AN ORDINANCE GRANTING PEOPLES NATURAL GAS, A DIVISION OF UTILICORP UNITED INC., A DELAWARE CORPORATION, ITS SUCCESSORS AND ASSIGNS, A NATURAL GAS FRANCHISE FOR A PERIOD OF 20 YEARS AND THE AUTHORITY TO CONSTRUCT, OPERATE, MAINTAIN, AND EXTEND A NATURAL GAS DISTRIBUTION PLANT AND SYSTEM, AND GRANTING THE RIGHT TO USE THE STREETS, ALLEYS, AND OTHER PUBLIC PLACES WITHIN THE PRESENT OR FUTURE CORPORATE LIMITS OF THE CITY OF COLWICH, KANSAS.
Franchise Granted. The City of Colwich, Kansas, (hereinafter referred to as granter) hereby grants a non-exclusive franchise to Peoples Natural Gas, a division of UtiliCorp United Inc., a Delaware corporation, (hereinafter called grantee), its lessees, successors and assigns. This repeals the franchise previously granted by Ordinance No. 239. Grantee is hereby granted the right, privilege, franchise, permission and authority to construct, maintain, operate and extend in the present and future streets, alleys, avenues, bridges and public places as are now within the present or future limits of the granter, a natural gas distribution system for the purpose of supplying natural gas or processed gas for all purposes to the inhabitants of said granter and consumers in the vicinity thereof, and for the distribution of natural gas from or through said granter to points beyond the limits thereof. Granter further grants grantee the right, permission and authority to lay, install, maintain, and operate over, across and along all of the streets, avenues, alleys, bridges and public places of granter all mains, services, pipes, conduits and appliances necessary or convenient for transmitting, transporting, distributing and supplying natural gas for all purposes for which it may be used, and to do all other things necessary and proper in providing natural gas service to the inhabitants of granter and in carrying on such business.
Term. The rights and privileges granted by this ordinance shall remain in effect for a period of 20 years from the effective date of this ordinance. Five years from the date of enactment of the ordinance, and every five years thereafter until the end of the term as defined in this section, granter or grantee may, for good cause, review the ordinance and propose amendments to the franchise fees provision thereto. Granter or grantee shall notify the other party in writing, no later than 180 days before each five year anniversary of the effective date if it desires to amend the ordinance. Granter and grantee shall negotiate in good faith to agree upon mutually satisfactory amendment(s). No amendment shall be effective until mutually agreed upon and accepted by the granter and grantee. The ordinance shall continue as written, unless amended as provided in this section.
Franchise Fees. In exchange for the franchise granted herein, grantee shall collect from its customers, but not from the City of Colwich, located within the corporate limits of granter, and pay to grantor an amount equal to one percent of gross receipts derived from the sale, distribution or transportation of natural gas delivered within the present or future limits of granter. Gross receipts as used herein are revenues received from the sale, distribution or transportation of natural gas, after adjustment for the net write-off of uncollectible accounts and corrections of bills theretofore rendered. The amount paid by grantee shall be in lieu of, and grantee shall be exempt from, all other occupation, license, excise or right-of-way permit fees or taxes.
Additionally, in exchange for the franchise granted herein, grantee shall collect from its transportation customers, but not from the City of Colwich, located within the corporate limits of granter, and pay to granter an amount equal to $0.02/Mcf (one thousand cubic feet)/month of natural gas delivered through its facilities to its transportation customers.
Any consideration hereunder shall be reported and paid to granter by grantee on a monthly basis. Such payment shall be made not more than 30 days following the close of the period for which payment is due. Initial and final payments shall be prorated for the portions of the periods at the beginning and end of the term of this ordinance.
Grantee shall list the local fee collected from customers as a separate item on bills for utility service issued to customers. If at any time the Kansas Corporation Commission or other authority having proper jurisdiction, prohibits such recovery, then granter and grantee shall renegotiate the franchise fee provision of this ordinance.
Granter shall have access to and the right to examine during normal business hours, those of grantee’s books, receipts, files, records and documents that are necessary to verify the correctness of payments due hereunder. If it is determined that a mistake was made in the payment of any fee required hereunder, such mistake shall be corrected promptly upon discovery, such that any under-payment by grantee shall be paid within 30 days of the recalculation and any over-payment by grantee shall be discounted from the next payment(s) due.
Rules and Regulations. This ordinance is granted subject to all conditions, limitations and immunities now provided for, or as hereafter amended, and applicable to the operations of a public utility, by the laws of the State of Kansas. The rates to be charged by grantee for service within the present or future corporate limits of granter and the rules and regulations regarding the character, quality and standards of service to be furnished by grantee shall be under the jurisdiction and control of such regulatory body or bodies as may, from time to time, be vested by law with authority and jurisdiction over the rates, regulations and quality and standards of service to be supplied by grantee. Provided however, should any judicial, regulatory or legislative body, having proper jurisdiction, take any action that precludes grantee from recovering from its customers any cost associated with services provided hereunder, then grantee and granter shall renegotiate the terms of this ordinance in accordance with the action taken, so as to allow grantee to be made whole economically.
Construction. Any pavements, sidewalks or curbing taken up and any and all excavations made shall be done in such a manner as to cause only such inconvenience to the inhabitants of granter and to the general public as is reasonably necessary; and repairs and replacements shall be made promptly by grantee, leaving such properties in the same or better condition as existed immediately prior to excavation.
Maintenance. Grantee agrees that for the term of this grant, it will use its best efforts to maintain facilities and equipment sufficient to meet the current and future energy requirements of grantor, its inhabitants and industries. While maintaining its· facilities and equipment, grantee shall obtain permits as required by ordinance, except that in emergency situations, grantee shall take immediate unilateral actions as it determines are necessary to protect the public health, safety, and welfare; in which case, grantee shall notify granter as soon as reasonably possible.
Extension of Company Facilities. Upon receipt and acceptance of a valid application for service, grantee shall, subject to its own economic feasibility criteria, make reasonable extensions of its distribution facilities to serve customers located within the current or future corporate limits of granter. No obligation shall extend to, or be binding upon, grantee to extend its facilities if grantee is, for any reason, unable to obtain and deliver an adequate energy supply
Relocation of Company Facilities. If granter elects to alter or change the grade of or otherwise improve any street, alley, avenue, bridge, or public place, grantee, upon reasonable notice from granter, shall remove and relocate its facilities or equipment situated in the public rights-of-way at the cost and expense of grantee; provided however, that if granter orders or requests grantee to relocate its facilities or equipment primarily for non-public purposes or the primary benefit of a commercial or private project, or as a result of the initial request of a commercial or private developer or other nonpublic entity, grantee shall receive reimbursement for the cost of such relocation. Granter shall consider reasonable alternatives in designing its public works projects so as not arbitrarily to cause grantee unreasonable additional expense in exercising its authority under this section.
Confidential Information. Granter acknowledges that certain information it might request pursuant to this franchise may be of a proprietary and confidential nature. If grantee requests that any information provided by grantee to grantor be kept confidential due to such proprietary or commercial value, grantor and its employees, agents, and representatives shall maintain the confidentiality of that information. If granter is requested or required by legal or administrative process to disclose any such confidential information, granter shall promptly notify grantee of such request or requirement so that grantee may seek an appropriate protective order or other relief. Granter shall use all reasonable efforts to ensure that the confidentiality of grantee’s confidential information is maintained.
Force Majeure. It shall not be a breach or default under this franchise if either party fails to perform its obligations hereunder due to force majeure. Force majeure shall include, but not be limited to, the following: 1) physical events such as acts of God, landslides, lightning, earthquakes, fires, freezing, storms, floods, washouts, explosions, breakage or accident or necessity of repairs to machinery, equipment or distribution or transmission lines; 2) acts of others such as strikes, work-force stoppages, riots, sabotage, insurrections or wars; 3) governmental actions such as necessity for compliance with any court order, law, statute, ordinance, executive order, or regulation promulgated by a governmental authority having jurisdiction; and any other causes, whether of the kind herein enumerated or otherwise not reasonably within the control of the affected party to prevent or overcome. Each party shall make reasonable efforts to avoid force majeure and to resolve such event as promptly as reasonably possible once it occurs in order to resume performance; provided, however, that this provision shall not obligate a party to settle any labor strike.
Hold Harmless. Grantee, during the term of this ordinance, agrees to save harmless granter from and against all claims, demands, losses and expenses arising directly out of the negligence of grantee, its employees or agents, in the constructing, operating, and maintaining of distribution and transmission facilities or appliances of grantee; provided, however, that grantee need not save harmless granter from claims, demands, losses and expenses arising out of the negligence of granter, its employees or agents.
Severability. If any clause, sentence or section of this ordinance is deemed invalid, the remaining provisions shall not be affected.
Non-Waiver. Any waiver of any obligation or default under this franchise shall not be construed as a waiver of any future defaults, whether of like- or different character.
(5-10-1999)