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HomeMy WebLinkAbout01-15-2019 Item 8 - MOU with Morro Bay for Monterey Bay Community Power Boards Department Name: Administration Cost Center: 1001 For Agenda of: January 15, 2019 Placement: Consent Estimated Time: N/A FROM: Robert A. Hill, Interim Deputy Director, Office of Sustainability Prepared By: Chris Read, Sustainability Manager SUBJECT: APPROVE A MEMORANDUM OF UNDERSTANDING WITH THE CITY OF MORRO BAY FOR SHARING POLICY BOARD, OPERATIONS BOARD, AND COMMUNITY ADVISORY COMMITTEE SEATS ON MONTEREY BAY COMMUNITY POWER RECOMMENDATIONS 1. Approve the draft Memorandum of Understanding (MOU) with the City of Morro Bay for sharing Policy Board, Operations Board, and Community Advisory Committee seats on Monterey Bay Community Power (Attachment A); and 2. Authorize the City Manager to execute the MOU in a form subject to approval of the City Attorney’s Office. DISCUSSION Background Community Choice Energy (CCE), authorized by Assembly Bill 117, is a state law that allows cities, counties, and other authorized entities to aggregate electricity demand within their jurisdictions to purchase and/or generate electricity supplies for residents and businesses within their jurisdiction while maintaining the existing electricity provider for physical transmission and distribution services. CCEs are typically created to provide a higher percentage of renewable energy electricity, such as wind and solar, at competitive and potentially cheaper rates than existing investor owned utilities, while giving consumers local choices and promoting the development of renewable power sources and local economic development. The City Council has been supportive of the research and development of a viable regional CCE program for the City of San Luis Obispo and surrounding communities for the last several years. In November of 2018, the City of Morro Bay and the City of San Luis Obispo adopted ordinances and resolutions committing both cities to join Monterey Bay Community Power (MBCP). On December 5, the MBCP Policy Board unanimously voted to approve the two cities’ membership. Packet Pg. 133 Item 8 MBCP is governed by two Boards: 1) a Policy Board that meets quarterly and is comprised of elected officials, and 2) an Operations Board that meets at least eight times per year and is comprised of City Managers and County Administrative Officers. MBCP also has a Community Advisory Council comprised of local residents and business owners. In MBCP, counties and jurisdictions with 50,000 or more residents hold six permanent Board seats. An additional six Board seats are shared by multiple jurisdictions based on geography. As part of membership, the City of San Luis Obispo and the City of Morro Bay agreed to share a seat in each of the three bodies. Upon approval of joining MBCP, the City of San Luis Obispo and the City of Morro Bay each agreed to negotiate a formal agreement for sharing the Policy Board, Operations Board, and Community Advisory Council seat. In December of 2018, staff from the two cities drafted and negotiated the draft MOU that is provided as Attachment A. The draft MOU outlines the following provisions: 1. Policy Board. The Policy Board representative shall serve for a term of two years and shall alternate between cities. The City of San Luis Obispo shall provide the initial representative and will serve from January 2019 to December 2020 and thereafter shall rotate every two years between the City of Morro Bay and San Luis Obispo. a. The City with the currently serving Policy Board representative shall, after each Policy Board meeting, distribute via email to both City Councils and City Managers the meeting minutes and any additional narrative deemed necessary to stay informed of policy, business or other related matters. b. The Policy Board Director alternative shall be identified by the city currently holding the seat. 2. Operations Board. The Operations Board representative shall serve for a term of two-years and may be one of two options: a. The City Manager for the city of the Policy Board representative; or b. director or deputy-director level staff member as determined by the City Manager of the Policy Board representative. 3. Community Advisory Council. There shall be one Community Advisory Council (CAC) member that shall serve a two-year term and shall be selected by the current Policy Board Member and the Alternate. Although MBCP is not an advisory body, and although the potential pool of CAC applicants includes registered voters living in Morro Bay and San Luis Obispo, the selection of the CAC member will mirror established City advisory body protocol including staff requesting and reviewing applications. The process will conclude with the election of the CAC member by the current Policy Board Director and Alternate. Packet Pg. 134 Item 8 The MOU requires that in all cases, the elected officials, staff, or public representing the joint interests of the two cities shall consider the program purposes outlined in the Central Coast Community Energy Joint Exercise of Powers Agreement including reducing greenhouse gas emissions, providing electric power to customers at a competitive cost, carrying the programs to increase energy efficiency, stimulating and sustaining the local economy by developing local jobs in renewable energy and energy efficiency, and promoting long-term rate stability and energy security and reliability for residents through local control of electric generation resources. The MOU also includes a provision that if a party fails to attend or otherwise comply with the Monterey Bay Community Power JPA and bylaws, and if the seat becomes vacated because of such conduct, the other party shall serve in that seat. Should the CAC member fail to regularly attend or otherwise comply with the JPA and bylaws, a new member will be selected through the established process. Consistent with the subcommittee and liaison assignments identified at the January 8, 2019, City Council Meeting, the following roles are assigned for calendar years 2019 and 2020: Board Director Alternate Policy Board Mayor Harmon Vice Mayor Pease Operations Board Derek Johnson, City Manager Bob Hill, Interim Deputy Directory, Office of Sustainability The Community Advisory Council (CAC) Member will be identified following Council action on this item. POLICY CONTEXT At Council’s direction, the City has been pursuing participation in a CCE program since 2013. The MOU considered in this staff report is directly responsive to the most recent Council direction, in November of 2018, to join MBCP and develop a process for sharing Board seats with the City of Morro Bay. PUBLIC ENGAGEMENT Council and staff received public and written testimony in support of joining MBCP and sharing Board seats with the City of Morro Bay at the November 13, 2018, City Council meeting. ENVIRONMENTAL REVIEW The California Environmental Quality Act does not apply to the recommended action in this report, because the action does not constitute a “Project” under CEQA Guidelines Sec. 15278. Packet Pg. 135 Item 8 FISCAL IMPACT Budgeted: Yes Budget Year: 2018-19 Funding Identified: Yes Fiscal Analysis: Funding Sources Current FY Cost Annualized On-going Cost Total Project Cost General Fund $20,000 State Federal Fees Other: Total The only fiscal impact to participating on MBCP’s Boards come from staff time and occasional travel to Monterey County. These impacts are accounted for in City Administration’s current standard operational budget. ALTERNATIVES 1. The City Council could request amendments to the MOU. Should Council request amendments, they would be provided to the City of Morro Bay for consideration and brought back to Council at a future date. 2. The City Council could propose an alternative Director and Alternate. Council direction to propose alternative representation could be accommodated at this meeting. Attachments: a - Draft_Memorandum of Understanding - MBCP Shared Seats Packet Pg. 136 Item 8 MEMORANDUM OF UNDERSTANDING BEETWEEN CITY OF SAN LUIS OBISPO AND CITY OF MORRO BAY This MEMORANDUM OF UNDERSTANDING (MOU) is hereby made and entered into by and between the City of San Luis Obispo, hereinafter referred to as SAN LUIS OBISPO, and the City of Morro Bay, hereinafter referred to as MORRO BAY. A. INTRODUCTION In November 2018, SAN LUIS OBISPO and MORRO BAY jointly pursued community choice energy program for the purpose of providing choice in the electricity market, reducing greenhouse gas emissions, proving potential rate savings, supporting energy efficiency, promoting regional collaboration, and contributing to economic development. The two cities pursued participating in a community choice energy program by joining Monterey Bay Community Power (MBCP). On December 5, 2018, SAN LUIS OBISPO and MORRO BAY became official members of MBCP As outlined in the MBCP Joint Powers Agreement, the agency is governed by two decision making bodies and one advisory body: • The Policy Board is comprised of elected officials and meets quarterly to decide high level policy decisions. • The Operations Board is comprised of City Managers or their designees and meets approximately eight times per year to decide finer detailed operational decisions. • The Community Advisory Council is comprised of community members and serves in an advisory role to the Policy Board and Operations Board. MBCP is a large agency and to ensure manageable meetings, smaller jurisdictions share seats on the Policy Board and Operations Board. Jurisdictions with 50,000 or more residents have permanent seats, while smaller jurisdictions share seats based on geographic proximity. Since SAN LUIS OBISPO and MORRO BAY are smaller than 50,000 each, the two cities will share a Policy Board and Operations Board seat. Additionally, MBCP has communicated that the two cities may select one Community Advisory Council member. On November 13, 2018, both City Councils voted unanimously to direct staff to negotiate a Memorandum of Understanding between SAN LUIS OBISPO and MORRO BAY to provide a collaborative and fair strategy for MBCP representation and to return to their respective Councils for final approval. B. PURPOSE The purpose of this Memorandum of Understanding is to identify a clear framework between SAN LUIS OBISPO and MORRO BAY to share governance seats on Monterey Bay Community Power’s Policy Board, Operations Board, and Community Advisory Council. It should also be noted that community collaboration and regionalism was a key value of the effort to create a local community choice energy program. This Memorandum of Understanding seeks to encourage further regional collaboration. C. SHARED SEATS Packet Pg. 137 Item 8 1. Policy Board - The Policy Board representative shall serve for a term of two years and shall alternate between cities. SAN LUIS OBISPO shall provide the initial representative and will serve from December 2018 to December 2020 and thereafter shall rotate every two years between the City of Morro Bay and San Luis Obispo. a. The City with the currently serving Policy Board representative shall distribute via email to both City Councils and City Managers the meeting minutes and any additional narrative deemed necessary after each Policy Board meeting to stay informed of policy, business or other related matters. b. The Policy Board Director alternative shall be identified by the City currently holding the seat. 2. Operations Board - The Operations Board representative shall serve for a term of two-years and may be one of two options: a. The City Manager for the City of the Policy Board representative; or b. A director or deputy-director level staff member as determined by the City Manager of the Policy Board representative. 3. Community Advisory Council – There shall be one Community Advisory Council member that shall serve a two-year term and be selected by the current Policy Board Member and their alternative. The pool of Community Advisory Committee applicants shall include all registered voters residing in MORRO BAY and SAN LUIS OBISPO. The city currently providing the Policy Board representative shall conduct the Community Advisory Council selection process. 4. In all cases, the elected officials, staff, or public representing the joint interests of SAN LUIS OBISPO and MORRO BAY shall consider the program purposes outlined in the Central Coast Community Energy Joint Exercise of Powers Agreement: a. Reducing greenhouse gas emissions; b. Providing electric power to customers at a competitive cost; c. Carrying our programs to increase energy efficiency; d. Stimulating and sustaining the local economy by developing local jobs in renewable energy and energy efficiency; and e. Promoting long-term rate stability and energy security and reliability for residents through local control of electric generation resources. 5. If a party fails to attend or otherwise comply with the Monterey Bay Community Power JPA and bylaws, and if the seat becomes vacated because of such conduct, the other party shall serve in that seat. D. PROCESS SAN LUIS OBISPO City Council will appoint its respective Board Members for the two-year term by February 2019. Terms shall run for two-years starting in December and concluding in November of even- numbered years. Future term appointees shall be made by alternating City Councils in November of the year that the term concludes (e.g., MORRO BAY in 2020, SAN LUIS OBISPO in 2022, MORRO BAY in 2024, etc.). E. PRINCIPAL CONTACTS Packet Pg. 138 Item 8 The principal contacts for this MOU are: SAN LUIS OBISPO: Name Role: Derek Johnson, City Manager Bob Hill, City Lead Chris Read, City Lead MORRO BAY Name Role: Scott Collins, City Manager, City Lead F. COST OBLIGATION Each party to this Memorandum of Understanding shall be financially responsible for absorbing costs incurred for their own participation on the Policy Board, Operations Board, and Community Advisory Council. G. COMMENCEMENT/EXPIRATION DATE This Memorandum of Understanding is executed as of the date of last signature and is effective until an additional San Luis Obispo County jurisdiction joins MBCP, or SAN LUIS OBISPO or MORRO BAY withdraw from MBCP, at which time it will be renegotiated. H. LIABILITIES It is understood that neither party to this Memorandum of Understanding is the agent of the other and neither is liable for the wrongful acts, omissions or negligence of the other. Each party shall be responsible for its wrongful or negligent acts or omissions and those of its officials, officers, employees, and agents, howsoever caused, to the extent allowed by law, and shall be responsible for their own Commercial General Liability, Auto, Worker’s Compensation and Errors and Omissions insurance and adherence to their respective City’s policies. Each party to this Memorandum of Understanding agrees to indemnify, defend and hold the other, and their officials, officers, employees, and agents, against any liability, claim, personal injury, including death, or property damage caused by that party’s negligence or willful misconduct in their performance under this Memorandum of Understanding. I. NO ASSIGNMENT The rights and obligations of the parties to this Memorandum of Understanding may not be assigned or delegated. J. AMENDMENT Packet Pg. 139 Item 8 This Memorandum of Understanding may not be amended or modified in any manner whatsoever except by written agreement between the parties hereto. IN WITNESS WHEREOF, the parties hereto have executed this agreement as of the last written date below. FOR SAN LUIS OBISPO: Date: Derek Johnson, City Manger FOR MORRO BAY Date: Scott Collins, City Manager Packet Pg. 140 Item 8