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HomeMy WebLinkAbout1038ORDINANCE NO.1038 (1985 SERIES) AN ORDINANCE OF THE CITY OF SAN LUIS OBISPO GRANTING TO UNION OIL COMPANY OF CALIFORNIA, A CALIFORNIA CORPORATION, A FRANCHISE FOR FACILITIES NECESSARY FOR THE COLLECTION; TRANSPORTATION AND DISTRIBUTION OF ALL SUBSTANCES, EXCEPT RADIOACTIVE MATERIAL, USED IN THE PETROLEUM INDUSTRY ALONG, ACROSS OR UPON THE PUBLIC STREETS, WAYS, AND ALLEYS AS THE SAME NOW OR MAY HEREAFTER EXIST WITHIN SAID MUNICIPALITY. Be it ordained by the Council of the City of San Luis Obispo as follows: SECTION 1'- 'AUTHORITY AND-'GRANT -OF "FRANCHISE A franchise is hereby granted pursuant to the provisions of California Constitution, Article XI, Section 9(b), Government Code Section 39732 and Article X of the Charter of the City of San Luis Obispo. SECTION 2 = TERM The franchise granted under this Ordinance shall be for an initial term of twenty -five (25) years commencing with the date on which it is accepted. Thereafter, the franchise may by mutual consent be renewed for additional five (5) year terms under conditions mutually agreed on by both parties. SECTION 3 - DEFINITIONS "Appurtenances" Devices used in connection with Grantee's business that are installed under the terms of a franchise. "Council" City Council of the City of San Luis Obispo. 0 1038 Ordinance No. 1038 (1985 Series) Page 2. "City" City of San Luis Obispo, a municipal corporation under a charter of the State of California. "City Clerk" City Clerk of the City of San Luis Obispo. "Director" Director, City Public Works Department, or designee. "Facilities" All property and installations of the Grantee, including but not limited to pipelines, and other appurtenances necessary or convenient for the Grantee's "Finance Department" "Finance Director" "Grantee" SECTION -4 = GENERAL'PROVISIONS business. Finance Department of the City of San Luis Obispo. Director of the Finance Department of the City of San Luis Obispo. Union Oil of California, a California Corporation. SECTION -4= 1-= -SCOPE-OF-FRANCHISE: The facilities to be constructed; maintained, or operated under this franchise shall be built of good material, in a workmanlike manner. The work of Ordinance No. 1038 (1985 Series) Page 3. construction; repairing; or maintaining facilities shall at all times be in compliance in all respects with rules, regulations and ordinance of such city, state or federal authorities as may have jurisdiction over such facilities in effect at the time of such work. With respect to matters not covered herein, City reserves all regulatory power allowed to it over and with reference to the franchise granted and the exercise of rights, powers, or privileges under the same by the Grantee, its successors or assigns. The terms and conditions of this franchise shall also apply to any facilities of the Grantee which are located within the right -of -way of any street at the time such street becomes a City street and /or which may be subsequently acquired by the Grantee and which are located within the right -of -way of any City street at the time of such acquisition by the Grantee whether or not they were theretofore subject to a franchise granted by City. The franchise granted under the terms of this Ordinance is non - exclusive. SECTION-4= 2--- ACCEPTANCE: The franchise is granted on the terms and conditions contained herein. In addition, Grantee shall within thirty (30) days after the final adoption of this ordinance, file with the City Clerk written acceptance of the terms and conditions of the Ordinance No. 1038 (1985 Series) Page 4. franchise. Should Grantee fail to file written acceptance within thirty (30) days, any franchise rights or privileges shall automatically terminate with no further action by City. SECTION-4--;-3--;-'PERMIT.- Grantee may, subject to such regulations as are now or hereafter may be in force, make excavations in and place obstructions upon City roads within the area covered by a franchise for the purpose of constructing, maintaining, operating, or removing any franchise facility or property. No excavation in or obstruction of any City street may be made unless or until all permits required by the City and all other public agencies having jurisdiction have been obtained. No permit for an excavation in or obstruction upon any City street shall be issued if it is found that either the excavation or the obstruction or the placement and maintenance of the franchise facility or property will seriously or unreasonably interfere with the public uses and purposes of the City street or will create a dangerous condition in the City street. Notwithstanding the above, emergency excavations necessary for the preservation of life or property may be made without permit after providing notification to the Public Safety Department of the City by use of the emergency phone number "911" and provided application for a permit is made not later than the next business day following such emergency excavation. Ordinance No. 1038 (1985 Series) Page 5. SECTION- 4= 4-= -ASSUMPTION'OF'RISK: All work done in the exercise of franchise rights shall be done so as to cause the least possible interference with the use of City street by the public or by City. All excavations shall be backfilled and adequately compacted according to the City's specifications. The surface of City street shall be placed in as good and serviceable condition as existed at the beginning of the work and to the satisfaction of Director. Grantee shall indemnify City, its officers and employees, and save them harmless from and against any and all loss, damage, expense, liabilities, claims and demands, of whatsoever character, including but not limited to, injuries to employees of City or to third persons and damage to property belonging to or in the custody or possession of City or third persons, whether upon the property or right -of -way of City or elsewhere . caused directly or indirectly in the exercise by Grantee of any of the rights granted under this franchise. The conditions hereinabove specified are binding upon any and all successors or assigns of Grantee. SECTION -4 =5'- INSURANCE: Prior to acceptance of this franchise, Grantee shall file with the City Clerk and maintain on file throughout the term of the franchise a certificate of a current liability insurance policy issued by a company duly authorized to do business in the State of California; insuring Ordinance No. 1038 (1985 Series) Page 6. City and Grantee with respect to the installation; operation and maintenance of its facilities. Liability insurance policies shall be within limits to be approved by City, based upon comparable limits established for use in connection with Public Works construction projects. Insurance shall be noncancellable without forty -five (45) days written notice thereof to the City Clerk. Should Grantee fail to file replacement certificate of insurance prior to the expiration of the forty -five (45) days any franchise rights and privileges shall automatically terminate with no further action by City. SECTION 4-;--6--;­BOND. Grantee shall at all times during the term of this franchise, keep on file with City Clerk a bond running to City and to any successor to any of the rights of City under the terms of this franchise in an amount of $25,000 and with surety to be approved by City. The bond shall be conditioned upon Grantee well and truly observing, fulfilling and performing each and all terms and conditions of this. franchise, and in case of any failure by Grantee to perform any terms or conditions of this franchise, or in case of any breach of any terms or conditions of this franchise by Grantee, the principal and surety shall be jointly and severally liable for such performance or for any damage, expense, loss or injury directly or indirectly suffered therefrom by City. Ordinance No. 1038 (1985 Series) Page 7. Bonds shall not be deemed adequate unless they are valid for the entire term of this franchise plus one (1) year and contain provisions that bond shall remain valid until at least thirty (30) days after notification by surety to City Clerk that bond is about to be cancelled, expire or not be renewed. Nothing herein shall insulate Grantee from liability in excess of the amount of bond or shall be construed as a waiver by City of any legal remedy against Grantee for any breach of terms and conditions of this franchise or for any damage; loss or injury suffered by City in case of any damage; loss of injury suffered by any person by reason of any work done or any activity conducted by Grantee in exercise of franchise rights. SECTION'4 =7- =- PUBLIC - IMPROVEMENTS: Grantee shall remove or relocate at its expense any of its facilities located in any City street whenever removal or relocation is deemed necessary by Director because of any work being done in or about the City street by City or any public entity; or because of any change of street grade, alignment, or width. City shall endeavor to give Grantee at least ninety (90) days advance notice of relocation work required. If such work is not completed by Grantee prior to the end of the time stated in the notice, then City or other applicable public entity may contract or perform the removal or relocation at the sole expense of Grantee and Grantee shall immediately remunerate City or the applicable public entity for ordinance No. 1038 Page B. (1985 Series) the direct cost of such work plus the current rate of overhead being charged by the City for such reimbursable work or the actual cost to City plus administration; if work is performed by an independent contractor. Notwithstanding the foregoing; should a situation occur that requires removal; relocation or modification of Grantee's facilities with less than the ninety (90) days notice provided for herein, City shall give Grantee as much prior written notice as possible considering the nature of the emergency. Should Grantee not complete such work as required by City, City may contract or perform such work pursuant to the foregoing terms of this Section. SECTION "4= 8-=- RELOCATION-OF--ELKS -LANE "PIPELINES: Grantee shall relocate at its cost the two 8" pipelines which span San Luis Creek at Elks Lane so that the pipes pass under the creek bed. This relocation shall be designed and constructed in a manner which is mutually acceptable to the City and the Grantee within three (3) years after the date the Grantee accepts this franchise. SECTION-4-9--z.-ASSIGNMENT: Grantee shall not transfer or assign this franchise, or any of the rights or privileges granted therein, except upon consent of Council. Upon demonstration by proposed assignee of ability to operate consistent with the terms of this Ordinance such consent shall not be withheld without cause. Any transfer or assignment shall Ordinance No. 1038 (1985 Series) Page 9. be made only by a duly executed instrument in writing filed in the office of the City Clerk. No consent shall be effective until the proposed assignee files with the City Clerk an approved bond of the type and in the amount required by the franchise and assignee meets all the requirements which would be imposed on Grantee of a new franchise. No such consent shall be required to any transfer of the franchise in trust or by way of mortgage or hypothecation with all or a part of Grantee's other property for the purpose of securing any indebtedness of Grantee. Also; no such consent shall be required for assignment to a parent company or wholly owned subsidiary of Grantee; however; notice of this assignment shall be made to the City Clerk within thirty (30) days of such assignment. Such notice shall include appropriate riders to existing bonds and policies of insurance. SECTION -'4 =10 -= "FRANCHISE -FEES: The Grantee shall pay to the City in lawful money of the United States an annual fee based on pipelines installed and maintained in City streets; computed as follows: 1. Pipe of eight (8) inches or less in nominal internal diameter the annual fee shall be twelve (12) cents per linear foot. 2. Pipe greater than eight (8) inches in nominal internal diameter, the annual fee shall be twelve (12) cents per linear foot for the first eight (8) inches of nominal Ordinance No. 1038 ( 1985 Series) Page 10. internal diameter; plus two (2) cents per nominal internal diameter inch for each inch or fraction thereof over eight (8) inches. The amount of each annual payment of the annual fee shall be revised every year from the effective date of this ordinance granting the franchise, at the time of payment in accordance with the following formula: a. The "Wholesale 'Producer' Price" Index (1967 = 100) "All Commodities ", established by the United States Bureau of Labor Statistics, Department of Labor, as it stands on the date the franchise is granted, shall be taken as the "base index" upon which the above franchise fee is computed. b. If said Index for the last calendar month ending prior to the month in which payment to the City is due shall stand at other than said "base index ", then the rate of payment to the City shall vary from said "annual fee" in direct proportion that said Index has increased from the "base index ", as hereinabove defined; provided, however, that in no event shall the amount of the annual payment be less than the "annual fee" as set forth herein. C. If said Bureau shall revise the said Index, the parties hereto shall accept the method of revision or conversion recommended by said Bureau. Ordinance No. 1038 (1985 Series) Page 11. d. If said Bureau shall discontinue the preparation of the said Index using prices prevailing in the year 1967, as a base of 100; and if no transposition table prepared by said Bureau is available; applicable to said year of 1967; then the amount of each annual payment shall be computed by reference to such other price index as may be chosen by City and the City shall be the sole judge of comparability of successive indices. Said "annual fee" shall be paid annually during the life of the franchise; including the year of granting the franchise. In addition to the annual franchise fee the Grantee shall pay to the City an initial construction charge calculated at the rate of One Hundred Dollars ($100.00) per mile or fraction thereof for all new pipeline laid during the preceding report period. SECTION-4-11--ANNUAL -REPO=RT: On or prior to April 1st of each year, Grantee shall file with the City Clerk a report verified by Grantee's oath or the oath of the manager or other responsible officer of Grantee describing in detail the length; location (by street name) and nominal internal diameter of pipelines installed and maintained under this franchise. A map to a suitable scale shall be provided with this annual report showing the location of the Grantee's facilities. In this report the Grantee shall also show any change in footage since the last report period; segregating such footage Ordinance No. 1038 (1985 Series) Page 12. as to new pipelines laid; old pipelines removed; old pipelines abandoned in place; and the footage of pipelines in territory annexed or incorporated since the last franchise report. Simultaneously with the filing of the report; Grantee shall submit to the Finance Department fees required under Section 4 -10 FRANCHISE­FEES of this ordinance. Grantee shall also advise Finance Director of any change of name and address. Franchise fees paid late (after April 1) shall include a late charge penalty of 16% of the amount due for each year or portion thereof such fees are in arrears. This amount is not interest and therefore shall not be prorated. Neglect, omission or refusal by Grantee to file such verified reports or to pay franchise fees at the times or in the manner herein provided, in addition to the late charge penalty, shall be adequate grounds upon which the City may, by resolution, declare this franchise and all rights thereunder forfeited. If Grantee has not paid franchise fee plus 16% penalty by July 1, the Finance Department shall notify the Public Works Department. The Director shall then take appropriate action to collect such fees, including, if necessary, recommending that the Council forfeit the franchise. City shall have the right to inspect Grantee's pipeline records relating to its annual report and the right of audit and recomputation of any and all amounts payable under franchise. Ordinance No. 1038 (1985 Series) Page 13. Costs of audits shall,be borne by Grantee when audits result in an increase of more than five percent (5%) of Grantee's annual payments due City. Acceptance of any payment shall not be construed as a release or as an accord and satisfaction of any claim City may have for further or additional sums payable under this ordinance or for the performance of any other obligation hereunder. SECTION -'4 -12 -= "FORFEITURE: Failure or refusal of Grantee to comply with material terms or conditions of franchise shall be adequate ground for forfeiture of the franchise. The Council; prior to any forfeiture of this franchise; shall give to a Grantee not less than thirty (3) days notice, in writing, of any default thereunder. If Grantee does not, within the notice period, begin the work of compliance or after such beginning does not prosecute the work with due diligence to completion, the Council may hold a hearing, at which the Grantee shall have the right to appear and be heard, and thereupon the Council may determine whether such conditions are material and essential to this franchise and whether the Grantee is in default with respect thereto and,may declare the franchise forfeited. Notice of such hearings shall be given to the Grantee by certified mail not less than five (5) days before hearing. Forfeiture shall not of itself operate to release a bond. Upon declaring a franchise forfeited, Council may elect Ordinance No. 1038 ( 1985 Series) Page 14. to take and accept bonds as liquidated damages therefor and /or to pursue any other legal remedy for damages, losses or injuries suffered by City. After forfeiture of franchise, a bond shall remain in full force and effect for a period of one (1) year unless exonerated by Council. A bond shall not be exonerated unless a release is obtained from Council and is filed with the City Clerk. Releases shall state whether all excavations have been backfilled, all obstructions removed, and whether substratum and surface of City streets occupied or used have been left in a good and serviceable condition. Releases shall not constitute waivers of any rights or remedies which City may have against Grantee or any other persons for any damages, losses or injuries suffered by City as a result of any work or activity performed by Grantee in the exercise of franchise rights. Failure of Grantee to comply with terms or conditions of this franchise, which in the opinion of the Director does not warrant forfeiture, shall be subject to a monetary penalty of one percent (1 %) per day of the amount of Grantee's previous annual payment or anticipated payment on new or assigned franchises until such non - compliance is corrected. Director shall give Grantee not less than thirty (30) days notice, in writing, of intention to impose such penalty. Ordinance No. 1038 (1985 Series) Page 15. SECTION 4 -13 = TITLE-TO-PROPERTY. During the term of this franchise title to all real or personal property placed on, embedded in or buried under substratum or-subsurfaces of any City street by Grantee in exercise of franchise rights shall remain vested in Grantee, except as hereafter provided. Upon termination, expiration, forfeiture of franchise or when no renewal or replacement franchise has been granted, Grantee shall begin removal without expense to City of all facilities maintained pursuant to the terms of this franchise. If such removal is not completed within 180 days or any additional period granted by Council, Council may provide for the removal of the facilities or any part thereof and Grantee shall be required to pay the actual cost of such removals. During the term of, or upon termination of this franchise, Director may authorize Grantee to abandon in place Facilities as defined herein. The following shall be deemed to be an offer by Grantee to transfer title to its facilities to City: Requests to abandon Facilities in place. Failure to remove Facilities within 180 days of termination of franchise. Non - payment of annual fee on all or a portion of Grantee's Facilities. City at its sole option may accept such ownership or have such Facilities removed at Grantee's expense as provided above. Ordinance No. 1038 ( 1985 series) Page 16. SECTION 4 -14 --RIGHT-LIMITED TO PUBLIC RIGHT -OF =WAY: Franchise shall confer upon the Grantee only the right or privilege to enter upon right -of -way of City streets and shall not be construed to authorize any invasion of property rights of abutting owners, including the underlying fee title where Grantor has title in easement for public road and related purposes. SECTION 4 -15 - CHANGE IN- STATUS OF PUBLIC'AREA: If any areas not covered by this franchise are annexed or incorporated into the City, the City and Grantee shall have all the same rights and obligations they would have had if that area had been a part of the City at the time this ordinance was adopted. SECTION 4 -16-- LITIGATION-EXPENSES. Should City bring legal action against Grantee to compel performance of, or to recover for breach of covenants, agreements or conditions of this franchise, Grantee shall pay to City, in addition to any other relief obtained by City, such reasonable'attorney's fees as are fixed by the court. SECTION 4 -17 —LOCATION OF FACILITIES: All of Grantee's facilities shall be installed and maintained in such a manner as to provide for the greatest public safety and least interference with adjoining private property. Gity reserves the right to prescribe vertical and horizontal location of Grantee's facilities within public street rights -of -way. Ordinance No. 1038 (1985 Series) Page 17. SECTION 4 -18 - RENEWAL. Not later than six (6) months prior to the expiration of the term of this franchise, Grantee may apply to City for renewal. SECTION 4 -19— APPEAL PROCEDURE. Should a dispute arise between City and Grantee as to interpretation of a term or condition of this franchise the Grantee shall first appeal to the Director in writing. The Director shall then provide Grantee with a written final decision, containing the reasons upon which he bases his decision. If the Grantee is not satisfied with the Director's final decision, it may appeal directly to the Council in writing, setting forth the basis of any grievance arising from Director's final decision and enclosing a copy thereof. The City Clerk shall place any such appeals on Council's agenda and set a date for a hearing. The City Clerk shall notify the Grantee of the Council's decision on the appeal. The decision of Council is final. SECTION 4 -20 —DELEGATION OF AUTHORITY. It is intended that any and all authority delegated by this Ordinance to Director, or his designee, is also jointly and severally delegated to the City Administrative Officer of the City of San Luis Obispo, or his designee. Ordinance No. 1038 (1985 Series) Page 18. SECTION 4 -21-- EMERGENCY EQUIPMENT. At all times during the term of this franchise, the Grantee shall maintain or arrange for, on a twenty -four (24) hour a day basis, adequate emergency equipment and properly trained personnel within a reasonable distance from any facilities operated pursuant to this franchise for the purpose of shutting off the pressure and the flow of contents of such facilities in the event of an emergency resulting from any cause. The Grantee shall follow all state and local laws regarding notification of public agencies of any emergencies involving its facilities. SECTION 4 -22 - MAXIMUM VALUE FOR FRANCHISE. Grantee agrees that this franchise shall never be given any value before any court or other public authority in any proceeding of any character in excess of the initial cost of the franchise to the Grantee. SECTION 4 -23-- PRIOR RIGHTS. The provisions of this franchise shall apply to: (1) those pipelines of the Grantee and the appurtenances thereof which are maintained by the Grantee in the streets of the city pursuant to the existing franchise which this ordinance is intended to replace, in accordance with Charter Section 1004; (2) those pipelines and the appurtenances thereof which are maintained under franchises of adjacent jurisdictions in areas which are hereafter annexed to the City; and, (3) those pipelines and the appurtenances thereof which are hereafter installed in the streets of the city pursuant to the provisions of this franchise. Ordinance No.1038 ( 1985 Series) Page 19 . This franchise shall not apply to those facilities of the Grantee maintained pursuant to prior rights owned by the Grantee. The City shall have the right to be provided with reasonable written evidence of such prior rights. Moreover, notwithstanding the foregoing, the Grantee shall be obligated to comply with all other ordinances, rules, regulations and other requirements of the State of California, the City of San Luis Obispo, and any other public agencies having jurisdiction, applicable to pipelines and related facilities in the streets of the City, whether maintained under this franchise or otherwise, including the obligation to obtain a permit from the City to make excavations in or place obstructions upon the City streets, as outlined in Section 4.3. SECTION 5 - SEVERABILITY: If any section, subsection,. sentence, clause or phrase of this franchise is for any reason held illegal, invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity or the remaining portions hereof. The Council hereby declares that it would have passed this Ordinance and each section, subsection, sentence, clause and phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be declared illegal, invalid or unconstitutional. The invalidity of any portion of this Ordinance shall not abate, reduce or otherwise affect any consideration or other obligation required of the Grantee of any franchise granted hereunder. Ordinance No. 1038 ( 1985 Series) Page 20. SECTION 6. A summary.of this ordinance; approved by the City Attorney, together with the ayes and noes; shall be published at least three (3) days prior to its final passage in the Telegram- Tribune; a newspaper published and circulated in said City, and the same shall go into effect at the expiration of thirty (30) days after its said final passage. A copy of the full text of this ordinance shall be on file in the office of the City Clerk on and after the date following introduction and passage to print and shall be available to any interested member of the public. INTRODUCED AND PASSED TO PRINT by the Council of the City of San Luis Obispo at a meeting thereof held on the 2nd day of April ; 1985, on motion of Councilwoman Dovey seconded by Councilman Settle and on the following roll call vote: AYES: Councilmembers Dovey, Settle, Dunin, Griffin and Mayor Billig NOES: None ABSENT: None Ordinance No. 1038 ( 1985 Series) Page 21. APPROVED: City m'nistrative Officer Cit At rney City E ng' eer d d' ����`� P _ v �ds�� s y��o�oS,s ���- goog Pvblisd� >� ORDINANCE NO. 1038 (1985 Series) FINALLY PASSED this 16th, day of April , 19 85, on motion of Councilman Settle , seconded by Councilman Dunin and on the following roll call vote: AYES: Councilmembers Settle, Dunin, Dovey, Griffin and Mayor Billig NOES: None ABSENT: None ATTEST: /j 0 5 Cit Clerk Pamela es