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December 8, 1999
AGENDA REPORT
To: Mayor Yost and Members of the City Council
Attention: Keith Till, City Manager
From: Dan Dorsey, Assistant to the City Manager
Subject: STATUS REPORT ON PROPOSED RENEWAL OF OIL
PIPELINE FRANCHISE WITH SOUTHERN
CALIFORNIA EDISON COMPANY
SUMMARY OF REQUEST
City Council receive and file status report.
BACKGROUND
Seal Beach City Council approved Ordinance Number 953 on April 14, 1975 with
Southern California Edison Company for an oil pipeline franchise; this agreement expires
on April 14, 2000. SCE notified City staff several months ago that the utility desired to
commence the renewal process for another 25-year oil pipeline franchise. Edison
subsequently sent a proposed ordinance to staff for purposes of review.
Negotiations between the City and SCE commenced in earnest around mid-October. In
addition, representatives from Edison informed staff that the City would be eligible to
receive a higher annual franchise fee, commencing in the year 2000, if the ordinance were
to be approved by Council before December 31, 1999. However, staff identified several
provisions in Edison's proposed ordinance which required further negotiations. Some of
these provisions were in direct conflict with Chapter 16B of the City Code(Pipeline
Franchises). SCE and staff have yet to resolve these issues.
Under a new franchise agreement, the City would receive an annual fee of approximately
$5,355 as compared to the current(1998)fee of$1,331. However, staff believes that the
potential revenue increase does not warrant an expedited negotiation process because a
25-year agreement reflects a significant commitment by the City of Seal Beach.
Staff will continue to negotiate with representatives from Edison until all outstanding
issues are resolved. Moreover, staff will make every effort to ensure that the City receives
a higher franchise fee commencing in the year 2000.
Agenda Item:
RECOMMENDATION
City Council receive and file status report.
NOTED & APPROVED-
Keith Till
City Manager
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