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HomeMy WebLinkAbout2013-05-14 - ORDINANCES - PACIFIC PIPELINE FRANCHISE (2)' ORDINANCE NO. 13-05 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA CLARITA, CALIFORNIA, GRANTING A FRANCHISE TO CONSTRUCT AND USE AN OIL PIPELINE TO PACIFIC PIPELINE SYSTEM LLC WHEREAS, on May 1, 1999, the City of Santa Clarita (the "City") had, pursuant to Ordinance No. 00-4, granted to Pacific Pipeline System LLC., a Delaware limited liability company ("Grantee"), a franchise for the purposes of transporting oil and products and substances thereof by pipeline in certain designated areas of the City ("Previous Franchise"); and WHEREAS, the Previous Franchise terminated on May 1, 2009 and since that time, City and Grantee have continued to abide by the terns and conditions of Ordinance No. 00-4, including payment of all annual franchise fees through December 31, 2012, and Grantee continued to operate pipelines located in the City pursuant to the franchise set forth in Ordinance No. 00-4; and WHEREAS, Grantee desires for the City to grant a new pipeline franchise to Grantee pursuant to the terms and conditions in this ordinance: and ' WHEREAS; pursuant to Chapter 2 of Division 3 of the California Public Utilities Code (commencing with Section 6201, ("Chapter 2"), the State of California authorizes cities to issue franchises with terms and conditions, so long as those terms and conditions are not in conflict with the standards set forth therein. THE CITY COUNCIL OF THE CITY OF SANTA CLARITA, CALIFORNIA, DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1. NATURE OF FRANCHISE. The City hereby grants a non-exclusive franchise ("Franchise") to Pacific Pipeline System LLC, a Delaware limited liability company (hereinafter referred to as "Grantee'). This Franchise is hereby granted to Grantee, under and in accordance with the provisions of the Franchise Act of 1937 and the City's Municipal Code. This Franchise shall include the right, for the period and subject to the conditions hereof; to so maintain, operate; repair, renew, and change the size of the pipeline system; if any; of Grantee, as already laid and constructed in said streets for the purpose of transportation of crude oil/petroleum and products thereof. Any use of franchised facilities not consistent with the operation; use, or maintenance of a pipeline system for the purpose of transporting crude oil/petroleum and products thereof will require prior written approval of the City Council. The terms and conditions of this Franchise shall also apply to any pipe or other facilities of Grantee which are located within the right of way of any road or highway at the time such road or highway becomes a City highway. SECTION 2. TERM. The term of this Franchise shall be for a period of twenty ' (20) years from and after January 1, 2013 ("Effective Date"), to lay and use pipelines, not to exceed twenty-four (24) inches in internal diameter, for the transportation of oil and products thereof, in, under, along and across the public streets, highways, and alleys (collectively "streets"), in the City , as described in Exhibit "A" attached hereto and made a part hereof (hereinafter referred to as the "Franchise"). The Grantee may request, by written notice, up to two (2) five (5) year extensions to the tern of this Franchise prior to its expiration, as may be extended from time to time. Such extensions shall be subject to approval by the City in its sole discretion. The City shall provide written notice to the Grantee of its approval or disapproval of any extension request. SECTION 3. APPURTENANCES. The Grantee shall have the right, subject to the prior approval of the City Engineer, to construct and maintain such traps, manholes, conduits, valves, appliances, attachments, and appurtenances (hereinafter for convenience collectively referred to as "appurtenances"), as may be necessary or convenient for the proper maintenance and operation of the pipelines under the Franchise. Said appurtenances shall be kept flush with the surface of the streets and so located as to conform to any order of the City Engineer in regard thereto and not to interfere with the use of the street for travel. The Grantee shall have the right, subject to such ordinances, rules, or regulations as are now or may hereafter be in force, to make all necessary excavations in said highways for the construction and repair of said pipelines and appurtenances subject to the prior approval of the City Engineer. Such approval may be ' conditioned by the City Engineer, including, without limitation, the issuance to Grantee of certain encroachment permits. SECTION 4. LOCATION OF PIPELINES. So far as is practicable, any pipelines thereinafter laid shall be located along the edge or shoulder of the streets or in the parking areas adjacent thereto so as not to unreasonably disturb the flow of traffic and where possible shall be laid in the unpaved portion of the street. All work that involves lane closures shall be reviewed and approved by the City Engineer prior to commencement of work. If the pipelines shall be laid across or along the paved portion of a street, the repair of the street, after the pipelines have been laid, shall be made by the Grantee within ten (10) days of the completion of the laying of such pipeline, at the expense of the Grantee and in accordance with all applicable provisions of the City's Municipal Code, the City encroachment policy, and any other generally applicable policy or procedure established by Santa Clarita pertaining to street excavations, and all other applicable laws. SECTION 5. CONSTRUCTION OF PIPELINES A) Terms of Construction. The pipelines and appurtenances laid, constructed or maintained under the provisions of this Franchise shall be installed, maintained, and inspected by the Grantee in a satisfactory, safe, and workmanlike manner, of good material, and in conformity with all ordinances, rules, or regulations in effect at the time of such work as ' now or hereafter adopted or prescribed by the City Council, State, or Federal authorities. 2 ' B) Restoration of Strcets. The work of laying, constructing, maintaining, operating, renewing, repairing, changing and moving any of the pipeline system contemplated by this Franchise and all other work in exercise of this Franchise shall be performed in compliance with all applicable provisions of the City's Municipal Code pertaining to street excavations and restoration, including but not limited to the City's encroachments ordinance, and any current or future generally applicable policies, and other applicable laws and shall be conducted with the least possible hindrance or interference to the use of City roads by the public or by the City of Santa Clarita, and Grantee shall provide all necessary warning, safety and traffic control devices as are or may be required by City, County, State or Federal regulations. All excavations shall be back filled and adequately compacted. The surface of City roads shall be placed in a condition that is as good and as serviceable as existed at the beginning of this work and must be to the satisfaction of the City Engineer. If the City has an applicable road restoration ordinance, policy or other standard, then the City Engineer's discretion shall be consistent with that ordinance, policy, or other standard. SECTION 6. MAPS AND DATE TO BE FURNISHED. Within ninety (90) days following the date in which any pipelines or additional pipelines have been laid or constructed under this Franchise, the Grantee shall file a map in such form as may be required by the City Engineer showing the accurate location and size of all its facilities then in place, and shall, upon installation of any additional facilities or upon removal, change or abandonment of all or any portion thereof, file a revised map or maps showing the location and size of all such additional and/or abandoned facilities as of that date. If cathodic protection is to be used for facilities installed or maintained pursuant to this Franchise, a description of all the protective devices shall be furnished to the City Engineer which shall show the location and types of anodes, including a description of methods to be used as protection against corrosion and electrolytic leakage. SECTION 7. COMPENSATION TO THE CITY A) Amount of Franchise Fee. As consideration for the Franchise hereby granted, the Grantee shall pay a Franchise Fee to the City. The Franchise Fee shall be paid annually to the City in lawful money of the United States within sixty (60) days after the end of each calendar year and a penalty at the rate of two percent (2%) per month or fraction thereof beyond the payment date shall be charged, but in no event shall said penalty exceed fifty percent (50%). The payments due to the City shall be computed as follows: The length of the pipe expressed in feet located within the franchised area, rounded to the nearest foot shall be multiplied by the applicable base rate, as adjusted pursuant to subdivision (B), in accordance with the following schedule: Pipe Size (internal diameter in inches) Base rate per lineal foot 0-4 $0.088 6 0.132 8 0.176 3 10 0.220 12 0.264 14 0.308 16 0.352 18 0.396 20 0.440 22 0.484 24 0.528 26 0.572 28 0.616 30 0.660 For pipelines with an internal diameter not listed above, the Fee shall be in the same proportion to the Fee of a 12-inch-diameter pipe as the diameter of the unlisted pipe is to 12 inches. B) Computation of Payments. Such payments shall be computed from January 1, 2013, to and including the date of either actual removal of the facilities or the effective date of a properly approved abandonment "in place" authorized by the City, and until the Grantee shall have fully complied with all the provisions of this Franchise and of all other applicable provisions of law or ordinance relative to such abandonments. All such payments shall be made payable to the City, and shall be supported by the Grantee's verified statement concerning the , computation thereof. In the event of installation or abandonment of facilities with the approval of the City as elsewhere in this Franchise provided, or in the event of removal of such facilities by the Grantee, the payments otherwise due to the City or occupancy of the streets by such facilities shall be prorated for the calendar year in which such installation, removal or abandonment occurs as of the end of the calendar month in which installed, removed or abandoned. Provided, however, that the amount of each annual payment shall be computed and revised each calendar year as follows: (1) The applicable base rate shall be multiplied by the Consumer Price Index (CPI-U), All Items for the Los Angeles -Riverside -Orange County areas, as published by the United States Department of Labor, Bureau of Labor Statistics for the month of September immediately preceding the month in which payment is due and payable, and divided by the Consumer Price Index for .tune 30, 1989, which is declared to be 100.0. Under no circumstances shall the multiplying factor be less than one. (2) If the United States Department of Labor, Bureau of Labor Statistics discontinues the preparation or publication of a Consumer Price Index for the area, and if no translation table prepared by the Department of Labor is available so as to make those statistics which are then available applicable to the index of June 30, 1989, the City shall prescribe a rate of payment which shall, in its judgment, vary from the rates specified in this Section in approximate proportion as commodity consumer prices then current vary from commodity consumer prices current in December 1988. On this point, the determination by the City shall be final and conclusive. if said Bureau revises the said Index, the parties hereto shall accept the method of revision or conversion recommended by the said Bureau. C) Right of Inspection. The City shall have the right to inspect Grantee's pipeline records relating to its annual report and to audit and recompute any and all amounts payable under this Franchise. Costs of audit shall be borne by Grantee when audits result in an increase of more than five percent of Grantee's annual payments due the City. Acceptance of any payment shall not be construed as a release, waiver, acquiescence, or accord and satisfaction of any claim the city may have for further or additional sums payable under this Ordinance or for the performance of any other obligation hereunder. D) Grantine and Reimbursement Fee. In consideration for the granting of this Franchise, and to reimburse the City for its administrative expenses in preparing and approving the Franchise documents, Grantee shall pay the City Fifteen Thousand Dollars ($15,000.00) within thirty (30) days of the date the City Council approves this Franchise. SECTION 8. EMERGENCY PREPAREDNESS A) Equipment and Crews. At all times during the terms of this Franchise, the Grantee shall either; (1) maintain on a twenty-four (24) hour -a -day basis a fully -operational computer -aided system, such as Supervisory Control and Data Acquisition (SCADA), or a similar system designed for the purpose of controlling and monitoring rates of flow, pressures and fluid characteristics; or (2) provide adequate emergency equipment and a properly trained emergency crew or representatives within a radius of fifteen (15) miles from any facilities installed or maintained pursuant hereto for the purpose of shutting off the pressure and the flow of contents of such facilities in the event of an emergency resulting from any earthquake, act of war, civil disturbance, flood or other cause. B) Plans. Within thirty (30) days of the effective date of this Ordinance, Grantee must submit to the City Engineer an emergency preparedness plan that complies with the requirements of Government Code section 51010 et. seq. and is approved by the California State Fire Marshall, including all information required to be provided to the local fire department pursuant to Government Code section 51015(a). Such information includes a map or suitable diagram showing the location of the pipeline, a description of all products transported within the pipeline, and a contingency plan for pipeline emergencies which shall include, but not be limited to any reasonable information which the State Fire Marshal may require. All emergency plans and information submitted pursuant to this subsection shall be updated as required by the State Fire Marshall or any other provision of law. SECTION 9. REPAIRS. Grantee shall pay to City on demand the cost of all repairs to City property made necessary by any of the operations of Grantee under the Franchise, provided however that Grantee may make repairs to streets; sidewalks, curbs and gutters itself at its own cost in accordance with City specifications, if the same can be done without undue inconvenience to the public use of the streets. ' SECTION 10. REARRANGEMENT OF FACILITIES. A) Expense of Grantee. (1) If any of the Grantee's facilities, in the discretion of the City, shall endanger the public in the use of the public streets or interfere with or obstruct the use of any street by the public or for public purpose, the City shall have the right -to require the Grantee, and the Grantee shall move, alter or relocate the same (hereinafter called "rearrangement") to avoid such danger interference or obstruction, in conformity with the written notice of the City Engineer, at the Grantee's sole expense. (2) Whenever, during the existence of this Franchise, the City, or any other agency or entity established by the City (now or in the future), shall change the grade, width, alignment or location of any street, way, alley or place or improve any said street in any manner, including but not limited to the laying of any sewer, storm drain, conduits, gas, water or other pipes, pedestrian tunnels, subway, viaduct or other work of the City (the right to do all of which is specifically reserved to the City without any admission on its part that it would not otherwise have such rights), the Grantee shall, at its own cost and expense, do any and all things to effect such change in position, or location, in conformity with the written approval of the City Engineer and any applicable City policies, including without limitation the acceptance of encroachment permits, and the removal or relocation of any facilities installed, if and when made ' necessary by the determination of the City Engineer. B) Expense of Others (1) The City shall also have the right to require the Grantee to rearrange any part of the Grantee's facilities for the accommodation of any private person, firm, or corporation. When such rearrangement is done for the accommodation of any private person, firm or corporation, the cost of such rearrangement shall be borne by the accommodated party. Such accommodated party, in advance of such rearrangement, shall deposit with the Grantee funds in an amount as, in the reasonable discretion of the Grantee, shall be required to pay the costs of such rearrangement. (2) The rearrangement referred to in subsection (1) of Subsection B of this Section shall be accomplished in conformity with the written notice of the City Engineer. C) Rearrangement of the Facilities of Others. Nothing in this Franchise contained shall be construed to require the City to move, alter or relocate any of its facilities upon said streets, at its own expense, for the convenience, accommodation or necessity of any other public utility, person, firm or corporation now or hereafter owning a public utility system of any type or nature, or to move, alter or relocated any part of its system upon said streets for the , convenience, accommodation or necessity of the Grantee. D) Notice. The Grantee shall be given not less than thirty (30) days written notice of any rearrangement of facilities that the Grantee is required to make herein. Such notice shall specify in reasonable detail the work to be done by the Grantee and shall specify the time that such work is to be accomplished. To the extent local, state or federal permits are required for the rearrangement of Grantee's facilities, the City shall provide Grantee with a reasonable amount of time, as determined by the City in consultation with the Grantee, to obtain such permit(s) and accomplish such work. In the event that the City shall change the provisions of any such notice given to the Grantee, the Grantee shall be given an additional period not less than sixty (60) days to accomplish such work. SECTION IL Rl3MOVAL OR ABANDONMENT OF FACILITIES. At the time of expiration, revocation or termination of this Franchise or the permanent discontinuance of the use of its facilities, or any portion thereof, the Grantee shall, within thirty (30) days thereafter, make a written application to the City Engineer to either: (1) abandon all, or a portion, of such facilities in place, or (2) remove all, or a portion, of such facilities as the City Engineer, in his discretion, shall consider to be appropriate. Such application shall describe the facilities desired to be abandoned by reference to the map or maps required by Section 5 of this Ordinance and shall also describe with reasonable accuracy the relative physical condition of such facilities. Thereupon, the City Engineer shall determine whether any abandonment or removal which is thereby proposed may be effected without detriment to the public interest or under what conditions such proposed abandonment or removal may be safely effected and shall then notify the Grantee, according to such requirements as shall be specified in the City Engineer's order, ' and within ninety (90) days thereafter, to either: (a) Remove all or a portion of such facilities, or (b) Abandon in place all or a portion of such facilities. If any facilities to be abandoned in place subject to prescribed conditions shall not be abandoned in accordance with all such conditions, then the City Engineer may make additional appropriate orders, including, if he deems desirable, an order that the Grantee shall remove all such facilities in accordance with applicable requirements. A request of the Grantee to abandon in place any facilities shall be deemed an offer of transfer of such facilities to the City and by resolution authorizing Grantee to abandon any facility in place, the City shall succeed to all right, title and interest of Grantee in said facilities. If Grantee has made application for a new franchise agreement following expiration of this Agreement as provided for in Section 2,. Grantee shall not be required to apply for abandonment or removal of its facilities. Facilities which are idle or maintained in a condition defined as Out -of -Service by the California State Fire Marshal, for any amount of time, do not constitute permanent discontinuance of the use of such facilities or a revocation, termination or abandonment of the Franchise. SECTION 12. COMPLETION OF WORK. If Grantee fails to commence any work or act and diligently proceed or complete any such act or work required of the Grantee by ' the terms of this Franchise within the time limits required hereby, the City may cause such act or work to be completed by the City or, at the election of the City, by a private contractor. The City agrees that, to the extent reasonably possible, any work by the City or its private contractors shall be performed in a manner that does not cause damage to Grantee's facilities or disruption to the transportation of oil and other petroleum products through Grantee's pipeline system. In the event the City causes such act of work to be completed by the City or a private contractor, the City shall send an itemized bill to Grantee. Within thirty days (30) of receipt of the bill, Grantee shall either pay the bill in writing plus an amount equal to fifteen percent (15%) thereof for overhead, or detail in writing to the City Manager why such bill is inappropriate. If Grantee timely provides this statement to the City, the City Manager shall consider Grantee's statement, and shall notify Grantee in writing of the City Managers determination. If Grantee determines that the City Manager's determination was incorrect, Grantee may bring an action in court challenging that decision. Regardless of Grantee's position on the accuracy of the City Manager's decision, Grantee shall pay all amounts determined by City Manager within 10 days of receipt of City Manager's determination. For any removal, relocation or modification of Grantee's facilities by the City as provided for herein, the City shall, to the extent required by law, only conduct such work with the prior approval of, and in coordination with, the California State Fire Marshal and comply with Chapter 5.5 of Title 5, Division 1, Part 1, of the California Government Code (Elder California Pipeline Safety Act of 1981) and all other local, State and Federal laws. ' SECTION 13. RECOVERY OF COSTS OF REPAIRS AND UNPAID FEES. If the Grantee has not paid the City for such fees and expenses incurred by or payable to the City as hereinabove set forth, the City may take any and all reasonable enforcement actions, including, but not limited to, ordering that the charge(s) be assessed against the property of the Grantee in the City, that liens be imposed on said property, instituting collection proceedings, and instituting franchise default proceedings. SECTION 14. BOND. Grantee shall, within thirty (30) days of the Effective Date of this Franchise, file with the City Clerk, and yearly thereafter, maintain in full force and effect, a bond of the required amount for the benefit of the City, with a surety to be approved by the City Finance Director. The bond shall be surety that the Grantee shall, will and truly observe, fulfill, and perform each and every term and condition of this Franchise, and in case of a breach of condition of said Franchise, subject to the default language in Section 20, the whole amount of the penal sum therein shall be paid to the City in addition to any damages recoverable by the City and shall be recoverable from the principal and sureties of the bond. If said bond is not so filed, Grantee agrees and acknowledges that the award of this Franchise will be set aside and any money paid therefore will be forfeited. For the first eight years from the Effective Date, the amount of the bond shall be One -Hundred Thousand Dollars ($100,000.00). For each five year period thereafter, the amount of the required bond shall increase by 20%, compounded at each five year interval. ' Whenever a bond is taken and deemed to be liquidated damages for any breach of a term or condition of this Franchise, the Grantec must immediately file another bond of like amount and character, and if the Grantee [ails to do so within the time set by the City Council, the Council may, by resolution, declare said Franchise automatically forfeited. Nothing herein shall insulate Grantee from liability in excess of the amount of said bond or shall be construed as a waiver by the City of any remedy at law against the Grantee for any breach of the terns and conditions of this Franchise, or for any damage, loss or injuries suffered by the City in case of any damage, loss or injury suffered by any person, firm, or corporation by reason of any work done or any activity conducted by the Grantee in the exercise of this Franchise. SECTION 15. INSURANCE. Grantee shall procure and maintain for the duration of the Franchise insurance against claims for injuries to persons or damages to property which may arise from or in connection with the Grantee's pipeline and appurtenances or performance of any work hereunder and the results of that work by the Grantee, its agents, representatives, employees or subcontractors. A) Minimum Scope of Insurance. Coverage shall be at least as broad as: (1) Insurance Services Office Commercial General Liability coverage (occurrence Form CG 00 01). (2) Insurance Services Office Form Number CA 00 01 covering Automobile Liability, code 1 (any auto). (3) Workers' Compensation insurance as required by the State of California and Employer's Liability Insurance. B) Minimum Limits of Insurance. Grantee shall maintain limits no less than: (1) General Liability: To include operations; products & completed operations. The general liability policy shall include an endorsement for Sudden and Accidental Pollution Liability coverage. (2) Automobile Liability: $20,000,000 Per occurrence for bodily injury, personal injury and property damage. If Commercial General Liability insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit. $2,000,000 Per accident for bodily injury and property damage. 1 (3) Workers' Compensation As required by the State of California (4) Employer's Liability: $2,000,000 Per accident for bodily injury or disease. ' If the Grantee maintains higher limits than the minimums shown above, then, their City shall be entitled to coverage for the higher limits maintained by the Grantees. C) Deductibles and Self -Insured Retentions. Any deductibles or self -insured retentions must be declared to and approved by the City. At the option of the City, either: the insurer shall reduce or eliminate such deductibles or self -insured retentions as respects the City, its officers, officials, employees and volunteers; or the Grantee shall provide a financial guarantee satisfactory to the City guaranteeing payment of losses and related investigations, claim administration, and defense expenses. Notwithstanding anything to the contrary in this paragraph, any deductibles or self -insured retentions shall be deemed acceptable if a parental guaranty from Plains All American Pipeline, L.P. or other parent company approved in writing by the City, in a form attached hereto as Exhibit `B", is effective and on file with the City. D) Other Insurance Provisions. The General Liability and Automobile Liability policies are to contain, or be endorsed to contain, the following provisions: (1) The City, its officers, officials, employees, and volunteers are to be covered as insureds with respect to liability arising out of automobiles owned; leased, hired or borrowed by or on behalf of the Grantee; and with respect to liability arising out of work or operations performed by or on behalf of the Grantee including materials, parts or , equipment furnished in connection with such work or operations. General Liability coverage shall be provided in the form of an Additional Insured endorsement (CG 20 10 11 85 or equivalent) to the Grantee's insurance policy, or as a separate owner's policy. (2) For any claims related to Grantee's pipelines and appurtenances or work conducted pursuant to the Franchise, the Grantee's insurance coverage shall be primary insurance as respects the City, its officers, officials, employees, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, or volunteers shall be excess of the Grantee's insurance and shall not contribute with it. (3) Each insurance policy required by this clause shall be endorsed to state that coverage shall not be canceled by either party, except after thirty (30) day's prior written notice has been provided to the City. E) Waiver of Subrogation. Grantee hereby agrees to waive subrogation which any insurer of Grantee may acquire from Grantee by virtue of the payment of any loss. Grantee agrees to obtain any endorsement that may be necessary to effect this waiver of subrogation. The Workers' Compensation policy shall be endorsed with a waiver of subrogation in favor of the City for all work performed by the Grantee, its employees, agents and subcontractors. F) Acceptability of Insurers. Insurance is to be placed with insurers with a current A.M. Best's rating of no less than A:VII unless otherwise acceptable to the City. 10 G) Verification of Coverage. Grantee shall furnish the City with original certificates and endorsements effecting coverage required by this clause within ten (10) days of Grantee's acceptance of the Franchise and within ten (10) days following expiration of any existing coverage. However, failure to do so shall not operate as a waiver of these insurance requirements. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements effecting the -coverage required by these specifications at any time. SECTION 16. INDEMNIFICATION BY GRANTEE. For all claims relating to activity taken during the times subject to this Ordinance, including any retroactivity dates, the Grantee shall indemnify, defend with counsel selected by the City subject to approval of Grantee whose approval shall not be unreasonably withheld, protect and hold harmless City, its officers, employees, agents, assigns and any successor or successors to City's interest from and against all claims, actual damages (including but not limited to special and consequential damages), penalties, attorneys' fees, consultant's_ and expert's fees and costs ("Liabilities") arising as a result of the Grantee's exercise of the Franchise or operation of the pipeline system, regardless whether any act or omission complained of is authorized, allowed, or prohibited by the Franchise. This indemnity includes, but is not limited to any repair, cleanup or detoxification, or preparation and implementation of any removal, remedial, response, closure or other, plan (regardless of whether undertaken due to governmental action) concerning any facilities or equipment or the effects of such facilities or equipment authorized by this franchise, and any ' hazardous substance or hazardous wastes including petroleum and its fractions as defined in the Comprehensive Environmental Response, Compensation and Liability Act ["CERCLA'; 42 U.S.C. § 9601, et sue.] the Resource Conservation and Recovery Act ["RCRA"; 42 U.S.C. § 6901 et sue.] and California Health & Safety Code § 25280 et sue. at any place where Grantee maintains a pipeline for the transportation of substances and liquids pursuant to this Franchise. The foregoing indemnity is intended to (1) supplement and not replace any other indemnity from any source, and (2) operate as an agreement pursuant to Section 107(e) of CERCLA and California Health & Safety Code Section 25364, to assure, protect, hold harmless and indemnify City from liability. Grantee shall not be liable to the City for any Liabilities resulting from or arising out of acts, errors, or omissions, or caused by the negligence, or willful misconduct of the City, its officers, employees, agents, assigns or successors. SECTION 17. ASSIGNMENT A) The grantee shall not sell, transfer, assign or lease the franchise, or any part thereof, except with the consent of the City Council. Such sale, transfer, assignment or lease shall be made only by filing with the City Council a copy of the duly executed instrument of such sale, transfer, assignment or lease, and a written request for the, consent of the Council to such sale, transfer, assignment or lease. If such duly executed instrument and such written request is not filed with the City Council before the expiration of 30 days after the effective date of such sale, transfer, assignment or lease then, upon the expiration of said 30 days, the franchise shall be subject to forfeiture and the City Council may, without notice, by ordinance, repeal the franchise. B) As a condition to the granting of consent to such sale, transfer, assignment or lease, the Council may impose such additional terms and conditions upon the franchise and upon the grantee or assignee which the City Council may deem to be in the public interest. The City may also condition transfer upon payment of a transfer fee of $10,000 to be paid by the transferee to the City. Such additional terms and conditions shall be expressed by ordinance. C) Nothing herein contained shalt be construed to grant to the grantee the right to sell, transfer, assign or lease the franchise, or any part thereof except in the manner aforesaid. This section applies to any assignment, whether by operation of law, by voluntary act of the grantee or otherwise. No such consent shall be required to any transfer of the franchise in trust or by way of mortgage or hypothecation with all or a part of grantee's other property for the purpose of securing any indebtedness of grantee. A merger will not be deemed a sale, transfer, assignment or lease of the franchise under this section. D) The provisions of this Section shall not apply to Grantee's assignment of rights, duties and obligations under the Franchise to any affiliate of Grantee. As used in this Franchise, the term "affiliate" shall mean an entity controlling, controlled by or under common control with the entity to which the term applies, whether by ownership, contract or voting control. Franchisee and the entity to whom the rights are to be assigned shall sign an assignment and assumption agreement whereby the transferee agrees to be bound by and comply with the terms of this Franchise. ' SECTION IS. RECEIVERSHIP AND FORECLOSURE A) Subject to applicable provisions of the Bankruptcy Code, the Franchise shall, at the option of the city, cease and terminate one hundred twenty (120) days after the appointment of a receiver or trustee to take over and conduct the business of the Grantee whether in a receivership, reorganization, bankruptcy or other action or proceeding unless such receivership or trusteeship shall have been vacated prior to the expiration of said one hundred twenty (120) days, or unless: (1) Such receiver or trustee shall have, within one hundred twenty (120) days after his election or appointment, fully complied with all renrns of the Franchise and remedied all breaches of the Franchise or provided a plan for the remedy of such breaches which is satisfactory to the City; and (2) Such receiver or trustee shall, within said one hundred twenty (120) days, execute an agreement duly approved by the court having jurisdiction, whereby such receiver or trustee assumes and agrees to be bound by each and every term, provision and limitation of the Franchise. B) Upon the foreclosure or other judicial sale of all or a substantial part of a pipeline system, the Grantee shall notify the City Clerk of such fact, and such notification shall be treated as a notification that a change in ownership of the Grantee has taken place and the provisions of this Chapter governing such changes shall apply. 12 SECTION 19, WAIVER OF BREACH. No waiver of the breach of any ofthe covenants, agreements, restrictions, or conditions of this, Franchise by the City shall be construed to be a waiver of any such succeeding breach of the same or other covenants, agreements, restrictions or conditions of this Franchise. No delay or omission of the City in exercising the right, power or remedy herein provided in the event of default shall be construed as a waiver thereof, or acquiescence therein, nor shall the acceptance of any payments made in a manner or at a time other than is herein provided be construed as a waiver of or variation in any of the terms of this Franchise. SECTION 20. DEFAULT A) Default Any neglect, failure or refusal to comply with any of the conditions of the Franchise shall constitute grounds for the suspension or forfeiture thereof. The City Council, prior to any suspension or forfeiture of the Franchise or recovery of the surety bond, shall give to the Grantee not less than 30 days' notice in writing of any default thereunder. If the Grantee does not within the noticed period begin the work of compliance, or after such beginning does not prosecute the work with due diligence to completion, the City Council may hold a hearing, at which the Grantee shall have the right to appear and be heard, and thereupon the City Council may determine whether such conditions are material and essential to the Franchise and whether the Grantee is in default and may declare the Franchise suspended or forfeited. Notice of the hearing shall be given to the Grantee not less than ten days before the hearing. If the City Council declares this Franchise forfeited; it may thereupon and thereafter exclude the Grantee from further occupancy or use of all City roads authorized under this Franchise. A forfeiture of said Franchise shall not of itself operate to release the bond filed for said Franchise. Upon declaring a Franchise forfeited, the City Council may elect to take and accept the bond as liquidated damages therefor and pursue any other legal remedy for any damage, loss or injury suffered by the City as a result of such breach. After forfeiture, the bond shall remain in full force and effect for a period of one (1) year unless exonerated by the City Council. No bond shall be exonerated unless a release is obtained from the City Engineer of the City of Santa Clarita and is filed with the Clerk of the City of Santa Clarita. The release shall state whether all excavations have been back filled, all obstructions removed, and whether the substratum or surface of City roads occupied or used have been placed in good and serviceable condition. Release shall not constitute a waiver of any right or remedy which the City of Santa Clarita may have against the Grantee or any person, firm or corporation for any damage, loss or injury suffered by the City as a result of any work or activity performed by the Grantee in the exercise of this Franchise. B) Cumulative Remedies. No provision herein made for the purpose of securing the enforcement of the terms and conditions of this Franchise shall be deemed an exclusive remedy or to afford the exclusive procedure, for the enforcement of said terms and conditions, but the remedy and procedure herein provided, in addition to those provided by law, shall be deemed to be cumulative. 13 SECTION 21. SCOPE OF RESERVATION. Nothing herein contained shall ever be construed so as to exempt the Grantee from compliance with all ordinances of the City now in effect or which may be hereafter adopted which are not inconsistent with the terms of this Franchise or in conflict with the California State Fire Marshal's exclusive safety, regulatory and enforcement authority over intrastate hazardous liquid pipelines as provided for in Section 51010 of the California Government Code. The enumeration herein of specific rights reserved shall not be construed as exclusive, or as limiting the general reservation herein made or as limiting such rights as the City may now or hereafter have in law. SECTION 22. NOTICE. Any notice required to be given under the terms of this Franchise, the manner ot'service of which is not specifically provided for, may be served personally or by United States First Class Mail as follows: A) Upon the City, by addressing a written notice to: City Clerk ofthe City of Santa Clarita City Hall 23920 Valencia Boulevard Santa Clarita, California 91355 With a copy to: City Attorney ' City Hall 23920 Valencia Boulevard Santa Clarita, California 91355 B) Upon the Grantee, by addressing a written notice to: Pacific Pipeline System LLC Attn: Land Department 333 Clay Street, Suite 1600 Houston, Texas 77002 Office (713) 645-4143 Fax (713) 646-4216 and Pacific Pipeline System LLC 5900 Cherry Avenue Long Beach, California 90805 Attn: Manager, Western Region and Land Department Office (562) 728-2800 Fax (562) 728-2823 ' C) For such other address as may from time to time be furnished in 14 writing by one party to the other and depositing said notice in the United States Mail, postage prepaid. When service of any such notice is made by mail, the time of such notice shall begin with and run from three (3) business days after the date of the deposit of same in the United States Mail. A summary of this Ordinance shall be published in a newspaper published and circulated in said City at least five (5) days prior to the City Council meeting at which the proposed Ordinance is to be adopted. A certified copy of the full text of the proposed Ordinance shall be posted at City Hall. Within fifteen (15) days after adoption of the Ordinance, the summary with the names of those City Council members voting for and against the Ordinance shall be published again, and the City Clerk shall post a certified copy of the full text of such adopted Ordinance. SECTION 23. SUCCESSORS. The terms herein shall inure to the benefit of and shall bind, as the case may be, the successors and assigns of the parties hereto, subject, however, to the provisions of Section 16 of this Franchise. SECTION 24. INTERPRETATION. This Franchise is granted upon each and every condition herein contained, and shall be strictly construed against Grantee. Nothing shall pass by the Franchise granted hereby to Grantee unless it be granted in plain and unambiguous ' terms. Each of said conditions is a material and essential condition to the granting of the Franchise. SECTION 25. FORCE MAJEURE. The time within which Grantee is obligated hereunder to construct, erect, maintain, operate, repair, renew, change the size of and remove pipelines or other improvements shall be extended for a period of time equal in duration to, and performance in the meantime shall be excused on account of and for and during the period of any delay caused by strikes, threats of strikes, lockouts, war, threats of war, insurrection, invasion, acts of God, calamities, violent action of the elements, fire, impossibility of obtaining materials, or other things beyond the reasonable control of Grantee. SECTION 26. ATTORNEYS' FEES. If either party brings an action to enforce the terms of any covenant, agreement or condition contained in this Franchise, the prevailing party in such action, in trial or appeal, shall be entitled to reasonable attorneys' fees to be paid by the losing party as fixed by the court. SECTION 27. PUBLICATION EXPENSES. The Grantee of this Franchise shall, pursuant to California Public Utilities Code Section 6293, pay to the City a sum of money sufficient to reimburse it for all publication expenses incurred by it in connection with the granting of this Franchise; said payment to be made within thirty (30) days after the City shall have furnished said Grantee with a written statement of such expenses. SECTION 28. ACCEPTANCE. The Franchise granted hereby shall not become effective until written acceptance thereof shall have been filed by the Grantee with the City Clerk 15 of the City within thirty (30) days of the effective date of this Ordinance. SECTION 29. SEVERABILITY. The City Council hereby declares that the provisions of this Ordinance are severable and if for any reason a court of competent jurisdiction shall hold any sentence, paragraph, or section of this Ordinance to be invalid, such decision shall not affect the validity of the remaining parts of this Ordinance. SECTION 30. CERTIFICATION. The City Clerk shall certify to the adoption of this Ordinance and shall cause the same to be posted as required by law. SECTION 31. BUSINESS DAYS. As used in the Ordinance, the term "business days" shall mean days other than Saturdays, Sundays, and legal holidays and closures observed by the City, and "days" shall mean calendar days. If the time I'or performance of an obligation under this Ordinance falls on other than a business day, the time for performance shall be extended to the next business day. SECTION 32. EFFECTIVE DATE OF FRANCHISE -RETROACTIVITY. This Ordinance shall be in full force and effect thirty days after its adoption. All conditions precedent having first been met to make this Franchise effective and binding upon the City and the Grantee, the rights, privileges, limitations, restrictions, conditions, obligations and duties granted and imposed hereby shall be retroactive to May 1, 2009, provided however, the Grantee is deemed to be in full compliance with the requirements and conditions of this Ordinance as of the date of the adoption of this Ordinance. ' SECTION 33. EXCLUSION OF PRIOR DRAFTS. Prior drafts and prior correspondence regarding this Franchise shall not be used by either party as evidence of the intent of the parties or otherwise be admissible in evidence in interpreting this Franchise. SECTION 34. ENTIRE AGREEMENT.The parties agree that this Franchise shall constitute the entire agreement between the parties with respect to the transactions contemplated hereby. Any and all previous agreements and understandings between or among the parties regarding the transactions contemplated hereby, whether written or oral, are superseded by this Franchise. SECTION 35. NO THIRD PARTY BENEFICIARIES. It is expressly understood that the provisions of this Franchise do not impart enforceable rights in anyone who is not a party or a successor or assign of a party hereto. No third party (including an employee or a contractor of a party) is intended to have or shall have any rights under this Franchise. SECTION 36. HEADINGS. The headings, subheadings and numbering of the different paragraphs of this Franchise are inserted for convenience and for reference only and shall not be considered for any purpose in construing this Franchise. SECTION 37. This Ordinance shall be in full force and effect thirty (30) days from its passage and adoption. 16 SECTION 33. The City Clerk shall certify to the passage of this Ordinance and shall cause the same to be published as required by law. PASSED, APPROVED, AND ADOPTED this 14th day of May 2013. AYOR DATE: 143 STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss. CITY OF SANTA CLARITA ) 1, Armin6 Chaparyan, Interim City Clerk of the City of Santa Clarita, do hereby certify that the foregoing Ordinance 13-04 was regularly introduced and placed upon its first reading at a regular meeting of the City Council on the 23rd day of April 2013. That thereafter, said Ordinance was duly passed and adopted at a regular meeting of the City Council on the 14th day of May 2013, by the following vote, to wit: AYES: COUNCILMEMBERS: Weste, Boydston, McLean, Ferry, Kellar NOES: COUNCILMEMBERS: None ABSENT: COUNCILMEMBERS: None AND I FURTHER CERTIFY that the foregoing is the o and was published in The Signal newspaper in accordance with Ordinance No. 13-04 i (Q. 40806). 17 EXHIBIT "B" ' PARENTAL GUARANTY For valuable consideration, the receipt of which is hereby acknowledged, Plains All American Pipeline, L.P., a Delaware limited partnership ("Guarantor"), in accordance with and subject to the terms and conditions contained herein, unconditionally guarantees to the City of Santa Clarita, a California municipal corporation ("Beneficiary"), the prompt payment when due by Pacific Pipeline System LLC, a Delaware limited liability company ("Grantee"), of all payments due Beneficiary under that certain Pipeline Franchise Agreement, dated , 2013, by and between the Beneficiary and Grantee (the "Franchise"). The rights afforded the Beneficiary under this Parental Guaranty (the "Guaranty") are personal and not transferable nor assignable by the Beneficiary. This Guaranty cancels and supersedes any and all previous and outstanding guaranties given by Guarantor to Beneficiary with respect to the Franchise. This Guaranty shall be construed under and governed by the laws of the State of California (but not the laws concerning conflicts of laws). The Guarantor and Beneficiary submit to the exclusive jurisdiction of the courts located in the Central Business District of the City of Los Angeles, California with respect to any matter related to or arising under this Guaranty. I Guarantor's obligations and liability under this Guaranty shall be limited to payment obligations only, and Guarantor shall have no obligation to perform or enforce performance on Debtor under the Franchise. Guarantor represents and warrants that this Guaranty is a legal, valid, and binding obligation of the Guarantor, enforceable against the Guarantor in accordance with its terms except as limited by bankruptcy or other laws of general application. Guarantor agrees that any amendments, modifications, alterations or changes made in the Franchise covered by this Guaranty or the giving by the Beneficiary of any extension of time for the performance of any of the Franchise terms, if any, or the giving of any other forbearance on the part of the Beneficiary to the Grantee shall not in any way release the Guarantor or its successors or assigns from any liability arising hereunder, and notice to the Guarantor of any such amendments, modifications, alterations or changes is hereby waived. Upon failure by the Grantee to make payment due under the Franchise, Beneficiary shall make demand of payment upon the Guarantor. Such demand shall be in writing and shall state the amount the Grantee has failed to pay, and an explanation of why such payment is due, with a specific statement that the Beneficiary is calling upon the Guarantor to pay under this Guaranty. , li3 ' The Guarantor reserves to itself all rights, setoffs, counterclaims, and other defenses to which the Grantee may have to payment of any obligation, other than (a) defenses arising from the bankruptcy or insolvency of the Grantee, and (b) any other defenses expressly waived in writing by the Grantee or otherwise waived in this Guaranty. This Guaranty is a continuing guaranty and, subject to earlier termination pursuant to the Franchise, shall remain in full force and effect through the terns of the Franchise, until revoked by Guarantor on not less than 10 days prior written notice. This Guaranty shall automatically terminate, except as to guaranteed obligations which arose or existed on or before the date of termination, when (a) the Franchise terminates or when the Franchise has been assigned from Grantee to a party and as part of the assignment, Grantee has been released from its obligations under the Franchise by the Beneficiary, or (b) Guarantor sells, assigns or conveys a majority of its interest in the Grantee to an unaffiliated third party. Any notice or other communication given hereunder by either Guarantor or Beneficiary to the other party (`Notice") shall be in writing and delivered at the addresses below by prepaid overnight courier service, certified mail (postage prepaid, return receipt requested), or by personal delivery. Notices shall be effective upon actual receipt. Either party may change the address to which Notice is to be given to it by giving Notice as provided above of such change of address to the other party. ' If to Beneficiary: City Clerk of the City of Santa Clarita City Hall 23920 Valencia Boulevard Santa Clarita, California 91355 With a mandatory copy to: City Attorney City Hall 23920 Valencia Boulevard Santa Clarita, California 91355 If to Guarantor: Plains All American Pipeline, L.P. 333 Clay Street, Suite 1600 Houston, Texas 77002 Attn: Credit Department I With a mandatory copy via prepaid overnight courier to: 19 Plains All American Pipeline, L.P. 333 Clay Street, Suite 1600 Houston, Texas 77002 Attn: Lawrence J. Dreyfuss, Senior Vice President & General Counsel - Commercial & Litigation It is expressly understood and agreed that this Guaranty is without recourse of any kind against PAA GP LLC (acting hereunder solely in its capacity as the general partner of the Guarantor), Plains AAP, L.P. (acting hereunder solely in its capacity as the sole member of Plains GP LLC), or Plains All American GP LLC (acting hereunder solely in its capacity as the general partner of Plains AAP, L.P.) and that the Beneficiary shall have recourse under this Guaranty solely against the Guarantor and its assets. IN WITNESS WHEREOF Guarantor has signed the Guaranty as of this day of .2013. Plains All American Pipeline, L.P. By: PAA GP LLC, its general partner By: Plains AAP, L.P., its sole member By: Plains All American GP LLC, its general partner Bv: Name: Charles Kingswell-Smith Title: Vice President and Treasurer 20