ORDINANCE NO. 14,342
AN
ORDINANCE extending and amending the franchise heretofore granted to Midwest
Gas Company, predecessor in interest to MidAmerican Energy Company, and
granting unto MidAmerican Energy Company, its successors and assigns, the
right, franchise and privilege for a period of ten years from and after the
effective date hereof, to acquire, construct, operate and maintain in the City
of Des Moines, Iowa, the necessary facilities for the production, distribution,
transmission and sale of gas for public and private use; and to use and occupy
the public streets, highways, avenues, alleys, bridges and public places for
such purposes; providing for the imposition and collection of a franchise fee
in consideration thereof; and prescribing the terms and conditions thereof.
WITNESSETH:
WHEREAS,
pursuant to Ordinance No. 6281 adopted by the city council on May 4, 1987 and
ratified by the voters at a special election on June 9, 1987, the City of Des
Moines did grant unto Midwest Gas Company for a period of 25 years from and
after the effective date thereof, a franchise to acquire, construct, operate
and maintain in the City of Des Moines, Iowa, the necessary facilities for the
production, distribution, transmission and sale of gas for public and private
use; and to use and occupy the public streets, highways, avenues, alleys,
bridges and public places for such purposes; providing for the imposition and
collection of a franchise fee from its customers in consideration thereof; and
prescribing the terms and conditions thereof; and
WHEREAS,
this City Council has determined that it would be in the best interests of the
City of Des Moines and its residents to amend said franchise and to extend the
term thereof for a period of ten years, all as hereinafter provided.
Now,
Therefore, Be It Ordained by the City Council of the City of Des Moines, Iowa:
Section 1. Franchise extended.
That the franchise heretofore granted to
Midwest Gas Company, to acquire, construct, operate and maintain in the City of
Des Moines, Iowa ("city"), the necessary facilities for the
production, distribution, transmission and sale of gas for public and private
use and to construct and maintain along, upon, across and under the streets, highways,
avenues, alleys, bridges and public places the necessary fixtures and equipment
for such purposes, be and the same is hereby extended in the name of
MidAmerican Energy Company (hereinafter "the Company") for a period
of ten years, such that said amended franchise
shall continue in effect until June 15, 2022, at which time said franchise
shall terminate and expire.
Section 2. Representation
of Company.
Section 3. Rates.
The
Company shall supply gas to consumers within the city at just and reasonable rates. It is recognized that under the
statutes of the State of Iowa, the Iowa Utilities Board of the Iowa Department
of Commerce is vested with legal authority to supervise, fix or change rates
and charges authorized to be charged by the Company to gas consumers. In the
event rates or charges in general, or any class or type of rate or charge
shall, during the term of this franchise, cease to be regulated by any state or
federal agency the City Council reserves the right to regulate such rates
within the City with the costs of such
regulation to borne by the company as a part of its cost of doing business, and
reflected in its rates.
The
Company shall file with the city council a true copy of the annual report of
the Company pertaining to the operation or conduct of the business of the
Company under this franchise. The
report may be the same as the Company shall have prepared for such year in the
ordinary course of business of the Company and filed with the Iowa Utilities
Board. In the event the city council
undertakes to regulate rates for service within the city, the Company shall
provide all information necessary to permit the City Council to set just and
reasonable rates.
Section 5. Compliance with city ordinances.
The Company shall at all times during the
term of this franchise conform with, submit to, and carry out the provisions of
any and all valid ordinances (a) relating to any person, firm or corporation
supplying and distributing gas to the city or its inhabitants now in force or
that hereafter may be lawfully enacted; (b) relating to the use of city
right-of-way, including but not limited to the City's Right-of-Way Management
Ordinance, now codified in Chapter 102, Article IX of the Des Moines City Code,
2000, entitled "Right-of-Way Occupancy", as same may hereafter be
amended; or (c) relating to the city's exercise of its police powers.
Section 6. Franchise fee.
In consideration of the right to construct
and maintain such facilities and equipment along, upon, across and under the
streets, highways, avenues, alleys, bridges and public places of the city there
is hereby imposed upon the Company and, by its acceptance of this franchise, it
agrees that there shall be collected from Company’s customers within the
corporate limits of the city and remitted by the Company to the city, a
franchise fee in an amount equal to three percent (3%) of the gross receipts
derived by the Company from the transmission or distribution
of gas to customers within the corporate limits of the city (excluding,
however, the sale of gas to the city)commencing with gross receipts received on
or after September 1, 2004, and that the franchise fee may increase to an
amount not greater than six percent (6%) upon an additional majority vote of
the Des Moines City Council at a duly scheduled City Council meeting after
fourteen (14) days advance public notice.
With
respect to the distribution of gas other than by sale thereof to a purchaser
from the Company, the percentage of gross receipts stated above shall be
applied to the customer’s full cost of gas delivered within the City, including
all costs of acquisition, ownership and transmission thereof, wherever
incurred. In determining the amount of the fee, the Company may presume that
the customer’s cost of gas is the same as if the gas were sold by the Company,
unless a different cost is provided.
The obligation to pay the
fee imposed by this section is modified if:
1.
The City permits any other person to sell, transmit or distribute gas to City
consumers and pay a franchise fee or its lawful equivalent at a lesser rate
than provided in this section, in which case the Company shall collect from its
customers and pay at the lesser rate; or
2.
If the City adds additional territory by annexation or
consolidation and is unable to lawfully impose the franchise fee upon
any person selling, transmitting or distributing gas to consumers within the
additional territory, in which case the franchise fee on the revenue from sales
by the Company in the additional territory shall be equal to that of the lowest
fee being paid by any other person selling, transmitting or distributing gas to
consumers within the additional area.
Section. 7. Exemption from payment of
franchise fee.
The
Company shall be relieved of its obligation to collect from its customers and
remit to the city the franchise fee if the franchise fee or the manner in which
it is collected from customers is ruled to be unlawful by the Supreme Court of
Iowa in a final
non-appealable decision. If a refund to customers is ordered by the
Supreme Court in a final non-appealable decision, the city agrees to repay to
the Company such fees as are ordered to be repaid.
Section 8. Remittance of franchise fee.
The Company shall remit the sum collected
from customers to the city treasurer quarterly on May 1, August 1, November 1
and February 1 of each year for the three-month periods ending respectively
March 31, June 30, September 30 and December 31.
Section. 9. Preservation of city's rights.
This franchise shall not be exclusive and
shall not restrict in any manner the right of the city council or any other
governing body of the city in the exercise of any regulatory power (but not
including the power to acquire by condemnation all of part of the Company’s
facilities) which it may now have, or hereafter be authorized or permitted, by
the laws of the State of Iowa.
The violation of any
material portion of this franchise by the Company or its successors or assigns,
or its failure to promptly perform any of the provisions of this franchise
shall be cause for forfeiture of this franchise and the termination of all
rights under this franchise. Such forfeiture shall be accomplished after
written notice to the Company by the city, and a continuation of the violation,
failure or default specified in the notice for at least sixty days from the
date the notice was served upon the Company.
If
either party determines that there is a default under this franchise, the other
party shall be given a written notice describing the default, stating whether a
forfeiture or termination of the franchise will be sought, and where the
default is curable, providing a reasonable time to cure the default, which
shall be not less than thirty nor more than one hundred eighty days.
Section
11. Reservation of Home Rule Powers.
This
ordinance is intended to be and shall be construed as consistent with the
reservation of local authority contained in the Twenty Fifth Amendment to the
Iowa Constitution granting municipalities home rule powers. To such end any limitation on the power of
the city is to be strictly construed and the city reserves to itself the right
to exercise all power and authority to regulate and control its local affairs,
and all ordinances and regulations of the city shall be enforceable against the
Company unless, and only to the extent, they are irreconcilable with any rights
granted to the Company under this ordinance.
Section 12. Maps of
Distribution System.
The
Company shall furnish to the city such mapping data regarding its distribution
system as the city shall hereafter require pursuant to it right-of-way
management program and Section 102-663 of the Des Moines City Code, 2000, or
successor provision thereto. At the request of the Company, any
information requested with respect to the location or type of equipment which
the Company maintains or plans to install in the right-of-way, which qualifies
as trade-secret information under I.C. § 550.1 et seq., shall be treated as
trade-secret information in accordance with I.C. § 22.1 et seq., pertaining to
examination of public records, or which qualifies to be kept confidential under
any provision of I.C.§ 22.1 et. seq.
Section 13. Use of Eminent Domain
Powers.
The
Company shall have the power to condemn private property for the purpose
of providing gas utilities to the extent necessary to serve a public use and in
a reasonable relationship to an overall plan of transmitting and/or
distributing gas in the public interest upon approval of the City Council.
The Company must establish the necessity for each taking of private property,
and when so established, the City Council may approve the condemnation of the
private property by resolution. Any such exercise of the eminent domain powers
shall be conducted in accordance with the Des Moines Municipal Code.
Section 14. Severability; effect of
regulatory actions.
Provisions of this franchise shall not be
deemed severable except as provided in Section 7, and if either party is
prevented from fulfilling its obligations hereunder by final, non-appealable
regulatory or judicial action or by legislative action, the entire franchise
shall be deemed of no further force and effect as of the date of the agency
order imposing such regulatory action or such other date required by such
judicial or legislative action.
Section
15. Publication of Ordinance and Notice; Election
upon submission of valid petition; effective date.
Upon
Council adoption of this ordinance, the City Clerk shall publish this
ordinance, together with a notice as hereafter provided, in a newspaper of
general circulation in Polk County, all as required by Section 380.7 of the
Iowa Code. If at any time within twenty days after publication of notice of
hearing on this ordinance a petition is filed with the clerk of the city in the
manner provided by Iowa Code Section 362.4, asking that the question of passage
of this ordinance be submitted to the registered voters of the city, then the
council shall direct the county commissioner of elections to call a special
election upon the question of passage of this ordinance.
This
ordinance shall take effect as provided in the notice to be published by the
City Clerk, which shall read as follows:
NOTICE
Under
the provisions of Section 364.2 of the Iowa Code, Des Moines City Council
Ordinance No. 04 – 14,342, extending the gas franchise heretofore granted to
Midwest Gas Company, predecessor of MidAmerican Energy Company, shall take
effect upon September 1, 2004, provided that MidAmerican Energy Company shall
have filed with the city clerk a written acceptance of the franchise extension
granted pursuant to said Ordinance. Provided, however, if prior to June 21,
2004, a valid petition under Section 362.2 of the Iowa Code requesting
submission to the voters of the proposal to extend said franchise is submitted
to the City Clerk, said Ordinance shall not take effect unless it is approved
by an affirmative majority vote of the electors. Upon the county election commissioner's certification of an
affirmative majority vote of the electors with respect to the proposal to
extend the gas franchise as provided in said Ordinance, said Ordinance shall
take effect.
Passed
_____________, 2004
Signed
_____________, 2004
T.M.
FRANKLIN COWNIE, Mayor
Attest:
I, Diane Rauh, City Clerk of the City of
Des Moines, Iowa, hereby certify that the above and foregoing is a true copy of
an ordinance (Roll Call No. 04-_____), passed by the city council of said city
at a meeting held __________, 2004, and signed by the mayor ____________, 2004,
and published as provided by law in the Des Moines Register on July 14, 2004.
DIANE
RAUH, City Clerk