5.5. SR 07-12-1999 - Laserfiche WebLink

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. the city and the other company cannot serve that area. Dealing with two franchises and gas companies will require additional city rules and regulations for development activities. There will be some situations where both companies will have mains down the same street (assumed to be major streets, and lines on opposite sides of the street) and these dual main situations will not be able to be avoided. However, the city can avoid double mains in subdivisions that most likely would be uneconomical for the companies and would raise the safety issue of "who to call" if a gas leak is experienced. The existing gas company in Elk River is Reliant (Minnegasco). The franchise with Reliant started in 1953 and this franchise agreement was for 25 years. This agreement was renewed in 1978 for another 25 years, which will expire in 2003. This is a non exclusive franchise agreement that allows us to enter into other gas franchise agreements. Not surprisingly, Reliant does not support NSP's request. Based on recent discussions with Reliant representatives, it is being requested that Elk River consider renewal of the Reliant franchise agreement at the same time as we consider the request from NSP. Reliant has been an excellent corporate citizen for Elk River and is a major player in Elk River's Energy City efforts. We would expect similar involvement in this program from NSP and also that this company would be an excellent corporate citizen. Attached for your review is some material from both NSP and Reliant . regarding their companies and this request. There is not a request for approval or denial of the NSP proposal at this meeting, but only a discussion on this issue. If the City Council is, in general, looking favorable or even open to this request, then it is suggested that we go through the public hearing process to consider these franchise agreements. On the other hand, if the City Council is not in favor of even considering entering into a franchise with NSP, then this needs to be stated early in the process and we will not go through the public hearing to consider this request. . Regardless if the request moves forward, it is also appropriate for the City Council to consider a franchise fee for the gas utility or utilities. A franchise fee based on usage or number of meters or another such system could be discussed at the public hearing. Any franchise fee imposed by the city should be identical for both utilities and franchise fees are printed on the bills. The cable commission (Elk River is a member) currently has a franchise fee as part of its cable TV agreement and, in effect, the city receives a franchise fee from the municipal utilities (although this expense is not printed on the bills). Franchise fees come from the same "pockets" as tax revenue, but this is not a tax and could be based on use and consumption. Franchise fees may be a viable source of funds as municipal revenues become increasingly restricted by the state through such things as levy limits and cutbacks in state aid programs. Based mainly on utilities being in the city owned, managed, and controlled right-of-way, a franchise fee seems reasonable.