94-115 RESOLUTION NO. 94R-115
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF ANAHEIM ESTABLISHING RIGHT-OF-WAY
FEES FOR THE CITY-OWNED ELECTRIC UTILITY
AND WATER UTILITY.
WHEREAS, the City of Anaheim owns and operates its own
electric utility (the "Electric Utility") and water utility (the
"Water Utility") which Electric Utility and Water Utility are
collectively referred to in this Resolution as the "City
Utilities;" and,
WHEREAS, portions of the works, equipment and other
facilities necessary or convenient for the operation of said City
Utilities (the "Facilities") are currently located within, and
additional such Facilities will in the future be placed within,
the public streets, ways, alleys or places owned by the city of
Anaheim and acquired by the City for good and valuable
consideration; and,
WHEREAS, use of said public streets, ways, alleys or
places by the City Utilities constitutes a valuable property
interest the acquisition and expense of which would otherwise be
a cost of operations or cost of capital construction payable from
the rates established for the Electric Utility and Water Utility
pursuant to paragraphs (a) or (d) of Section 1221 of the Charter
of the City of Anaheim; and,
WHEREAS, in lieu of requiring payment for such valuable
property interests as an operations expense or capital
construction expense of the Electric Utility or Water Utility, or
either of them, the City desires to establish and impose a fee as
an operations expense of each of such City Utilities.
NOW, THEREFORE, BE IT RESOLVED by the City Council of
the city of Anaheim as follows:
SECTION 1. ELECTRIC UTILITY RIGHT-OF-WAY FEE.
The City of Anaheim hereby imposes upon the Electric
Utility a right-of-way fee~ in lieu of all other charges and
expenses for the placement and maintaining of the equipment of
the Electric Utility in the public right-of-way owned by the City
of Anaheim, in an annual amount equal to one and one-half percent
(1 1/2%) of the prior year's audited annual gross sales receipts
less annual gross sales receipts from other Electric Utilities
and uncollectibles of said Electric Utility. Said fee shall be
hereinafter referred to as the "Electric Utility Right-of-Way
Fee." The Electric Utility Right-of-Way Fee shall be deemed an
operations cost of the Electric Utility Pursuant to Section 1221
(a) of the City Charter.
SECTION 2. WATER UTILITY RIGHT-OF-WAY FEE.
The City of Anaheim hereby imposes upon the Water
Utility a right-of-way fee, in lieu of all other charges and
expenses for the placement and maintaining of the equipment of
the Water Utility in the public right-of-way owned by the City of
Anaheim, in an annual amount equal to one and one-half percent (1
1/2%) of the prior year's audited annual gross sales receipts
less annual gross sales receipts from other Water Utilties and
uncollectibles of said Water Utility. Said fee shall be
hereinafter referred to as the "Water Utility Right-of-Way Fee."
The Water Utility Right-of-Way Fee shall be deemed an operations
cost of the Water Utility pursuant to Section 1221 (a) of the
City Charter.
SECTION 3. EFFECTIVE DATE OF FEES.
The fees established pursuant to Sections 1 and 2 of
this Resolution shall become effective on July 1, 1994, and shall
remain in full force and effect unless and until amended or
repealed by the City Council.
THE FOREGOING RESOLUTION is approved and adopted by the
City Council of the city of Anaheim this 21st day of
June , 1994. ~~
MAY HE CI
ATTEST
CITY CLERK OF THE OF ANAHEIM
4816.3\JWHITE\Ma¥ 31, 1994
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss.
CITY OF ANAHEIM )
I, LEONORA N. SOHL, City Clerk of the City of Anaheim, do hereby certify that the foregoing Resolution
No. 94R-115 was introduced and adopted at a regular meeting provided by law, of the Anaheim City
Council held on the 2'1st day of June, 'i994, by the following vote of the members thereof:
AYES: COUNCIL MEMBERS: Feldhaus, Pickler, Daly
NOES: COUNCIL MEMBERS: Simpson, Hunter
ABSENT: COUNCIL MEMBERS: ~1one
AND I FURTHER CERTIFY that the Mayor of the City of Anaheim signed said Resolution No. 94R-115
on the 22nd day of June, '1994.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of
Anaheim this 22nd day of June, 1994.
' ~ CITY CLERK OF THE ~;;ITY OF ,~NAHEIM
(SEAL)
I, LEONORA N~'SOHL, City Clerk of the City of Anaheim, do hereby certify that the foregoing is the
original of Resolution No. 94R-'115 was duly passed and adopted by the City Council of the City of
Anaheim on June 21, 1994.
CITY CLERK OF THE CITY OF ANAHEIM
SURVEY OF FMI,&5~CIt~IISE FI~E$
ORANGE COUNTY ANIt~ $OIlTI~IERN {'.A;LItFORN~,
PRIMARY RESULTS:
· Anaheim's proposed 1.5 percent right-of-way fee lies within the average .range of
franchise fees being charged to private gas anti electric utilities in the area.
None of the Cities surveyed charge right-of-way fees to utilities operating within
their jurisdictions. Right-of-way ~'ees are similar to franchise fees. While rights-
of-way provide access to City streets and other points, franchises provide this
access and include various additional stipulations.
None of the municipally-operated utilities are charged fees in excess of thek
charter-specified general fi~nd contcibutions, with the exception of the Los
Angeles Department of Water and Power, which will be required to provide an
additional $75 million to the City's general fund for'fiscal year 1994/95~ The
DWP anticipates selling several of its assets in order to meet this requirement.
Franchise fees charged to gas and electric utilities range from a low of o~e-half of
one percent of gross annual receipts (GAR) in Fullertor~ to a high of tt~rce
percent of GAR in San Diego. Several cities use the Bro~ghton Act: formt~la
(BAF), which is based on the miles of pipeline within a City's frm~chised fight*of-.
way. Generally, the GAP, percentage produces higher revenues tha~ does the
BAF percentage (in fact, a 1% GAR is normally higher than it 2% BAF). At/is
most recent California Public Utilities Commission hearing, the Sodthem
California Gas Company estimated its average franchise fee (paid acloss its ¢:ntice
system) to be 1.48 percent of gross annual re~,enues.
C'ypress is the only City among those surveyed which charges a t~anc~,.'se fee v.~ [is
water provider (a private water company). While Fnllerton's buriget calls the fee
a "franchise fee," it is similar to the general fund transfers made .by most Cilb'
water departments (including Anaheim). Garden Grave's water departmen~ pay:~
a fixed fee for its damage to City streets, though this fee is expressly not a "right-
of-way" fee.
legend of abbreviations: GAR Gross Annual Receipl's
GFT General Fund Transfer (by' City-owned u;5Ilties)
BAF Broughton Act For~tmla (based on miles of i;ipeline/power line)
ROW Right-Of-Way
ILF In-Lieu Fees (generally in-.lieu of ~eca; taxes)
I:\HOME\IN'I~.RN\AAGLE\FRANFEE May 24, 199,~
COMPARATIVE FRANCHISE FEES - ORANGE COUNTY
..... ::~::::Bre, 2% GAR 2% GAR None City Ordinance prohibks franchise fees from falling
.... : ::': ;below 1% GAR
:::}Cypress 2% GAR 2% GAR ;::: 2% GAR :;;:~Franch/se fee charged to private water company
u::~: ~Jameu Grove ': 2% BAF 1% GAR :: rkF ::Water de?anment makes a fixed arma~ in-lieu
~::::::. '::' Contibution of $1.35 million for damage to G~ meets
!':i Huntin.on B~.ach 2% GAg. ::i~ ;0.5% G~M~ 15 % Glm£
[. :: trane 2% G-A~--~) 2% GAR ?i None
?: Missi-~n Viejo 2%/1% None !i SoCal Gas pays 2% GAR, SDE&G pays 1% GAK
:: 2% BAF 2% BAF 6% I[~F .;!6% of gross water sales paidtott~e General Fund
i::: i:!: ::: i~iin-lieu of property taxes; began m F'f 9.
l:i;i!;iSama Ana }. 2% GAR : 2% GAR : 10% GFT ': -
COMPARATIVE FRANCHISE FEES - SOUTHERN CALIFORNIA
.... City. ........ G~..~.~ .....Elc~t rk: ....¥,'ater Con~nents
above a rate sector threshold equivalent; water pays
::~ ~: a small ILF based on depreciated book value
fi:!: additional $75 million (in excess of the normal GFT)
Pasadena 2% GAR ::; 8% GFT ii:: 6% GFT :'Although Charter supulates tha. GFT cannot exceed nets:
::: ::: i:~ncome, has done so recently due to Ciw's fiscal stress
:Redondo Beoch :: 1.4% GAR i::: 1% GAR :: None :Gas fi-anchise rate decelemtes over time
D/ego 3% GAR 3% GAR None ::Considering a ROW fee for city-owned water
::::: City Gas ::-7 Eleetric ::::Water Coremeros
t? 'i:Anaheim 2% BAF/ 11.5% ROW :i :L5% ROW: Gas franchise rate isthe higher of 2% BAF or 1% GARif ~
i: (proposed) : 1% G.~R ::: 4-4% GFT 74% GFT
Note: surv~, based on calls made to the li~ed cities .from 5/i9/94 to 5/23/94.
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