Item 7MCity of Southlake, Texas
MEMORANDUM
September 26, 2006
TO: Shana Yelverton, City Manager
PROM: Sharen Jackson, Finance Director
SUBJECT: Ordinance No. 903, An Ordinance Amending Existing Franchise Ordinance
Between The City Of Southlake And TXU Electric Delivery Company, A Texas
Corporation, Its Successors And Assigns, To Provide For A Different Payment
Schedule; Providing An Extension. Of The Franchise Term; Providing For TXU
Electric Delivery Acceptance
Action Requested: Approval of Ordinance No. 903
Background
Information: In accordance with the Agreement to Resolve Outstanding Franchise Issues
dated January 27, 2006 between TXU and the TXU Steering Committee, TXU
was required to amend the existing franchise ordinance, between TXU and the
Cities. The purpose of this franchise amendment is to convert to quarterly,
instead of annual, payment of franchise fees. A by- product of that conversion
is a 5 -year extension of the franchise until October 31, 2011.
Financial
Considerations: Ordinance No. 903 would increase the frequency of franchise revenue received
which could potentially increase interest earning.
Citizen Input/
Board Review: Public hearing scheduled for October 17, 2006
Legal Review: The steering committee attorney prepared the ordinance.
Alternatives: Approve or deny.
Supporting
Documents: Ordinance No. 903
Staff
Recommendation: Approve Ordinance No. 903
ORDINANCE NO. 903
AN ORDINANCE AMENDING EXISTING FRANCHISE ORDINANCE BETWEEN THE
CITY OF SOUTHLAKE AND TXU ELECTRIC DELIVERY COMPANY, A TEXAS
CORPORATION, ITS SUCCESSORS AND ASSIGNS, TO PROVIDE FOR A DIFFERENT
PAYMENT SCHEDULE; PROVIDING AN EXTENSION OF THE FRANCHISE TERM;
PROVIDING FOR TXU ELECTRIC DELIVERY ACCEPTANCE; FINDING AND
DETERMINING THAT THE MEETING AT WHICH THIS ORDINANCE IS PASSED IS
OPEN TO THE PUBLIC AS REQUIRED BY LAW.
WHEREAS, TXU Electric Delivery Company, successor in interest to Oncor Electric
Delivery Company (hereinafter called "Company ") is engaged in the business of providing electric
utility service within the City of Southlake, Texas (hereinafter called "City ") and is using the public
rights -of- -ways within the City for that purpose under the terms of a franchise ordinance heretofore
duly passed by the governing body of the City and duly accepted by Company; and
WHEREAS, pursuant to Agreement to Resolve Outstanding Franchise Issues dated January
27, 2006, the City has requested and Company has agreed to amend said franchise ordinance to
provide for a different payment schedule and an extension of the term;
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
SOUTHLAKE, TEXAS: that
SECTION 1 : The franchise between the City and Company is amended as follows:
A. A final annual payment will be made on or before November 1, 2006, based on each
kilowatt hour of electricity delivered by Company during the twelve -month period
ending August 31, 2006, to each retail customer whose consuming facility's point of
delivery is located within the City's municipal boundaries. This payment is for the
rights and privileges granted under the franchise for the twelve month period
November 1, 2006 — October 31, 2007.
Effective February 1, 2007 the annual prospective payment schedule is hereby
changed to a quarterly prospective schedule as follows:
Payment Due Date Basis Period Privilege Period
( Following Year
Feb. 1
Sept. 1
—Nov. 3 0
Nov. 1
— Jan. 31
May 1
Dec. 1—
Feb. 2$(29)
Feb. I
April 30
Aug. 1
Mar. 1 --
May 31
May 1
— July 31
Nov. 1
June 1
—Aug. 31
Aug. 1
— Oct. 31
The first quarterly payment will be due and payable on or before February 1, 2007,
based on the period beginning September 1, 2006 and ending November 30, 2006 for
the rights and privileges granted under the franchise during the period November 1,
Page 1 of 2
2007 and ending January 31, 2008. Subsequent payments will be made on a quarterly
basis as provided in the above schedule. The final payment under this Franchise will
be made on or before November 1, 2010, based on the period beginning June 1, 2010
and ending August 31, 2010, for the rights and privileges beginning August 1, 2011
and ending October 31, 2011.
After the final payment date of November 1, 2010, Company may continue to make
additional quarterly payments in accordance with the above schedule. City
acknowledges that such continued payments will correspond to privilege periods that
extend beyond the term of this franchise and that such continued payments will be
recognized in any subsequent franchise agreement as full payment for the relevant
quarterly periods; and
B. The term of the franchise is hereby extended for an additional five years to expire on
October 31, 2011.
SECTION 2 : In all respects, except as specifically and expressly amended by this
ordinance, the franchise heretofore duly passed by the governing body of the City and duly accepted
by Company shall remain in full force and effect according to its terms until said franchise
ordinance terminates as provided herein.
SECTION 3 : This ordinance shall take effect upon its final passage and Company's
acceptance. Company shall, within sixty (60) days from the passage of this ordinance, file its
written acceptance of this ordinance with the Office of the City Secretary.
SECTION 4 . It is hereby officially found and determined that the meeting at which this
Ordinance is passed is open to the public as required by law and that public notice of the time, place
and purpose of said meeting was given as required.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
SOUTHLAKE, TEXAS, this the day of , 2006.
Mayor
ATTEST:
City Secretary
Page 2 of 2