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HomeMy WebLinkAboutO-2019-3746 Granting a Franchise to CenterPoint Energy Resources Corp. CITY OF LA PORTE, TEXAS - ORDINANCE NO. 2019-3746 AN ORDINANCE GRANTING TO CENTERPOINT ENERGY RESOURCES CORP., D/B/A CENTERPOINT ENERGY TEXAS GAS OPERATIONS, THE RIGHT, PRIVILEGE AND FRANCHISE TO CONSTRUCT, INSTALL, EXTEND, REMOVE, REPLACE, ABANDON, OPERATE AND MAINTAIN ITS FACILITIES WITHIN THE PUBLIC RIGHTS-OF-WAY OF THE CITY OF LA PORTE, TEXAS FOR THE TRANSPORTATION, DELIVERY, SALE AND DISTRIBUTION OF NATURAL GAS; CONTAINING OTHER PROVISIONS RELATING TO THE FOREGOING SUBJECT; PROVIDING FOR SEVERABILITY; FINDING COMPLIANCE WITH THE OPEN MEETINGS LAW; CONTAINING A REPEALING CLAUSE; AND PROVIDING AN EFFECTIVE DATE. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LA PORTE,TEXAS: Section 1. GRANT OF AUTHORITY. Subject to the terms, conditions and provisions of this ordinance, the right, privilege and franchise is hereby granted to CenterPoint Energy Resources Corp., D/B/A CenterPoint Energy Texas Gas Operations, hereinafter called "Company", to construct, install, extend, remove, replace, abandon, operate and maintain its facilities within the Public Rights-of-Way of the City of La Porte, Texas for the transportation, delivery, sale and distribution of natural gas within the corporate limits of the City of La Porte, Texas as the same are now and as the same may from time to time be extended. Section 2. DEFINITIONS. A. "City"shall mean the City of La Porte, Texas. B. "City Group" shall have the meaning set forth in Section 13 of this Franchise Ordinance. C. "Company" shall mean CenterPoint Energy Resources Corp., D/B/A CenterPoint Energy Texas Gas Operations, a Delaware Corporation, and shall not mean any of its affiliates and subsidiaries who shall have no right,privilege or franchise granted hereunder. D. "Facilities" shall mean pipes, pipelines, natural gas mains, laterals, feeders, regulators, meters, fixtures, connections and attachments and other instrumentalities and appurtenances, used in or incident to providing transportation, distribution, supply and sales of natural gas for heating, lighting,power and any other purposes for which natural gas may now or hereafter be used. E. "Public Rights-of-Way" shall mean the areas in, under, upon, over, across, and along any and all of the present and future Streets (as defined herein) or streams now or hereafter owned or controlled by City. F. "Street" shall mean the surface and the space above and below any public street, road, highway, alley, bridge, sidewalk, or other public place or way. G. "Transport Customer" shall have the meaning set forth in Section 8 of this Franchise Ordinance. Section 3. TERM OF FRANCHISE. This Franchise shall become effective on the Effective Date described in Section 21 of this Franchise Ordinance and shall be in full force and effect for a term of ten(10)years. Section 4. CONSTRUCTION AND MAINTENANCE OF NATURAL GAS DISTRIBUTION SYSTEM. All Facilities installed by Company shall be of sound material and good quality, and shall be laid so that they will not interfere with the artificial drainage of the City or its underground fixtures, or with navigation in or the natural drainage of any stream. All Facilities shall be installed in accordance with applicable Federal and State regulations and in the absence of such regulations in accordance with accepted industry practice. Within the Public Rights-of-Way, the location and route of the Facilities by the Company shall be subject to the reasonable and proper regulation, direction and control of the City or the City official to whom such duties have been delegated. Such regulation shall include, but not be limited to, the right to require in writing to the extent provided in Section 14 of this Franchise Ordinance, the relocation of Company's Facilities at Company's cost within the Public Rights-of-Way of the City whenever such relocation shall be reasonably necessary to accommodate the widening, change of grade, or relocation by City of Streets or Public Rights-of-Way, or construction or relocation by City of City utility lines or drainage facilities. Company shall keep current and up-to-date maps showing the physical location of Company's facilities and make such maps available for inspection by the City at no cost during normal working hours. Section 5. STREETS TO BE RESTORED TO GOOD CONDITION. Company and its contractors shall give City reasonable notice, via electronic mail, of the dates, location, and nature of all work to be performed on its Facilities within the Public Rights-of-Way. Following completion of work in the Public Rights-of-Way, Company shall repair the affected Public Rights-of-Way as soon as possible, but in all cases Company shall comply with all City ordinances (including but not limited to Chapter 62, Article IV "Management of Public Rights-of-Way of the City of La Porte Code of Ordinances) governing time periods and standards relating to excavating in the Public Rights-of-Way. No street, alley, highway or public place shall be encumbered for a longer period than shall be necessary to execute the work. Section 6. PERMITS. Company and its contractors shall obtain a permit prior to its commencement of any planned engineering work, including replacements, extensions and public relocations, within the Public Rights-of-Way, except as otherwise provided below. No permit shall be required for Routine Maintenance in the Public Rights-of-Way, but the Company must provide email notification to the City at least one day prior to the Company's commencement of such work. Company shall be exempt from any existing or future professional engineering stamp or certification requirement of the City. No permit shall be required to promptly initiate emergency repairs and repairs pursuant to the rules and regulations of the Railroad Commission of Texas. All work shall be preceded by an 811 call and be subject to the Texas One-Call Statute (Texas Utilities Code, Chapter 251, and any successor statutes). Company shall give the City telephone notice of the initiation of emergency repairs involving breaks in the paved surface of the Public Rights-of-Way, including sidewalks and curbs, as soon as practicable under the circumstances and shall submit a permit promptly following completion of the work. Company and contractors performing work for the Company shall not be required to obtain any permits for relocations of Facilities requested by the City, provided that the relocated facilities are placed in the location designated by the City and relocation is otherwise in accordance with the City's request to relocate. This Franchise shall constitute a permit to park vehicles in the Streets and other Public Rights-of-Way when necessary for the installation, replacement, abandonment, operation or maintenance of Company's Facilities. Company and contractors performing work for Company shall not be required to pay any fee in addition to the franchise fee in order to obtain a permit to perform work on Company's Facilities, or park within the Streets and other Public Rights-of-Way. City shall not be required to pay any fee in order to obtain a letter of consent from the Company regarding the City's abandonment of Public Rights-of-Way. However, any third party associated with the City's abandonment shall pay all costs related to the abandonment process. Section 7. QUALITY OF SERVICE. The service furnished hereunder to the City and its inhabitants shall be in accordance with the quality of service rules of the Railroad Commission of Texas (Texas Administrative Code, Title 16, Part 1, Chapter 7), state and federal regulations. Company shall furnish the grade of service to its customers as provided by its rate schedules and shall maintain its system in reasonable operating condition during the continuance of this Franchise. An exception to this requirement is automatically in effect, but only for so long as is necessary, when caused by a shortage in materials, supplies and equipment beyond the control of the Company as a result of fires, strikes, riots, storms, floods and other casualties, governmental regulations, limitations and restrictions as to the use and availability of materials, supplies and equipment and as to the use of the services, and unforeseeable and unusual demands for service. In any of such events the Company shall do all things reasonably within its power to restore normal service as quickly as practicable. Section 8. PAYMENT TO THE CITY. In consideration of the rights and privileges herein granted, the administration of the Franchise by the City, the temporary interference with the use of Public Rights-of-Way and cost and obligations undertaken by the City in relation thereto and in lieu of any license, charge, fee, street or alley rental or other character of charge for use and occupancy of the Streets, alleys, and public places of the City, and in lieu of any inspection fee, the Company agrees to pay to the City franchise fees in the amount and manner described herein as follows: Company agrees to pay to the City quarterly during the continuance of this Franchise a sum of money equal to three percent (3.00%) of the Company's gross receipts for the preceding calendar quarter received by the Company from the sale of gas within the corporate limits of the City plus seven cents (70) per Mcf for natural gas transported by Company for its Transport Customers during such quarter, without offset or exclusion of any amounts received by Company for receipts associated with Miscellaneous Service Charges, as defined and set forth in the Company's tariff. "Transport Customer" means any person or entity for whom Company transports gas through the distribution system of Company within the corporate limits of City for consumption within the corporate limits of City. The franchise fees hereunder shall be calculated for the calendar quarters ending March 31, June 30, September 30, and December 31 and shall be payable on or before the fifteenth day of May, August, November, and February following the quarter for which payment is made, beginning with the first such date following the Effective Date of this Franchise and each August 15th, November 15th, February 15th, and May 15th thereafter; provided, however, the first such payment shall be prorated as necessary to reflect only those gross receipts received and transportation volumes delivered by Company after the Effective Date of this Franchise. If the ten(10)year term of this Franchise provided for in Section 3 above ends on any day other than the last day of a calendar quarter, then the last payment shall be prorated as necessary. In no event shall the Company be required to remit to the City franchise fee amounts that for any reason whatsoever are not fully recoverable from its customers. Upon receipt of the above amount of money, the City Secretary shall deliver to the Company a receipt for such amount. If any payment due date required herein falls on a weekend or bank holiday,payment shall be made on or before the close of business of the first working day after the payment due date. Section 9. ANNEXATIONS BY CITY. This Franchise shall extend to and include any and all territory that is annexed by the City during the term of this Franchise. Within sixty (60) days from the receipt of notice from the City of any such annexation, the Company shall assure that any and all customers within such annexed territory are included and shown on its accounting system as being within the corporate limits of the City of La Porte, Texas. After such sixty (60) day period the payment provisions specified in Section 7 of this Franchise Ordinance shall apply to gross receipts and transport fees received by the Company from customers located within such annexed territory. Company shall true-up its map of City boundaries to the City's map on an annual basis. Section 10. NON-EXCLUSIVE FRANCHISE. Nothing contained in this Franchise shall ever be construed as conferring upon the Company any exclusive rights or privileges of any nature whatsoever. Section 11. COMPLIANCE AND REMEDIES. (a) In the event the Company by act or omission violates any material term, condition or provision of this Franchise, the City shall notify the Company in writing of such violation. Should the Company fail or refuse to correct any such violation within thirty (30) days from the date of City's notice, the City shall, upon written notification to the Company, have the right to terminate this agreement. Any such termination and cancellation shall be by ordinance adopted by City Council; provided, however, before any such ordinance is adopted, the Company must be given at least sixty (60) days' advance written notice. Such notice shall set forth the causes and reasons for the proposed termination and cancellation, shall advise the Company that it will be provided an opportunity to be heard by City Council regarding such proposed action before any such action is taken and shall set forth the time, date and place of the hearing. (b) Other than its failure, refusal or inability to pay its debts and obligations, including, specifically, the payments to the City required by this Franchise, the Company shall not be declared in default or be subject to any sanction under any provision of this Franchise in those cases in which performance of such provision is prevented by reasons beyond its control. (c) The rights and remedies of City and Company set forth herein shall be in addition to, and not in limitation of, any other rights and remedies provided at law or in equity and City's exercise of any particular remedy shall not constitute a waiver of its rights to exercise any other remedy. Section 12. RESERVE OF POWERS. Except as otherwise provided in this Franchise, the City by the granting of this Franchise does not surrender or to any extent lose, waive, impair or lessen the lawful powers, claims and rights, now or hereafter vested in the City under the Constitution and statutes of the State of Texas and under the Charter and Ordinances of the City of La Porte or other applicable law, to regulate public utilities within the City and to regulate the use of the Streets by the Company; and the Company by its acceptance of this Franchise agrees that, except as otherwise provided in this Franchise, all lawful powers and rights, whether regulatory or otherwise, as are or as may be from time to time vested in or reserved to the City, shall be in full force and effect and subject to the exercise thereof by the City at any time and from time to time. Section 13. INDEMNITY. THE COMPANY,ITS SUCCESSORS AND ASSIGNS,SHALL PROTECT AND HOLD THE CITY AND ITS OFFICERS, AGENTS, AND EMPLOYEES (COLLECTIVELY REFERRED TO IN THIS SECTION AS "CITY GROUP") HARMLESS AGAINST ANY AND ALL CLAIMS OR DEMANDS FOR DAMAGES TO ANY PERSON OR PROPERTY BY REASON OF THE CONSTRUCTION AND MAINTENANCE OF THE COMPANY'S NATURAL GAS DISTRIBUTION SYSTEM,OR IN ANY WAY GROWING OUT OF THE RIGHTS GRANTED BY THIS FRANCHISE, EITHER DIRECTLY OR INDIRECTLY,OR BY REASON OF ANY ACT,NEGLIGENCE OR NONFEASANCE OF THE COMPANY OR THE CONTRACTORS,AGENTS OR EMPLOYEES OF THE COMPANY OR ITS SUCCESSORS AND ASSIGNS, AND SHALL REFUND TO CITY GROUP ALL SUMS WHICH CITY GROUP MAY BE ADJUDGED TO PAY ON ANY SUCH CLAIM, OR WHICH MAY ARISE OR GROW OUT OF THE EXERCISE OF THE RIGHTS AND PRIVILEGES HEREBY GRANTED OR BY THE ABUSE THEREOF, AND THE COMPANY OR ITS SUCCESSORS AND ASSIGNS SHALL INDEMNIFY AND HOLD CITY GROUP HARMLESS FROM AND ON ACCOUNT OF ALL DAMAGES, COSTS, EXPENSES, ACTIONS, AND CAUSES OF ACTION THAT MAY ACCRUE TO OR BE BROUGHT BY, A PERSON, PERSONS,COMPANY OR COMPANIES AT ANY TIME HEREAFTER BY REASON OF THE EXERCISE OF THE RIGHTS AND PRIVILEGES HEREBY GRANTED,OR OF THE ABUSE THEREOF. Section 14. RELOCATION OF FACILITIES. The Company shall, upon written request of the City, relocate its Facilities within Public Rights-of-Way at Company's own expense, exclusive of Facilities installed for service directly to City, whenever such shall be reasonably necessary on account of the widening, change of grade, or relocation by City of Public Rights-of-Way, or construction or relocation by City of City utility lines or drainage facilities. City shall bear the costs of all relocations of Facilities installed for service directly to City and of any relocation of other Facilities requested by City for reasons other than the widening, change of grade, or relocation by City of Public Rights-of- Way, or construction or relocation by the City of City utility lines or drainage facilities. Section 15. GOVERNMENTAL FUNCTION. All of the regulations and activities required by this Franchise are hereby declared to be governmental functions and for the health, safety and welfare of the general public. Section 16. RECORDS AND REPORTS. (a) Books of Account. The Company shall keep complete and accurate books of accounts and records of its business and operations under and in connection with this Franchise. All such books of accounts and records shall be kept at the company's principal office in Houston, Texas. (b) Access by City. The City may conduct an audit or other inquiry or may pursue a cause of action in relation to the payment of the franchise fee only if such audit, inquiry, or pursuit of a cause of action concerns a payment made less than three (3) years before the commencement of such audit, inquiry, or pursuit of a cause of action. Each party shall bear its own costs of any such audit or inquiry. Upon receipt of a written request from the City, all books and records related to Company's operations under this Franchise shall be made available for inspection and copying no later than thirty (30) days from receipt of such request. (c) Interest on Underpayments and Overpayments. (1) Amounts due to City for late payments shall include interest, compounded daily equal to the return on equity plus three percent (3%) granted to the Company in its most recent proceeding fixing rates applicable to customers within the corporate limits of the City. (2) If the City identifies, as a result of a franchise fee compliance review, amounts owed by the Company from prior periods or prior underpayments, then the Company shall pay simple interest on such amounts equal to the return on equity granted to the Company in its most recent proceeding fixing rates applicable to customers within the corporate limits of the City. Said interest shall be payable on such sums from the date the initial payment was due until it is paid and shall not be billed to customers. (3) Amounts due Company for past overpayments shall include simple interest equal to the return on equity granted to the Company in its most recent proceeding fixing rates applicable to customers within the corporate limits of the City; provided, however, if there is a change in the approved return on equity during the time period subject to the City's audit or inquiry, then for each time period during which there was an overpayment, the approved return on equity in effect during such time period shall be used in calculating interest under this subparagraph (c). Interest payable on such sums shall be credited to customers. Section 17. EASEMENT. In consideration for the compensation set forth in Section 8 of this Franchise Ordinance, City agrees that if City sells, conveys, or surrenders possession of any portion of the Public Right-of-Way that is being used by Company pursuant to this Franchise, City, to the maximum extent of its right to do so, shall first grant Company an easement for such use and the sale, conveyance, or surrender of possession of the Public Right-of-Way shall be subject to the right and continued use of Company. Section 18. ACCEPTANCE. The Company shall, within thirty (30) days following the final passage and approval of this Franchise, file with the City Secretary of the City of La Porte either 1) a written statement signed in its name and behalf in the following form or 2) this document duly executed below by the Vice President of Regional Operations: "To the Honorable Mayor: and City Council of the City of La Porte, Texas: CenterPoint Energy Resources Corp., D/B/A CenterPoint Energy Texas Gas Operations, its successors and assigns, hereby accepts the attached Franchise Ordinance and agrees to be bound by all of its terms and provisions." CENTERPOINT ENERGY RESOURCES CORP., DBA CENTERPOINT ENERGY TEXAS GAS OPERATIONS Talmadge R. Centers Jr., Division Vice President, Regional Operations Dated this day of , 2019. Section 19. SEVERABILITY. If any provision, section, subsection, sentence, clause or phrase of this Franchise is for any reason held to be unconstitutional, void, or invalid or for any reason unenforceable, the validity of the remaining portions of this Franchise shall not be affected thereby, it being the intent the City of La Porte, Texas in adopting this Franchise that no portion hereof or provision hereof shall become inoperative or fail by reason of any unconstitutionality or invalidity of any other portion, provision or regulation and, to this end, all provisions of this ordinance are declared to be severable. Section 20. NOTICES. Every notice, order, petition, documents or other direction or communication to be served upon the City or the Company shall be deemed sufficiently given if sent by registered or certified mail, return receipt requested. Every such communication to the Company shall be sent to: CenterPoint Energy Resources Corp. Vice President Regulatory Relations PO Box 4567 Houston, TX 77210-4567 With a copy to: General Counsel, Gas Division PO Box 2628 Houston, TX 77252-2628 Every such communication to the City or the City Council shall be sent to the: Mayor, City of La Porte, Texas 604 W. Fairmont Pkwy. La Porte, Texas 77571 With a copy to: City Secretary 604 W. Fairmont Pkwy. La Porte, Texas 77571 Section 21. PUBLICATION, PASSAGE AND EFFECTIVE DATE. This Franchise, having been published in the official newspaper of the City of La Porte, Texas once each week for four consecutive weeks after its final passage, shall take effect sixty days after final passage ("Effective Date"). The Company shall pay the cost of those publications. Section 22 COMPLIANCE WITH TEXAS OPEN MEETINGS LAW. The City Council officially finds, determines, recites, and declares that a sufficient written notice of the date, hour, place, and subject of this meeting of the City Council was posted at a place convenient to the public at the City Hall of the City for the time required by law preceding this meeting, as required by the Open Meetings Law, Chapter 551, Texas Government Code; and that this meeting has been open to the public as required by law at all times during which this ordinance and the subject matter thereof has been discussed, considered, and formally acted upon. The City Council further ratifies, approves, and confirms such written notice and the contents and posting thereof. Section 23. REPEAL. All ordinances or parts of ordinances in conflict herewith are hereby repealed to the extent of the conflict only. Section 24. COMPLIANCE WITH CHARTER AND ORDINANCES. This Franchise, the rights granted hereby and the operations and activities performed by Company pursuant hereto shall be subject to applicable provisions of the Charter of the City of La Porte, Texas. Except to the extent otherwise expressly provided herein, the Franchise and rights granted hereby and the operations and activities performed by Company pursuant hereto, shall be subject to all valid ordinances and regulations of the City insofar as such ordinances and regulations (a) do not shorten the term hereof or terminate, abrogate, or materially and adversely affect the Franchise and right granted to Company hereby, (b) do not conflict with or are not inconsistent with the terms and provisions contained in this ordinance, (c) do not modify, preempt, or cause Company to violate the terms of a tariff approved by the Railroad Commission of Texas, Railroad Commission Rules, or the Gas Utility Regulatory Act, or (d)do not unreasonably regulate the Company's operations and activities in the City Right of Way. Section 25. APPROVAL. Read in full on its first reading at a regular meeting of the City Council of La Porte, Texas, on the 24th day of June, 2019, and read in full and passed and adopted on its second reading at a regular meeting of the City Council of La Porte, Texas, on the �(th day of nA5V" , 2019 and approved by the Mayor. CITY OFr ' S ' E, TEXAS alb 111 Lo W. Rigby,Ma ATTEST: APPROVED AS TO FORM: 1 0 11 t : ". ,,,,,,...1., ,,odward, w 5711.57- Clark T. Askins,Assistant City Attorney THE STATE OF TEXAS § COUNTY OF HARRIS § I, the duly appointed, qualified and acting City Secretary of City of La Porte, Texas, do hereby certify that the above and foregoing ordinance was read on first and second readings at regular meetings of the City Council of said City of La Porte, Texas, held on the 24th day of June, 2019 and on the A(0 day of Rk Au ! • ,2019;that written notice of the date,place and subject of said meetings were posted on a bulletin board located at a place convenient to the public in the City Hall, as well as on the City of La Porte, Texas' website, for at least 72 hours preceding the day of said meetings; that Mayor Louis Rigby and six (6) Councilpersons: 1. Steve Gillett 4. Thomas Garza 2. Brandon Lunsford 5. Bill Bentley 3. Jay Martin 6. Danny Earp were present at the meeting for the first reading of the above and foregoing ordinance and acted as the Council throughout;that the Mayor Louis Rigby, and C`ouncilpersons: 1. 11111 • • 5. l V�OrYNc � 2. CS.A I,, i� 6. N\ �' n 111*s 7. Iv as 4. atu30_,GA as. 8. were present at the meeting for the second reading of the above and foregoing ordinance and acted as the Council throughout; that the same has been signed and approved by the Mayor and is duly attested by the City Secretary; and that the same has been duly filed with the City Secretary and recorded by the City Secretary in full in the books for the purpose of recording the ordinances of the City of La Porte,Texas. EXECUT under my hand and the official seal of the City of La P. e,Texas at said City,this 1l9 day of ,2019. ,ip oodward, Ci - - - , • of La Porte, Texas [SEAL]