HomeMy WebLinkAbout2000-04-03 City Council (7)City of Palo Alto
City Manageris.Rep0rt
TO:HONORABLE CITY COUNCIL 5
FROM:CITY MANAGER DEPARTMENT:UTILITIES
DATE:April 3, 2000 CMR:188:00
SUBJECT:REQUEST FOR APPROVAL OF A BUDGET AMENDMENT
ORDINANCE IN THE AMOUNT OF $400,000 FOR FIBER OPTICS
CUSTOMER DESIGN AND CONNECTION SERVICES CAPITAL
IMPROVEMENT PROJECT
RECOMMENDATION
Staff’recommends that the Council adopt the attached BAO in the amount of $400,000 for
the Fiber Optics Customer Design and Connection Services Capital Improvement
Program Project (CIP Number 9802).
BACKGROUND
The Fiber Optics Customer Design and Connection Services CIP provides capital funding
for the addition of new fiber optic plant for customer connections. The improvements
provided in this CIP include the installation of new conduits, fiber optic cables, splices, and
enclosures. The City receives 100 percent cost reimbursement from customers for the
installation of new services.
DISCUSSION
The volume of requests for connections to the City’s fiber optic network has accelerated over
the last six months due to the increased competition in the business market for fiber optic
connections. Since the beginning of this year 14 customers have been connected to the
network at a cost of approximately $237,414. In addition to the customers already
connected, there are 6 customers who have paid fees and are awaiting connections at an
estimated cost of $176,772. Currently there are 26 customers who have requested initial
design services. It is projected that 18 customers will request service connections by June
30, 2000 at a cost of approximately $400,000.
The above projects are expected to total $770,712 by year-end. This amount will exceed
the current budget of $370,712 by $400,000.
CMR:188:00 Page 1 of 2
RESOURCE IMPACT
The $400,000 increase requested will be offset by a $400,000 increase in revenues from
customer connection payments. The attached BAO requests an additional appropriation of
expenses and has no impact on the Electric Distribution Rate Stabilization Reserve and no
future year ongoing costs are anticipated as a result of this BAO. Attachment B summarizes
the BAO’s approved to date in 1999-00 that impact the Electric Distribution Rate
Stabilization Reserve. This attachment also estimates future year ongoing costs associated
with BAO’s approved to date to provide a projection for the future resource needs from the
Electric Distribution Rate Stabilization Reserve for those programs approved after the
adoption of the 1999-00 Budget.
POLICY IMPLICATIONS
This report does not represent any change to existing City policies:
ENVIRONMENTAL REVIEW
This project is categorically exempt from the provisions of the California Environmental
[Quahty Act (CEQA) pursuant to Section 15301 (existing facilities) of the CEQA guidelines.
ATTACHMENTS
Attachment A: Budget Amendment Ordinance ,
Attachment B: Budget Amendment Ordinances Impacting the Electric Distribution Rate
Stabilization Reserve Approved to Date in 1999-00.
PREPARED BY: Tomm Marshall, Engineering Manager, Electric
DEPARTMENT HEAD APPROVAL:
CITY MANAGER APPROVAL:
ULRICH
CMR:188:00 Page 2 of 2 "
ORDINANCE NO.
ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO
AMENDING THE BUDGET FOR THE FISCAL YEAR 1999-00 TO
PROVIDE AN ADDITIONAL APPROPRIATION OF $400,000 FOR THE
FIBER OPTIC CUSTOMER DESIGN AND CONNECTION SERVICES
CAPITAL IMPROVEMENT PROJECT NUBMER 9802
WHEREAS, pursuant to the provisions of Section 12 of Article
III of the Charter of the City of Palo Alto, the Council on June 28,
1999 did adopt a budget for fiscal year 1999-00; and
WHEREAS, the Fiber Optics Customer Design and Connection
Services capital improvement project provides funding for the
addition of new fiber optics for customer connections, including the
installation of new conduits, fiber optic cables, splices, and
enclosures; and
WHEREAS, the volume of requests for connections to the City’s
fiber optic network has accelerated over the last six months due to
the increased competition in the business market for fiber optic
connections; and ~
WHEREAS, it is projected that 18 additional customers will
request service connections by the end of this fiscal year at a cost
of $400,000; and
WHEREAS, an additional appropriation of $400,000 is needed to
fulfill th’e request for service connections; and
WHEREAS, this cost will be fully reimbursed by customers; and
WHEREAS, the additional appropriation of funds is a one-time
cost and no future year ongoing costs are anticipated; and
WHEREAS, City Council authorization is needed to amend the
1999-00 budget as hereinafter set forth.
NOW, THEREFORE, the Council of the City of Palo Alto does
ORDAIN as follows:
SECTION i. Revenue in the Electric Fund is increased by the
sum of $400,000 to reflect reimbursement from customers for service
connections.
~SECTION 2. The sum of Four Hundred Thousand Dollars ($400,000)
is hereby appropriated to Capital Improvement Program Project Number
9802, Customer Design and Connection Services.
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 is categorically exempt from the
provisions of the California Environmental Quality Act (CEQA)
pursuant to Section 15301 (existing facilities) of the CEQA
guidelines.
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 Director of
Services
Administrative
Director of Utilities
City of pJo Alto
ATTACHMENT B
Budget Amendment Ordinances Impacting Utilities Rate Stabilization Reserves Approved To Date in 1999~00
03/15/00
Electric Fund
Estimated Electric Distribution Rate Stabilization
Reserve (RSR) Balance
Customer Information System (CIP 9357)
IT Strategic Plan
Stanford West Underground Extension Project (CIP 9901)
Midyear Report
Customer Design and Connection Services (CIP 9802)
Total BAOs
RSR Balance After BAO’s
$400,000
$400,000
($255,000)
($2,545)
($120,000)
($567,500)
($400,000)
($1,345,045)$0
$6,837,000
($255,000)
($2,545)
($~20,000)
($567,500)
$o
($945,045)
$5,891,955
($4,213
($4,213