HomeMy WebLinkAboutAgenda Report - August 3, 2016 C-06AGENDA ITEM C11
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CITY OF LODI
COUNCIL COMMUNICATION
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AGENDA TITLE: Adopt Resolution Authorizing City Manager to Execute Supplement No. 1 to
Amended and Restated Northern California Power Agency Joint Powers
Agreement, Adding City of Shasta Lake as a Party
MEETING DATE: August 3, 2016
PREPARED BY: Electric Utility Director
RECOMMENDED ACTION: Adopt a resolution authorizing the City Manager to execute
Supplement No. 1 to Amended and Restated Northern California
Power Agency Joint Powers Agreement, Adding City of Shasta Lake
as a Party.
BACKGROUND INFORMATION: The City of Lodi is one of 16 members of the Northern California
Power Agency (NCPA). NCPA's objective is to enhance political
reach and influence, provide needed services to other public power
entities, and expand the savings and benefits of joint action. The NCPA Strategic Plan focuses heavily on
the importance of using the human and physical resources of the Agency to serve new members and
provide contract services. As a result of outreach in this regard, the City of Shasta Lake, California, on
April 25, 2016, submitted an application for membership in NCPA, as well as an application fee in the
amount of $10,000 to support the Agency's thorough review of its eligibility for membership. Since that
time, NCPA staff has carefully evaluated the application and reviewed public information to assure full
compliance with NCPA's New Member Policy.
The City of Shasta Lake meets all minimum screening criteria delineated in NCPA's New Member Policy
that was approved by the NCPA Commission on February 25, 2016. A review of filings submitted to state
agencies, and discussions with Shasta Lake's City Council and executive staff, indicate that the City of
Shasta Lake has goals that are consistent with those of NCPA and its members; including support for
local control, recognition of the benefits and savings that can be achieved through joint action and a
desire to minimize wholesale electric costs in order to provide economic benefits to their retail customers.
The City of Shasta Lake is also eligible to purchase preference power from the Western Area Power
Administration (Western) which is a requirement for membership in NCPA. Shasta Lake currently has a
0.805 percent allocation of power supplied by Western. As well, in accordance with NCPA's policy
requirements, Shasta Lake is willing to participate in political proceedings that will benefit the NCPA
members through participation in NCPA programs.
NCPA policy also requires that a potential member has financial strength, and the analysis of Shasta
Lake's Electric Enterprise shows it is financially sound with no concerns in this area. The internal credit
rating assessment provided an A to A- overall credit score and reflected the utility's strong cash position
with over 266 days of operating cash on hand with no outstanding debt. Shasta Lake's rates are
competitive, and a multi-year rate increase is ongoing. Shasta Lake's Electric Enterprise also has risk
mitigation for exposure to one very large industrial customer (12 percent of load) in place and an
established power cost adjustment clause to mitigate energy risk.
The NCPA Commission has previously determined that all NCPA members must execute the NCPA
Legislative and Regulatory Affairs Program Agreement and participate in the Legislative and Regulatory
Program to assure broad support for local decision making and to protect NCPA from potential policy
APPROVED: r
Step en SchO.>tbaubr, City Manager
Adopt Resolution Authorizing City Manager to Execute Supplement No. 1 to Amended and Restated Northern California Power
Agency Joint Powers Agreement, Adding City of Shasta Lake as a Party
August 3, 2016
Page 2 of 2
changes that could devalue the public investment that has been made in the NCPA generation facilities.
In accordance with this policy, the City of Shasta Lake, if approved for membership in NCPA, will not only
become a signatory to the NCPA Joint Powers Agreement (JPA), but would also execute the Legislative
and Regulatory Affairs Program Agreement. Once it is a member, it is Shasta Lake's intention to begin
exploring other NCPA services as well as participation in NCPA generation projects.
Approval of the City of Shasta Lake's membership in NCPA requires approval of Supplement No. 1 to the
Amended and Restated Northern California Power Agency Joint Powers Agreement, adding Shasta Lake
as a Party. NCPA is not itself a signatory to this document, but rather it must be unanimously approved
by each of the governing boards of all existing NCPA members and by the City of Shasta Lake's
governing board. On June 23, 2016, the NCPA Commission adopted a resolution recommending
approval of Supplement No. 1 by Shasta Lake and all current NCPA members.
With this Commission authorization and in accordance with the New Member Policy, the City of Shasta
Lake is now invited to participate in NCPA committee and Commission proceedings in a non-voting
status until formal approval of Supplement No. 1 by Shasta Lake and all existing NCPA members. After
all governing board approvals, the City of Shasta Lake would pay $128,864 toward the NCPA FY2016/17
Legislative and Regulatory Affairs budget. This amount includes payment of $28,978 toward the JPA fee.
This payment is estimated to reduce all other NCPA member payments as shown in the table below.
NCPA Member
Approved FY2016/17
L&R Budget
Recalculated with
Shasta Lake
Net Effect with
Shasta Lake Addition
Alameda
$ 188,527
$180,942
$7,585
BART
67,287
67,100
187
Biggs
76,746
71,127
5,619
Gridley
89,395
83,542
5.853
Healdsburg
93,193
87,294
(5,899)
Lodi
200,118
192z367
7,751
Lompoc
110,675
104,473
6,202
Palo Alto
565,108
550,462
14,646
Plumas-Sierra
144,202
137 347
6,855 .
Port of Oakland
99,904
93,871
6,033
Reddina
437,111
424,885
12,226.
Roseville
492,006
479,017
12,989
Santa Clara
11154,769
1,130,154
(24,615L
Shasta Lake
0
128,864
128,864
Truckee Donner
115,652
109,348
(6,304)
Ukiah
104,592
98,463
6,099
Staff recommends adoption of a resolution authorizing the City Manager to execute Supplement No. 1 to
Amended and Restated Northern California Power Agency Joint Powers Agreement, Adding City of
Shasta Lake as a Party.
FISCAL IMPACT: Annual savings of $7,751.
FUNDING AVAILABLE: Not applicable.
Elixabe A. Kirkley
Electric Utility Director
SUPPLEMENT NO. 1 TO
AMENDED AND RESTATED NORTHERN CALIFORNIA POWER AGENCY
JOINT POWERS AGREEMENT,
ADDING CITY OF SHASTA LAKE AS A PARTY
This Supplement No. 1 to Joint Powers Agreement ("this Agreement") dated
by and among the parties signatory to it ("Parties"),
WITNESSETH:
WHEREAS, all of the Parties, except the City of Shasta Lake ("Shasta Lake") are also
parties to that joint powers agreement first made the 19th day of July, 1968, and amended and
restated as of January 1, 2008 ("the Joint Powers Agreement"); and
WHEREAS, the Joint Powers Agreement created the Northern California Power Agency
("NCPA") pursuant to the Joint Exercise of Powers Act (Section 6500 et seq, of the Government
Code of the State of California) as a separate public agency and legal entity existing apart from
its members; and
WHEREAS, all Parties except Shasta Lake are signatory to the Joint Powers Agreement
and are thereby members or associate members of NCPA; and
WHEREAS, Shasta Lake is a California general law city, is a public agency of the State
of California eligible to enter into joint powers agreements pursuant to the Joint Exercise of
Powers Act, is entitled to be a preference purchaser of electric service from the Central Valley
Project of the United States, and has powers equivalent to those of the other members of NCPA
so far as is relevant to the powers of NCPA and it is therefore eligible for membership in NCPA
pursuant to the Joint Powers Agreement; and
WHEREAS, Shasta Lake and each of the other Parties desire that Shasta Lake shall
become a party to the Joint Powers Agreement and a member of NCPA on the same basis as
each of the other NCPA members; and
WHEREAS, concurrently with its execution of this Agreement Shasta Lake has also
executed the NCPA Legislative and Regulatory Affairs Program Agreement, dated as of July 1,
2001, indicating its agreement to participate in the NCPA Legislative and Regulatory Affairs
Program on terms consistent with those applicable to other NCPA members, contingent upon its
membership in NCPA.
NOW, THEREFORE, the Parties, including Shasta Lake, agree as follows:
Section 1. On and after the effective date of this Agreement, the City of Shasta Lake
shall be a member of NCPA and a party to the Joint Powers Agreement, and shall have the same
rights, powers, and privileges and immunities, duties, and obligations as any other member of
NCPA.
Section 2. Shasta Lake shall not be liable for any share of the organization, planning, or
other costs of NCPA incurred prior to the effective date of this Agreement, and shall not by force
of this Agreement become a party to any other agreement or instrumentality of NCPA entered
into or created prior to the effective date of this Agreement, except with its consent and the
consent of all other NCPA members and associate members who are parties to such agreement or
instrumentality evidenced separately from this Agreement.
2
Section 3. This Agreement shall take effect on the first day of the calendar month
following the complete execution of this Agreement by all Parties.
Section 4. This Agreement may be executed in counterparts by the Parties to it.
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PORT OF OAKLAND
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CITY OF SHASTA LAKE
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RESOLUTION NO. 2016-148
A RESOLUTION OF THE LODI CITY COUNCIL AUTHORIZING THE
CITY MANAGER TO EXECUTE SUPPLEMENT NO. 1 TO AMENDED
AND RESTATED NORTHERN CALIFORNIA POWER AGENCY JOINT
POWERS AGREEMENT, ADDING CITY OF SHASTA LAKE AS A PARTY
WHEREAS, the Northern California Power Agency's (NCPA) Strategic Plan highlights
the importance of using the human and physical resources of the Agency to recruit new
members and to provide services to non -Agency members; and
WHEREAS, the City of Shasta Lake, California, has submitted an application for NCPA
membership that complies with the minimum screening criteria of NCPA's New Member Policy
that was approved by the Commission on February 25, 2016; and
WHEREAS, the NCPA Legislative and Regulatory Affairs Committee and Commission
have voted to recommend that the City of Shasta Lake become a member of the Agency; and
WHEREAS, if unanimously approved for membership by all NCPA member governing
boards and by the City of Shasta Lake's governing board, Shasta Lake would then become a
member of the NCPA Legislative and Regulatory Affairs Program, and it is their intention to
begin exploring other NCPA services as well as participation in NCPA generation projects.
NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby
authorize the City Manager to execute Supplement No. 1 to Amended and Restated Northern
California Power Agency Joint Powers Agreement, adding City of Shasta Lake, California, as a
Party.
Dated: August 3, 2016
I hereby certify that Resolution No. 2016-148 was passed and adopted by the City
Council of the City of Lodi in a regular meeting held August 3, 2016, by the following vote:
AYES: COUNCIL MEMBERS — Johnson, Kuehne, Mounce, and Mayor Chandler
NOES: COUNCIL MEMBERS — None
ABSENT: COUNCIL MEMBERS — Nakanishi
ABSTAIN: COUNCIL MEMBERS — None
NIFER . FERRAIOLO
f
y Clerk
2016-148