HomeMy WebLinkAboutr10411citysintentapprovetransferfranchiseord1564operate&maintainpipelinestransportationoil&othermaterialsinsloconocophillipspiplinecotophillips66pipelinellc&settingphforjan222013RESOLUTION NO . 10411 (2012 Series)
A RESOLUTION OF CITY OF SAN LUIS OBISPO DECLARING THE CITY'S INTEN T
TO APPROVE THE TRANSFER OF FRANCHISE ORDINANCE 1564 TO OPERAT E
AND MAINTAIN PIPELINES FOR THE TRANSPORTATION OF OIL AND OTHE R
SPECIFIED MATERIALS IN THE CITY OF SAN LUIS OBISPO FRO M
CONOCOPHILLIPS PIPELINE COMPANY TO PHILLIPS 66 PIPELINE LLC AN D
SETTING A PUBLIC HEARING FOR JANUARY 22, 201 3
WHEREAS,the City of San Luis Obispo adopted Ordinance No . 1564 on June 21,201 1
granting a franchise to ConocoPhillips Pipeline Company, a Delaware Corporation, for a term o f
10 years for the transportation and distribution of oil and other specified materials in the City o f
San Luis Obispo ; and
WHEREAS,as a result of a corporate reorganization, Phillips 66 Pipeline LLC ha s
assumed all of ConocoPhillips Pipeline Company's properties, rights and obligations, includin g
its pipeline operations in the City of San Luis Obispo and expressly agreed to assume the right s
and obligations of ConocoPhillips Pipeline Company under Franchise Ordinance 1564 ; an d
WHEREAS,the agreement approved by Ordinance 1564 contains the following ke y
provisions :
Purpose :
To maintain and operate pipelines for the transportation of oil an d
hydrocarbons within the City of San Luis Obispo .
Type :
Non-exclusive
Term ;
10 years (expiring June 20, 2021 )
Fees :_Annual franchise fee to the City in accordance with Public Utilities Cod e
Section 6231 .5(A fee ranging from $0 .088 to $0 .66 per foot based o n
pipeline diameter )
Bond :
One million dollars faithful performance bond
Insurance :
Ten million dollars liability insuranc e
Indemnity :Franchisee to indemnify the City for any and all damages to persons o r
property arising out of operations under the franchise . Includes indemnity
for joint acts with the City .
In addition, the Franchise covers all other subjects commonly found in such franchise document s
such as : the type of maintenance and operation of the pipelines, permitted transfers of th e
franchise, requirements for moving pipelines to accommodate public works and utilities ,
encroachment permits, and pipeline abandonment and removal requirements ; and
WHEREAS,in lieu of providing audited financial statements certified by an independen t
certified public accountant, which are unavailable due to Phillips 66 Pipeline LLC being a ne w
R 10411
Resolution No . 10411 (2012 Series )
Page 2
company, Phillips 66 Pipeline LLC has agreed to increase the amount of the faithful performanc e
bond from one million dollars to five million dollars .
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Lui s
Obispo as follows :
SECTION 1 . Pursuant to Section 1002 of the Charter of the City of San Luis Obisp o
and Article 17 of Franchise Ordinance 1564, the City Council hereby declares its intention t o
consent to the transfer of Franchise Ordinance number 1564 from ConocoPhillips Pipelin e
Company to Phillips 66 .
SECTION 2 .A public hearing will be held on January 22, 2013 at 6 :00 p .m . in the
Council Chambers of City hall, located at 990 Palm Street, San Luis Obispo, California . Any
persons having an interest in the franchise transfer or any objection to the approval of th e
franchise transfer may appear before the Council and be heard thereon . This date is not less than
twenty (20) or more than sixty (60) days after the passage of this resolution, in compliance wit h
Section 1002 of the City Charter .
SECTION 3 .The City Clerk shall publish this resolution at least once within fifteen (15 )
days of its passage in a newspaper in the City of San Luis Obispo .
Upon motion of Council Member Carter, seconded by Council Member Ashbaugh, an d
on the following vote :
AYES :
Council Members Ashbaugh, Carpenter and Carter, Vice Mayor Smith
and Mayor Marx
NOES :
Non e
ABSENT : None
The foregoing resolution was adopted this 4th day of December 2012 .
ague,
Maeve Gri m
City Clerk