HomeMy WebLinkAbout2004-08-24 - AGENDA REPORTS - OIL PIPELINE FRANCHISE ORD (2)CONSENT CALENDAR
DATE:
SUBJECT:
DEPARTMENT:
Agenda Item: 11
CITY OF SANTA CLARITA
AGENDA REPORT
City Manager Approval:
Item to be presented by:
August 24, 2004
Dennis Luppens
FIRST READING OF AN ORDINANCE GRANTING AN OIL
PIPELINE FRANCHISE
Administrative Services
RECOMMENDED ACTION
City Council introduce and conduct first reading of an ordinance entitled "AN ORDINANCE OF
THE CITY COUNCIL OF THE CITY OF SANTA CLARITA, CALIFORNIA, GRANTING A
FRANCHISE TO CONSTRUCT AND USE AN OIL PIPELINE TO SHELL CALIFORNIA
PIPELINE COMPANY, LLC.", extending the franchise agreement to the year 2011. Direct the
City Manager or designee to execute necessary agreements, subject to the City Attorney
approval, to implement the Agreement. Increase estimated revenues in account number
001-4023 by $14,000.
BACKGROUND
In 1992, the City adopted an ordinance granting an oil pipeline franchise agreement to Texaco
Trading and Transportation, Incorporated. The City recovered a $ 10,000 fee to grant the
franchise. Additionally, the City received annual payments in the amount of approximately
$350. Subsequently, Texaco was acquired by Shell Oil, and in 1998, the City approved the
transfer of ownership as required by Ordinance 92- 10 by adopting Resolution 98-76.
The franchise agreement expired in December of 2001. The attached Ordinance extends that
agreement to September 30, 2004, and renews the agreement to the year 2011. Obligations of the
City and Shell California Pipeline Company have been in force during the period between
December 2001 and the present time, including franchise payments. The renewal of the
agreement entitles the City to recover franchise fees. The amount agreed upon by Shell Pipeline
Company is $14,000.
Additionally, Shell Pipeline has notified the City of its intent to sell the pipeline covered by this
agreement. If this event takes place, staff will bring a report to a future Council meeting,
covering the conditions of an ownership transfer and a recommendation. According to the
current franchise agreement, and the one staff is recommending tonight, the City may not
unreasonably withhold its consent to a franchise transfer.
ALTERNATIVE ACTIONS
Other direction as provided by the City Council.
FISCAL IMPACT
The franchise fee of $14,000 be placed into revenue account number 001- 4023.
ATTACHMENTS
Ordinance