HomeMy WebLinkAbout1997-06-02 City Council (25)City Manager’s Report
~TO:HONORABLE CITY COUNCIL
FROM:CITY MANAGER DEPARTMENT: UTILITIES
AGENDA DATE:
SUBJECT:
JUNE 2, 1997 CMR:261:97
APPROVAL OF BUDGET AMENDMENT ORDINANCE FOR
FUNDING OF JOINT CONSTRUCTION WITH PACIFIC
BELL IN THE CUSTOMER DESIGN/CONNECTION CIP-
PROJECT 8928
REQUEST
This staff report requests City Council approval of a Budget Amendment Ordinance
(BAO), in the amount of $300,000, to increase the Electric Fund, Customer
Design/Connection Capital Improvement Project #8928. These additional funds are
required to cover primarily the costs of joint construction with Pacific Bell of a
substructure along Forest Avenue and increased electric customer design and connection
activity within the City.
RECOMMENDATIONS
Staff recommends that Council approve a Budget Amendment Ordinance in the amount
of $300,000, to be taken from the Electric Fund Rate Stabilization Reserve, to fund joint
construction with Pacific Bell of a substructure along Forest Avenue and increased work
in the Customer Design/Connection CIP Project #8928.
POLICY IMPLICATIONS
The additional funding does not represent any change to existing policies.
EXECUTIVE SUMMARY
The Custome~ Design/Connection CIP (Major Project 8928) is the ongoing project that
funds electrical design and construction of customer interconnections and related capital
CMR:261:97 Page 1 of 3
with yearly escalation to offset inflation. This projection method works well in typical
years; however, in years that see unusually high business activity or unusual projects,
there can be insufficient funds for customer design and connection services.
In the current fiscal year, and primarily during the last six months, the department of.
Utilities Electric Engineering Division has seen a substantial increase in new business
activity. In FY 1995/96, Electric Engineering prepared approximately 200 customer
design jobs. As of May 1, 1997 220 jobs have been prepared in FY 1996/97. By year-
end, it is projected that nearly 300 customer design jobs will have been prepared. This
represents a 50 percent increase in the number jobs from the previous fiscal year.
In addition to the customer connection work normally experienced during the year, one
unusually high cost project will also require funding this fiscal year. This is a joint
trench construction project with Pacific Bell on Forest Avenue, between the 700 and 900
Block. Staff learned of this project on April 4, 1997 and requested Council approval to
proceed with engineering design on this project in CMR 243:97 dated May 19, 1997.
In this CMR staff stated that they would return to Council with a BAO at a later date after
Contract negotiations were completed. The combined effect of this project and the
increased customer design and connection activity have increased the expected
expenditures in the Customer Design/Connection CIP 8928 by $300,000.
FISCAL IMPACT
The attached BAO requests an additional $300,000 be appropriated from the Electric
Fund Reserve and added to the original Customer Design/Connection CIP. This request
is in addition to the $200,000 requested in the mid-year budget review for CIP 8928 to
cover the costs of new electric meters that will be needed because of deregulation. There
are sufficient funds in the Electric System Reserves to cover this request.
ENVIRONMENTAL ASSESSMENT
This project is exempt from the provision of the California Environmental Qualtiy Act
(CEQA) pursuant to sections 15302 (replacement of existing facilities) and 15303 (minor
new construction) of the CEQA quidelines.
ATTACHMENTS
Budget Amendment Ordinance
CMR:261:97 Page 2 of 3
Prepared by: Tomm Marshall, Electrical Engineering Manager
DEPARTMENT HEAD APPROVAL:
EDWARD J. MRIZEK
Director of Utilities
CITY MANAGAER APPROVAL:
EMI HAR SON
Assistant City Manager
CMR:261:97 Page 3 of 3
ORD INANCE NO.
ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO
AMENDING THE BUDGET FOR THE FISCAL YEAR 1996-97 FOR
FUNDING OF JOINT CONSTRUCTIONWITH PACIFIC BELL OF A
SUBSTRUCTURE AND INCREASED WORK .IN CUSTOMER DESIGN ~AND
CONNECTION CIP-PROJECT 8928
WHEREAS, pursuant to the provisions of Section 12 of Article
III of the Charter of the City of Palo Alto, the Council on June
24, 1996 did adopt a budget for fiscal year 1996-97; and
WHEREAS, Capital Improvement Project 8928 was created to
provide the design and Construction of connections to electrical
customers; and
WHEREAS, the City of Palo Alto has experienced a 50 percent
increase in the number of customers requesting design services due
to increased business ~activity; and
WHEREAS, the Utilities Department has entered into a joint
trench construction project.with Pacific Bell for increased work in
customer design and connection services; and
WHEREAS, City Council authorization is needed to amend the
1996-97 budget as hereinafter set forth.
NOW, THEREFORE, the Counci! of the City of Palo Alto does
ORDAIN as follows:
SECTION I. The sum of Three Hundred~ Thousand Dollars
($300,000) is hereby appropriated to Capital Improvement Project
Number 8928, Electric Services And Meters and the Electric Rate
Stabilization Reserve is correspondingly reduced.
SECTION 2. This transaction will reduce the Electric Rate.
Stabilization Reserve from 15,519,000 to 15,219,000.
SECTION 3. As specified in Section 2.28.080(a) of the Palo
Alto Municipal Code, a’two-thirds vote of the City Council is
required to adopt this ordinance.
SECTION 4. This project has been determined to be
categorically exempt under Sections 15302 and 15303 of the
California Environmental Quality Act.
.SECTION 5. As provided in Section 2.04.350 of the Palo Alto
Municipal Code, this ordinance shall become effective upon adoption.
INTRODUCED AND PASSED:
AYES:
NOES:
ABSTENTIONS:
ABSENT:
ATTEST:APPROVED:
City Clerk Mayor
APPROVED AS TO FORM:City Manager
Senior Asst. City Attorney Deputy City
Administrative
Department
Manager,
Services
Director of Utilities