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Home My WebLink About1996-05-14 - AGENDA REPORTS - ENERGY SAVING (2)PUBLIC HEARING DATE: SUBJECT: DEPARTMENT: AGENDA REPORT City Manager Approval A:� Item to be presented by: Jesse Juarros May 14, 1996 ENERGY SAVING LIGHTING RETROFIT PROJECT RESOLUTION NO. 96-54 Administrative Services In October of 1993, the City of Santa Clarita entered into a Municipal Service Program (MSP) with Honeywell, Incorporated. The objective of the MSP was to review current energy consumption systems used by the City and to determine where savings of both money and energy could be achieved. Phase I of the program, which provided a retrofit of the heating, ventilation and air conditioning (HVAC) system, has been completed. Tracking reports through May of 1995 confirm the Phase I retrofit program is tracking at approximately 131% of the targeted savings, amounting to a cost savings of nearly $60,000 per year.. Based on the success of Phase I of the MSP, staff recommends the approval and implementation of Phase II for the retrofit to lighting components at the City Hall Facility. As with the HVAC retrofit, Phase II is a self -funding lease/purchase program and does not require any up -front capital expenditures. Total costs for the Phase II MSP are expected to be approximately $107,385, and are payable over a four year period. The minimum annual savings, as projected below, will be used to fund this capital improvement and are guaranteed in writing by Honeywell, Inc. If the minimum annual projected savings are not realized, Honeywell, Inc. will issue a check for the shortfall to the City. Electricity 26,791 Lamp and Ballast Inventory Reductions 2.06 Total Estimated Annual Savings $29,777 This program has additional benefits associated with it other than energy cost savings. It will enhance the value of the City Hall property and result in a positive environmental impact reduction of the following pollutants: * Carbon Dioxide 428,631 lbs. * Nitrogen Oxide 1,654 lbs. * Sulfur Dioxide t� 3,131 lbs. rz, nT1 7r �� - 4 Agenda ltem.OLD RESOLUTION NO. 96-54 May 14, 1996 - Page 2 Lastly, the City Hall facility enjoys a special rate for electrical service. This reduced rate is due to its ability to stay under a 500 KWH per month usage. If the facility exceeds 500 KWH in any three months during the year, it will be reclassified into a much higher rate. Last year the facility went over the threshold in two consecutive months, and currently hovers around 450 KWH each month. This program will help to dramatically reduce the KWH usage, thus protecting the rate currently assigned. Staff recommends that City Council: 1. Receive public testimony and close the public hearing. 2. Authorize entering into an energy conservation contract with Honeywell, Incorporated, for a retrofit and upgrade of the City Hall's existing lighting system. 3. Adopt Resolution No. 96-54 authorizing entering into a financial arrangement with Municipal Leasing Associates for the purpose of financing this program through a lease purchase agreement over the four years of the contract. 4. Authorize the use of energy cost savings to pay for the project. 5. Authorize the City Manager to execute all necessary contract documents and change orders if required., Resolution No. 96-54 Notice of Public Hearing rnundl\rea9664y Public Hearing Procedure 1. Mayor opens hearing *States purpose of hearing 2. City Clerk reports on hearing notice 3. Staff report 4. Proponent Argument (30 minutes) 5. Opponent Argument (30 minutes) 6. Five-minute rebuttal (Proponent) *Proponent 7. Mayor closes public testimony 8. Discussion by Council 9. Council decision 10. Mayor announces decision CITY OF SANTA CLARITA NOTICE OF PUBLIC HEARING FOR CONSIDERATION OF AN ENERGY SAVING LIGHTING RETROFIT CONTRACT AND LEASE PURCHASE AGREEMENT FOR THE FINANCING OF THE CONTRACT WITH HONEYWELL, INC. PUBLIC NOTICE IS HEREBY GIVEN: A Public Hearing will be held before the City Council of the City of Santa Clarita for consideration of entering into an energy saving lighting retrofit contract with Honeywell, Inc. for energy auditing services and equipment for City facilities. In conjunction with this contract, the City is considering entering into a lease -purchase agreement for the financing of the equipment. The hearing will be held by the City Council in the City Hall Council Chambers, 23920 Valencia Boulevard, 1st Floor, Santa Clarita, the 14th day of May, 1996, at or after 6:30 p.m. Proponents, opponents, and any interested persons may appear and be heard on this matter at that time. Further information may be obtained by contacting the City Clerk's Office, Santa Clarita City Hall, 23920 Valencia Boulevard, 3rd Floor, Santa Clarita. If you wish to challenge this order in court, you may be limited to raising only those issues you or someone else raised at the Public Hearing described in this notice, or in written correspondence delivered to the City Council, at, or prior to, the Public Hearing. Dated: May 1, 1996 Donna M. Grindey, CMC City Clerk Publish Date: May 3, 1996 RESOLUTION NO. 96-54 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CLARITA, CALIFORNIA AUTHORIZING LEASE AGREEMENT, SIGNATORIES AND NOTICE OF INTENT TO BE REIMBURSED WHEREAS, City of Santa Clarita, County of Los Angeles, State of California ("City") is duly authorized and existing under the laws of said State; and WHEREAS, the City has entered into agreements for lighting retrofit ("Property"); and WHEREAS, the governing body has determined it is in the best interests of the City and the citizens it serves to secure lease -purchase financing to provide moneys in the approximate amount of $107,385 necessary to pay for the Property; and WHEREAS, Municipal Leasing Associates, Inc. ("Corporation") has offered the City a cost effective lease -financing arrangement requiring periodic rental payments including principal plus interest computed at a 5.38% annual percentage rate for the lighting retrofit; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA CLARITA does resolve as follows: SECTION 1: that the Mayor or the City Manager acting alone be hereby authorized in the name and on behalf of City to enter into binding agreements with the Corporation for leasing the Property upon such terms as may seem advisable to said officer(s), and to execute, as agent for the City all necessary agreements including, but not limited to, a lease/option agreement, custodial and agency agreement, arbitrage and tax certificate, acknowledgment of assignment and acceptance certificate. Each officer is also authorized to accept or direct delivery of the Property. The authority given hereunder shall be deemed retroactive and any and all acts authorized hereunder performed prior to the passage of this resolution are hereby ratified and affirmed. SECTION 2: that the City of Santa Clarita declares its official intent to be reimbursed from the proceeds of the leasetoption agreement approved hereby for a maximum principal amount of $107,385 of expenditures occurring no earlier than sixty days prior to the adoption of this resolution. All reimbursed expenditures will be capital expenditures as defined in Section 1.150-1(b) of the Federal Income Tax Regulations. SECTION 3: that this approved lease financing be designated as a qualified tax exempt obligation for the calendar year in which the lease is issued pursuant to Section 265(b) of the Internal Revenue Code of 1986 (as amended) and the authorized officers be directed to execute the "Designation of Qualification" document. RESOLUTION NO. 96-54 SECTION 4: The City Clerk shall certify to the adoption of this Resolution. PASSED, APPROVED AND ADOPTED THIS , 1996. MAYOR ATTEST: CITY CLERK STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES) SS CITY OF SANTA CLARITA) DAY OF I Donna M. Grindev , City Clerk of the City of Santa Clarita, do hereby certify that the foregoing Resolution was duly adopted by the City Council of the City of Santa Clarita at a regular meeting thereof, held on the day of 1996 by the following vote of the Council: AYES: COUNCILMEMBERS NOES: COUNCILMEMBERS ABSENT: COUNCILMEMBERS CITY CLERK .d1\.96-54jj