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Item 3.2 Xcel Energy3601 Thurston Avenue Anoka, MN 55303 763.231.5840 TPC@PlanningCo.com 1 PLANNING REPORT TO: Otsego Planning Commission FROM: D. Daniel Licht REPORT DATE: 14 August 2024 60-DAY DATE: 6 September 2024 RE: Otsego - Otsego Industrial Park; Xcel Energy Knight Substation TPC FILE: 101.02 BACKGROUND Xcel Energy is proposing development of an electric substation on Lot 2, Block 1, Otsego Industrial Park Second Addition to serve existing and future electric service needs in Otsego. The subject property is located at the northeast quadrant of the intersection of 65th Street (CSAH 37) and Jansen Avenue. There is an Xcel Energy electric transmission line that crosses the southern portion of the subject property parallel to 65th Street (CSAH 37) to which the substation will be connected with. Xcel Energy has applied for a Zoning Map amendment zoning the subject property to INS, Institutional District; a Conditional Use Permit for an essential service use within the INS District and reduction in required lot area; and an Interim use Permit for a special purpose fence. A public hearing to consider the applications has been noticed for the Planning Commission meeting on 19 August 2024 at 7:00PM. Exhibits: Site Location Map Narrative dated July 8, 2024 Site Plan Site Plan and Profile Plan Contour and Grading Plan Electrical Equipment Enclosure Fence Layout Item 3.2 2 ANALYSIS Use. The proposed electric substation is defined by the Zoning Ordinance as an essential service regulated by Chapter 32 of the Zoning Ordinance. Electric substations are allowed in all zoning districts as a conditional use by Section 11-32-5.A of the Zoning Ordinance. Conditional uses require Xcel Energy to comply with performance standards and criteria established by the Zoning Ordinance. If Xcel Energy demonstrates to the satisfaction of the City that the proposed use is consistent with the requirements and criteria of the Zoning Ordinance, there is an expectation that the City must approve the use. Comprehensive Plan. The 2023 Comprehensive Plan guides the subject site for Industrial land uses. The subject site is located within the West Sewer District to be served by City sewer and water services once extended south of I-94, but which the proposed use will not require connection. Location of an electric substation as an essential service within an industrial area is appropriate from a land use perspective and consistent with the Comprehensive Plan. Zoning. The subject site is zoned I2, General Industrial District. City staff is recommending amendment of the Zoning Map to zone the subject property to INS, Institutional District. The intent of the INS District is to provide a specific zoning district for facilities devoted to serving the public and essential services such as the proposed electric substation that are incidental to and required by the existing development and planned growth occurring within the City. Existing and approved future electric substation locations within the City have also been zoned to INS District. Surrounding Land Uses. The subject site is surrounded by the following existing/planned uses: Direction Land Use Plan Zoning Map Existing Use North Industrial I2 District Cummings Mobility East Albertville Albertville Undeveloped South LD Residential Albertville A1 District Albertville Rural Residential Cultivated field Townhome dwellings West Industrial I2 District Apex Center The area where the electric substation is to be located is adjacent to existing and planned industrial uses in Otsego and Albertville. South of 65th Street (CSAH 37), there are three rural residential dwellings in Otsego, as well as townhome dwellings that are east of Kadler Avenue in Albertville. The existing electric transmission line along the north side of 65th Street (CSAH 37) limits the ability to provide plantings to screen the substation from view of the existing and future residential uses to the south of 65th Street, but fencing is proposed to address aesthetic compatibility issues, which also would have been required of any industrial development of the subject property. 3 Lot Requirements. Section 11-90-7 of the Zoning Ordinance requires lots within the INS District to be a minimum of five acres in area unless reduced by approval of a Conditional Use Permit to allow for efficiency in the development of essential services. The proposed lot is 3.8 acres in area. Section 11-32-5.B of the Zoning Ordinance allows the minimum lot area requirements for an essential service to be reduced by Conditional Use Permit provided that lot is of sufficient dimensions to allow the setbacks from all property lines to be equal to the height of the various structures on the parcel or the setback requirements of the district, whichever are greater. Lesser structure setbacks may be allowed by the City Council upon demonstration that the facility's design is such that the collapse of said structure will not endanger surrounding property. Section 11-90-7 of the Zoning Ordinance requires a minimum 50 foot setback for essential services uses from the perimeter of the lot on which it is located. The closest structure to 65th Street (CSAH 37) setback 75 feet from the right-of-way, the closest structure to Jansen Avenue is setback 195 from the right-of-way, and the closest structure to Kadler Avenue is setback 98 from the right-of-way, all of which complies with the Zoning Ordinance. There is a utility building that is setback 28 feet from the north line, but as this structure cannot collapse, the proposed setback complies with the requirements of the Zoning Ordinance. Access. The subject site abuts 65th Street (CSAH 37), Kadler Avenue, and Jansen Avenue. The Wright County Transportation Plan designates 65th Street (CSAH 37) as a Minor Arterial Roadway. Kadler Avenue is also designated as a future Minor Arterial Roadway for a future overpass of I-94 to connect 70th Street (future CSAH 38) and 65th Street (CSAH 37). The Zoning Ordinance prohibits direct access to Minor Arterial roadways except under unique circumstances to preserve traffic capacity. Jansen Avenue is a local industrial street developed as part of the Otsego Industrial Park plat to provide access to the lots within the development, including the subject property. The proposed electric substation is to be accessed via one driveway from Jansen Avenue. The proposed driveway is setback 55 feet from the north line of the lot and 185 feet from the right- of-way line for 65th Street (CSAH 37). The location of the proposed access to the subject property complies with Section 11-21-6.B of the Zoning Ordinance. The proposed driveway is 25 feet in width and extends approximately 190 feet east of Jansen Avenue to a gate in the fence encompassing the electric substation. The distance between Jansen Avenue and the fence gate is sufficient to allow for any service vehicles to pull completely off of the street when the gate is closed so as not to obstruct traffic. A condition of approval will be that the driveway be paved with asphalt or concrete as required by Section 11- 21-7.C.2 of the Zoning Ordinance from Jansen Avenue to the gate. The design and construction of the paved driveway is to be subject to review and approval of the City Engineer. 4 Off-Street Parking. Section 11-32-4.D. 2 of the Zoning Ordinance requires provision of off- street parking for vehicles anticipated to be at the electric substation, which is anticipated to be limited to occasional service vehicles. There is sufficient space within the lot to accommodate necessary vehicle parking. Section 11-21-7.C of the Zoning Ordinance allows gravel surfaced parking areas for essential services, which should be limited to the area inside the fence. Structures. The electric substation facility consists of a 1,485 square foot utility building that is 14 feet in height. At the southwest corner of the facility is 115kV transmission equipment that connects the facility to the existing transmission line parallel to 65th Street (CSAH 37). The transmission equipment has components that are 50 feet in height with tower elements up to 60 feet in height. To the east of the 115kV transmission equipment will be three 35kV distribution equipment installations, two of which will be added in the future for expansion purposes. The majority of the components for the 35kV distribution equipment is 35 feet or less, but also with tower elements up to 60 feet in height. Section 11-17-3.B.10 of the Zoning Ordinance exempts essential service structures from any height limitations. Fence. The proposed substation is to be surrounded by a 10-foot chain link fence on the east, north, and west sides. The south side of the electric substation enclosure is a stone veneer concrete wall to provide for screening from view of the residential uses to the south in accordance with Section 11-32-4.D of the Zoning Ordinance. Section 11-19-4.H.2 of the Zoning Ordinance limits the height of fences for industrial uses to eight feet, unless a greater height is approved as an interim use. The proposed height of the fence is dictated by the section on the south side, which functions to provide screening as well as security. Approval of an Interim Use Permit includes the stipulation that allowed height of the fence terminates upon occurrence of any of the events listed in Section 11-5-4 of the Zoning Ordinance. Landscaping. The site plan indicates that the areas of the subject property outside of the fence enclosing the electric substation is to be native pollinator plantings. Xcel Energy will need to submit a more detailed plan of the plantings in accordance with the natural landscaping provisions of Section 5-2-3.F of the City Code to be subject to review and approval of the Zoning Administrator. No trees are proposed to be installed within the subject property. The existing electric transmission line and easement crossing the subject property parallel to 65th Street (CSAH 37) precludes trees adjacent to this roadway either for screening purposes or aesthetics. 5 Exterior Lighting. The submitted plans do not identify installation of any exterior lighting. Any light fixtures to be installed upon the subject property must comply with the provisions of Section 11-16-6 of the Zoning Ordinance, including not being mounted higher than 25 feet, providing a 90 degree horizonal shield, and to not cast light at more than 0.4 foot-candles to adjacent properties. Installation of any exterior lighting is to be subject to review and approval of the Zoning Administrator. Grading. Xcel Energy has submitted a grading plan for the proposed development of the electric substation. The grading plan includes construction of stormwater basins within the subject property for infiltration, water quality, and rate control of stormwater runoff. All grading and stormwater management issues are to be subject to review and approval of the City Engineer. Utilities. The proposed electric substation does not require connection to City sewer or water utilities. Performance Agreement. The proposed electric substation does not require installation of City infrastructure. City staff recommends that there in not a need for Xcel Energy to enter into a Site Improvement Performance Agreement for the proposed electric substation. Criteria. Applications for a Zoning Map amendment, Conditional Use Permits, and Interim Use Permit are to be considered based upon, but not limited to, the following criteria established by the Zoning Ordinance: 1. The proposed action's consistency with the specific policies and provisions of the Otsego Comprehensive Plan. Comment: The 2023 Comprehensive Plan recognizes that planning for utility services, whether City facilities such as sewer and water or private utilities such as electric, gas, phone, cable, etc., are needed to support existing development and planned future uses guided by the 2023 Comprehensive Plan as part of the City’s growth management policies. The proposed development of an electric substation to serve Otsego and surrounding areas is consistent with the policies of the 2023 Comprehensive Plan. 2. The proposed use's compatibility with present and future land uses of the area. Comment: The proposed electric substation is to be constructed witin an industrial area separated from existing and future residential uses by a minor arterial roadway minimizing compatibility issues. 3. The proposed use's conformity with all performance standards contained within the Zoning Ordinance and other provisions of the City Code. 6 Comment: The proposed subdivision and construction of an electric substation will comply with all requirements of the Zoning Ordinance. 4. Traffic generation of the proposed use in relation to capabilities of streets serving the property. Comment: The proposed electric substation will be accessed via Jansen Avenue from 65th Street (CSAH 37), which has capacity to accommodate the minimal traffic generated by the proposed electric substation. 5. The proposed use can be accommodated by existing public services and facilities and will not overburden the City's service capacity. Comment: The proposed use is will provide necessary service capacity for existing land uses and future development as guided by the 2023 Comprehensive Plan. RECOMMENDATION The proposed construction of an electric substation by Xcel Energy provides for needed essential services to existing properties and future development within Otsego (and surrounding areas) consistent with the policies of the 2023 Comprehensive Plan. The subject property provides a suitable industrial location to separate the facility from existing and future residential uses and the proposed electric substation complies with the performance standards established by the Zoning Ordinance. Our office recommends approval of the applications subject to the conditions as set forth below. POSSIBLE ACTIONS A. Motion to recommend approval of a Zoning Map amendment, Conditional Use Permit, and Interim Use Permit for Xcel Energy Knight Substation, subject to the following conditions: 1. The site and building shall be developed in accordance with the plans on file with the City as provided for by Section 11-9-4 of the Zoning Ordinance and the conditions set forth herein. 2. Driveway access shall be paved with asphalt or concrete from Jansen Avenue to the gate, subject to review and approval of the City Engineer. 3. The interim use permit allowing the 10-foot fence height shall terminate in accordance with Section 11-5-4 of the Zoning Ordinance. 4. The proposed landscaping shall require approval of a Natural Landscape Permit, subject to review of the Zoning Administrator. 7 5. All exterior lighting shall comply with Section 11-16-6 of the Zoning Ordinance, subject to review and approval of the Zoning Administrator. 6. All signs shall comply with Chapter 37 of the Zoning Ordinance, subject to review and approval of the Zoning Administrator. 7. All grading and stormwater management issues shall be subject to review and approval of the City Engineer. B. Motion to recommend the application be denied based on a finding that the request is inconsistent with the Comprehensive Plan and intent of the Zoning Ordinance. C. Motion to table. c. Adam Flaherty, City Administrator/Finance Director Audra Etzel, City Clerk Ron Wagner, City Engineer David Kendall, City Attorney 414 Nicollet Mall Minneapolis, MN 55401-1993 July 8, 2024 Planning Commission and City Council City of Otsego 13400 90th St NE Otsego, MN 55330 Re: Application for Conditional Use, Rezoning, and Interim Use Permits Xcel Energy Knight Substation Address: ~9966 65th St NE PID: 118158001020 To whom it may concern, Recently, eastern Wright County has been experiencing rapid population growth. To meet the increased demand for electricity and ensure the reliability of the electrical system that serves our customers, the construction of a new substation is necessary. Xcel Energy is seeking to construct a substation at the vacant parcel located at the corner of 65th St NE and Kadler Ave NE in Otsego. During a recent meeting with officials with the City of Otsego, application requirements were discussed in detail. In order to comply with the zoning code of the City of Otsego, Xcel Energy is hereby applying for four permits: 1. A Conditional Use Permit for the construction of the new substation. 2. A Rezoning Permit to change the parcel from General Industrial to Institutional, which is more suitable for the proposed substation. 3. An Interim Use Permit to allow for a 10-foot-tall fence and wall to be built around the perimeter of the substation. 4. A variance to allow for reduced structure setbacks from 50’ to 28’ along the north boundary of the property to allow for adequate equipment clearance. The parcel in question is rectangular in shape, bounded to the north by the Cummings Mobility equipment supplier, to the east by Kadler Ave NE, to the south by 65th St NE, and to the west by James Ave NE. There are three residential properties located directly across the street on 65th St NE. Xcel Energy’s 115kV electric transmission line is located along the south boundary of the property. Rezoning and Conditional Use Request Presently, the parcel is zoned as General Industrial, which to Xcel Energy’s understanding does not permit substation facilities transmitting greater than 100 kV. The energy source for the new Knight substation will be the existing 115 kV line located along the southern border of the property. The substation will step down the electric voltage so that it can be distributed to the businesses and residents of the surrounding community. The property also has the advantage of being located adjacent to the existing 115kV transmission line, minimizing the number of transmission structures. As a result, Xcel Energy is requesting that the property be rezoned to Institutional, and a Conditional Use Permit be granted to allow for 115kV voltages at the substation. With these permits granted, Xcel Energy can reliably distribute electricity to the rapidly growing community. Interim Use Permit Request Across its service area, Xcel Energy is investing resources into increasing its security measures at many of its facilities. This includes new security fence standards and other measures to ensure the safe operation of Xcel Energy’s equipment and the electrical grid as a whole. The Federal Energy Regulatory Commission (FERC) issued Order No. 802 – CIP-014-1 Physical Security which mandates owners of bulk-power systems to enhance physical security measures for critical facilities to lessen the overall vulnerability of the power system against physical attacks. To comply with the FERC Order, standards were adopted by Xcel Energy, and implemented security measures that will reduce the possibility of unauthorized access to the property and equipment located at this new proposed substation. To comply with the federal mandate, Xcel Energy is proposing to construct a ten feet tall fence along the perimeter of the substation. The City of Otsego currently allows for fences up to seven feet tall. However, given the critical nature of the electrical energy infrastructure, a taller fence is necessary to mitigate external threats and ensure the safety and security of the substation, as well as comply with new federal regulations. Hence, we are seeking an Interim Use Permit to allow for the construction of a 10’ tall perimeter fence/wall. The wall will be located along the southern edge of the substation and extend north 30’ on the east and west sides of the substation. The remainder of the substation will be secured with a 10’ tall chain-link security fence. The concrete wall provides visual screening along 65th St. and will be cast with a decorative stone veneer. Attached is a photo of a similar wall recently built near Victoria, MN. With the higher fence, it will become significantly harder for external threats to breach our physical systems and cause damage to critical infrastructure, ensuring the reliability of our systems and continued delivery of electricity to the residents of Otsego, as well as eastern Wright County as a whole. Variance Request There will be many sensitive pieces of electrical transmission and distribution equipment placed within the substation boundaries. In particular, an electrical equipment enclosure (EEE) will be placed within 28 feet of the north property line of the substation. Existing structure setback requirements are 50 feet from the property line. The placement of structures within the substation is governed by safety standards that require minimum distances between structures within the facility. The structure and equipment placement within the substation is carefully considered and designed to protect the safety of employees who are working in the substation. Xcel Energy is requesting a 22-foot variance to the structure setback requirements to the northern property line. Allowing for a decreased setback on the north side of the property will ensure that Xcel Energy has the required space to safely install, operate, and maintain its electrical energy infrastructure. This ensures that the substation compound and the electrical transmission lines are designed to meet minimum electrical standards for the operation and maintenance of the substation and provide for the health, safety, and welfare of the community and Xcel Energy employees. Landscape/Screening We understand the importance of maintaining the aesthetic integrity of the city, and we assure you that all construction of the substation will be carried out with utmost consideration for the local community and environment. There are three residential properties located across the street from the planned substation on 65th St NE. In order to buffer views of the substation, as well as preserve the aesthetic qualities of the property, a 10’ tall concrete wall with a stone veneer will be constructed along the south side and extend to the north 30’ on the east and west sides of the substation. The existence of the 115kV transmission line along the southern border limits the ability to install trees within the existing easement. We are proposing to install pollinator plantings in the area south of the which will extend around the perimeter of the substation. In areas to the east and west of the substation various forms of screen planting (such as understory trees and shrubs) are proposed in areas that do not conflict with electric transmission and distribution lines. With the rezoning and conditional use permits allowing for the construction of this new substation, Xcel Energy will continue to provide safe reliable electric energy to the local community. In addition, our new security standards, here in the form of the 10-foot-tall fence/wall, will help ensure the safety of the public, Xcel Energy employees, and the substation infrastructure and the electric grid. Xcel Energy respectfully requests your approval of our permit requests. Sincerely, George Wojcicki George Wojcicki Siting and Land Rights Agent 773-677-4574 george.r.wojcicki@xcelenergy.com Cc: Brian Sullivan IMAGE: Example of stone wall around an existing Xcel Energy substation. Property Location Map 921 ft Overview Legend Highways Interstate State Hwy US Hwy Roads Road Labels City/Township Limits c t Parcels Torrens 115kV Transmission Equipment35kV Distribution EquipmentElectricalEquipmentEncloser10' Tall Concrete Wall with Stone Veneer10' Tall Concrete Wall with Stone VeneerDriveway10' Tall Chain Link FenceGatePond PondEx. 75' Electric Transmission EasementTransmissionPower PoleWetlandWetlandBuffer28' toPropertyLine10' Tall Chain Link Fence 10' Tall Chain Link FenceFuture 35kV Distribution EquipmentNative Pollinator Plantsaround Perimeter ofSubstationNative PollinatorPlants aroundPerimeter ofSubstationNative Pollinator Plantsaround Perimeter ofSubstationGravel Mow Strip Around Fence PerimeterKNIGHT SUBSTATIONSITE PLAN 18'-0"18'-0"18'-0"18'-0"18'-0"18'-0"62'-0"24'-0"34'-0"30'-0"30'-0"34'-0"10'-0"10'-0"38'-0"408'-0" Main Office: 3601 Thurston Avenue, Anoka, MN 55303 Phone: 763/427-5860 www.haa-inc.com MEMORANDUM TO: Honorable Mayor and City Council CC: Adam Flaherty, City Administrator Audra Etzel, City Clerk Daniel Licht, City Planner Dave Kendall, City Attorney Michelle MacMillan, Xcel Energy FROM: Ronald Wagner, P.E. City Engineer DATE: August 14, 2024 RE: Knight Substation We have reviewed the following information provided by Xcel Energy regarding Knight Substation: Site Plan, undated by Xcel Engineering Dept Contour and Grading Layout, undated by Xcel Engineering Dept Fence Layout, undated by Xcel Engineering Dept. The submittal is to be considered for preliminary acceptance. We would offer the following comments: Site Plan 1. The driveway off of Jansen may impact a potential wetland in the NW corner of the lot. Even a few feet south while still lining up with the driveway across the street may be needed to minimize impacts or a short retaining wall. 2. Storm water basins must include filtration for the 1st 1.1” of runoff. 3. Storm water calcs are needed. 4. At least driveway off Jansen must be paved – Please reference the same pavement area identified in the planning report - from Jansen Avenue to the gate of the fenced enclosure. Contour and Grading Layout 1. No storm water outlets are shown for storm ponds. 2. No normal water level, and 2-, 10-, and 100-year storm water levels for storm ponds shown. 3. Storm water ponds must have 10:1 safety slope incorporated for the first one foot (1’) below the NWL. 4. No culvert shown under driveway to site. Fence Layout August 14, 2024 Page 2 1. Rename sheet Knight Substation. Wetland 1. A wetland delineation is needed for the wetland in the NW corner of the lot. The lot was platted before the wetland buffer requirements applied - no wetland buffer required. Additional comments 1. Storm water calculation will need to be submitted with final construction plans but storm ponding appears to be adequate to meet City requirements if substation area is not impervious. Summary and/or Recommendation We recommend approval contingent on the above comments being addressed.