HomeMy WebLinkAbout2018-01-23 - AGENDA REPORTS - PUBLIC UTILITIES CMSM (2)O
Agenda Item: 6
CITY OF SANTA CLARITA
AGENDA REPORT
CONSENT CALENDAR
CITY MANAGER APPROVAL: 41
DATE: January 23, 2018
SUBJECT: CALIFORNIA PUBLIC UTILITIES COMMISSION RESOLUTION:
SOUTHERN CALIFORNIA GAS COMPANY
DEPARTMENT: City Manager's Office
PRESENTER: Masis Hagobian
RECOMMENDED ACTION
City Council oppose the proposed California Public Utilities Commission Resolution G-3536,
related to imposing a moratorium on Southern California Gas Company, and transmit position
statements to the California Public Utilities Commission and Santa Clarita's state legislative
delegation.
BACKGROUND
On December 15, 2017, the Energy Division of the California Public Utilities Commission
issued a recommendation for the California Public Utilities Commission (CPUC) to order
Southern California Gas Company (SoCalGas) to implement an emergency moratorium on new
commercial and industrial natural gas service connections in both incorporated and
unincorporated areas of Los Angeles County. At the regular meeting on January 9, 2018, Mayor
Pro Tem Marsha McLean requested that the City of Santa Clarita (City) generate a letter
addressing the concerns and effect of the proposed moratorium.
Draft Resolution G-3536 originally orders the emergency moratorium to be implemented from
January 11, 2018, until further Commission action or March 31, 2018, whichever is earlier. The
CPUC was initially going to review the proposed moratorium on January 11, 2018; however, the
item was postponed to February 8, 2018.
The proposed resolution describes that the moratorium is designed to enhance natural gas
reliability to existing customers during the winter heating season, in an effort to preserve public
health and safety. The proposed resolution also references three recent outages of natural gas
pipelines, which has raised significant concerns SoCalGas will be unable to meet natural gas
demand during peak winter conditions in 2018.
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The Los Angeles County Economic Development Corporation examined the potential economic
implications of the proposed moratorium. The Los Angeles County Economic Development
Corporation estimates 5,160 fewer total jobs would be created in Los Angeles County.
Additionally, the report estimates $879.5 million lost in future economic output, $323.9 million
lost in future labor earnings, and $119.7 million lost in future federal, state and local tax
revenues, of which $5.8 million will be lost in tax revenues to local cities.
The proposed moratorium would not impact any City projects; however, the resolution would
affect a new local health center in Newhall. The Northeast Valley Health Corporation, a primary
health care provider to medically underserved residents, is scheduled to open its third health
center in the Santa Clarita Valley in February 2018. However, if the proposed moratorium is
approved by the CPUC prior to the opening of the health center, the Northeast Valley Health
Corporation will not be able to access natural gas until the moratorium is lifted by CPUC or
March 31, 2018. Should the moratorium be extended for the rest of the year, the new Patient
Tower at Henry Mayo Hospital could be impacted.
The proposed moratorium also applies to new industrial and commercial connections in existing
buildings. Therefore, a new tenant in an existing facility would also be unable to access natural
gas during the moratorium period.
Senator Scott Wilk, Assembly Member Dante Acosta, and Supervisor Kathryn Barger have sent
letters to the CPUC in opposition of the proposed moratorium. Additionally, the Santa Clarita
Valley Chamber of Commerce and Santa Clarita Valley Economic Development Corporation
have been actively working to oppose the proposed moratorium.
ALTERNATIVE ACTION
1. Adopt a "neutral" position on the CPUC proposed moratorium
2. Adopt a "support" position on the CPUC proposed moratorium
3. Take no action on the CPUC proposed moratorium
4. Refer the CPUC proposed moratorium to the Legislative Committee
5. Other action, as determined by the City Council
FISCAL IMPACT
Approval of the recommended action requires no additional resources beyond those already
contained within the adopted FY 17/18 budget.
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