HomeMy WebLinkAboutAgenda Report - June 21, 2000 E-16CITY OF LODI COUNCIL COMMUNICATION
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AGENDA TITLE: Power Supply Contract between the City of Lodi and Fairmont Sign Company, Inc.
MEETING DATE: June 21, 2000
PREPARED BY. Electric Utility Director
RECOMMENDED ACTION: That the City Council authorize the City Manager to execute the attached
Power Supply Contract (Contract) between the City of Lodi and Fairmont
Signs Company, Inc. (Customer).
BACKGROUND INFORMATION: In consideration of the Customer's providing significant new employment and
the City's power supply resource at which time negotiations commenced, the
City and the Customer desire to execute the attached economic development
contract.
The Contract is designed to give the Customer maximum flexibility with regard to personnel shift assignments and
production schedules while providing a measure of price certainty for both the City and the Customer. The Contract is
similar to those between the City of Lodi and Apache Plastics, and the City of Lodi and Arkay Plastics.
FUNDING: Not applicable
A//�
Alan N. Vallow
Electric Utility Director
PREPARED BY: Jack Stone, Manager, Business Planning and Marketing
ANV/JS/1st
C: City Attorney
APPROVED: ✓�_� `% l ,,'1'� `! A—
H. Dixon Flynn - City Manager
RATE AGREEMENT
BETWEEN
FAIRMONT SIGN COMPANY, INC.
AND
THE CITY OF LODI
This Agreement is made by and between FAIRMONT SIGN COMPANY, INC. ("Customer") and
the CITY OF LODI ("City"), collectively called "the Parties" and individually as "Party". This
Agreement supersedes the City's mandatory Rate Schedule assignment for this Customer.
WITNESSETH:
WHEREAS, City operates an electric utility system supplying electric power to City customers; and
WHEREAS, Customer is a manufacturer which will be operating in the City; and
WHEREAS, Customer has developed a new facility in the City's industrial area; and
WHEREAS, Customer has brought new employment to the City; and
WHEREAS, City desires to supply the Customer's total load and provide Customer with a contract
rate; and
WHEREAS, City desires to provide the Customer an economic incentive in the form of a discounted
electric rate in return for creating a new business with new electric load in the City.
NOW, THEREFORE, the Parties hereto agree as follows:
Section 1. Definitions. Whenever used in this Agreement, in either the singular or plural number,
the following terms shall have the following respective meanings:
1.1 "Agreement" is this contract.
1.2 "City" is the City of Lodi, a California Municipal Corporation.
1.3 "Customer" is Fairmont Sign Company, Inc.
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1.4 "Facility" is the Customer's facility receiving service at secondary voltage, as measured
at the low side of the transformer, located at 850 South Guild Avenue, Lodi, California.
1.5 "Account" is defined as Customer's Account Numbers 31291 and 31293, the Facility's
main electric service, and successor Account Numbers. Fire Pump service, Account
Number 31258, is to remain on the applicable published electric rate schedule.
1.6 "Parties" are collectively Customer and City.
1.7 "kw" is a kilowatt, a demand charge billing unit.
1.8 "kwh" is a kilowatt-hour, an energy charge billing unit.
1.9 "billing cycle" is the monthly bill.
1.10 "Force Majeure", as used herein, means unforeseeable causes beyond the reasonable
control of and without the fault or negligence of the Party claiming force majeure.
Such an occurrence may include, but is not limited to, acts of God, labor disputes,
sudden actions of the elements, actions or inactions by federal, state and municipal
agencies, and actions or inactions of legislative, judicial, or regulatory agencies.
1.11 "Energy Multiplier" is the sum of 1.000 plus the change in the Western Urban B/C
Consumer Price Index (CPI) as published by the Bureau of Labor Statistics for the
previous calendar year. Following the initial year of the Contract, the Energy
Multiplier will be in effect for bills rendered on and after February of the applicable
year. Succeeding yearly Energy Multipliers will be the product of the previous Energy
Multiplier and the sum of 1.000 plus the change in the Consumer Price Index for the
previous calendar year. In no case will the Energy Multiplier be less than 1.000.
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Section 2. Rate Application.
The billing cycle charge for the Customer shall be as follows:
February 1, 2000 through December 31, 2002 Billing Periods:
Customer Charge: $ 125.00
Demand Charge: $ 0.00 per kw
Energy Charge: $0.05511 per kwh times the Energy Multiplier less the
Economic Development Credit
Economic Development Credit: $ 0.0002 per kwh Full Time Equivalent (FTE)
employee up to a maximum of $ 0.01000 per kwh.
Initial and subsequent FTE totals may be updated at
month intervals. The Electric Utility Department may
update the FTE total at more frequent intervals when in
its sole judgment an update is appropriate.
Energy Multiplier: as defined in Section 1.11 above
Section 3. Term of Agreement.
3.1 Upon signing by all Parties, this Agreement shall be binding for bills rendered on or after
February 1, 2000, and shall remain in effect subject to Paragraphs 3.2 and 3.3 below, for
bills rendered through December 31, 2002.
3.2 If either party fails to perform any of the provisions of this Agreement, the other party may,
by written notice given within thirty days of such failure to perform, terminate this
agreement. Customer may appeal such termination in writing to the Electric Utility
Director. This is in addition to any other legal recourse Customer may have.
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3.3 This Agreement cannot be terminated without mutual consent of the Parties.
3.4 Parties may mutually extend this Agreement from year to year beyond the original term of
this Agreement.
Section 4. Force Mai eure.
4.1 If either Party because of Force Majeure is rendered wholly or partly unable to perform its
obligations under this Agreement, that Party shall be excused from whatever performance is
affected by the Force Majeure to the extent so affected, provided that:
The non-performing Party, within two weeks after the occurrence of the Force Majeure,
shall give the other party a written report describing the particulars of the occurrence.
The suspension of performance is of no greater scope and of no longer duration than is
required by the Force Majeure.
4.2 No obligations of either Party which arose before the occurrence causing the suspension of
performance are excused as a result of the occurrence.
4.3 The non-performing Party uses its best efforts to remedy its inability to perform. This sub-
paragraph shall not require the settlement of any strike, walkout, lockout or other labor
dispute on terms which, in the sole judgement of the Party involved in the dispute, are
contrary to its interest. It is understood and agreed that the settlement of strikes, walkouts,
lockouts or other labor disputes shall be entirely within the discretion of the Party having
the difficulty.
Section 5. Assignments.
5.1 Neither Party shall voluntarily assign its rights nor delegate its duties under this Agreement
without the written consent of the other Party.
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Section 6. Amendments.
6.1 This Agreement may be amended only by written instrument executed by the Parties or
their successors.
Section 7. Severability.
7.1 In the event that any of the terms, covenants, or conditions of this Agreement shall be held
invalid, the Parties intend that all other terms, covenants, and conditions and their
application shall not be affected thereby, but shall remain in force and effect unless a court
holds that such provisions are not severable from all other provisions of this Agreement.
Section 8. Governing Law.
8.1 This Agreement shall be interpreted, governed by, and construed under the laws of the State
of California.
Section 9. Counterparts.
9.1 This Agreement may be executed in counterparts, all or any of which shall be regarded for
all purposes as one original and shall constitute and be but one and the same instrument.
Section 10. Headings.
10.1 The headings to the articles in this Agreement are intended for convenience only and not for
the purpose of interpreting the provisions of this Agreement.
Section 11, Notices.
11.1 Any notice, demand or request required or permitted to be given by either Party to the other
and any instrument required or permitted to be tendered or delivered by either Party to the
other may be so given, tendered or delivered, as the case may be, by depositing the same in
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any United States Post Office with postage prepaid, for transmission by certified or
registered mail, addressed to the Party, or personally delivered to the Party, at the address
designated below. Changes in such designation may be made by notice similarly given.
11.2 All written notices or questions shall be directed as follows:
To City: ELECTRIC UTILITY DIRECTOR
CITY OF LODI
1331 SOUTH HAM LANE
LODI CA 95242-3995
To Customer: FAIRMONT SIGN COMPANY INC.
850 SOUTH GUILD AVENUE
LODI, CA 95240
Section 12. Non -waiver.
12.1 None of the provisions of the Agreement shall be considered waived by either Party except
when such waiver is given in writing. The failure of any Party at any time or times to
enforce any right or obligation with respect to any matter arising in connection with this
Agreement shall not constitute a waiver as to future enforcement of that right or obligation
or any right or obligation of the Agreement.
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Section 13. Warranty of Authority.
13.1 Each of the Parties which has executed and delivered this Agreement represents and
warrants that it has agreed to be bound by all the terms, covenants, and conditions of this
Agreement and has acted with all the requisite capacity and authority and approval of its
governing body.
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IN WITNESS THEREOF, the Parties have caused this Agreement to be executed by
their duly authorized officers and their seal to be affixed, as of the day and year herein
written.
CITY OF LODI
H. Dixon Flynn
City Manager
Date
Approved as to Form:
Randall A. Hays
City Attorney
ATTEST:
Jacqueline L. Taylor
Interim City Clerk
CAWINOOWSWEMM06-21-00 JS Fairmont Signs Contract.doc
FAIRMONT SIGN
COMPANY, INC.
Adam Bonislawski
Vice President
Date
RESOLUTION NO. 2000-107
A RESOLUTION OF THE LODI CITY COUNCIL AUTHORIZING
THE CITY MANAGER TO APPROVE POWER SUPPLY
CONTRACT WITH FAIRMONT SIGNS COMPANY, INC.
BE IT RESOLVED, that the Lodi City Council hereby authorizes the City
Manager to approve Power Supply Contract with Fairmont Signs Company, Inc.; and
FURTHER RESOLVED, that the City Manager is hereby authorized to execute
said contract on behalf of the City.
Dated: June 21, 2000
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I hereby certify that Resolution No. 2000-107 was passed and adopted by the
Lodi City Council in a regular meeting held June 21, 2000 by the following vote:
AYES: Council Members — Hitchcock, Land, Nakanishi, Pennino
and Mann (Mayor)
NOES: Council Members - None
ABSENT: Council Members - None
ABSTAIN: Council Members - None
CQ ELINE L. TAYLO
Interim City Clerk
2000-107