resolve the dispute, however, if unresolved, the dispute shall be resolved by binding arbitration pursuant to RCW 7.04A, the Mandatory Rules of Arbitration. Venue shall be placed in Franklin County, Washington, and the prevailing party shall be awarded attorney fees and costs. SECTION 21. Repealer. Upon the effective date of this Ordinance and acceptance of such Ordinance and Franchise by PacifiCorp, Ordinance No 3318 shall be repealed in its entirety. SECTION 22. Notices. Unless otherwise specified herein, any notices or information required or permitted to be given to the parties under this Franchise shall be sent to the following addresses: city PacifiCorp Director of Public Works Customer and Community Affairs CITY OF PASCO Vice President PO Box 293 PACIFIC POWER Pasco WA 99320 825 NE Multnomah Lloyd Center Tower Suite 2000 Portland OR 97232 and such other office as PacifiCorp may advise the City of by written notice. SECTION 23. Severability. If any section, sentence, paragraph, term or provision hereof is for any reason determined to be illegal, invalid, or superseded by other lawful authority including any state or federal regulatory authority having jurisdiction thereof or unconstitutional, illegal or invalid by any court of common jurisdiction, such portion shall be deemed a separate, distinct, and independent provision and such determination shall have no effect on the validity of any other section, sentence, paragraph, term or provision hereof, all of which will remain in full force and effect for the term of the Franchise or any renewal}orr renewals thereof. IIPIIASSED by the City Council of the City of PC.l5eD , Washington this M day of OC 4 X.r , 200 Joyc is Mayor ATTEST: APPR AS TO FORM: Lat- Debra. L. Clark, City C Leland B. Kerr, City Attorney 8 Page 28 of 43 41 uu I-S al LLI Al L v -twi J i—MA aV.5e V.gQ - ^ 1FF/Z -'9t'L8 1_ %k N I xl , a ro a : jss flit 149 vol! h 6%L•V.-WMT. vov Its 12 VdkL.0 ow a W, wel T,-A-j T5- tz V.V,55 MV JL___j V-5—V L. f-7 12.-SV FA tso-&s VGV,01.MP, L H.- JZAVz* aj San i9 sel- QZ Z4 w.- KI 5 WV_ tL awsm O.SL 5 X-sq-4, LC 1+17)L_-90 L JT XN sv A to-I IYdHL,sg W 0 J sv o 1 Vb~(qmw d14 1. 103MLS z 41 IN GV 617 j 7_4 L S9jj10. oz LJ j drys T r, mt k" Page 29 of 43 r•-- eeL- i m..-.—-..__. OBST riOE Z J L S3h.M1 t' n sm mlmasna tr wv oa14Fa a,,ae=ty anvl a q_ ..-- I LT.,.I-- 3TiA6 Sj ONY j A n:vu ms im a;La10 of n-: Ma -c.n oats W1 dri1S51575D1Ytl1 h:l 89r° L i!NN 3dtlOSY-OO6Yo t. I i I t p5 5 b i 4 illy ' D f J 1 !a:iectil^•:;Si:;iF:a, i^.'\` a - i ..ar. Fy \ i 3:'r••,t.•:iV.dai U"a rie L 1 I p k ._ ° Aa, wi \ ! 1` 5C i S 4. as i I o ldl3_.G9 J j _ .... d'P, scGa,L \ \ i `' 4 it I Z:Z' .SL_—.—._.......,_ Y y. 1.-- . - •iLGi4, ,` a\ J I , I i I I d Ii n• 1 fit A'Ji I' j°yy i i I b I'sI x g,asln fI{ ` mid Page 30 of 43 l- 1 ir Sk 1°cwal Yv0 <II aar Wll IL ara,w i Y I iiA---- .fItIA,Y 11,B0AI II,K! .. ll'Z83LL af,}y1L UL11.141EYCi S 6W .V,3 if'' I; I v IE I mHVIV.o.3 S` oa r s2+= a9191 his= o.i7 f - pq.ea I`n min o-\F rx\ o d, • k j i 2av o Q3eg I e i aJ.t - bao•L' V y id Ty.p ayeiwCImo- al\ Ct Z a# =3E8 L I 66- -p N $ O\r' -y:_e-Ea: } . •k m Le- N Bhfl t7 9 n\ilt• ' ll LCp'!A; I I a & k1 B I ..... 0}r•7 W65 g f9.p N i LI(X2p 30L'LI BhLID N. aD30 • Bga b Om I. r 0, .JP,S ZI-IQ 1Ia a0GOL.95 .+ 345 ep91 OodL As nYn i i 11 n1 WIEj9-9 j g96.EV1 U J L._..'! 0 S OOL3L.M. p 6L' u1°Ih i 7777 Il 98_,p• it-•i li I s i G_ IYV 0a'lb Ci41li'2OI63 bag+9a1 E •4b1 35-VO-d M i I i eQ-a R KIM -aca•aal \ ;i» n\m% L-2 0013E.SSE 9013E f"1 Q3AQWea dva ens vd9 20 z-r.s•It lx.. P x d I T I 99-v PEA1'l. °_-a b.ol. s d2 of a; m ,v al i 1 Fl Page 31 of 43 SFtv2 ixwv 1 ie I` n •` .a iv, r tl ` j O1.4b a6 1 i p• $2$ym I a v Afisl / & mD c¢+rD II VWES ' 9 I 'I,W9 i t w'.3:,•c'9,a:s•anrl aa+,as o,c,i a le FZ".°F o. Y N 4b+BL N' lias h y'•• I f d JIYIItY1S9 oe. V I I eor I I 4(35 F h owed_ 1, Ecb.4n . go GSA i I ... .-... 1_. S. .1. CYJ V' s..IP 1 I > &R d a• . ems I - o,i• I z 2. lhlo Le` ,_y_y.A[t 'S 4.]x•1,"y 7 4 Icy P7-Q2 I+'•;V`•4 '919t aRft. Nl ! '_ I( i` 6_ aco _ Exllo v ew I Tom" Y 61.1, . i . ::x.s'iaaG'J•r:''6'!'1P hC .0.9 __ - .. .M i yr.:'z.8?v __ _. row.Anw.9J ' J; s r I I s I I7- , b1 D.. 6 I cI1 g_ _WG 1 j i5gi a Caiv 117 I ,JG3:li^,iiiv;••L1M9 Aura "199 -a rqbb3s°ev IPi p pI 11 f]1 j 1 1 q oo — aP VR F j'g3 nd 94-61 I ' I g 9y If • N.' N r,gg n1 W v za K 001 dl ns a,39 • ab-bl i I ti 00l dl.SS v,--v '---' ms.µo. tl a la 001 3A.DD v 109 n•\'50. 51 v 198 N'Cf .- by+i Y • ro ° 1 f bo t 0160 1d• - OL.4 p'`' d 'Gaoa r's,;wv v 1 say.-G aawsawvaasaetiawss-a.Oe 3-4't- ;irow+v :i 3 isF.i s,a: ry lea` y' I we_+`" d °'b8>lbEJ•d91 sirdar ss a ` sn:.auwcm a.GnlG JfAG3aYT113b M91Gl4 Page 32 of 43 sr,IW x10 CY' - t?Rv:'1 X11 LK1g1a nrYlLVaI qt OW MO a8 Iott:M 3104 eb .idt MO 1B wS atnr _ - u. , s:.W- L18&i B[fLEE1V Ep'IEIZ£400 0."7 •' r:`+! t`., I . tiEi70 6' 4Yp1 G 6 li ect:ema as-m r'nlw 6• aj I_ 1 I UIV—FX laV Sa.L91 n• < L+ 'f ` w 3]O3 i'.. 1 I 31 e s k ikR ff s I S 1 4' Qit9N'390'nP ( D E1 l t 11V _LS m - au I t' •:.r.-..I qtr, r__ T•ul>:r-a rt=s 4 ey., n1 i Ol az= itW V. rt aoa9l \ d 1667I r 1441 on..—, ko OOL31 4,g tom .. l oo•Lf I x lib; 1 a MAL t6L i W'.I e, I; 71}a oo-caI e 3 00.b11 i L - v 146 011 DDL3L•9L r 00.511 V'`P/ I Y' t II V,94 $ aA1a- ..... _-AO-011 a 1 7 li9 w.a.or CA' 1+116 I 7185 Q epN oo.oor a. 11 w m 2i er a0i V !ly t n 00131 SC C 8 ao.l Dr t's x L ilyd r Lb•a Gb J_ iL n3V»OJ IFpN 11P h S 1r 1 rrssl aa3ral+sr Page 33 of 43 AGENDA REPORT FOR: City Council October 22, 2018 TO: Dave Zabell, City Manager Special Meeting: 10/29/18 FROM: Steve Worley, Director Public Works SUBJECT: Bid Award: 1800059 Wastewater Treatment Plant PLC and Controls Upgrade I. REFERENCE(S): Vicinity Map Resolution 3827 - SCADA & PLC Sole Source Townsend Controls & Electric, LLC. Bid II. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS: MOTION: I move to award the Wastewater Treatment Plant (WWTP) PLC and Controls Upgrade project to Townsend Controls and Electric, LLC. in the amount of $814,172.48 and, further, authorize the City Manager to execute the contract documents. III. FISCAL IMPACT: Total Project 2017 Sewer Revenue Bond - $855,000 IV. HISTORY AND FACTS BRIEF: This project consists of replacing the aging and out-of-date programmable logic controllers (PLC) and supervisory control and data acquisition (SCADA) systems at the Waste Water Treatment Plant. The current systems were installed in the mid-1990's; hardware, drivers, coding, networking, and other system components are obsolete and unavailable on the open market, with replacement parts no longer in production and used parts scarce. As a result, these systems are becoming increasingly difficult to maintain leaving the operation of this critical infrastructure vulnerable to catastrophic failure. Similarly, technical support for these aged systems has diminished to the point where professional service providers no longer offer assistance for troubleshooting system issues or repair Page 34 of 43 work. An operational objective of standardizing PLC automation equipment city wide will be met with this upgrade including: the ability to use Ethernet connectivity, reliable and readily available technical support, parts and service availability, software packages and hardware upgrades, and system reliability and continuity. This project is included in the City's 2018 - 2023 Capital Improvement Plan and 2018 adopted budget. V. DISCUSSION: On October 17, 2018, the City received the project bid from Townsend Controls and Electric, LLC. Subject to award of the contract by the City Council, the starting date of construction will be coordinated with the contractor. The anticipated substantial completion date is March 30, 2018. The proposed 2019 budget will include sufficient carryover to fund completion of this project. Staff has reviewed the bid submittal and found no exceptions or irregularities and, therefore, recommends award of the contract to Townsend Controls and Electric, LLC. of Pasco, Washington. Page 35 of 43 Page 36 of 43 RESOLUTION NO. (3.&I A RESOLUTION of the City of Pasco, Washington, waiving the competitive bidding requirements and approving the acquisition of improvements and related services for their supervisory control and data acquisition (SCADA) and programmable logic controller (PLC) system from Townsend Controls and Electric, LLC. WHEREAS, it is critical for the City of Pasco to have proper equipment to perform SCADA and PLC system functions; and WHEREAS, the City has need to acquire improvements and related services to the SCADA and PLC system; and WHEREAS,the City has worked with Townsend Controls and Electric, LLC. to develop and integrate a standardized, straight-forward programming logic which operates PLCs citywide. City staff has adapted to this standard and is capable of monitoring, operating, and troubleshooting PLCs using it. WHEREAS, the use of Townsend Controls and Electric, LLC. services are clearly and legitimately limited to a single source of services to support current operations standards this acquisition becomes subject to waiving competitive bidding requirements per RCW 39.04.280(1)(a) and RCW 39.04.280(1)(b) of purchases from a sole source supplier and purchases involving special facilities. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PASCO, WASHINGTON, DO RESOLVE AS FOLLOWS: Section 1. That the City of Pasco acquire improvements and related services to the SCADA and PLC system from Townsend Controls and Electric, LLC. Section 2. The above-described circumstances is justification for the waiver of bidding requirements under the authority of RCW 39.04.280(1)(a)and RCW 39.04.280(1)(b)for purchases from a sole source supplier involving special facilities, and, therefore, the bidding requirement is hereby waived for the acquisition of services from Townsend Controls and Electric, LLC. PASSED by the City Council of the City of Pasco at its regular meeting this egriciday of 4/0n.2018. Matt Watkins, Mayor AT EST: APPROVED AS TO FORM: r Daniela Erickson, City Clerk Leland B. Kerr, City Attorney Page 37 of 43 SOLE SOURCE WORKSHEET Sole source purchases are defined as clearly and legitimately limited to a single supplier. Sole source purchases are normally not allowed except when based upon strong technological grounds such as operational compatibility with existing equipment and related parts or upon a clearly unique and cost effective feature requirement. Requisition Item: SCADA/PLC Improvements and Related Services Requisition No. Prior Purchase Order Number(if item had been approved previously): N/A 1.Please describe the items and its function: This work is for upgrades to the City of Pasco (referred to as City) supervisory control and data acquisition (SCADA) and programmable logic controller(PLC) system; which allow the process systems to run autonomously with or without operator presence. Previously the main Irrigation automation controller was upgraded which included six of the 13 automation controllers at pump sites by Townsend Controls and Electric, LLC. (referred to as Townsend). There are seven remaining Irrigation pump sites that need PLCs upgraded and programmed to function with the main automation controller to completed the project. 2.This is a sole source because: Sole provider of a licensed or patented good or service x Sole provider of items that are compatible with existing equipment, inventory, systems, programs or services CI Sole provider of goods and services for which the City has established a standard Sole provider of goods or services that will meet the specialized needs of the City or perform the intended function(please detail below or in an attachment) L I The vendor/distributor is a holder of a used item that would represent good value and is advantageous to the City (please attach information on market price survey, availability, etc.) 3.What necessary features does this vendor provide which are not available from other vendors? Please be specific. Townsend Controls has successfully completed PLC upgrades for the City in the following areas: PWRF: 14 PLCs in circle pivots,IPS building, Screens building, and Foster Wells. Water Treatment: 4 PLCs at the following pump stations: Eastside,Riverview,Burden,and Road68 water tank. Wastewater Treatment: Maitland lift station. Irrigation: Irrigation Master PLC,USBR,RD108, 1St Place,I-182,Desert Sunset,and Village of Pasco Heights. These previous projects were awarded to Townsend by using the city's competitive bid process. Townsend was most recently awarded the Butterfield Water Treatment Plant PLC Controls Upgrade Project in 2017 which is in the final stage of completion. In previous projects,Townsend worked with staff to develop and integrate a standardized, straight-forwardprogramming logic which operates PLCs citywide. City staff has adapted to this standard and is capable of monitoring, operating,and troubleshooting PLCs using it. This standardized programming logic created for the city is the primary factor desired for this sole source request. By eliminating multiple contractors,who will need to create their own Page 38 of 43 programing logic for each site,the city will gain consistency and overall efficient use of City resources. In addition to winning previous bids, and developing the adopted standard programing, several other supporting sole source factors include; Townsend also has gained in-depth knowledge of the City's overall PLC/SCADA architecture which allows them to more accurately understand the needs of the system. They are a local business which permits the City to efficiently schedule for implementation needs and provide emergency after hours' response in short notice. They are also a Rockwell(Allen-Bradley)recognized integrator,which is the technology that the City has standardized on. 4.What steps were taken to verify that these features are not available elsewhere? x Other brands/manufacturers were examined (please list phone numbers and names, and explain why these were not suitable). Talos Engineering 509 893-5799,previously hired on 3 prior WWTP lift station PLC upgrades.Programming would not match needed standard. CREM 509 430-5993,contacted but did not provide quote due to having to outsource programmer. Other vendors were contacted (please list phone numbers and names, and explain why these were not suitable). 5.The city has compared costs of previously awarded projects completed by Townsend to these sole source upgrade costs to ensure the lowest price is consistently offered for each PLC upgrade in this request. Certification of Need This recommendation for sole source is based upon on objective review of the product/service required and appears to be in the best interest of the City. I know of no conflict of interest on my part of personal involvement in any way with this request. No gratuities, favors or comprising actions have been taken. Neither has my personal familiarity with particular brands, types or equipment, materials or firm been a deciding influence on my request to sole source this purchase. By:v , 2"--e/ zDate: 3 Z // ? Page 39 of 43 BID PROPOSAL 1800059 -WASTEWATER TREATMENT PLANT PLC AND CONTROLS UPGRADE PROJECT NO CP7-SE-ZR-18-00 HONORABLE MAYOR AND CITY COUNCIL City Hall Pasco,Washington 99301 Gentlemen: The undersigned declares that he has carefully examined the site at 1015 S.GrayAve,Pasco,WA 99301 -Waslewater Treatment Plant And has carefully examined speci?cations,plans,laws,and ordinances covering furnishing all materials and equipment and performing all labor necessary for the replacement of the City of Pasco Waslewater Treatment Plant Primary Logic Controllers including programming,new back panels for existing control panels,new touch screens,system testing,and operator training for a complete and operable system, In accordance with the terms,provisions,and requirements of the foregoing,the following prices are tendered as an offer to furnish the equipment, materials,appurtenances and guarantees.where required.and to perform the work in place and in good working order. SCHEDULE OF PRICES Unit prices for all items,all extensions,and total amount of bid must be shown. ALL ENTRIES SHALL BE IN lNK OR TYPED TO VALIDATE BID. 1 1 LS Mobilization,Bonds,Insurance,Permits,and Demobilization 2&4“50 28 44‘50 2 1 LS Demolish and Remove Existing Proiibus System 570000 670000 3 500 LF Ethernet Cable,CAT 6,Fibq ,1’!(ms 45 56 22780 00 4 1 LS Replace Operations Building Master PLC MCP-1000 89.540 70 89,540 70 5 1 LS Replace Operations Buildingv Lower Level LCFL400 59 447 54 69447 54 6 1 LS Replace Trickling Filter Pump Station LCP-410 47.849 26 47,849 26 7 1 LS Replace Digester Control Building LCP-941 43627 54 49627 54 8 1 LS Replace Blower Control Building LCP-600 56 795 12 56 796 12 9 1 LS Replace Old Digester Control Building PLC LCP-942 31 165 57 31 165 57 10 1 LS Replace Headworks LCP-121 3&3”72 38378 72 11 1 LS Replace Biosclids?hickening Building LCP-1100 40 232.22 40232 22 12 1 LS Replace UV Treatment Unit Building (Existing Package System) 41 609 95 41 609 25 13 1 LS Programming,Testing,Commissioning,and Training ,Et\’o"t¢¢l--5 191,620 00 191 620 00 14 1 LS Spare Pens and Software License 2010 00 2010 00 15 1 LS Operations 8.Maintenance Manuals,Record Drawings.and Electronic Files 7 SUB-TOTAL: SALES TAX (8.6%)! TOTAL: Page 40 of 43 1800059 -WASTEWATER TREATMENT PLANT PLC AND CONTROLS UPGRADE PROJECT NO CP7-SE-2R-18-00 The Proposal Form,Bid Bond.Noncollusion Declaration,Subcontractor Disclosure and Acknowledgment of all Addenda shall be submitted as a complete integral bid package.The undersigned hereby agrees that the City Engineer for the City of Pascc shall determine the actual amount of quantities and materials to be paid under the Contract for which this Proposal is made and that all material furnished and all work performed shall be strictly in accordance with the plans and specifications. The undersigned agrees that if awarded the contract,he will commence work on the date indicated on the written Notice to Proceed and that all work should be completed by March 30,2019.The undersigned further agrees to pay $6.000 as liquidated damages for each consecutive calendar day thereafter per Section 01 it 00 Summary of Work,paragraph 3.1.A.In addition,damages associated with scheduled plant shutdown windows will be assessed per Section 01 11 00,Summary of Work,paragraph 3.1 .B. The undersigned Bidder hereby certifies that,within the three~year period immediately preceding the bid solicitation date for this Project,the bidder is not a “wi||fu|"violator.as de?ned in RCW 4948.082,of any provision of chapters 49.46,49.48,or 49.52 RCW,as determined by a final and binding citation and notice of assessment issued by the Department of Labor and Industries or through a civil judgment entered by a court of limited or general jurisdiction. I certify (or declare)under penalty of perjury under the Iavvs of the State of Washington that the foregoing is true and correct. Accompanying this Proposal is a certified check,cashier's check,bid bond,cash or money order payable to the City of Pasco being an amount not less than 5%of the total bid based upon the estimate of quantities at the above prices according to the conditions of the Information for Bidders.If this proposal is accepted by the City of Pasco,and the undersigned shall fail to execute a satisfactory contract and bonds,as stated in the Instructions For Bidders hereto attached,Mthin ten (10)calendar days from the date of notice of award,then the City may,at its option,determine that the undersigned has abandoned the contract and thereupon this proposal shall be null and void and the certified check,bid bond,cash or money order accompanying this proposal shall be forfeited to and become the property of the City of Pasco.Othervinse,the certified check,cashier's check,bid bond,cash or money order accompanying this proposal shall be returned to the undersigned. Receipt is hereby acknowledged of addendum(s)No.(s)NONE ,,,8- DATED AT Pa to WA THIS l7th DAY OF OCTOBER ,2941 2013 SIGNEDI TITLE:Electiical Eriqineericontrol Systems Nlanaoei PRINTED NAME:Andy Townsend NAME OF COMPANY:Townsend Controls and Electric LLC ADDRESS:040 North Coiiimeiriai A e Pa co WA 99301 TELEPHONE:509«545—1600 STATE CONTRACTORS LICENSE NO.:IOWNSCLQ l 7P8 P-2 Page 41 of 43 AGENDA REPORT FOR: City Council October 25, 2018 TO: Dave Zabell, City Manager Special Meeting: 10/29/18 FROM: Dave Zabell, City Manager Executive SUBJECT: Performance of a City Official I. REFERENCE(S): City of Pasco City Manager Evaluation 2017/2018 - Final Report II. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS: MOTION: I move to accept the final report by Kenbrio Inc. reflecting the City Council's corporate view of the City Manager's performance for the period June 2017 - June 2018. III. FISCAL IMPACT: IV. HISTORY AND FACTS BRIEF: The City Council conducted its annual performance review of the City Manager earlier this year which was facilitated by David Mercier of the Kenbrio Company. The review included a standardized questionnaire that allowed for comment and ratings in key performance areas by individual Councilmembers, one-on-one interviews of each Councilmember with the facilitator, and a legally advertised executive session with the City Manager to discuss his performance. The attached document, prepared by Mr. Mercier at the direction of the City Council, serves as the Council's corporate view of the manager's performance and reflects the major points of the evaluation. V. DISCUSSION: Council to consider accepting the assessment document prepared by the facilitator and discuss as appropriate. Page 42 of 43 Kenbrio, Inc., 1708 SE 41st Avenue, Portland, Oregon 97214 Phone: (360) 546-5640/ Kenbrio3@gmail.com / www.kenbrio.com/gov August 11, 2018 Mr. David Zabell, City Manager City of Pasco 525 N.3rd Avenue Pasco, WA 99301 Subject: City of Pasco City Manager Evaluation 2017/2018 – Final Report Dear Mr. Zabell and City Council, It has been my pleasure to serve the City of Pasco by assisting the City Council in the evaluation of the City Manager. The formal evaluation is guided by the City Manager’s employment contract. This required evaluation provides an opportunity to examine the perceptions and conclusions of the City Council about the City Manager’s performance with regard to progress in the attainment of goals identified by the City Council and to additionally consider other elements of managerial practice for advisory purposes. The evaluation was accomplished using the six-step process prescribed in the Letter of Engagement with the facilitator Conclusion Based on a review of the City Manager’s activities, attributes and initiatives, the City Council rated his performance “excellent” as reflected on a 10 point scale. In doing so, the City Council indicated their appreciation of the City Manager’s clear and deep understanding of how cities function under a council/manager form of government, his professionalism, leadership, listening skills and selection of executive team personnel. Looking toward the future, the Council enlisted the City Manager’s thoughts and efforts in strengthening relations with other government agencies, keeping the lines of communications open with area developers and contractors, improving the content and quality of information presented to the Council, developing a six-month advance agenda, and also broadening staff training and expertise in the planning department. David Mercier Facilitator Page 43 of 43