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HomeMy WebLinkAbout5.3 An Ordinance Autorizing Northern Illinois Gas Company to Operate and Maintain Gas Distributing system in VMP BoardDocs® ProPage 1 of 3 Agenda Item Details MeetingJun 05, 2018 - REGULAR MEETING OF THE MOUNT PROSPECT VILLAGE BOARD - 7:00 p.m. Category5. CONSENT AGENDA Subject5.3 Motion to waive the rule requiring two readings of an ordinance and adopt AN ORDINANCE AUTHORIZING NORTHERN ILLINOIS GAS COMPANY (d/b/a NICOR GAS COMPANY) ITS SUCCESSORS AND ASSIGNS, TO CONSTRUCT, OPERATE AND MAINTAIN A GAS DISTRIBUTING SYSTEM IN AND THROUGH THE VILLAGE OF MOUNT PROSPECT, ILLINOIS. AccessPublic TypeAction, Action (Consent) Preferred DateJun 05, 2018 Absolute DateJun 05, 2018 Recommended ActionApprove the Nicor Gas Franchise Ordinance authorizing Nicor Gas Company to construct, operate and maintain a gas distributing system in and through the Village of Mount Prospect, IL. Public Content Information The Village entered into a Gas Ordinance ("franchise agreement") with Nicor in April 1968. The Village of Mount Prospect allows Northern Illinois Gas Company ("Nicor") to construct, operate and maintain a natural gas distributing system within its municipal limits. In return Nicor must comply with all reasonable Village regulations with respect to public streets and right-of-ways including restoration. The franchise agreement also stipulates that Nicor will indemnify the Village from any and all judgments, damages, decrees, costs and expenses including attorneys' fees resulting from operating a natural gas system within Village limits and repair any damage cause by its work and agrees to indemnify the Village for claims arising out of such work. The franchise agreement had a term of 50 years (May 1, 1968 to April 30, 2018). In 2008, the Northwest Municipal Conference and the Dupage Mayors and Managers Conference recognized the need for and created a Natural Gas Franchise Consortium to facilitate franchise agreement negotiations with Nicor. The Village joined the Consortium along with about 60 other municipalities. In 2011, the Village and some municipalities decided to withdraw from the Consortium due to attorney fees and the total cost of participation at that point. The Consortium ultimately negotiated a franchise agreement and participating municipalities adopted their new franchise agreements in 2016. This spring Village staff and legal worked with Nicor on an updated franchise agreement. Staff reviewed Nicor's template renewal agreement, the Consortium's franchise agreement and other non-consortium municipalities' recently negotiated franchise agreements. Staff proposed several changes to the franchise agreement (see attached Mt. Prospect Proposed Franchise Agreement document) and the following items were approved by Nicor: ?Changed term from 50 years to 25 years. This matches the Consortium's agreement and positions the Village for an opportunity to benefit from a future Natural Gas Franchise Consortium. ?Added language referencing Exhibit A "Gas Letter - Nicor's Free Therm Allotment". The prior franchise agreement did not have language regarding natural gas provided without charge to the municipality and adding to the new agreement to records this reciprocity. ?Changed references to "Committee on Streets and Alleys of the Municipality" to the "Director of Public Works (or designee)". This change reflects Village operations. https://www.boarddocs.com/il/vomp/Board.nsf/Private?open&login6/21/2018 BoardDocs® ProPage 2 of 3 Fiscal Impact: Upon entering into the new franchise agreement, the Village's allotment of free therms would increase from 86,265 to 103,518 based on Nicor's updated therm allocation formula. The free therms allocation would be identical to what was provided in the Consortium's franchise agreement. The last update to the therm allocation formula was in 2001 while the Village's population was updated with the 2010 U.S. Census. The below table shows how the therm allocation formula would change. New Therm Allocation2001 Therm Allocation Therm Allocation Criteria (in therms)(in therms) 3.63per person up to 10,000 of population 2.42per person for the next 10,000 of population 1.21per person for the next 80,000 of population 1.451.2per person for the next 20,000 of population 1.81.5per person for the population over 120,000 The Village's free therms allotment is used on average by the end of the first quarter or middle of second quarter depending on weather conditions. Free therms are shared by Village Hall, Police HQ, the three Fire Stations, Public Works and the Emergency Operations Center. The Village may change the service addresses receiving free therms at any time. The below table shows total terms the Village used per year from 2011 through 2017. Total Therms Year (Franchise + Non-franchise) 2011114,957 2012121,829 2013145,106 2014172,972 2015139,008 2016110,219 2017124,383 Alternatives 1. Approve an ordinance authorizing Northern Illinois Gas Company (d/b/a Nicor Gas Company) its successors and assigns, to construct, operate and maintain a gas distributing system in and through the Village of Mount Prospect. 2. Action at discretion of Village Board. Staff Recommendation Staff recommends that the Village Board approve the attached Gas Ordinance authorizing Northern Illinois Gas Company (d/b/a Nicor Gas Company) its succors and assigns, to construct, operate and maintain a gas distributing system in and through the Village of Mount Prospect. Mt Prospect Proposed Franchise Agreemt_04-19-2018.pdf (39 KB) Nicor_Gas_Ordinance_Final.pdf (20 KB) Administrative Content Executive Content https://www.boarddocs.com/il/vomp/Board.nsf/Private?open&login6/21/2018 BoardDocs® ProPage 3 of 3 All items under Consent Agenda are considered routine by the Village Board and will be enacted by one motion. There will be no separate discussion of those items unless a Board member or member from the audience so requests, in which the item will be removed from the Consent Agenda and considered in its sequence on the agenda. Motion & Voting (not specified) Motion by Michael Zadel, second by William Grossi. Final Resolution: Motion Carries Yea: William Grossi, Eleni Hatzis, Paul Hoefert, Richard Rogers, Colleen Saccotelli, Michael Zadel https://www.boarddocs.com/il/vomp/Board.nsf/Private?open&login6/21/2018 GAS ORDINANCE AN ORDINANCE AUTHORIZING NORTHERN ILLINOIS GAS COMPANY (d/b/a NICOR GAS COMPANY) ITS SUCCESSORS AND ASSIGNS, TO CONSTRUCT, OPERATE AND MAINTAIN A GAS DISTRIBUTING SYSTEM IN AND THROUGH THE VILLAGE OF MOUNT PROSPECT, ILLINOIS. BE IT ORDAINED BY THE PRESIDENT AND BOARD OF TRUSTEES OF THE VILLAGE OF MOUNT PROSPECT, ILLINOIS: SECTION 1. That the right, permission and authority be and the same are hereby granted to NORTHERN ILLINOIS GAS COMPANY (d/b/a NICOR GAS COMPANY), an Illinois corporation, its successors and assigns (hereinafter referred to as the "Grantee"), to construct, operate and maintain in and through the VILLAGE OF MOUNT PROSPECT (hereinafter referred to as the "Municipality"), in the State of Illinois, for a term of Twenty five (25)Fifty (50)years, a system for the production, distribution and sale of gas for fuel, heating, power, processing and other purposes within and outside the corporate limits of the Municipality, and to construct, lay, maintain and operate such gas pipes, mains, conductors and other devices, apparatus and equipment as may be necessary or convenient for such system in, under, along and across each and all of the streets, alleys, avenues and other public places in the Municipality, subject to the conditions and regulations hereinafter set forth. The consideration to the Village for providing the Grantee the right, permission and authority set forth in this Section 1 is described in Exhibit A which is attached hereto and incorporated as part of this Ordinance, and as may from time to time hereafter be modified by Grantee. 3 SECTION 2. All pipes, mains, conductors and other appliances, including connections with service pipes, hereafter laid in streets, alleys, avenues or other public places, shall be laid under the supervision of the Director of Public Works (or designee)Committee on Streets and Alleys of the Municipality,or such other duly authorized agent of the Municipality as the Board of Trustees may from time to time designate. All pipes, mains, conductors and other appliances shall be so located as not to injure unnecessarily any drains, sewers, catch basins, water pipes, pavements or other like public improvements, but should any drain, sewer, catch basin, water pipe, pavement or other like public improvement be injured by such location, the Grantee shall forthwith repair the damage caused by such injury to the satisfaction of the Director of Public Works (or designee)Committee on Streets and Alleys, or such other duly authorized agent, and in default thereof the Municipality may repair such damage and charge the cost thereof to, and collect the same from, the Grantee. The Grantee shall be subject to all reasonable regulations which may now or hereafter be prescribed by general ordinance of the Municipality with respect to the use of the public streets, alleys, avenues and other public places of the Municipality; including, specifically, Chapter 9, Article VIII, “Construction of Utility Facilities in Public Rights of Way,” of the Village Code of Mount Prospect. SECTION 3. The Grantee and the Municipality believe that it is in their mutual interest to be informed of their respective capital improvement programs, so that whenever practicable those programs can be undertaken to minimize the cost of construction and public inconvenience. At annual meetings, representatives of the Grantee and the Municipality will be prepared to discuss significant known Gas System Work and Municipal projects that could impact the Gas System and that will or may be undertaken within the Municipality. SECTION43. The Grantee shall indemnify, become responsible for and -2 forever save harmless the Municipality and its elected and appointed officials and officers, employees, agents and representatives, from any and all injuries, claims, demands, judgments, damages, decrees, costs and expenses, including attorneys' fees and the cost of suit or defense, which the Municipality may legally suffer or incur, or which may be legally obtained against the Municipality, for or by reason of the use and occupation of any street, alley, avenue or other public place in the Municipality by the Grantee pursuant to the terms of this ordinance or legally resulting from the exercise by the Grantee of any of the privileges herein granted; except that the indemnity provided for in this Section 3 shall not apply to any liability, judgments, damages, decrees, costs and expenses determined by a court of competent jurisdiction to have resulted from the negligence or intentional acts or omissions of Municipality, its agents and employees. SECTION54. After the passage of this ordinance, and within thirty (30) daysafter passage, this ordinance, if accepted, shall be accepted by the Grantee by its filing with the Village Clerk of the Municipality an unconditional written acceptance hereof, to dulyexecuted according to law, and a failure of the Grantee to so accept this ordinance be said period of time shall be deemed a rejection hereof by the Grantee, and the rights and within privileges herein granted shall after the expiration of said period of thirty (30) days, if not so accepted,absolutely cease and determine, unless said period of time shall be extended by the Municipalityby ordinance duly passed for that purpose and before the expiration of said period of thirty (30) days. SECTION65. All provisions of this ordinance which are obligatory upon, or which inure to the benefit of, said NORTHERN ILLINOIS GAS COMPANY (d/b/a NICOR GAS COMPANY) shall also be obligatory upon and shall inure to the benefit of any and all successors and assigns of said Company, and the word "Grantee" wherever appearing in this 3 ordinance shall include and be taken to mean not only said NORTHERN ILLINOIS GAS COMPANY (d/b/a NICOR GAS COMPANY), but also each and all of such successors and assigns. SECTION76. This ordinance, if accepted by the Grantee as hereinabove provided, shall be in full force and effect as of May 1, 2018, and from and after the effectivedate shall supersede, cancel, repeal and be in lieu of any and all other existing or prior grants of right,permission and authority by said Municipality to said Grantee or any predecessor companies orassignors of the Grantee to construct, operate and maintain any system for theproduction, distribution and sale of gas for fuel, heating, power, processing and any other purposes within thecorporate limits of this Municipality, and this ordinance shall likewise cancel all of the obligations under said existing or prior grants. PASSED BY THE BOARD OF TRUSTEES OF THE VILLAGE OF MOUNT PROSPECT, ILLINOIS, THIS DAY OF 2018. VillageClerk APPROVED BY THE PRESIDENT OF THE VILLAGE OF MOUNT PROSPECT, ILLINOIS, THIS DAY OF .2018. President (Seal) ATTEST: -4 VillageClerk 3 STATE OF ILLINOIS ) COUNTY OF COOK )SS. VILLAGE OF MOUNT PROSPECT ) I, ,Village Clerk of the Village of Mount Prospect, Illinois, do hereby certify that the foregoing is a true and correct copy of an Ordinance duly passed by the Board of Trustees of said Village on the __day of _,2018, and duly approved by the President of said Village on the day of ,2018, the original of which Ordinance is now on file in my office. I do further certify that I am the legal custodian of all papers, contracts, documents and records of said Village. WITNESSmyhandand the officialsealof said Village this dayof - - - - -----'2018. VillageClerk Mount Prospect, Illinois (SEAL) -6 GAS ORDINANCE AN ORDINANCE AUTHORIZING NORTHERN ILLINOIS GAS COMPANY (d/b/a NICOR GAS COMPANY) ITS SUCCESSORS AND ASSIGNS, TO CONSTRUCT, OPERATE AND MAINTAIN A GAS DISTRIBUTING SYSTEM IN AND THROUGH THE VILLAGE OF MOUNT PROSPECT, ILLINOIS. BE IT ORDAINED BY THE PRESIDENT AND BOARD OF TRUSTEES OF THE VILLAGE OF MOUNT PROSPECT, ILLINOIS: SECTION 1. That the right, permission and authority be and the same are hereby granted to NORTHERN ILLINOIS GAS COMPANY (d/b/a NICOR GAS COMPANY), an Illinois corporation, its successors and assigns (hereinafter referred to as the “Grantee”), to construct, operate and maintain in and through the VILLAGE OF MOUNT PROSPECT (hereinafter referred to as the “Municipality”), in the State of Illinois, for a term of twenty five years (25) years, a system for the production, distribution and sale of gas for fuel, heating, power, processing and other purposes within and outside the corporate limits of the Municipality, and to construct, lay, maintain and operate such gas pipes, mains, conductors and other devices, apparatus and equipment as may be necessary or convenient for such system in, under, along and across each and all of the streets, alleys, avenues and other public places in the Municipality, subject to the conditions and regulations hereinafter set forth. SECTION 2. All pipes, mains, conductors and other appliances, including connections with service pipes, hereafter laid in streets, alleys, avenues or other public places, shall be laid under the supervision of the Director of Public Works (or designee) of the Municipality, or such other duly authorized agent of the Municipality as the Board of Trustees may from time to time designate. All pipes, mains, conductors and other appliances shall be so located as not to injure unnecessarily any drains, sewers, catch basins, water pipes, pavements or other like public improvements, but should any drain, sewer, catch basin, water pipe, pavement or other like public improvement be injured by such location, the Grantee shall forthwith repair the damage caused by such injury to the satisfaction of the Director of Public Works (or designee), or such other duly authorized agent, and in default thereof the Municipality may repair such damage and charge the cost thereof to, and collect the same from, the Grantee. The Grantee shall be subject to all reasonable regulations which may now or hereafter be prescribed by general ordinance of the Municipality with respect to the use of the public streets, alleys, avenues and other public places of the Municipality. SECTION 3. The Grantee shall indemnify, become responsible for and forever save harmless the Municipality from any and all judgments, damages, decrees, costs and expenses, including attorneys’ fees, which the Municipality may legally suffer or incur, or which may be legally obtained against the Municipality, for or by reason of the use and occupation of any street, alley, avenue or other public place in the Municipality by the Grantee pursuant to the terms of this ordinance or legally resulting from the exercise by the Grantee of any of the privileges herein granted; except that the indemnity provided for in this Section 3 shall not apply to any liability, judgments, damages, decrees, costs and expenses determined by a court of competent jurisdiction to have resulted from the negligence or intentional acts or omissions of Municipality, its agents and employees. SECTION 4. After the passage of this ordinance, and within thirty (30) days after passage, this ordinance, if accepted, shall be accepted by the Grantee by its filing with the -2- Village Clerk of the Municipality an unconditional written acceptance hereof, to be duly executed according to law, and a failure of the Grantee to so accept this ordinance within said period of time shall be deemed a rejection hereof by the Grantee, and the rights and privileges herein granted shall after the expiration of said period of thirty (30) days, if not so accepted, absolutely cease and determine, unless said period of time shall be extended by the Municipality by ordinance duly passed for that purpose and before the expiration of said period of thirty (30) days. SECTION 5. All provisions of this ordinance which are obligatory upon, or which inure to the benefit of, said NORTHERN ILLINOIS GAS COMPANY (d/b/a NICOR GAS COMPANY) shall also be obligatory upon and shall inure to the benefit of any and all successors and assigns of said Company, and the word “Grantee” wherever appearing in this ordinance shall include and be taken to mean not only said NORTHERN ILLINOIS GAS COMPANY (d/b/a NICOR GAS COMPANY), but also each and all of such successors and assigns. SECTION 6. Grantee shall provide an amount of natural gas during each billing year, without charge to the Municipality, in accordance with its policy existing from time to time and applicable to other municipalities, as expressed in and pursuant to the terms of a “Gas Letter,” in the form of Exhibit A, attached hereto and incorporated herein, and as may from time to time hereafter be modified by Grantee. Notwithstanding the first sentence of this Section, Municipality and Grantee agree that no gas without charge or other payment or benefit is payable, due or owing for any period prior to January 1, 2018. SECTION 7. This ordinance, if accepted by the Grantee as hereinabove provided, shall be in full force and effect as of May 1, 2018, and from and after the effective date -3- shall supersede, cancel, repeal and be in lieu of any and all other existing or prior grants of right, permission and authority by said Municipality to said Grantee or any predecessor companies or assignors of the Grantee to construct, operate and maintain any system for the production, distribution and sale of gas for fuel, heating, power, processing and any other purposes within the corporate limits of this Municipality, and this ordinance shall likewise cancel all of the obligations under said existing or prior grants. PASSED BY THE BOARD OF TRUSTEES OF THE VILLAGE OF MOUNT PROSPECT, ILLINOIS, THIS _____ DAY OF _____________________, 2018. ____________________________________ Village Clerk APPROVED BY THE PRESIDENT OF THE VILLAGE OF MOUNT PROSPECT, ILLINOIS, THIS _____ DAY OF_____________________, 2018. ____________________________________ President (Seal) ATTEST: __________________________________________ Village Clerk -4- EXHIBIT “A” “Form of Gas Letter” Village of Mount Prospect, Illinois The undersigned, Northern Illinois Gas Company (d/b/a Nicor Gas Company) (the “Company”), for and in consideration of the adoption by the authorities of the Village of Mount Prospect, Illinois (the “Municipality”), of an ordinance granting the Company the right to construct, operate and maintain a gas distribution system in the Municipality for a term of 30 years from \[OPEN: TO BE COMPLETED BY NICOR\] (the “Franchise Ordinance”), hereby agrees for itself, its successors and assigns, that so long as said ordinance shall remain in full force and effect, Company will during each billing year (start and finish of each year shall begin and end with regular meter reading date nearest to January 1) throughout the remainder of the life of said ordinance, supply without charge to the Municipality, an amount of gas not to exceed \[OPEN: TO BE COMPLETED BY NICOR\] therms (“Therm Allocation”), to be used in buildings which may be occupied from time to time by the Municipality solely for municipal purposes, or such part thereof as may from time to time be so occupied, and not for purposes of revenue. The Therm Allocation is calculated using the municipality’s population of \[OPEN: TO BE COMPLETED BY NICOR\] based on the most recent decennial census data. The Therm Allocation will be adjusted by the Company based on each decennial census count. Between decennial census counts, Therm Allocation may be increased on the basis of changes in population of the Municipality as shown by revised or special census. Upon the submission of a written request by the Municipality accompanied by the official State notification of census change, the Therm Allocation will be adjusted by the Company. For so long as the Franchise Ordinance shall remain in full force and effect, the Municipality’s Therm Allocation will be based on the following revised formula: First 10,000 of population 3.60 therms per capita; Next 10,000 of population 2.40 therms per capita; Next 80,000 of population 1.20 therms per capita; Next 20,000 of population 1.45 therms per capita; Over 120,000 of population 1.80 therms per capita. None of said gas to be supplied without charge to the Municipality, shall be resold for any purpose whatsoever, and in the event the Municipality uses less than the above-mentioned number of therms of gas in any billing year, there shall be no payment due to the Municipality from the Company, or its successors and assigns, for gas not used during that billing year, nor shall any such unused therms be carried over for the following year’s use. In the event the Company’s policy in regard to the practice of supplying gas without charge to municipalities in its present service area is changed at any time in the future, or in the event that the Company in the future provides any other gas utility service benefit as a matter of general -5- policy to all municipalities in such service area, it will inform the Municipality of any such change and, upon acceptance by the Municipality, will grant the Municipality the benefits of such change or benefits under the same conditions applicable to other municipalities. The Company, for itself, its successors and assigns, reserves the option, however, to reduce the total amount of gas supplied during any one billing year without charge as aforesaid by the amount of any fees which the Municipality may charge the Company for permits, street or parkway openings, or inspections of any kind. Such reduction will be arrived at by the use of the Company’s applicable rate for such calculation. This agreement shall supersede, replace and be in lieu of the provisions as to the supply of gas without charge to the Municipality contained in a letter of the Company addressed to the \[OPEN: TO BE COMPLETED BY NICOR\]. END OF EXHIBIT -6- STATE OF ILLINOIS ) COUNTY OF COOK ) SS. VILLAGE OF MOUNT PROSPECT ) I, ______________________, Village Clerk of the Village of Mount Prospect, Illinois, do hereby certify that the foregoing is a true and correct copy of an Ordinance duly passed by the Board of Trustees of said Village on the ____ day of _____________________, 2018, and duly approved by the President of said Village on the ____ day of _____________________, 2018, the original of which Ordinance is now on file in my office. I do further certify that I am the legal custodian of all papers, contracts, documents and records of said Village. WITNESS my hand and the official seal of said Village this _____ day of _____________________, 2018. ____________________________________ Village Clerk Mount Prospect, Illinois (SEAL)