07-1108a�
ORDINANCE
AMENDED 12/OS/2007
Council File # 07-llflg
Green Sheet �3o46S30
0
OF SAINT PAUL, MINNESOTA
Presented by
1 An ordinance granting the District Heating Franchise, held by the
2 District Energy St. Paul, Inc. for a Period of Twenry Years, Ending in 2027
a Tf� COUNCIL OF THE CITY OF SAINT PAUL DOES ORDAIN:
s P;t�bi�e���
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7 Seetion 1. - � ° �r��
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9 That the Saint Paul Legislative Code be amended by repealing Appendix F.
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12 Section 2.
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14 That the Saint Paul Legislafive Code be amended by adding thereto a new
15 Appendix F to read as follows:
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18 APPENDIX F. DISTRICT HEATING FRANCHI5E--DISTRICT ENERGY ST. PAUL, INC.
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2o Cross reference(s)--General franchise requirements, Charter Chapter 16.
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22 Secrion 1. Franchise granted.
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The District Heating Development Company d/b/a District Energy St. Paul, Inc., a nonprofit Minnesota
corporation, hereinafter referred to as "District Energy," is hereby granted a franchise to use and occupy the streets
and other public property within the City of Saint Paul for the purpose of conshucting, maintaining and operating a
district heating system and fiber optic netwark for District Energy and governmental use by the City of Saint Paul,
the State of Minnesota, the County of Ramsey, and by other government enrities as may hereafter be approved by
city council resolution. Said franchise may not be sold, transfened, assigned, pledged, mortgaged or in any way
disposed of or encumbered without the consent of the city by ordinance, any of the foregoing to be treated as a
modificarion of this franchise; provided, however, that this sentence shall not apply to revenue bonds issued to
fmance consttuction or expansion of the distriet heating system.
;5 Section 2. Use of public property.
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The franchise granted herein shall extend to the construction of the district heating system and a fiber opric network
for governmental use by District Energy in the City of Saint Paul. District Energy shall, priar to commencement of any
conshuction or usage of the public streets or other public properry within the City of Saint Paul, file with the City of
Saint Paul a detailed routing map showing the conshucrion of the district heating system and fiber optic network Such
franchise to use the streets and other public properiy located in such city shall include such use for the purpose of
conshucting, maintaining and operating a system of pipes, subways and manholes with all other necessary
appurtenances for cazrying on a district heating system and a fiber optic network for use by only the City of Saint Paul,
the State of Minnesota and the County of Ramsey, and other government enrities as may hereafter be approved by City
Council resolution. Expansion of the district heating system beyond that contained in said routing map shall be
governed by uid in accordance with the applicable provisions of the Hot Water Delivery Agreement. All of the
foregoing are subject to the provisions of Secrion 5 hereof.
Appendix F, District Heating Franchise Agreement, Page 2 of 7
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2 Secrion 3. Locaiion of facilities.
4 In locating its district heating faciliries, District Energy shall not unreasonably interfere with the safety and
s convenience of ordinary travel along and over said streets and public property nor interfere with other uses to which
6 such places may be put by the City of Saint Paul, and in the event it shail become necessary during the term of this
7 franchise to remove or relocate the physical property of District Energy located within or upon any of the streets or
8 public properly in the City of Saint Paul, because of such interference or use by the city, or as a result of any public
9 improvement undertaken by the ciTy, District Energy shall, when so advised by the ciTy, remove and relocate said
10 facilifies without cost to the city, and shall place the streets or other public properry in the same condition as they were
1� prior to said removal or relocarion. Any relocation or removal of District Energy's facilifies made necessary because of
12 the extension tluough or into the city of a federally aided state trunk highway, included within the National System of
13 Interstate Highways, shall be governed by the provisions of the Minnesota Statutes 1981, Section 161.46.
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16 5ection 4. City regulations apply.
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18 District Energy in the installation, maintenance and operarion of its facilities shall be subject to such reasonable
19 regularions, not inconsistent with this ordinance, as may be provided by the city. No pipe or other appurtenance shall
20 hereafter be installed or laid by District Energy upon the streets and public properry of the ciry, except upon
21 application to the depariment of public works or other persons designated by the city, and written permission therefor
22 granted by said deparhnent or person.
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25 Section 5. Franchise fees.
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2� During the term of the franchise hereby granted, District Energy shall pay the city an annual district heating franchise
28 fee in the amount of eight (8) percent of District Energy's annual gross earnings, except as further provided in this
29 section. Said payments shall be made in monthly installments.. The payment shall be due on or befare the twenty-fifth
30 calendaz day of the month in which payment is made. The payment obligation shall be met if the payment is mailed
31 and postmarked on or before the due date. "Gross earnings" for the purposes of this ordinance, shall mean all sums
received or receivable by the company from the sale of hot water to customers of District Energy and all sums
collected by Disttict Energy for routine maintenance or use of the fiber optic network serving the State of Minnesota,
the CounTy of Ramsey, and other government entities as approved by the City. District Cooling St. Paul, Inc. shall not
be deemed a customer of District Energy nor shall District Energy be deemed a customer of District Cooling St. Paui,
IriC.
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39 Section 6. Rates and regulafion.
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(a) All rates made, demanded or received by District Energy shall be just and reasonable. Rates shall not
be unreasonably preferenrial, unreasonably prejudicial or discriminatory, but shall be sufficient,
equitable and consistent in application to a class of consumers. Rates shall generate sufficient revenue
to allow District Energy to recover its reasonable operating costs and expenses; to provide for the
timely and orderly payment of costs and expenses; to provide for the timely and orderly retirement of
debt, including those bonds issued for fmancing the system; to pay the debt service on such bonds;
and to provide for improvements, enlazgements and extensions necessary to adequately service the
territory of the city, including the principal and interest to become due on obligarions issued or to be
issued therefor. Provided, however:
(i) District Energy customer buildings with demand of one hundred (100) kilowatts or less may
be charged a combined demand/energy rate to be called the single rate. Said customers
eligible for the single rate shall be known as "small customers." The single rate shall be
charged according to thermal energy usage as metered or otherwise determined by District
Energy. The single rate sha11 be computed by dividing twelve (12) monthly installments of
demand charge per kilowatt by one thousand seven hundred (1,700) and adding that result to
Q:�Dist. Heat & Cooling Franchises\district heating ord - 12-5-07,doc
Appendix F, Distrlct Heating Franchise Agreement, Page 3 of 7
t the energy chazge per kilowatt hour;
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3 (2) District Energy may enter into agreements with Incentive Progam customers and small
4 customers, the terms of which may vary from material terms of the Uniform Hot Water
5 Delivery Agreement; and
7 (3) Incentive Program customers' terms may vary for demand charges only to the ea�tent of the
8 discount and in all other respects demand chazges shall be calculated and applied in a manner
9 consistent with non-Incentive Progam customers.
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ll (b) The rates, together with zules and regulations governing hot water heating service not inconsistent
t2 with the Hot Water Delivery Agreement, contained in Schedule "A" attached to this ordinance and
13 incorporated herein by reference, shall remain and continue in force unril amended or changed as
la provided herein.
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16 (c) District Energy shall not directly or indirectly chazge, demand, collect or receive from any consumer
I� or person a greater or less compensation for any service rendered or to be rendered by it than that
I8 prescribed in Schedule A; nor shall any person knowingly receive or accept any service from District
19 Energy for a compensation greater or less than that prescribed in Schedule A. District Energy shall
20 not, as to rates or service, make or gant any unreasonable preference or advantage to any person or
21 subject any person to any unreasonable prejudice or disadvantage. Nothing contained in this
22 subsecfion shall be conshued to impair the tas-exempt status of bonds issued to finance the system.
23 "Service," as used herein, does not include customer connection chazges and pracfices.
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(d) District Energy shall keep and render its books, accounts, papers and records accurately and faithfully
in the manner and form prescribed by the city, and shall comply with all direcfions of the ciTy relating
to these books, accounts, papers and records, including furnishing of such information ar
compilations and permitting an audit of the books, accounts, papers and records, as may be requested
by the city.
(e) After thiriy (30) days' notice to the city, District Energy may file in the office of the city clerk a new or
amended Schedule A, containing new ar amended rates, rules or regulations, together with rules and
regulations governing hot water heating service not inconsistent with the Hot Water Delivery
Agreement. Such notice is jurisdictional to a change in 5chedule A and shall include statements of
facts, substanriating documeats, and e�chibits supporting the changes requested, and further shall state
the changes proposed to be made in the rates then in force, and the time when the changes wiil go into
effect. Such new or amended rates shall be effecfive and may be charged on the tenth day (or such
later date that District Energy shall designate on its filing) after the filing of the new or amended
Schedule A in the office of the city clerk, and shall continue in effect until approved or denied by
resolution, or until deemed approved, pursuant to the terms of this ordinance and the Charter, which
Charter requires a public hearing after proper notice.
43 (fl The proposed changes shall be approved by the City Council if they aze just, reasonable and
a4 nondiscriminatory within one hundxed eighty (180) days of the filing of said application. Such 180-
45 day period may be extended by mutual agreement of District Energy and the city. If no action is taken
46 by the city council on an application filed by District Energy within one hundred eighty (180) days of
a7 filing, the applicafion is deemed approved. The city and District Energy shall work to assure an
48 orderly, timely and cost efficient process for reviewing the proposed changes. The city shall be
49 required to take into account the need of District Energy for revenue sufficient to enable it to meet the
5o cost of furnishing the service; to provide for the timely and orderly retirement of debt; including those
51 bonds issued for fivancing the initial system; to pay the debt service on such bonds; and to provide for
52 improvements, enlargements and extensions necessary to adequately service the territory of the city,
53 including the principal and interest to become due on obligarions issued therefor. The city shall also
54 be required to take into account the operation of the terms and condi6ons of the Hot Water Delivery
55 Agreement, including Sections 6.7, 73 and 21.2 thereof, which is the uniform contract entered into by
56 District Energy and District Energy customers providing for a detailed method of charges for demand
Q:�Dist. Heat & Cooling Franchises\district heating ord - 12-5-07.doc
Appendix F, District Heating Franchise Agecment, Page A of 7
67'l/�
t and energy related costs. The uniform Hot Water Delivery Agreement shall be filed in the office of
2 the city clerk at the same time as the written acceptance required by Section 13 herein. Amendments
3 to the Hot Water Delivery Agreement shall be filed with the city clerk at least ten (10) days prior to
a the effective date of such an amendment or amendments; provided, however, that no amendments to
i Secrions 6.7, 73 or 21.2 of said agreement shall be effecrive unless and until approved by the city
6 council by resolution. Amendments to other sections of said agreement aze effective without approval
? ten (10) days after filing.
9 (g) At the request of District Energy and in order to assist in determining whether the proposed changes
to in Schedule A shall be approved or denied, the city may require a pubtic hearing befote a hearing
11 examiner who shall be selected by mutual agreement of city and District Energy within ten (10) days
12 of District Energy's request. The hearing exazniner shall hold a heazing as a contested case and make
13 recommendations to the city. Upon receipt of such recommendafions, the city shall by resolution
la approve or deny the proposed changes in Schedule A within 180 days of the filing of District
15 Energy's application. If no such acrion is taken by the ciTy within 180 days of the filing of District
16 Energy's application or thirry (30) days after receipt of the heazing examiner's recommendations,
1� whichever is greater, such proposed changes aze deemed approved.
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t9 (h) Proposed changes to Schedule A can only be approved, approved in part if severable or denied, and
2o cannot be modified or amended. The city may notwithstanding require District Energy to refund or
21 credit to its customers any increases in rates which are in excess of the lawful and reasonable rates as
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fmally determined.
Section 7. City attorney assistance.
For the purpose of assisting the city in the regularions of the activities and rates of District Energy as provided in this
franchise, the ciTy attorney shail appoint an assistant or other attorney to perform the duties that such regularion
necessitates.
Section 8. Regulatory fee.
34 District Energy shall pay the city during the term hereof an annual amount of twenty-nine thousand seven hundred and
35 twenry-five dollars ($29,725.00) payable on October 1 of each year herein, which sum shall be used to pay that part of
36 the annual salary of the individual appointed by the city attorney, his assistant or assistants, clerical help and office
37 expenses, outside accountants, hearing examiner, attorneys, advisors and consultants' fees reasonably related to the
38 regulation of District Energy, its rate schedules, and other matters and operations under this franchise. The amount of
39 such payment or payments shall be ailowed as an operating expense of District Energy in the City of Saint Paul. Such
4o sum shall be increased each year by a dollar amount expressed in percentages equal to the percentage increase in the
al Consumer Price Index (or its successor index) for that yeaz, the increases to be cumulative and based on the amount of
42 such sum plus the previous years' increases.
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Section 9. Public reporting.
District Energy shall file during each month with anp person desi�ated by the city, a report of the number of
customers, sales and revenues by classes of service for the preceding month based upon its utility operations within the
City of Saint Paul.
51 Distaict Energy shall also file with such person as may be designated by the city within three (3 ) months after October
52 1 of each yeaz, a complete detailed statement on forms to be approved by said person, covering the utiliry operafions
53 within the Ciry of Saint Paul for the preceding yeaz, including all revenues, expenses and plant investment, together
54 with such breakdown and analysis of operating statements as the said person may request. The said person designated
55 by the city shall have the right to require addirional informa6on concerning operations under this ordinance from time
56 to tune in such form as may be prescribed by said person.
Q:�Dist. Heat & Cooling Franchises\district heating ord - 12-5-07.doc
Appendix F, Dishict Heating Franchise Ageement Page 5 of 7
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a7-i/DS
2 Any person or persons designated for that purpose by the city shall have the right, at all reasonable times and upon
3 reasonable norice, to examine the books of account, records, vouchers, disbursements, rates, revenues, contracts,
4 purchases, sales and other transactions bearing on and relevant to the rates Disttict Energy chazaes and the service it
s provides to its customers in the City of Saint Paul.
8 Section 10. Notice and publication.
10 Before this ordinance or any amendments thereto shall be finally adopted by the council, a public hearing shall be held
11 upon ten (10) days' published notice in the official newspaper and after said heazing the council may pass this
12 ordinance, revise or amend the same. District Energy shall beaz the costs of publicarion of the &anchise ordinance or
13 any amendments thereto and shall make a sufficient deposit with the city clerk to guarantee publication before the
14 ordinance or amendments are published.
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17 Secfion ll. IndemniTicafion and insurance
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19 District Energy shall defend, indemnify and save the ciTy whole and harmless from any and all damages or claims for
20 injury or damage to persons or properry occasioned by or azising out of the conshuction, maintenance, operation or
zi repair of District Energy's business in the ciry. District Energy shall insure its obligations in this secrion with an insurer
22 authorized to do business in the State of Minnesota in form, coverage and limits approved by the ciTy attorney and the
23 director of the deparlment of finance and management services.
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z6 Secrion 12. Severability.
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28 Every section, provision or part of this ordinance is declazed separate from every other section, provision or part; and
29 if any section, provision or part shall be held invalid, it shall not affect any other section, provision or part.
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32 SecHon 13. Approval, publication and filing.
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3a District Energy shall, within thirry (30) days after the passage, approval and publication of this ordinance or of any
35 amendments thereto, file with the city clerk of said city its written acceptance thereof in form to be approved by the
36 ciTy attorney, and therein shall agree to abide by, keep and petform all the ternts, limitafions, conditions and provisions
37 of this ordinance and any such amendments.
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4o Secfion 14. Nonexclusive franchise.
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This franchise herein granted shall not be exclusive nor irrevocable, but may be terminated and forfeited after nofice
and heazing for any breach or failure by District Energy to comply with the terms, limitations or conditions hereof.
Section 15. Term of franchise.
This franchise is granted for a term and period of twenty (20) yeazs, begimiing on the effecfive date of this ordinance.
Q:�Dis[. Heat & Cooling Franchises\district heating ord - 12-5-07.doc
Appendix F, District Heating Franchise Agreement, Page 6 of 7
� SCHEDULE A Q� �����
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3 RATES: The following rates shall be effective bev�nning with the billing month of October 2007 and shall remain in
a effect until superseded:
6 Single rate:
� Twapart rate:
8 Demand
9 Energy
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$0.0574 per kilowatt-hour
$4.57 per kilowatt per month
$25.15 per megawatt-hour
i 1 SNOWMELT DEMAND RATE: The Snowmelt Demand Rate is 50 percent of the Hot Water Demand Rate per
Iz kilowatt per month.
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la PROMP'T PAYMENT PROVISION: A charge of 5 percent will be added to the net bill computed at the rate
15 shown above, which chazge shall constitute a discount from the gross bill for payment within the discount period, all
is as more specifically provided in the Hot Water Delivery Agreement.
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t8 FUEL ADNSTMENT: As provided in the Hot Water Delivery Agreement, the energy chazge may be appropriately
19 adjusted (i.e., spread over the remaining months in the Fiscal yeaz) from time to time during the fiscal yeaz to cover
2o cost increases (or decreases) occurring subsequent to the establishment of the projected energy-related costs for such
21 period regazding energy purchased by District Energy St. Paul, Inc., to the extent such costs are in excess of (or below)
22 those costs projected by District Energy St. Paul, Inc. in establishing the energy chazge for such period.
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24 SURCHARGE: A CiTy fee surcharge of 8.7 percent will be included in the gross and net monthly bills computed
25 under this rate schedule except as otherwise provided by law.
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27 SERVICE CHARGES: The attached service charges shall be effecrive beginning with the billing month of October
28 2007 and shall remain in effect unril superseded.
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3o Pursuant to Section 8.5 of the Hot Water Delivery Ageement as amended, the following rates aze established for the
31 perforxnance to specific services more properly charged to an individual Customer than to all Customers as a whole.
32 Service charges are payable within 30 days of billing and are in addition to Demand Chazges and Energy Charges.
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Restoration of service after shutoff by District Energy:
Customer demand under 100 kW: $50.00
Customer demand 100 kW or over: $200.00
Damage to District Energy system equipment:
Actual cost of repair of replacement as determined by District Energy plus service charge of $50.00.
Unauthorized drainage of District Energy system water:
The sum of the following:
(a)
(b)
Estimated quantity of water lost times combined water and sewage rate paid by Dishict Energy during
period of drainage;
Estimated heat value of water lost times applicable Energy Rate; and
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52 (c) Service charge of $85.00/hour
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54 Note: Drainage of system water creates an unsafe condition and is cause for suspension of suspension of
55 service until corrected.
Q:�Dist. Heat & Cooling Franchises\distcict heating ord - 12-5-0?.doc
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Appendix F, District Heating Franchise Agreement, Page 7 of 7
6�-//bg
4. Service calls made at Customer's request by District Energy personnel for problems found to be in
Custumer's and not District Energy's equipment:
Behveen 8:00 am. and 330 p.m. on Monday through Friday (excluding holidays observed by District
Energy): $85.00/how
Ali other times: $125.00/hour
Section 3.
This ordinance shall take effect and be in force thirty (30) days following its
passage, approvaland publication.
Yeas Nays Absent
Benanav /
Bostrom �
Harris ,/
Helgen �-
Lantiy �
Montgomezy ,i
Thune �
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Adopted by Council: Date /a"//��o7/�p?
Adopfion Certified by Council Secretary
BY: / ✓ �1`��1� � i srir�
Approv M or: Date �_— / b
Q:�Dist. Heat & Cooling Franchises\district heatmg ord - 12-5-07.doc
PUBLISHED
JAN 21 20U8
By:
Requested by Department oE
By:
Form Approved by City Attorney
By:
Approved by Mayor for Submission to Council
�LiSHE�
JAN 21 TO��
� Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet �
�����8
Departmentlo�celcouncil: Datelnitiated: Green Sllee` NO. �D�tV3�o
F$ — Finencial Services 14NOV-07
Contact Person 8 Phone:
Matt Smith
266-8796
Doc. Type: ORDINANCE
E-Document Required: Y
Document Contact: Rarquel Naylor
Contact Phone: 266-8573
� ueoartmenx aen[iorerson m�
0 maoual Servicet � �
Assign 1 nancial Services De arhnent Airector �
Number Z ' Attome
Por
Routing 3 ounN
O�der 4 i Clerk
5
Total # of Signature Pages ` (Clip All Locations for Signature)
Granting the District Heating Franchise for a period of twenty years ending in 2027.
Planning Commission 1. Has this person/firm ever worked under a contrad for this depadment?
CIB CommiHee Yes No
Civil Service Commission 2. Has this person/firm ever been a ciry employee?
Yes No
3. Does this personlfirm possess a skAl not normally possessed by any
cufrent city employee?
Yes No
Explain all yes answers on separete sheet and attach to green sheet
Initiating Problem, Issues, Opportunity (Who, WhaL When, Where, Why):
Advantages If Approved:
Disadvan W ges If Approved:
Disadvantages If Not Approved:
Transaction:
Funding Source:
Fina�cia l Infortnation:
(Explain)
CosURevenue Budgeted:
ActiviTy Number:
November 14, 2007 11:48 AM Page 1
Council �fl'le# �—��
Green Sheet # ��
ORDINANCE
OF„SAINT PAUL, MINNESOTA
� An ordinance granting the District Heating Franchise, held by the
2 District Energy St. Paul, Inc, for a Period of Twenty Years, Ending in 2027
3
4 THE COUNCIL OF THE CITY OF SAINT PAUL DOES ORDAIN:
7 Section 1.
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4 That the Sa' t Paul Legislative Code be amended by repealing Appendix F,
to
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!2 Section 2.
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74 Thatthe Saint Paul Legt ative Code be amended by adding thereto a new
is Appendix F to read as foll s:
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t8 APPENDTX F. DISTRICT HEATING FRA AISE—DISTRICT ENERGY ST. PAUL, INC.
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z0 Cross reference(s)--General franc6ise requirements, Ch er Chapter 16.
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22 SecCiou 1. Franchise granted.
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2a The District Heating Development Company cVb/a District Energy St. Pa 1, Inc, a nonprofit Minnesota
25 corporaYion, hereinafrer referred to as "District Energy," is hereby granted a anchise Yo use and occupy the
zb streets and othar public properiy within the City of Saint Paul for the purpose f constructing, maintaining and
27 operating a district heating system and fiber optic network for District Energy governmental use by the City
28 of Saint Paul, the State of Minnesota, the County of Ramsey, and by other govem ent entities as may hereafter
z9 be approved by city council resolution. Said franchise may not be sold, transfened, signed, pledged, moftgaged
30 or in any way disposed of or encumbered without the consent of the city 6y ordinance; ny of the foregoing to be
3 i treated as a modification of this franchise; provided, however, that this senYence shall no apply to revenue bonds
32 issued to finance canstruction ar expansion of the disirict heating system.
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35 Section 2. Use of public property. ��
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3� The franchise granted herein shall extend to the consiruction of the district heating system and a fiber tic network
;8 for governmental use by District Energy in the City of Saint Paul. District Energy shall, prior to comme cement of
39 any construcrion or usage of the public streets or other public property within the City of Saint Paul, file ' h the
ao City of Saint Paul a detailed routing map showing the construction of the disttict heating system and Hber o' 'c
4t network. Such franchise to use the streets and other public property located in such city shall include such use _ r the
42 purpose of wnstructing, maintaining and operating a system of pipes, subways and manholes with all other nece ary
a3 appurtenances for carrying on a district heating system and a fiber optic network for use by only the CiTy of Saint
44 Paul, the State of Minnesota and the Counry of Ramsey, and other government entities as may hereafter be approved �
a5 by City Council resolution. Expansion of the district heating system beyo�d that contained in said roufing map shall
46 be govemeci by and in aocordance with the applicable provisions of the HoY Water Delivery Agreement. All of the
a7 foregoing are subject to the provisions of Section 5 hereof.
Appendix F, Disvict Heating Franchise Agreement, Page 2 of b
1 Q f'�f!/ 6
3\ Section 3. Location oS facilities.
5 In cating its district heating facilities, District Energy shall not unreasonably interfere with the safety and
6 conve ence of ordinary travel along and over said streets and public property nor interfere with other uses to which
� such pla s may be put by the City of Saint Paul, and in the event it shall become necessary during the term of this
8 franchise t emove or relocate the physical property of District Energy ]ocated within or upon any of the streets or
9 public prope m the Ciry af Saint Paul, because of such interference or use by the city, or as a result of any public
to improvement un rtaken by the city, District Energy shall, when so advised by the ciry, remove and relocate said
I1 faciliries without c t to Che city, and shall place the sReets or other public property in the same condition as they
�2 were prior to said remaval or relocation. Any relocation or removal of District Energy's facilities made necessary
� 3 because of the extension rough or into the city of a federally aided state trunk highway, included within the
14 National System of Intersta Highways, shall be governed by the provisions of the Minnesota Statutes 1981, Section
35 161.46.
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18 Section 4. City regulations apply.
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2D District E�ergy in the installation, maintena�ce and operation of its facilities shall be subject to such reasonable
21 regulations, not inconsistent with this ardinancye, as may be provided by the city. No pipe or other appurtenance shall
22 hereafter be installed or laid by District Energy n�on the streets and public properry of the ciry, except upon
23 application to the department of public works or ot�er persons designated by the city, and written permission therefor
24 granted by said department or person. ��
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27 Section 5. Franchise fees.
28 �
29 During the term of the franchise hereby granted, District Energy shall pay the city an annual district heating franchise
3o fee in the amount of eight (8) percent of District Energy's annual`gross eamings, except as further provided in this
3 t section. Said payments sha(1 be made in monthly installments.. The,payment shall be due on or before the twenty-
32 fifth calendar day of the month in which payment is made. The payment obligafion shall be met if the payment is
33 mailed and postmarked on or before the due date. "Gross earnings" forYhe purposes of this ordinance, shall mean all
34 sums received or receivable by the company from the sale of hot water ta customers of District Energy and all sums
35 collected by District Energy for routine maintenance or use of the fiber opiic network serving the State of Minnesota,
;e the County of Ramsey, and other government entities as approved by the Cit�, District Cooling St. Paul, Inc. shall
37 nQt be deemed a customer of Qistrict Energy nor sha11 District Energy be deem`&d a customer of District Cooli�g St.
38 Paul, Inc. `a
39 '�,
40 �
at Section 6. Rates and regulation.
42
43 (a) All rates made, demanded or received by District Energy shall be just and reasonable. Rates shall not
a4 be unreasonably preferential, unreasonably prejudicial or discriminatory, but s ali be sufficient,
45 equitable and consistent in application to a class of consumers. Rates shall gener y e sufficient
46 revenue to allow District Energy to recover its reasonable operating costs and expe�ses; to provide
a� for the timely and orderly payment of costs and expenses; to provide for the timely orderly
a8 retirement of debt, including those bonds issued far financing the system; to pay the de - service on
49 such bonds; and m provide for improvements, enlargements and extensions necessary to a equately
5o service the tenitory of the city, including the principal and interest to become d�e on obliga 'ons
51 issued or to be issued therefor. Provided, however:
52 �
53 (1) District Energy customer buildings with demand of one hundred (100) kilowatts or less m�
5a be charged a combined demand/energy rate to 6e cailed the single rate. Said customers
55 eligible for the single rate shall be known as "small customers." The single rate shall be
56 charged according to thermal energy usage as metered or otherwise determined by District
C:\DOCUPvIE—lldenkingnlLOCALS—I\TempVYPgrpwiselFinal l Od5 dis4ict heating ord - Dish�ct Energy Revision.doe
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Appendix F, District Heating Franchise AgFeement, Page 3 of6
� Energy. The single rate shall be computed by dividing twelve (12) monthly installments of
? demand charge per kilowatt by one thousand seven hundred (1,700) and adding that result to
3 the energy chazge per kilowatt hour;
4
5 \ (2) District Energy may enter into agreements with incentive Program customers and small
6 �. customen, the terms of which may vary from material terms ofthe Uniform Hot Water
7 �� Delivery Agreement; and
4 �3) Incentive Program customers' terms may vary for demand charges only to the extent of the
to discount and in all other respects demand charges sha11 be calculated and applied in a
t t \ manner consistent with non-Incentive Program customers.
12 �
13 (b) The rates, together with rules and regulations governing hot water heating service not inconsistent
14 with the Hot Water Delivery Agreement, contained in Schedule "A" attached to this ordinance and
75 incorporat�cl herein by reference, shall remain and continue in force until amended ar changed as
16 provided her�ei.p,
17 �.
i s (c) District Energy sh'a,ll not directly or indirectly charge, demand, collect or receive frpm any consumer
i9 or person a greater okless compensation for any service rendered or to be rendered by it than that
2o prescribed in Schedul�• nor shall any person knowingly receive or accept any service from District
2t Energy for a compensatiAn greater or less than that prescribed in Schedule A_ District Energy shall
22 not, as to rates or service; �ake or grant any unreasonable preference or advantage to any person or
23 subject any person to any un asonable prejudice or disadvantage. Nothing contained in this
24 subsection shall be construed�o impair Yhe tas-exempt staCUS of bonds issued to finance the system.
?5 "Service," as used herein, does rTOt include customer connection charges and practices.
26 �
27 (d) District Energy shall keep and rend`er its books, accounts, papers and records accurately and
28 faithfully in the manner and form prescribed by Yhe city, and shall comply with all directions of the
29 city relating to Yhese books, accounts, �pers and records, including furnishing of such inYottnation
30 or compilations and permitting an audit di the books, accounts, papers and records, as may be
3 � requested by the city. '�«
32 �1,
33 (e) Afrer thirty (30) days' notice to the city, Distr'ict Energy may file in the office of the city clerk a new
34 or amended Schedule A, containing new or amei�ded rates, rules or regulations, together with rules
35 and regulations governing hot water heating service naC inconsistent with tHe Hot Water Dalivery
36 Agreement. Such notice is jwisdictional to a change�n Schedule A and shall include statements of
37 facts, substantiating documents, and exhibits supporting the changes requested, and further shall state
38 the changes proposed to be made in the rates then in force, and the time when the changes wil] go
39 into effect. Such new or amended rates shall be effective and may be charged on the tenth day (or
4o such (ater date that District Energy shall designate on its filrpg) after the filing of the new or
41 amended Schedule A in the office of the city clerk, and shall'continue in effect until approved or
a2 denied by resolution, or until deemed approved, pursuant to th�terms of this ordinance and the
a3 Charter, which Charter requires a public hearing afrer proper noCiye.
A4
45 (� The proposed changes shall be approved by the City Council if the�are just, reasonable and
46 nondiscriminatory within one hundred eighty (] 80) days of the filin of said application. Such 180-
47 day period may be extended by mutual agreement of District Energy a�id the city. If no action is
48 taken by the city council on an application filed by District Energy with�jn one hundred eighty (] 80)
49 days of filing, the application is deemed approved. The city and District �nergy shall work to assure
5o an orderly, timely and cost efftcient process far reviewing the proposed ch�nges. The city shall be
51 required to take into account the need of D9strict Energy for revenue su�ci�nt to enable it to meet
Sz the cost of fumishing the service; to provide for the timely and orderly retirement of debt; including
53 Ynose bonds issued For Snancing the initial system; to pay the debt service on 'svch bonds; and to
5a provide far improvements, enlargements and extensions necessary to adequatelg�service the tenitory
55 of the city, including the principal and interest to become due on obligations issued therefor. The city
56 shall also be required to take into account the operation of the terms and condi�ion� of the Hot Water
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Appendix F, Dis[rict HeatFng Franchise Agreement, Page 4 of 6
] Delivery Agreement, including Sections 6.7, 7.3 and 21.2 thereof, which is the uniform contract
2 entered into by District Energy and District Energy customers providing for a detailed method oF
3 charges for demand and energy related cosu. The uniform Hot Water Delivery Agreement shall be
4 filed in the office of the ciry clerk at the same time as the written acceptance required by Section ] 3
s herein. Amendments to the Hot Water Delivery Agreement shall be filed with the city clerk at least
6 n(10) days prior to the effective date of such an amendment or amendments; provided, however,
7 tha no amendments to Sections 6.�, 73 or 212 of said agreement shall be effective unless and until
8 appro ed by the city council by resolution. Amendments to other sections ofsaid agreement aze
9 effective�,without approval ten (10) days afrer filing.
to �
11 (g) At the request of District Energy and in order to assist in dete�mining whether the proposed changes
�2 in Schedule A�s�iall be approved or denied, the city may require a public hearing before a heazing
t3 examiner who stiall be selected by mutual agreement of ciry and District Energy within ten (10) days
i4 of District Energy's�request. The hearing examiner shall hold a hearing as a contested case and make
� 5 recommendations to t�}ae city. Upon receipt of such recommendations, the city shall by resolution
16 approve or deny the pro�osed changes in Schedule A within ] 80 days of the filing of District
�7 Energy's application. lf no such action is taken by the city within 180 days ofthe filing of District
18 Energy's application or thi (30) days after receipt of the hearing examiner's recommendations,
19 whichever is greater, such pro osed changes are deemed approved.
20
2t (h) Proposed changes to Schedule A n only be approved, approved in part if severable or denied, and
2z cannot be modified or amended. Th city may notwithstanding require District Energy to refund or
23 credit to its customers any increases m ates which are in excess of the lawfu] and reasonable rates as
24 finally determined. `
25 ��
26
2� SecNon 7. City attorney assistance.
zs
29 For the purpose of assisting the city in the regularions of the acriviti' and rates of District Energy as provided in this
30 franchise, Che city attomey shall appoint an assistant or other artorney perform the duties that such regulation
31 �ecessitates. `�
32 ��
33 �`
,�
34 Section 8. Resulatory fee. "*�
35 �
36 District Energy shall pay the city during the term hereof an annual amount of twentj: thousand seven hundred
3� and twenty-five dollars ($29,725.00) payable on October 1 of each year herein, whicki°�sum sball be used to pay that
38 part of the annual salary of the individual appointed by the city attorney, his assistant oi�ssistants, clerical help and
39 office expenses, outside accountants, hearing examiner, attomeys, advisors and wnsultant�' fees reasonably related to
ao the regulation of District Energy, its rate schedules, and other matters and operations under Yhis franchise. The
41 amount of such payment or payments shall be allowed as an operating expense of D'tstrict Sner�gy in the City of Saint
42 Paul. Such sum shall be increased each year by a dollar amount expressed in percentages equal to the percentage
43 increase in the Consumer Price Index (or its successor index) for that year, the increases to be cuci�ulative and based
44 on the amount of such sum plus the previous years' increases.
45
46
47 Section 9. Public reporting.
48
44 District Energy shall file during each month with any person designated by the city, a report of the number of.
5o customers, sales and revenues by classes of service for the preceding month 6ased upon its utility operations within
5� the City of Saint Paul.
52
53 District Bnergy shall also file with such person as may be designated by the city within three (3) monYhs after ,
sa October 1 of each year, a complete detailed statement on forms to be approved by said person, covering the utiliry
ss operations within the City of Saint Paul for the preceding year, including all revenues, expenses and plant
56 investment, together with such breakdown and analysis of operating statements as the said person may request. The
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Appendix F, District Heating Franchise Ageemeni, Page 5 of 6
�
z
3
4
5
6
�
8
9
t0
11
12
13
14
15
Ib
17
18
19
2D
21
22
23
24
25
26
27
28
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30
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aid petson designated by the city shall have the right to require additional informarion conceming operations under
t' ordinance from time to time in such fottn as may be prescribed by said person.
Any rson or persons designated for that purpose by the city shall have the right, at all reasonable rimes and upon
reasona�b�e notice, to examine the books of account, records, vouchers, dishursements, rates, revenues, contracts,
purchases�sales and other transactions 6earing on and relevant to the rates District Energy charges and the service it
provides to'ixs customers in the City of Saint Paul.
Section 10. Notice and publication.
Before this ordinance'ar any amendments thereto shall be finally adopted by the council, a public heating shall be
held upon ten (10} days' pnblished notice in the official newspaper and after said hearing the council may pass this
ordinance, revise or amenfithe same. District Energy shall bear the costs of publication of the franchise ordinance or
any amendments thereto and��all� make a sufficient deposit with the city clerk to guarantee publication before the
ordinance or amendments are n�4lished.
Seation 11, tudemnificafion and
District Energy shall defend, indemnify an'tl.�save the city whole and harmless from any and all damages or claims for
injury or damage to persons or property occast�oned by or arising out of the consriuction, maintenance, operation or
repair of District Energy's business in the ciry. l�dstrict Energy shall insure its obligations in this section with an
insurer authorized to do business in the State of N�ilnnesota in form, coverage and limits approved by the city attorney
and the director of tbe deparhnent of finance and mat�,agement services.
Sectiou 12. Severability.
Every section, provision or part of this ordinance is declared sep
if any section, provision or part shall 6e held invalid, it shall not
Section 13. Approval, publicatio� and filing.
from every other section, provision or par[; and
t any other section, provision or part.
District Energy shall, within thirty (30) days after the passage, approval and pubbication of this ordinance or of any
amendments thereto, &le with the ciry clerk of said city its wriYCen acceptanca therepf in form ta be approved by the
city attorney, and therein shall agree to abide by, keep and perform all the terms, limuations, conditions and
provisions of this ordinance and any such amendments. `�
Section 14. Nonexclusive franchise.
This franchise herein granfed shall not be exclusive nor irrevocable, but may be terminated and�fprfeited after notice
and hearing for any breach or failure by District Energy to comply wit6 the terms, limitations or oanditions hereof.
Section 75. Term of franchise.
This franchise is granted for a term and period of twenty (20} yeaTS, beginning on the effective date of thi:
Section 3.
This oxdinance shall take effect and be in force thirry (30) days following its
passage, approval and publication.
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Appendix F, Disvict Heating Franchise Agreement, Page 6 of 6
,�
�
Yeas Nays Absen[
Benanav
Bostrom
Harris
Helgen
Lantry
Montgomery
Thune
Adopted by Co�ncii: Date
Adoption Certified by Council Secretary
By:
Approved by Mayor: Date
By:
Requested by Depa�i of:
�'v�a� �v��S
�
Sq;
�
Form A�roved by City Attorney
�
\
.
QIDOCUME-1\denkingnU.00ALS-P,Temp\XPgrpwise\Final 10-]5 district heating o�d - District Energy Revision.doc
: ���
r�.,
DISTRICT
ENERGY
ST. PAUL
e�-1/dS
� �FcFi�,�.�
Ci�,� � 2 00�
Fq�
August 29, 2007
Honorable Christopher B. Coleman
Mayor, City of Saint Paul
390 City Hail
15 West Kellogg Boulevard
Saint Paul, MN 551Q2
NEW FRANCHISE APPLICATION
Re: Franchise Applicarion for District Heating Development Company, doing
business as Distact Energy St. Paul, Inc.
Appendix F
Ordinance No. 16947, adopted July 20, 1982; and Ordinance No. 16962, adopted
October 5, 1982 (the "Franchise")
Deaz Mayor Coleman:
Tkris letter will serve as a formal applicafion to the City of Saint Paul consistent with the
provisions of the Saint Paul Charter to issue a 20-yeat Franchise to District Heating
Development Company, now doing busittess as District Energy St. Paul, Inc. (hereafter
"District Energy"). The current District Heating Franchise is located in Appendix F,
derived from Ordinance No. 16947, adopted July 20, 1982; and Ordinance No. 16962,
adopted October 5, 1982 (the "Franchise"}.
The Application far a new District Energy Franchise 25 years after the initial Franchise is
a great tribute to the vision of the City of Saint Pau1, tke District Energy customers and
all those who have supported ttus energy efficient, stable customer charges,
environmentally beneficial undeztaking. District Energy is widely recognized as the best
district energy system in America. We are grateful that the City of Saint Paul has been
generous in its recognition and applause for our successes.
The District Energy Franchise Application includes a proposed Franchise and its
Schedule A that is attached hereto and noted as Attachment A. The Franchise would
commence on January 1, 2008 attd ternunate 20 years later, Decembet 31, 202'J. The
modi5cations from the existing Franchise are noted in the mazked version to the existing
ians O. Nyman
2nergy Center �
'6 Keilogg Bivd. W. .
St Paul, MN 55102-96'It
's! �1297.8955
ax 651221.0353
iw�ni.di5[rictensrgy.com
Honorable Christopher B. Coleman
Mayor, City of Saint Paul
August 29, 2007
Page 2
07 �iiD$
Appendix F identifying each proposed change, attached hereto and noted as Attachment
B. Piease note that the changes, other than term, are min;mal and editorial in nature.
Specifically, the changes from the e�sting Franchise aze:
Conform nonprofit name throughout.
Section 5 Conform to adopted provisions of the City approved existing
District Cooling Francluse provisions.
Secfion 6(e) Designed to meet the City and Company goals to expedite the
filing process.
Section 6( fl The addition conforms to pracrices and procedures adopted under
the existing District Cooling Franchise provisions.
The deleted provision relates to City approval of certain provisions
of the Customer Coniract. All contract amendments must be
approved by the customers. The deleted provision was designed to
address the eazly operating years and is inconsistent with the
existing practices and procedures.
Section 8 Update of the payment from 1992 to 2008.
Section 13 Deleted language conforms to the �isting City and District Energy
practice.
The City and District Energy have worked together successfully for 25 yeazs under the
existing negotiated Franchise. Our mutual experience and other City formal negotiations
strongly indicates that an expedited process for considera6on of a new Franchise is in the
best interest of the City and District Energy. Accordingly, we have held informal
discussions to establish a reasonable time frame, regulatory and administration
evaluations that address this mutual goal.
District Energy respectfully requests that in view o£ the minimal changes proposed to the
existing Franchise the following procedure would prove prodnctive and economical for
the City, District Energy and its customers:
September 5, 2007 An introduction of the Ordinance consistent with the
proposed 2008 Franciuse attached hereto.
Honorable Christopher B. Coleman
Mayor, City of Saint Paul
August 29, 2007
Page 3
2.
�
5.
�
D��Il�B
i3ovember 7, 2007 The City Council would receive a written report from fl�e
City Administration and other interested parties.
On or before
November 14, 2007 District Energy will respond to the written comments.
November 21, 2007
November 28, 2007
December 5, 2007
The Public Hearing on the Ordinance.
Adoption of the Ordir�ance.
Publication of the Ordinance.
Adopting such a schedule will would enable the Franchise to be adopted by the City in
2007 and be effective as of January 1, 2008.
We respectfutly submit that following the schedule above will assure that all of the
interested parties will have an ample opporiwuty to be heazd and the Ordinance and its
minor modifications wiil be timely adopted.
We think the City can be justifiably proud of the stable Disirict Energy rates. Demand
Rates are, for the most part, under the control of the management team at District Energy.
Energy rates, of course, are subject to volatility of the energy markets.
The FY 200$ District Energy Schedule A previously delivered to the City Clerk in July
2007 is consistent with Schedule A to the proposed Franchise. The Demand Rate is
increasing for the first time in eleven years and is 5.1% above the present rate; an average
annual increase of 0.5% per year. From FY 1993 through tlus Schedule A filing, flxe
average annual Demand Rate increase has averaged 0.6% per yeaz while the CPI has
averaged 2.6%.
This Demand Rate record is a remarkable achievement that reflects cazeful a.dmiiustration
of costs within the control of District Energy management.
The request for a timely and efficient Franchise adoption process is designed to recogttize
the long, successful relationship between the City of Saint Paul and District Energy. The
numerous and extensive finan�ial information periodically provided to the City
concernirtg the operarion oFtlus company also facilitaYes this process. In addition, the
City annually receives a certified independent audit of the expenditures of this company.
07�11a�
Honorable Christopher B. Coleman
Mayor, City of Saint Paul
August 29, 2007
Page 4
We are very hopeful the Caty wiii adopt a schedule that will idenfify any concems from
the administration and timely and efficiently address and resolve these concems.
V ery truly your ,
/��� l�
Anders J. Rydak
President
Ca City Clerk
Members of the City Council
Honorable President, Kathy Lantry
Honorable Deborah Montgomery
Honorable Dave Thune
Honorable Pat Harris
Honorable Jay Benanav
Honorable Lae Heigen
Honorable Dan Bostrom
John Choi, City Attorney
Matt Smith, Director, Office of Financial Services
William M. Mahlum, Executive Vice President and General Counsel
aTrac�Nr a ��-I/48
Appendix F. District Heating Franchise--District Energy
St. Paul, Inc.
Section 1.
The District Heating Development Company d/b/a District Energy St. Paul, Inc., a nonprofit
Minnesota corporation, hereinafrer referred to as "District Energy," is hereby granted a franchise Co
use the streets and other public property within the City of Saint Paul for the purpose of
constructing and operating a district heating sy5tem and fiber optic network for government use
within said city. Said franchise may not be sold, transferred, assigned, pledged, mortgaged or in
any way disposed of or encumbered without the consent of the city by ordinance, any of the
forego(ng to be treated as a modification of this franchise; provided, however, that this sentence
shatl not apply to revenue bonds issued to finance construction or expansion oY the distrid heating
system.
Section 2.
The franchise granted herein shall extend to the construction of the district heating system and a
fiber optic network for government use by District Energy in the City of Saint Paul. District Energy
shall, prior to commencemenC of any construction or usage of the public streets or other pubiic
property within the City of Saint Paul, file with the City of Saint Paul a detailed routing map
showing the construction of the district heating system and fiber optic network. Such franchise to
use the streets and other public property located in such city shall include such use for the purpose
of constructing, maintaining and operating a system of pipes, subways and manholes with all other
necessary appurtenances for carrying on a district heating system and a fiber optic network for use
by only the City of Sai�t Paul, the State of Minnesota and the County of Ramsey, and other
govemment entities as may hereafter be approved by City Council resolution. Expansio� of the
district heating system beyond that contained in said routing map shal! be governed by and in
accordance with the applicable provisions of the Hot Water Delivery Agreement. All of the toregoin9
are s�bject to the provisions o( Section 5 hereof,
Section 3.
In locating its district heating facilities, District Energy shall not unreasonably interfere with the
safety and convenience of ordinary travel along and over said streets and public property nor
interfere with other uses to which such places may be put by the City of Saint Paul, and in the
event it shall beCOme necessary during the term of this franchise to remove or relocate the physical
property of District Energy located within or upon any of the streets or public properry in the City of
Saint Paul, because of such interference or use hy the city, or as a result of any puhlic
improvement undertaken by the city, District Ener9y shall, when so advised by the city, remove
and relocate said faciGties without cost to the city, and shall place the streets or oYher public
property in the same condition as they were prior to said removal or relocation. Any relocation or
removal of District Energy's facifities made necessary because of the extension through or into the
city of a federally aided state trunk highway, included within the National System of Interstate
Highways, shaif be governed by the provisions of the Minnesota Statutes 1981, Section 161.46.
Section 4.
District Energy in the installation, maintenance and operation of its facilities shall be subject to
such reasonable regulations, not (nconsistent with this ordinance, as may be provided by the city.
No pipe or other appurtenance shall hereafter be installed or Iaid by District Energy upon the
streets and pubtic property of the city, except upon applicaGon to the department of public works
or other persons designated by the city, and written permission therefor granted by said
department or person.
Section 5.
During the term of the franchise hereby granted, District Energy shall pay the city an annual
district heating fraochise fee in the amount of eight (8) percent of District Energy's annual gross
earnings, except as further provided in this section. Said payments shall be made in monthly
installments.. The payment shall be due on or before the twenty-fifth calendar day of the month in
which payment is made. The payment obligation shall be met if the payment is mailed and
postmarked on or before the due date. "Gross earnings" for the purposes of this ordinance, shall
mean all sums received or receivable by the company from the sale of hot water to customers of
District Energy and all sums collected by District Energy for routine maintenance or use of the fiber
optic network serving the State of Minnesota, the County of Ramsey, and other government
entities as approved 6y the City. District Cooling St. Paul, Inc. shall not be deemed a customer of
District Energy nor shall District Energy be deemed a customer of District Cooling St. Paul, Inc.
ATTACHMENT A � _"��J
Sectio� 6.
(a) All rates made, demanded or received by District Energy shall be just and reasonable. Rates
shail not be unreasonably preferential, unreasonably prejudicial or discriminatory, but shall be
sufficient, equitabie and consistent in application to a class of consumers. Rates sfiall generate
sufficient revenue to allow District Energy to recover its reasonable operating costs and expenses;
to provide for the timely and orderly payment of costs and expenses; to provide for the timely and
order{y retirement of debt, including those bonds issued for financing the system; to pay the debt
service on such bonds; and to provide for improvements, enlargements and extensio�s necessary
to adequately service the territory of the city, including the principal and interest to become due on
obligations issued or to be issued therefor. Provided, however:
(1) The Incentive Rate Program dated June 19, 1987, on file with the city clerk shall be
implemented and incentive rates charged to DHDC customers will not be in violation of or be
deemed inconslstent with the terms and provisions of thls section or any other sec[ion of this
franchise;
(2) District Ener9y customer buildings with demand of one hundred (S00) kilowatts or less may be
charged a combined demand/energy rate to be called the single rate. Said customers eligible for
the single rate shal{ be known as "smal{ customers." The sing{e rate shall be charged according to
thermal energy usage as metered or othenvise determined by District Energy. The single rate shall
be computed by dividing twelve (12) monthly installments of demand charge per kilowatt by one
thousand seven hundred (1,700) and addin9 that result to the energy charge per kilowatt hour;
(3) District Energy may enter into agreements with Incentive Program customers and small
customers, the terms of which may vary from material terms of the Uniform Hot Water Delivery
Agreement; and
(4) Incentive Program customers' terms may vary for demand charges only to the extent of the
discount and in all other respects demand charges shall be caiculated and applied in a manner
consistent with non-Incentive Program customers.
(b) The rates, together with rules and regufations governing hot water fieating service not
inconsistent with the Hot Water Delivery Agreement, contained in Schedule "A" attached to this
ordinance and incorporated herein by reference, shall remain and continue in force until amended
or changed as provided herein.
(c) District Energy shall not directly or indirectly charge, demand, collect or receive from any
consumer or person a greater or less compensation for any service rendered or to be rendered by it
than that prescribed in Schedule A; nor shall any person knowingly receive or accept any service
from District Energy for a compensation greater or less than that prescribed in Schedule A. District
Energy shall not as to rates or service, make or grant any unreasonable preference or advantage
to any person or subject any person to any unreasonable prejudice or disadvantage. Nothing
contained in this subsection shaft be construed to impair the tax-exempt sYatus of bonds issued to
finance the system. "Service," as used herein, does not include customer connection charges and
practices.
(d) DistricY Energy shaff keep and render its books, accounts, papers and records accurately and
faithfully in the manner and form prescribed by the city, and shall comply with all directions of the
city relating to these books, accounts, papers and records, including furnishing of such information
or compilations and permitting an audit of the books, accounts, papers and records, as may be
requested by the city.
(e) After thirty (30) days' notice to the city, District Energy may file in the office of the city derk a
new or amended Schedule A, containing new or amended rates, rules or regulations, together with
rules a�d regulations governing hot water heating senrice not inconsistent with the Hot Water
Delivery Agreement. Such notice is jurisdictional to a change in Schedule A and shall include
statements of facts, substantiating documents, and exhibits supporting the changes requested, and
further shal( state the changes proposed to be made in the rates then in force, and the time when
the changes will go into effect. Such new or amended rates shall be effective and may be charged
on the tenth day (or such later date that District Energy shall designate on its filing) after the filing
of the new or amended Schedule A in the office of the city clerk, and shall continue in effect until
approved or denied by resolution, or until deemed approved, pursuant to the terms of this
ordinance and the Charter, which Charter requires a public hearing after proper notice.
(� The proposed changes sfiaff be approved if they are just, reasonable and nondiscrimfnatory
within one hundred eighty (180) days of the filing of said application. Such 180-day period may be
extended by mutual agreement of District Energy and the city. If no action is taken by the city
councif on an application filed by District Cooling within one hundred eighty (180) days of filing, the
application is deemed approved. The city and District Energy shall work to assure an orderly, timely
az-rac�Nr a a? -//�}g
and cost e�cient process for reviewing the proposed changes. The city shail be required to take
into account the need of District Energy for revenue sufficient to enable ft to meet the cost of
furnishing the service; to provide for the timely and orderly retirement of debt; including those
bonds issued for financing the initial system; to pay the debt service on such bonds; and to provide
for improvements, enfargements and extensions necessary to adequately service the territory of
the city, i�cluding the principal and interest to become due on obiigations issued therefor. The city
shall also be required to take into account the operation of the terms and conditions of the Hot
Water Delivery Agreement, including Sections 6.7, 7.3 a�d 21.2 thereof, which is the uniform
contract entered into by Distrid Energy and Distric[ Energy customers providin9 for a detailed
method of charges far demand and energy related costs. The uniform Hot Water Delivery
Agreement shall be filed in the office of the city clerk at the same time as the written acceptance
required 6y Section 13 herein. Amendments to the Hot Water Defivery A9reement shall be filed
with the city clerk at least ten (SO) days prior to the effective date of such an amendment or
amendments. Amendments of said agreement are effective without approval ten (10) days after
filing.
(g) At the request of District Energy and in order to assist in determining whether the proposed
changes in Schedule A shall be approved or denied, the city may require a public hearing before a
hearing examiner who shall be selected by mutual agreement of city and District Energy within ten
(SO) days of District Energy`s request. The hearing examiner shali hold a hearing as a contested
case and make recommendations to the city. Upon receipt of such recommendations, the city shall
by resolution approve or deny the proposed changes in Schedule A. If no such action is taken by
the city within thirty (30) days after receipt of the hearing examiner's recommendations, such
proposed changes are deemed approved.
(h) Proposed changes to Schedule A can only be approved, approved in part if severable or denied,
and cannot be modified or amended. The city may notwithstanding require District Energy to
rePund or credit to its customers any Increases in rates which are in excess of the lawfuf and
reasonable rates as finally determi�ed.
Section 7.
For the purpose of assisting the city in the regutations of the activities and rates of District Energy
as provided in this franchise, the city attorney shall appoint an assistant or other atCOrney to
perform the duties that such regulation necess�tates.
Section 8.
District Energy shall pay the city during the term hereof an annual amount of twenty-nine thousand
seven hundred and twenty-five dollars ($29,725.00) payable on October 1 of each year herein,
which sum shall be used to pay that parY of the annuaf salary of the individual appointed by the city
attorney, his assistant or assistants, clerical help and office expenses, outside accountants, hearing
examiner, attorneys, advisors and consultants' fees reasonably related to the regulation of District
Energy, its rate schedules, and other matters and operations under this franchise. The amount of
such payment or paYments shall be allowed as an operating expense of District Energy in the City
of Saint Paul. Such sum shall be increased each year by a dollar amount expressed in percentages
equal to the percentage increase in the Consumer Price Index (or its successor index) for that year,
the increases to be cumulative and based on the amount of such sum plus the previous years'
increases.
Section 9.
District Energy shalf file during each month with any person designated by the city, a report of the
number of customers, sales and revenues by ctasses of service for the preceding month based
upon its utility operations within Che City of Saint Paul.
District Energy shall also file with such person as may be designated by the city within three (3)
months after Odober 1 of each year, a complete detailed statement on forms to be approved by
said person, covering the utility operations within the City of Saint Paul for the preceding year,
including all revenues, expenses and plant investment, together with such breakdown and analysis
of operati�g statements as the said person may request. The said person designa[ed by the city
shall have the right to require additional informatfon concerning operations under this ordinance
from time to time in such form as may be prescribed by said person.
Any person or persons designated for that purpose by the city shall have the right, at all
reasonabfe times and upon reasonable notice, to examine the books of account, records, vouchers,
disbursemenYS, rates, revenues, contracts, purchases, sales and other transactions bearing on and
relevant to the rates District Energy charges and the service it provides to its customers in the City
of Saint Paul.
Section 10.
aTrAC�,z.rr A D � ����g
Before this ordinance or any amendments thereto shall be finally adopted by the council, a public
hearing shall be held upon Yen (10) days' published notice in the o�cial newspaper and after said
hearing the council may pass this ordinance, revise or amend the same. District Energy shalf bear
the costs of publication of the franchise ordinance or any amendments thereto and shall make a
su�cient deposit with the city clerk to guarantee publication before the ordinance or amendments
are published.
Section 11.
District Energy shall defend, indemnify and save the city whole and harmless from any and all
damages or clafms for injury or damage to persons or property occasioned by or arising out of the
construction, maintenance, operation or repair of District Energy's business in the city. District
Energy shall insure its obligations in this section with an insurer authoriaed to do business in the
State of Minnesota in form, coverage and limits approved by the dty attorney and the director of
the department of finance and management services.
Section 12.
Every section, provision or part of this ordinance is declared separate from every other section,
provision or part; and if any section, provision or part shall be held invalid, it shall not affect any
other section, provision or part.
Section 13.
District Energy shall, within thirty (30) days after the passage, approval and publication of this
ordinance or of any amendments thereto, file with the city clerk of said city its written acceptance
thereof in form to be approved by the city attorney, and therein shall agree to abide by, keep and
perform all the terms, limitations, conditions and provisions of this ordinance and any such
amendments.
Section 14.
This franchise herein granted shall not be exclusive nor irrevocable, but may be terminated and
forfeited after notice and hearing for any breach or failure by District Energy to comply with the
terms, limitations or conditions hereof.
Section 15.
This franchise shall be in full force and effect for a term and period of twenty (20) years, beginning
on the effective date of this ordinance.
D7�//D�
SCHEDULE A
to
FRANCHfSE
granted to
District Heating Development Co. d.b.a.
DISTRICT ENERGY ST. PAUL, WC.
by the
CITY OF SA1NT PAUL
RATES: 7he following rates shall be efEective beginning with the billing month of October 2007
and shall remain in effect until superseded:
Single rate:
Two-part rate:
Demand
Energy
$0.0574 per kilowatt-hour
$4.57 per kilowatt per month
$25.15 per megawatt-hour
SNOWMELT DEMAND RATE: The Snowmelt Demand Rate is 50 percent of the Hot Water
Demand Rate per kilowatt per month.
PROMP7 PAYMENT PROVISION: A charge of 5 percent wiil be added to the net biil
computed at the rate shown above, which charge shall constitute a discount from the gross bill
for payment within the discount period, all as more specificaliy provided in the Hot Water
Delivery Agreement.
FUEL ADJUSTMENT: As provided in the kiot Water Delivery Agreement, the energy charge
may be appropriately adjusted (i.e., spread over the remaining months in the fiscal year) trom
time to time during the fiscal year to cover cost increases (or decreases) occurring subsequent
to the establishment of projected energy-related costs for such period regarding energy
purchased by District Energy St. Paul, Inc., to the extent such costs are in excess of (or below)
those costs projected by District Energy St. Paul, Inc. in establishing the energy charge for such
period.
SURCHARGE: A City fee surcharge of 8.7 percent wifl be included in the gross and net
monthly biils computed under this rate schedule except as otherwise provided by law.
SERVICE GHARGES: The attached service charges shall be effective beg+nning with the
bitling month of October 2007 and shail remain in effect until superseded.
0� /!/��
Schedule A
Attachment 1
DISTRICT ENERGY ST. PAUL, INC.
Service Charges Effective October 2007
Pursuant to Section 8.5 of the Hot Water Delivery Agreement as amended, the following rates
are established for performance of specific services more properly charged to an individual
Customer than to all Customers as a whole. Service charges are payabie within 30 days of
bilfing and are in addition to Demand Charges and Energy Charges.
Restoration of service after shutoff by District Energy:
Customer demand under 100 kW: $50.00
Customer demand 100 kW or over: $200.00
2. Damage to District Energy system equipment:
Actual cost of repair or replacement as determined by District Energy plus service
charge of $50.00.
3. Unauthorized drainage of District Energy system water:
The sum of the following:
{a) Estimated quantity of water fost times combined water and sewage rate paid by
District Energy during period of drainage;
(b) Estimated heat value o4 water lost times applicable Energy Rate; and
(c) Service charge of $85.00/hour.
Note: Drainage of system water creates an unsafe condition and is cause for
suspension of service untii corrected.
4. Service calis made at Customer's request by District Energy personnel for
problems found to be in Customer's and not District Energy's equipment:
Between 8:00 a.m. and 3:30 p.m. on Monday through Friday (excluding holidays
observed by District Energy): $85.00(hour
All other times: $125.00/hour
ATTACHIvtENT B
Appendix F. District Heating Franchise--District ner
St. PauL Inc.
• Seclion 1.
The District Heating Development Companv dlbfa Distr ct Ene gy St Paul Inc _a_nonproFt
M7�nesoW mrporation, hereinafter referred to a5 lJistnct Energy," is_herebygrantgd a franchise to
u5e the 5treets and other public property within the City of Saint Paul for the purpose of
construding and operating a district heating sys[em and fiber optit network for government use
within said city. Safd franthise may mt be sold, transferred, assigned, pledged, mortgaged or in
any way disposed oF or encumbered w(thout the tonsent of the city by ordinance, any of the
foregoing to be treated as a modification of this franchise; provfded, however, that Mis sentence
shall not apply to revenue bonds issued to finance construction or ezpansion of the district heating
system.
$eetion 2. . - - - - - _ - -
The frartchise granted herein shall extend to the construction of the district heating system and a
fiber optic network for government use byAistria Enerqk ig the_City of Saint Paul. Aistrict Enerqy
shall, prior to comme�cement af any construction or usage of the pubiit s[reets or other pubtic
proqerty within the City of Saint Paul, file with the City of Sai�t Paul a detailed routlng map
showing the construcYion of the distrid heating system and f�ber optic network. Such fran[hise to
u5e the 5[reets and other public property located in such tity shall include such use for the purpose
of tonstructing, maintaining and operating a system of pipes, subways and manholes wi[h all other
netessary appurtenances for carrying on a district heating system and a fiber optic network for use
by only the City of Saint Paul, the State of Minnesota and the County of Ramsey, a�d other
government entities as may hereafter be approved by City Coun[il resolution. F�cpansion of the
district heating system beyond that contained in said routing map shall be governed by and in
accordance with the appliwble provision5 of the Hot Water Delivery Agreement. All of the forego+n9
are subject to the provisions of Set[ion 5 hereof.
$ectio_n_3. _ . .
_ __ _ _ _ _ __ _. _____
In locating its distritt heating facilities, A�s[n�nerov shall not unreasonably_ mterfere with the
safety and conveniente of ordinary travel along and over said streets and publit properYy nor
intertere with other uses to which suth pfaces may be put by the City of Saint Paul, and in the
event it shall betome necessary during the term of this franthise tA remove or relocate the physical
properiy ofA�strict Energy located within or upon any of the streets or pubfic property in the City of
Saint Paul, betause of such interference or use by the city, or as a result of any publit
improvement undertaken by the city, pistrict Enerqv shall when so advised by the city, remoye
and relocate said facihties without cost to the city, and shali place the stree[5 or other public
properly in the same mndition as they were pnor to said removai or relocation. Any rebcation or
removal of.Distric[ Energk� facilities made necessary because of the exten5ion through or mto the
dty of a federally aided state trunk�highway, induded within the National System of Interstate
Highways, shall be governed by the provisions of the Minnesota Statutes 1981, Section 161.46.
Sedion 4.
Aistnct Energv in the installation, maintenance and_operation of its facilities shalt be subject to
such reasonable regulations, not inconsis[ent with this ordinance, as may be provided by the city.
No pipe or ot0er appurtenance shall hereaRer be installetl or laid byAistnct Enerav_uppn [he_ _
streets and public property of the city, ex[ept upo� appfication to the department of pubiic works
or other persons designated hy the city, and written permission therefor granted 6y said
department or person.
Section 5.
,DUring the term of the_franchise hereby granted„pistrict Energy shali p@y the tity_ an apnual
district heating fianchise fee in the amount of eight (8) percent ofAistrict Eneroy's annua_I gtoss
eamings, except as further provided in this section. Said payment5 5hall be made in morRhfy
installment� The payment_shall be due on or before the twenty_-ffth ralendar day of the month in
wh�ch paymenY is made. The payment obligation shall be mef if fhe payment is maifed and
postmarked on or before the due date. "Gross earnings" for the purposes of this ordinance, shall
mean all sums rece�ved or receivabie 6y the comparty from the sale of hot water to customers of
is nct Energy_ and all sums coliected by j>istrict Energy for routine, maintenance or use of the fber
optic network serving the State of Minnesota, the County of Ramsey, and other government
entities as apDroved bv the CiN._ D«Tricc CQObnu SC. PauL Jnc.. shaN_not be deemed a customer of
�-�iaS
I DeleCed: Heating Development .
I Company*
� Dete�tl: -�..---_.a�.m.°,_.^_-°
; *EdiYOr's note--Appendix F antl
� Schetlule A immediately
I ioiiowmg Said appendix are
i derived from Ord. No. 16947,
� adoptetl July 20, 1982; and Ord.
� No. 16962, adopted Oct. 5,
i i9sz9
� Cross reference(s)--6eneral
I franch�se requirements, Title
� XXX.9
' Deleted: ,
Deleted: DNDC
Dele[etl: (C.F. No. 03-484, 743-
03)¶
Deletetl: DHDC
� Deleted: DHDC �
Deleted: (C.F. No. 03-484, 7-23-
03)9
� Deieted: DHDC �
Deletad: DHDC
Deleted: DHDC
Deleted: �HDC`s �
DefMed: DHDC
DeleteA: DHDC
Deleted: (a)
� Deleted: DHDC
Deletetl: DHfICs I
Deleted: , after the accumulation
of the amou�[s required by
subseCcion (b)herein. Sa�tl
paymen[, when made, shall be
exght (8) percent of the gross
earmn9s of DHDC for that month
which is in the thirteenth month
precedmg the month in which
payment is made, it being the
intention of subsec[ion (b) and of
this subsecGOn [hat the franchise
Fees for the most-retent twelve-
month period be accumulated
thereUntler m the Franchise Fees
Account.
Deletetl: DHDC
ATTACI�NT B
• Section �a.
(a) Aif rates made, demanded or receivetl byA"strid Enerav sfial{ be }ust and reasonable. Rates
shall not be unreasonably preferentiai, unreasonabty prejudicial or discriminatory, but shalf be
sufficient, equitable and consistent in applitation to a cfass of cansumers. Rates shall generate
sufficient revenue to allowp�strict Energy to recover its reasonable ope2ting costs a_nd expenses;
to provide for the timely and orderly payment of costs and expenses; to provide for the timely and
orderly retirement of tlebt, inclutling those bonds issued for financing the system; to pay the debt
service on such bonds; and to provide for improvements, enlargements and e�ctensions necessary
to adequately service the terrltory of the city, including the principal and interest to become due on
obligations issued or to be issued therefor. Provided, however:
{1) The Incentive Rate Progcam dated June 19, 1987, on file with the city clerk shatl 6e
imp{emented and incentive tates charged Fo DHDC customers will not be in violation oF or be
deemed intonsistent wi[h the terms and provisions of This section or any other section of this
franchise;
(2) Pistrtd Ene� cus[omer build_ings with demand of one hundred (100)_k0owatt5 or fess may be
charged a combined dema�d%energy 2te to be wlled the single rate. Said customers eligibie for
the single rate shall be known as "small customersl' The single rete shall be tharged aCwrding to
thermal energy usa9e as metered or otherwise determined byDistrict Energ� The single rate shali
be computed by dividing twelve (12) monthry instaliments of demand tharge per kilowatt by one
thousand seven hundred (1,700) and adding that result to the energy charge per kilowatt hour;
(3) �listri Enegy may enter into agreemen� wi� incentiye Program_customers and small _.
customers, the Cerms of which may vary from material Yerms of the Uniform Hot Water Oelivery
Agreement; and
(4) Incentive Program customers' tertns may vary for demand charges onry to the extent of the
discount and 7n all other respects tlemand charges sha11 be calcula[ed and appiied in a manner
consistent with non-Incentive Pro9ram tus[omers.
(b) The rates, together with rules and regulations governing hot water heating service not
intonsistent with the Hot Water Delivery Agreement, contained in Schedule "A" attached to thi5
ordinance and incorporated herein by reference, shall remain and continue in force until amended
or changed as provided herein.
(c) �7istnct Enerov shafl not directly_or indirectly charge, de_mand, colfecf g from @ny_ __.
consumer or person a qreater or less compensation for any service rendered or to be rendered by R
than that prescribed in Schedule A; nor shail any person knowingry receive or azcept any service
fromAistnct Enerov for a compensat_ioqgreater_or fess than thatprescribed in Schedule A., istrict
ner shall not, as to ra[es or service, make or grant any unreasonable preference or advantage
to any person or subjett any person to any u�reasonable prejudice or disadvantage. Nothing
contained in this subse[tion shall be construed to impair the tax-exempt status of bonds issued to
finance the system. "Service," as used herein, does noY include customer connection charges and
practices.
(d),pJstnct Eneroy shall keep and_render its 600ks, accounts,_ papers and records accurately and _
Faithfupy in [he manner and form prescnhed hy the city, and shall mmply with all directions of the
city relating to these books, accounts, papers and recortls, including furn�shing of such information
or Compilations and permitting an audif of the books, aCCOUnfS, papers and records, as may be
requested by the city.
(e) AfferShtrtv BOl day5' notice to the Gity„Distrid Enerov may Fde in the offite of the city Clerk a
new or amendetl Schedule A, containing new or amended ra[es, rules or regufations, togeiher with
rules and regulations goveming hot water heating service not inconsistent with the Hot Water
Delivery Agreement. Such notice is juristlictional to a chan9e in Schedule A and shall include
statements of facts, substantiating dotumenYS, and exhibits supporting the changes requested, and
further shall state the changes proposed to be made in the rates then in force, and the time when
the changes will go into effect. Such new or amended rates shall be effective and may be charged
on the tenth day (or such later date thatAistnct Enerov shall designate on its _filiqg) after_the filing
of the new oc ameoded Schedule A in Che o�ce of the city Uerk, and shall co�tinue in effect untit
approved or denied by resolution, or until deemed approved, pursuant to the terms of this
ordinance and the Charter, which Charter requires a public hearing after proper nohce.
(� "fhe proposed change5 shall be approved if they are just, reasonable antl nondiscriminator� _
p7-(!08
Deleted: (b) Such franchise fee
shall be aaumulated by DH�C in
an account held and maintained
by DHDC (the "Franchise Fees
ACCOUnT"). Said acamUlation
shall be in an amount at least
equal to the franchise fees for
the preceding twelve (12)
months' period (such
accumulated amount to be called
the "Franchise Fee
RequiremenY') for so long as
bonds issued by the HRA for
financing the distriR heating
system remain outstandin9.¶
(c) DHDC is exempt from the
franchise fee antl is specifically
relievetl of the payment the�eof
�n any month in which there are
insuffinent funds in the Revenue
Account esCablished by those
certam loan a9reements behveen
the HRA and DHDC, and dty antl
DHDC (the "loan agreements")
to make the payments required
by the loan agreements or t0 pay
the debt service (as the term
"debt service" is further defined
m the loan a9reements for tbe
purposes of, and as it may
DeieCed: 5 of this ordinance) on
bonds issued pursuant to the
loan agreemenis, or, with the
approval of the city, on other
debt permitted under the loan
agreements. In such case, DNDC
or [he trustee as identifled in the
loan a9reements may wlthdraw
from the Franchise Fees Account
such amounts as may be
necessary to pay said debt
serv'ice; provided, that no
withdrawals for debt service
payment shall be made if tlr_ ���
Del¢tetl: DH
Deleted: DHDC
DeleteA: DHDC
Deleted: DHDC.
!aw_� �..�]
';�12;%'• � � y
Deletsf: DHDC
DeieCed: DHDC
Deletetl: sxtY (
Deleted: DHDC
ATTACHNIENT B
and cost effcfent orocess for reviewmo the or000sed chanoes The tity shall be required [o take
into account the need of District Enerov for revenue sufficient to enable R io meet the cogt of
fumishing the service; to provide for Che timely and orderly retirement of debt; including those
bonds issued for financing the iniYial sys[em; to pay the debt servire on suth bonds; and to provide
for improvements, enlargemerrts and extensions necessary to adequately service the tertitory of
the city, induding the princlpal and interest to bemme due on obligations issued therefoc The cdy
shall also be required to take into account the operation of the terms and conditions of the Hot
Water Delivery Agreement, in[luding Sections 6.7, 7.3 and 21.2 thereof, which is the uniform
cont2ct erKered iata byD�sCnct Enerov and,D�strict Erterov customers,prpviding_fgr a Getdiled
method of charges for demand and energy related costs. The uniform Hot Water Detivery
Agrnement shali be fitetl in the office of the city clerk at the same time as the written acceptance
required by Section 13 herein. Amendments to the Hot Water Delivery Agreement shafl be flied
with the dty clerk at least ten (10) days prior to the effeCtive date of such an amendment or
amendment4 Amendments_yf said agreement are effe_ttiv_e without approyal_ten (10) days af[er
filing.
(g) At the request ofpistrict Enerov and in order to assist in determining w_hether the proposed_ _
changes in Schedule A shall be approved or denied, the city may requtre a public hearing before a
hearing examiner who shall be selected by mutual agreement of city andAistr"ct Enerav wghin ten
(10) days of,�istnct Enerq� reguest. The hearing examiner shall hofd a hea_ring as a contested_ _
case and make recommendations Yo the city. Upon receipt of such recommendations, fhe city shall
by resofution approve or deny the proposed thanges in Schedule A. If no such aRion is taken by
the city within thirty (3D) days after receip[ of the hearing examiner`s retommendations, such
proposed changes are deemed approved.
(h) Proposed changes to Schedule A w� only be approved, approved in part if severa6le nr denied,
and wnnot be modified or amended. The city may notwithstanding requirepistrict Enerqy to_
refund or credit to its customers any increases in rates which are in excess of the fawFul and
reasonable rates as finally determined.
�ectio_n_7.,
For the purpose of ass�s[ing the city in the regulations of the activities antl rates of D�str�ct Energy
as provided in this franchise, the city attomey shali appoinY an assistant or other attomey to
perform the dutie5 that suth regulation necessitates.
Section 8.
9istrict Energy shaN pay_the city durinq the term hereof_an annual amouM of,twenty-nine thousand
seven hundred and twentv-five doflars ( 725.DOJ payabie on_OCtober 1 of each year herein, _,
which sum shall be used to pay that part of the annual salary of the individual appointed by the ciry
attomey, his assistant or assistants, clencal help and office expenses, outside acmuntants, hearing
examiner, attomeys, advisors antl consultants' fees reasonabry related M the regulation of istrid
nes , its rate schetlules, and other matters and operations untler this franchise. The amount of
such paymerrt or payments shall be aftowed as an operating expense ofpistnct Eneroy in_the CRy_
of Saint PauL Such sum shall be mcreased each year by a dollar amount expressed in pertentages
equal to the percentage increase in the Consumer Price Index (or its successor index) for that year,
the increases to 6e cumulaUve and based on the amount of such sum plus the previous years'
mcreases.
Section 9.
Aistrict Enerqy shall file during eath month with_any person designated by the_city, a report of the
num6er of customers, sales and revenues try classes of servi[e for the preceding monfh 6ased
upon its ufility operations with+n the City of Saint Paul. '
istr ct Enerav ghall afso file with such person as may be designated by the city wi[hin [hree_(3)
months after October 1 of each year, a complete detaded statement on forms to be approved by
said person, covering the utility oQerations withm the City pf Saint Paul for the preceding year,
inGUdi�g all reve�ues, expenses and plan[ investment, together with such hreakdowa and analysis
of operating statements as the said person may request. The said person designated by the ciky
shall have the right to require atldftional information concerning operations under this ordinance
from time to time in such form as may be p2scribed by said person.
Any person or persons designated for that purpose by the city shall have the right, at all
reasonable times and upon 2asonable notice, to examine the books of account, records, vouchers,
disbursemerns, rates, revenues, contracts, purchases, sales and other transat[ions bearing on and
relevant to the ratesAistrict Energy charges anQ the service it provides to rts cu_stomers in the City
of Saint Paul.
Section 10.
D?-fl0�
�� �eleted: DHOC
, Deleted D DCH �
i ��: DNDC j
Deleked: ; providetl, however,
that no amendments to Sections
6.7,7.3or21.2of52id
agreement shall be effective
unless and until approved by the
city counul by ordinance.
DeIMeC: to other section5
Deteted: DHDC's
Deleted: DHDC
Deleted: (Ord. No. 17A82, § 1,
&-s-&7)A
Deleted: DHDC ��
Dele[ed: DHDC
DHeted: Fifteen
Deleted: 15,000
� Deletetl: DHDC
Deleted: DHDC
Deleted: DHDC __�
�Deleted: DHDC ^ �
� Deleted: DHDC �
ATTACFIIvIENT B
Before this ordinance or any amendmerts thereto shall be finally adopted by the muocil, a pe6lic
hearing shall be held upon ten (10) tlays' published notice in the o�cial newspaper and after said
hearing the countil may pass this ordinance, revise or amend the same. p�stric[ Enerov sha(I 6ear
the costs of publication of the franchise ordinance or any amendments thereto and shall make a
su�cient deposi[ with the city clerk to gua2ntee publication before the ordinance or amendments
are published.
Sectinn il.
A�stricc Enerov shall defend, indemnify and save_the ciYy whole and hacmless from any and_all
damages or claims for injury or damage to persons or properry occasioned by or arising out of the
con5huction, maintenance, opetatian or repair ofAistnct Energys 6usiness in the city. �smcc
Enerov shall insure its o6ligadons in this section with an insurer authorized to do busi�ess in the
Sfate of Minnesota in form, coverage and Iimits approved by the city attomey antl the tlirector of
the departmeM of finance and management services.
Sec[ion 12,
Every SecGOn, provision or part of chis ordinance is dectared separaFe from every other section,
provision or part; and if any sedion, provision or part shall be held invalid, it shall not affect a�y
other section, provision or part.
Section 13.
Aistnct Enerov_shall,_within thiriy (30) days after the pas5age,_approyal and,publication_of this
ordinance or of any amendments thereto, fi{e with the city derk of said cify it5 writYen atceptante
thereof in form Yo be approved by the city attorney, and therein shall agree to abide by, keep and
pertorm all the terms, IimiTaYions, conditions and provisions of this ordinance and any such
amendments.,
SeMion 14.
This franchise herein grarited shail not be exdusive nor inevocable, but may be terminated and
forfeRed after notke and hearing for any breach or taifure byA�strict Eneroy to compfy with the
terms, limitations or conditions hereof.
Section 15.
This franchise�hall be in tull force and effect for a termgnd oenod of twentv (20) year4 beainning
on the effec[ive date oP this ordinanc�
��'�l�b
I DeJeted: DNDC
! Deleted: DHDC
''� Dele.tetl: DHDC's J i
� Deleted: DHDC
�Deleled: OHDC
1 peleted: DHDC shall also file with 1
I the aty derk executed mpies of i
j the loan agreemeMS referzed to ��
�n Section 5 herem, as weli as �
� ezecuTetl mpies of any i
I amendments co sucft �.
I agreementr, within thirty (30)
tlays after execution of such loan
�agreementr andamendmenu.
Deleted: DHDC
� Deleted:is granted
{ Oeleted: not To ezteed thirty-one
Delete�f: from and after
Dektm: , pureuant to the
provisions of Minnesota Laws
1981, chapter 334, section 6,
subdivis�on 5.
Deletrtl: SCHEDULE A¶
The rates that shall be effective
upon adopGOn of this ordinance
and untii subsequently amended
shall be:1l
Demand Rate: $2.45 per kilowat[
per month¶
Energy Rate: $0.0148 per
kilowatt hour¶
Prompt payment provision: A
charge of five (5) percent will be
atlded to net biil computed at the
rate shown above, which charge
Shall constitute a diSCOUnt tfom
gross bili for payment within the
discount penod, all as more
specifically provided in the Hot
Water Delivery Agreement.¶
Fuel c/ause: As provided in the
Hot Water Delivery AgreemenY,
the energy charge may be
appropriately adlusted (i.e.,
spread over the remaining
months in the fiscal year) from
time to t�me during fiscai year to
mver cost mcreases (or
decreases) occUrring subsequent
[o the es[ablishment of projectetl
energy-refatetl costsfor such
period regardmg energy
purchasetl by DHDC, to the
eMertt such costs are in excess
of (or below) those costs
projected by OHDC m
establishing the energy charge
for such period.¶
Surcharge. A surcharge of (`-�Zi
I ?�/lOg
Page 2: jl] Deleted 7eanette Bray 8J29J2007 2:22:00 PM
5 of this ordina�ce) on bonds +ssued pursuant to the loan agreements, or, with the approval of the
city, on other debt permitted under the Ioan agreements. In such case, DHDC or the trustee as
identified in the loan agreements may withdraw from the Franchise Fees Account such amounts as
may be necessary to pay said debt service; provided, that no withdrawafs for debt service payment
shall be made if there are su�cie�t fu�ds availab(e therefor in funds or acwunts from which prior
withdrawals are to be made under the foan agreements.
(d) The fra�chise fee hereunder shall be paid from fu�ds in the Franchise Fees Account in excess of
the Frenchise Fees Account Requirement and not required to pay debt service.
{e) DHDC shall determine for each such month the exact amount of the franchise fee which would
have been paid to the city but for the operation of subsection (t) hereunder. In any subsequent
month in which there are su�cient funds available for debt sentice in the Revenue Account and
subsettion (b) has been complied with, the franchise fee required by subsection (a) herein shall be
paid to the city, together with an additional amount computed by dividing the total of all franchise
fees not previously paid by the number of months in which such franchise fees were not paid. Such
totai unpaid franchise fees shall be reduced in like manner each month when su�cient funds are
available and when subsection {b) herein has been complied with, until aIl unpaid franchise fees
have been paid.
(C.F. No. 03-484, 7-23-03)
Section
Page 4: I27 Deleted � 7eanette Bray 8/29/2007 2:22:00 PM
SCHEDULE A
The rates that shall be effective upon adoption of this ordinance and until subsequently amended
shall be:
Demand Rate: $2.45 per kilowatt per month
Energy Rate: $0.0148 per kilowatt hour
Prompt payment provision: A charge of five (5) percent wilf be added to net bill computed at Yhe
rate shown above, which charge shali constitute a discount from gross bill for payment within the
discount period, al{ as more specifical{y provided in the Hot Water Delivery Agreement.
Fuel clause: As provided in the Hot Water Delivery Agreement, the energy charge may 6e
appropriately adjusted (i.e„ spread over the remaining months in the fiscaf year) from time to time
during fiscal year to cover cost increases (or decreases) occurring subsequent to the establishment
of projected energy-related costs for such period regarding energy purchased by DHDC, to the
extent such costs are in excess of (or below) those costs projected by DHDC in establishing the
energy charge for such period.
Surcharge. A surcharge of eight and seven-tenths (8.7) percent will be included in the gross and
net monthly bilis computed under this rate schedule.