HomeMy WebLinkAbout2008-06-02 Ordinance 5008ORDINANCE NO. 5008
ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO
AMENDING THE BUDGET FOR THE FISCAL YEAR 2007-08 TO
PROVIDE ADDITIONAL APPROPRIATIONS OF $6,350,000 FOR
ELECTRIC FUND SUPPLY COSTS, $1,500,000 FOR GAS FUND
SUPPLY COSTS, AND $700,000 FOR WATER FUND SUPPLY COSTS
The Council of the City of Palo Alto does ordain as follows:
SECTION 1. The Council of the City of Palo Alto finds
and determines as follows:
A. Pursuant to the provisions of Section 12 of Article III of
the Charter of the City of Palo Alto, the Council on June II, 2007
dld adopt a budget for fiscal year 2007-08; and ------
B. The adopted budget for fiscal year 2007-08 included
$67,510,771 for electric supply commodity purchases, $26,139,362
for gas supply commodity purchases, and $7,698,000 for water
supply commodity purchases. The budget was amended by the City
Council on February 19, 2008, to include additional appropriations
of $4,500,000 for electric supply commodity purchases and $303,753
for water supply commodity purchases bringing total appropriations
to $72,010,771 for electric supply commodity purchases and
$8,001,753 for water supply commodity purchases; and
C. The adopted budget and related adjustments for fiscal year
2007-08 for the Electric Fund, Gas Fund, and Water Fund are based
on prevailing market prices and anticipated demand levels at the
time the budget was adopted and adjusted; and
D. Wholesale electric market prices have increased and
hydroelectric generation has been lower than estimates since the
------time--the-budget-was-adopted-and-adjusted-. --An-est±mated-additional-------------
$6,350,000 beyond the amount appropriated in the budget is
required for electric supply commodity purchases; and
E. Revenue from electric surplus energy, which is sold on a
daily basis, is expected to increase by $800,000 due to higher
than anticipated estimates. This increase in revenue is expected
to partially offset the increase of $6,350,000 in electric supply
commodity purchases resulting in a net reduction to the Electric
Supply Rate Stabilization Reserve of $5,550,000; and
F. Gas commodity costs have risen since the time the budget
was adopted due to higher than anticipated market prices and
higher than anticipated demand as well as several external
factors. An estimated additional $1,500,000 beyond the amount
appropriated in the budget is required for gas commodity
purchases; and
G. Higher than expected demand for natural gas is expected
to generate an additional $1,900,000 in total sales revenue, which
includes $900,000 in gas supply sales revenue and $1,000,000 in
gas distribution sales revenue. The $900,000 in gas supply sales
revenue is expected to partially offset the increase of $1,500,000
for gas supply commodity purchases resulting in a net reduction to
the Gas Supply Rate Stabilization Reserve of $600,000; and
H. Water supply costs have increased since the time the
budget was adopted and adjusted due to higher than anticipated
water consumption. An estimated additional $700,000 beyond the
amount appropriated in the budget is required for water supply
-----------c-o-m-m-o-d~ity purchases; and
I. Higher than expected demand for water is expected to
generate an additional $2,000,000 in water sales revenue. This
increase in revenue is expected to exceed the increase of $700,000
in water supply commodity purchases resulting in a net addition to
the Water Fund Rate Stabilization Reserve of $1,300,000; and
J. City Council authorization is needed to amend the 2007-08
budget to make additional appropriations of $6,350,000 for
electric supply commodity purchases, $1,500,000 for gas supply
commodity purchases, and $700,000 for water supply commodity
purchases as hereinafter set forth.
SECTION 2. The sum of Six Million Three Hundred Fifty Thousand
Dollars ($6,350,000) is hereby appropriated to commodity purchases
expense in the Supply Resource Management Functional Area in the
Electric Fund.
S-EeT:rE>N :3. E-lectric Fund revenues are hereby increased by--
Eight Hundred Thousand Dollars ($800,000) to reflect higher than
previously anticipated estimates for electric surplus energy
revenue.
SECTION 4. The Supply Rate Stabilization Reserve in the
Electric Fund is hereby reduced by Five Million Five Hundred Fifty
Thousand Dollars ($5,550,000) to Thirty-Six Million Seventy-Six
Thousand Dollars ($36,076,000).
SECTION 5. The sum of One Million Five Hundred Thousand
Dollars ($1,500,000) is hereby appropriated to commodity purchases
expense in the Supply Resource Management Functional Area in the
Gas Fund.
SECTION 6. Gas supply sales revenues and gas distribution
sales revenues are hereby increased by Nine Hundred Thousand
Dollars ($900,000) and One Million Dollars ($1,000,000) ,
respectively, to reflect higher than expected demand for natural
gas.
SECTION 7. The Supply Rate Stabilization Reserve in the Gas
Fund is hereby reduced by Six Hundred Thousand Dollars ($600,000)
to Four Million Nine Hundred Ninety Thousand Dollars ($4,990,000).
SECTION S. The Distribution Rate Stabilization Reserve in the
Gas Fund is hereby increased by One Million Dollars ($1,000,000)
to Three Million Six Hundred Fourteen Thousand Dollars
($3,614,000) .
SECTION 9. The sum of Seven Hundred Thousand Dollars
-----~( $_2 00 i a Cl..Q)~is-hereh..1l--appr..Qpriat.edt 0 commodLt....1l--pur .. chases-expens..e-----
in the Supply Resource Management Functional Area in the Water
Fund.
SECTION 10. Water sales revenues are hereby increased by Two
Million Dollars ($2,000,000) to reflect higher than expected
demand for water.
SECTION 11. The Water Fund Rate Stabilization Reserve is
hereby increased by One Million Three Hundred Thousand Dollars
($1,300,000) to Ten Million Nine Hundred Ninety-Six Thousand
Dollars ($10,996,000).
SECTION 12. As specified in Section 2.2S.0S0(a) of the Palo
Alto Municipal Code, a two-thirds vote of the City Council is
required to adopt this ordinance.
SECTION 13. The Council of the City of Palo Alto hereby finds
that this is not a proJ'-ec""t un<ier-the. Callfornia Environmental
Quality Act and, therefore, no environmental impact assessment is
necessary.
SECTION 14. As provided in Section 2.04.330 of the Palo Alto
Municipal Code, this ordinance shall become effective upon
adoption.
INTRODUCED AND PASSED:
AYES:
June 02, 200S
BARTON, BURT, DREKMEIER, ESPINOSA,
KISHIMOTO, KLEIN, MORTON, SCHMID, YEH
NOES:
ABSTENTIONS:
ABSENT:
ATTEST: APPROVED:
APPROVED AS TO FORM:
Senior Asst. ~~y