10.04 Gas Franchise Ordinances - Laserfiche WebLink

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AGENDA ITEM #10.4 City Of Pequot Lakes— _ REPORT TO CITY COUNCIL Report Prepared by: Nancy Malecha Date: February 5, 2019 Subiect: Gas Franchise Ordinances Report: The City currently has a gas franchise ordinance with Northern States Power/Xcel Energy that expires in April of 2019. This ordinance grants Xcel Energy permission to erect a gas distribution system in the City of Pequot Lakes. The City was contacted by Xcel Energy approximately two years ago to begin the process of renewing this ordinance. At the Apri14, 2017 City Council Meeting, a consensus of the Council agreed to consider including a $1-$2 per month flat franchise fee. Attached are the draft ordinances for your review. As you can see, the gas service franchise fee ordinance defines a monthly flat franchise fee of$2 to customers within the City of Pequot Lakes'jurisdiction. This fee would generate approximately $22,344 in revenue to the City per year. The draft ordinances have been reviewed by Xcel Energy, the City Attorney, and myself. Please know that if the City implements a franchise fee on Xcel Energy, the draft gas franchise ordinance states that the City agrees to impose an equivalent franchise fee upon all other energy providers (Minnesota Power and Crow Wing Power) operating in the City and we have until Apri130, 2021 to do so or the franchise fee on Xcel Energy shall expire. I am requesting a consensus from the Council to proceed with the draft gas franchise ordinances as presented or provide direction on changes. This will allow me time to meet the 90 day notification requirement to Xcel Energy as outlined in the ordinances.