ORD 02-20GAS ORDINANCE
ORDINANCE NO. 2002-20
CITY OF OTSEGO, WRIGHT COUNTY, MINNESOTA
AN ORDINANCE GRANTING CENTERPOINT ENERGY MINNEGASCO, A DIVISION
OF CENTERPOINT ENERGY RESOURCES CORPORATION, A DELAWARE
CORPORATION, ITS SUCCESSORS AND ASSIGNS, A NONEXCLUSIVE FRANCHISE
TO CONSTRUCT, OPERATE, REPAIR AND MAINTAIN FACILITIES AND
EQUIPMENT FOR THE TRANSPORTATION, DISTRIBUTION, MANUFACTURE AND
SALE OF GAS ENERGY FOR PUBLIC AND PRIVATE USE AND TO USE THE PUBLIC
WAYS AND GROUNDS OF THE CITY OF OTSEGO, MINNESOTA, FOR SUCH
PURPOSE; AND, PRESCRIBING CERTAIN TERMS AND CONDITIONS THEREOF.
THE CITY COUNCIL OF THE CITY OF OTSEGO, WRIGHT COUNTY, MINNESOTA,
ORDAINS:
SECTION 1.
For purposes of this Ordinance, the following capitalized terms listed in alphabetical order
shall have the following meanings:
City. The City of Otsego, County of Wright, State of Minnesota.
City Utility System. Facilities used for providing public utility service owned or operated
by City or agency thereof, including sewer, storm sewer, water service, street lighting and traffic
signals, but excluding facilities for providing heating, lighting, or other forms of energy.
Commission. The Minnesota Public Utilities Commission, or any successor agency or
agencies, including an agency of the federal government, which preempts all or part of the authority
to regulate gas retail rates now vested in the Minnesota Public Utilities Commission.
Company. CenterPoint Energy Minnegasco, a division of CenterPoint Energy Resources
Corporation, a Delaware corporation, its successors and assigns including all successors or assigns
that own or operate any part or parts of the Gas Facilities subject to this franchise.
Gas Facilities. Gas transmission and distribution pipes, lines, ducts, fixtures, and all
necessary equipment and appurtenances owned or operated by the Company for the purpose of
providing gas energy for public or private use.
Gas. Natural gas, manufactured gas, mixture of natural gas and manufactured gas or other
forms of gas energy.
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Non -Betterment Costs. Costs incurred by Company from relocation, removal or
rearrangement of Gas Facilities that do not result in an improvement to the Gas Facilities.
Notice. A writing served by any party or parties on any other party or parties. Notice to
Company shall be mailed to CenterPoint Energy Minnegasco, V.P., Regulatory & Supply Service,
800 LaSalle Avenue, Minneapolis, MN 55402-2006. Notice to the City shall be mailed to the City
of Otsego, 8899 Nashua Ave NE, Otsego, MN 55330-7314. Any party may change its respective
address for the purpose of this Ordinance by written notice to the other parties.
subd. 3. Public Way. Public right-of-way within the City as defined in Minn. Stat. § 237.162,
Public Ground. Land owned or otherwise controlled by the City for park, open space or
similar public purpose, which is held for use in common by the public.
SECTION 2. ADOPTION OF FRANCHISE.
2.1. Grant of Franchise. City hereby grants Company, for a period of 20 years from the
date this Ordinance is passed and approved by the City, the right to import, manufacture, distribute
and sell gas for public and private use within and through the limits of the City as its boundaries
now exist or as they may be extended in the future. This right includes the provision of Gas that is
(i) manufactured by the Company or its affiliates and delivered by the Company, (ii) purchased and
delivered by the Company or (iii) purchased from another source by the retail customer and
delivered by the Company. For these purposes, Company may construct, operate, repair and
maintain Gas Facilities in, on, over, under and across the Public Ways and Public Grounds, subject
to the provisions of this Ordinance. Company may do all reasonable things necessary or customary
to accomplish these purposes, subject however, to such lawful regulations as may be adopted by
separate ordinance and as currently exist under City Ordinance 98-2. The Company shall be notified
60 days in advance of proposed changes to Otsego City Ordinance 98-2. The City and Company
shall negotiate in good faith to reach mutually acceptable changes. If the City and Company are
unable to agree, disputes will be handled under the terms of Section 2.5 of this Ordinance. If a
provision of City Ordinance 98-2 conflicts with a provision on the same subject in this Ordinance,
this Ordinance will control.
2.2. Effective Date; Written Acceptance. This franchise shall be in force and effect
from and after its passage of this Ordinance and publication as required by law and its acceptance
by Company. If Company does not file a written acceptance with the City within 90 Days after the
date the City Council adopts this Ordinance, or otherwise places the City on written notice, at any
time, that the Company does not accept all terms of this franchise, the City Council by resolution
may either repeal this ordinance or seek its enforcement in a court of competent jurisdiction.
2.3. Service and Gas Rates. The service to be provided and the rates to be charged by
Company for gas service in City are subject to the jurisdiction of the Commission
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2.4. Publication Expense. The expense of publication of this Ordinance shall be paid
by Company.
2.5. Dispute Resolution. If either party asserts that the other party is in default in the
performance of any obligation hereunder, the complaining party shall notify the other party of the
default and the desired remedy. The notification shall be written. Representatives of the parties
must promptly meet and attempt in good faith to negotiate a resolution of the dispute. If the dispute
is not resolved within 30 days of the written notice, the parties may jointly select a mediator to
facilitate further discussion. The parties will equally share the fees and expenses of this mediator.
If a mediator is not used or if the parties are unable to resolve the dispute within 30 days after first
meeting with the selected mediator, either party may commence an action in State District Court,
Wright County, to interpret and enforce this franchise or for such other relief permitted by law.
2.6. Continuation of Franchise. If the City and the Company are unable to agree on the
terms of a new franchise by the time this franchise expires, this franchise will remain in effect until
a new franchise is agreed upon, or until 90 days after the City or the Company serves written Notice
to the other party of its intention to allow the franchise to expire.
SECTION 3. LOCATION, OTHER REGULATIONS.
3.1. Location of Facilities. Subject to regulation under Otsego Ordinance 98-2, Gas
Facilities in the Public Way shall be located, constructed, and maintained so as not to disrupt
normal operation of any City Utility System. Gas Facilities may be located on Public Grounds as
determined by the City.
3.2. Restoration of Public Ways and Public Ground. Restoration of the Public Way
shall be subject to Otsego Ordinance 98-2. After completing work requiring the opening of Public
Ground, the Company shall restore the Public Ground to as good a condition as formerly existed,
and shall maintain the surface in good condition for six (6) months thereafter. All work shall be
completed as promptly as weather permits. If Company shall not promptly perform and complete
the work, remove all dirt, rubbish, equipment and material, and put the Public Ground in the said
condition and after demand to Company to cure, City shall, after passage of a reasonable period of
time following the demand, but not to exceed five days, have the right to make the restoration of the
Public Ground at the expense of Company. Company shall pay to the City the cost of such work
done for or performed by the City. This remedy shall be in addition to any other remedy available
to the City for noncompliance with this Section.
3.3. Waiver of Performance Security. The City hereby waives any requirement for
Company to post a construction performance bond, certificate of insurance, letter of credit or any
other form of security or assurance that may be required under Otsego Ordinance 98-2 currently or
in the future. The City reserves all other rights under Otsego Ordinance 98-2 to enforce Company
performance requirements for work in the Public Way or Public Ground.
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3.4. Avoid Damage to Gas Facilities. Nothing in this Ordinance relieves any person
from liability arising out of the failure to exercise reasonable care to avoid damaging Gas Facilities
while performing any activity.
SECTION 4. RELOCATIONS.
4.1. Relocation of Gas Facilities. Relocation of Gas Facilities in Public Ways shall be
subject to Otsego Ordinance 98-2. City may require Company at Company's expense to relocate or
remove its Gas Facilities from Public Grounds upon a finding by City that the Gas Facilities have
become or will become a substantial impairment to the existing or proposed public use of the
Grounds. Relocation Gas Facilities in Public Ground shall comply with applicable City ordinances
consistent with law.
4.2. Proiects with Federal Funding. Relocation, removal, or rearrangement of any
Company Gas Facilities made necessary because of the extension into or through City of a
federally -aided highway project shall be governed by the provisions of Minnesota Statutes
Section 161.46, as supplemented or amended. City shall not order Company to remove or relocate
its Gas Facilities when a Public Way is vacated, improved or realigned because of a renewal or a
redevelopment plan which is financially subsidized in whole or in part by the Federal Government
or any agency thereof, unless agreement is made that the reasonable Non -Betterment Costs of such
relocation and the loss and expense resulting therefrom will be paid to Company when available to
the City. The City need not pay those portions of such for which reimbursement to it is not
available.
4.3. No Waiver. The provisions of Section 4 apply only to Gas Facilities constructed
in reliance on a permit or franchise from City and Company does not waive its rights under an
easement or prescriptive right or State or County permit.
SECTION 5. CHANGE IN FORM OF GOVERNMENT.
Any change in the form of government of the City shall not affect the validity of this
Ordinance. Any governmental unit succeeding the City shall, without the consent of Company,
succeed to all of the rights and obligations of the City provided in this Ordinance.
SECTION 6. FRANCHISE FEE.
6.1. Reservation of Rights. The City reserves all rights under Minn. Stat. § 216B.36,
to require a franchise fee at any time during the term of this franchise. If the City elects to
require a franchise fee it shall notify Company and negotiate in good faith to reach a mutually
acceptable fee agreement, which shall be set forth in a separate ordinance and not adopted until at
least 60 days after Notice enclosing such proposed ordinance has been served upon the Company
by certified mail. If the City and Company are unable to agree on a franchise fee or on any terms
related thereto, each hereby consents to the jurisdiction of State District Court, Wright County, to
construe their respective rights under the law, subject to all rights of appeal.
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SECTION 7. LIMITATION ON APPLICABILITY: NO WAIVER
This Ordinance constitutes a franchise agreement between the City and its successors and
the Company and its successors and permitted assigns, as the only parties. No provision of this
franchise shall in any way inure to the benefit of any third person (including the public at large)
so as to constitute any such person as a third party beneficiary of the agreement or of any one or
more of the terms hereof, or otherwise give rise to any cause of action in any person not a party
hereto. This franchise agreement shall not be interpreted to constitute a waiver by the City of any
of its defenses of immunity or limitations on liability under Minnesota Statutes, Chapter 466.
SECTION 8. AMENDMENT PROCEDURE.
Either party to this franchise agreement may at any time propose that the agreement be
amended. This Ordinance may be amended at any time by the City passing a subsequent ordinance
declaring the provisions of the amendment, which amendatory ordinance shall become effective
upon the filing of Company's written consent thereto with the City Clerk within 60 days after the
effective date of the amendatory ordinance.
SECTION 9. PREVIOUS FRANCHISES SUPERSEDED.
This franchise supersedes and replaces previous franchises granted to the Company or its
predecessors. Upon Company acceptance of this franchise under Section 2.2, the previous
franchise shall terminate.
Passed and approved: November 25, 2002 by the Otsego City Council.
Fo yor
Attest:
J Huso C-ity Clerk
ACCEPTED: This Franchise is accepted and we agree to be bound by its terms and conditions.
CENTERPOINT ENERGY M1NNEGASCO, A DIVISION OF CENTERPOINT ENERGY
RESOURCES CORPORATION, A DELEWARE CORPORATION
Dated:
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CITY OF OTSEGO
COUNTY OF WRIGHT
STATE OF MINNESOTA
ORDINANCE SUMMARY, OTSEGO ORDINANCE NO. 02-20
OFFICIAL ORDINANCE SUMMARY- ORDINANCE NO. 02-20
GRANTING A NON-EXCLUSIVE GAS ENERGY FRANCHISE TO
CENTERPOINT ENERGY MINNEGASCO, A DIVISION OF
CENTERPOINT ENERGY RESOURCES CORPORATION, A
DELEWARE CORPORATION.
As authorized by State law, including Minnesota Statutes, section 412.191, subd.
4, the City of Otsego has approved the publication of the above-described
ordinance in summary form. The full text of the ordinance is posted, and copies
are available for inspection at the office of the Otsego City Clerk.
The approved summary of the ordinance follows:
CITY OF OTSEGO, MINNESOTA
ORDINANCE NO. 02-20
The non-exclusive gas energy franchise ordinance grants Centerpoint Energy
Minnegasco the right to operate gas energy lines and other facilities within the
City of Otsego over the term of the franchise, and sets forth the terms and
conditions for construction and operation of the same. The Franchise Ordinance
incorporates the regulations of the current City right-of-way ordinance.
The ordinance shall be effective upon the date of publication of this summary.
ADOPTED BY THE OTSEGO CITY COUNCIL this 2 3rd day of December,
2002.
IN FAVOR: Mayor Fournier; Councilmembers: Heidner, Struthers,
Wendel and Ackerman
OPPOSED: NONE
CITY OF OTSEGO
r r, Mayor
C/Y�
J d Hud o City Clerk
Published: Elk River Star News January 9, 2003
Posted: Otsego City Hall December 31 2002