03. PH Adopt Reso Establishing Underground Utility District No. 24 along Paramount and Imperial 50 ft. South of Quill

Item No.

TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL

FROM: OFFICE OF THE CITY MANAGER
BY: MATTHEW BAUMGARDNER, P.E., DIRECTOR OF PUBLIC WORKS/

CITY ENGINEER

DATE: APRIL 22, 2025

SUBJECT: CONSIDERATION OF ESTABLISHING UNDERGROUND UTILITY DISTRICT NO. 24 PURSUANT TO CALIFORNIA PUBLIC UTILITIES COMMISSION RULE 20A AND CHAPTER 5 OF ARTICLE VII OF THE

DOWNEY MUNICIPAL CODE

EXECUTIVE SUMMARY

The City Council will consider adopting a resolution establishing an underground utility district along the length of Paramount Boulevard from Imperial Highway to approximately 50 feet south of Quill Drive (Underground District No. 24), therefore, causing all specified utilities therein to be relocated underground. At its meeting of June 11, 2024, the City Council had selected a 0.4-mile long segment on Firestone Boulevard between Arnett Street and the western City limit. However, following SCE’s technical review, only the segment along Paramount Boulevard met the requirements for use of the City’s Rule 20A funds, which are planned to be used for this project. As a result, a new location is proposed for the execution of this project using the available funding.

RECOMMENDATION

That the City Council:

Adopt Resolution No. 25-8297, establishing Underground Utility District No. 24 along the length of Paramount Boulevard from Imperial Highway to approximately 50 feet south of Quill Drive pursuant to California Public Utilities Commission Rule 20A and Chapter 5 of Article VII of the Downey Municipal Code.

BACKGROUND

The California Public Utilities Commission’s (CPUC) Rule 20 sets forth the procedures for converting overhead utility infrastructure to underground systems, a process commonly referred to as “undergrounding.” The City of Downey has actively pursued undergrounding improvements over the past several years through the formation of Underground Utility Districts (UUDs) along corridors such as Bellflower Boulevard, Lakewood Boulevard, and other arterial streets. These efforts have utilized Rule 20A, 20B, and 20C funding mechanisms. Rule 20A projects are fully funded by Southern

APPROVED BYCITY MANAGER

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DOWNEY ESTABLISHING UNDERGROUND UTILITY DISTRICT NO. 24 PURSUANT TO CALIFORNIA PUBLIC UTILITIES COMMISSION RULE 20A AND CHAPTER 5 OF ARTICLE VII OF THE DOWNEY MUNICIPAL CODE APRIL 22, 2025
PAGE 2

California Edison (SCE) using “work credits” set aside from utility ratepayer revenues and are intended for corridors that meet certain public benefit criteria. Rule 20B projects are applicant-funded but receive a limited subsidy from SCE, while Rule 20C projects are entirely funded by the applicant without subsidy.

On June 3, 2021, the CPUC adopted Decision 21-06-013, which initiated the wind-down of the Rule 20A program. Under that decision, utilities received their final allocation of Rule 20A credits in January 2022, and the long-standing practice of borrowing against future credits was discontinued. In response to the impending closure of the Rule 20A program, an agenda report presented to the City Council on June 11, 2024, outlined eight candidate segments for consideration under the City’s remaining Rule 20A work credits totaling $2.8 million. At this meeting, the Council selected a 0.4-mile segment along Firestone Boulevard between Arnett Street and the western City limit.

ANALYSIS

Following the presentation to City Council, Southern California Edison (SCE) conducted a technical review of the eight proposed locations, including the Firestone Boulevard segment, to evaluate feasibility based on Rule 20A eligibility requirements, existing infrastructure constraints, and available credit capacity. Upon completion of their assessment, SCE determined that only one segment from Paramount Boulevard from Imperial Highway to approximately 50 feet south of Quill Drive met the necessary criteria for advancement. On January 17, 2025, SCE provided a formal Project Cost Estimate to the City of Downey confirming the corridor's eligibility for Rule 20A funding and outlining the preliminary project scope and budget which established the technical justification for proceeding with the formation of Underground Utility District No. 24. This letter is included as Attachment B along with the City’s engineering report on the project.

The SCE Project Cost Estimate describes the removal of approximately 1,400 linear feet of overhead distribution facilities and the installation of new underground conduit, vaults, cable, transformers, and associated infrastructure. The project scope includes up to 100 feet of service lateral conversion per customer, along with panel upgrades as required, and one-for-one replacement of existing overhead streetlights with underground-fed marbelite poles. The preliminary estimated construction cost is $2.8 million, with SCE indicating that construction could begin in 2027 following design coordination, agency permitting, utility notification, and right-of-way clearance.

The information contained in the SCE estimate and staff report served as the technical basis for designating this segment as Underground Utility District No. 24 and initiating the formal public hearing process. This undergrounding district is proposed as a California Public Utilities Commission (CPUC) Rule 20A project. Under Rule 20A, Southern California Edison (SCE) will fund the undergrounding of its electrical facilities using work credits accrued from utility ratepayers. Other participating utilities—such as Charter

Communications and Frontier Communications—will be responsible for funding the underground conversion of their own infrastructure. Telecommunication providers are required to remove their existing aerial facilities and install new underground conduit and cabling at their own expense, as Rule 20A funding does not apply to non-electric utilities and the City is not responsible for covering these costs.

SCE anticipates a two- to three-year lead time between district establishment and construction mobilization. The City will act as the lead coordinator among utilities and support affected property owners during the design and service conversion process.

While SCE will manage its own design and construction activities, close coordination will be required with other utility agencies to ensure all above-ground infrastructure within the district is fully removed and replaced underground.

Notices of the public hearing were mailed to all affected adjacent property owners. The SCE Project Estimate and supporting documentation were made available for public review through the Public Works Department.

CITY COUNCIL PRIORITIES

Efficiency & Adaptability
Quality of Life, Safety & Infrastructure

FISCAL IMPACT

Underground Utility District No. 24 will be funded by Rule 20A funds. Southern California Edison’s (SCE) preliminary construction cost estimate for undergrounding improvements associated with Underground Utility District No. 24 is $2,800,000. There is no local match required under Rule 20A, as eligible project costs are fully funded through the City’s accumulated Rule 20A work credits. These credits are issued by SCE at a value of $1 per credit and are considered 100 percent utility-funded through ratepayer contributions.

As a result, the City is not responsible for any direct capital outlay for the scope of work covered under Rule 20A.

Eligible costs covered by SCE under the Rule 20A program include the design, trenching, conduit installation, vaults, cable, transformers, service cutovers, and removal of overhead utility poles and wires. Additionally, the program covers up to 100 feet of each customer’s service lateral conversion, including associated panel upgrades where required. Given the distance from the roadway centerline on Paramount Boulevard to the face of buildings is approximately 50 feet, the Rule 20A budget, which covers up to 100 feet of each customer’s service lateral conversion, will adequately accommodate all necessary conversions. However, residents and businesses may experience temporary impacts during construction activities, including brief interruptions of utility services during the cutover period, restricted driveway or sidewalk access, temporary loss of street

parking, noise, dust, and minor disturbances. To minimize disruption, the City will provide advance notification to affected properties through mailers and on-site postings.

Additional updates will be available on the City’s website and through social media channels. City staff will be available to answer questions and coordinate with residents and businesses throughout the planning and construction phases. The program also includes one-for-one replacement of existing SCE-owned overhead cobra-head or wood- pole mounted streetlights with standard underground-fed marbelite streetlight poles.

ATTACHMENTS

Attachment A: Resolution No. 25-8297
Attachment B: SCE Project Cost Estimate and City’s engineer report

RESOLUTION NO. 25-8297

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DOWNEY
ESTABLISHING UNDERGROUND UTILITY DISTRICT NO. 22 PURSUANT TO CALIFORNIA PUBLIC UTILITIES COMMISSION RULE 20A AND CHAPTER 5

OF ARTICLE VII OF THE DOWNEY MUNICIPAL CODE

WHEREAS, the California Public Utilities Commission (“CPUC”) has established electric tariff Rule 20 in response to local government interest in enhancing the aesthetics of their communities; and

WHEREAS, under Rule 20, there are three programs, 20A, 20B, and 20C, each addressing different funding mechanisms and qualifications for undergrounding existing overhead utility lines; and

WHEREAS, under Rule 20A, projects deemed to create a general public benefit are funded by all of Southern California Edison’s ratepayers throughout the service area, whereby the utility allocates funds defined as “work credits” to cities to convert overhead electric facilities to underground; and

WHEREAS, as of April 22, 2025, Downey has a work credit balance of $2,971,258; and

WHEREAS, Chapter 5 (Underground Facilities) of Article VII of the Downey Municipal Code (Streets and Public Works) outlines the procedures and requirements for establishing an underground utility district, including public hearing and noticing requirements for all persons owning real property and affected utilities within the proposed district; and

WHEREAS, the City of Downey wishes to establish an underground utility district within the portion of the road right-of-way on Paramount Boulevard between Imperial Highway and approximately 50 feet south of Quill Drive, as identified on Exhibit A of the City Engineer’s Report for Proposed Underground Utility District No. 24 (“Engineer’s Report”); and

WHEREAS, the City Council held a duly noticed public hearing on April 22, 2025, at which all interested persons were given the opportunity to be heard, to ascertain whether the public necessity, health, safety or welfare requires the removal of existing poles, overhead wires, and associated overhead structures within the portion of the road right-of-way on Paramount Boulevard between Imperial Highway and approximately 50 feet south of Quill Drive and the underground installation of wires and facilities for supplying electric, communication, or similar or associated service.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF DOWNEY DOES HEREBY RESOLVE AS FOLLOWS:

SECTION 1. In accordance with Downey Municipal Code Section 7502, the City Council finds that the public necessity, health, safety or welfare requires the removal and underground installation of poles, overhead wires, and associated overhead structures, as those terms are defined by Downey Municipal Code Section 7500.3, within the portion of the road right-of-way on Paramount Boulevard between Imperial Highway and approximately 50 feet south of Quill Drive, which area is hereby declared Underground Utility District No. 24, as depicted on Exhibit A (“District”). Specifically,

RESOLUTION NO. 25-8297
PAGE 2

(A) Paramout Boulevard is a major arterial highway which is exclusively used by the general public and carries a high volume of pedestrian and vehicular traffic; and

(B) Undergrounding will avoid and/or eliminate an unusually heavy concentration of overhead distribution and transmission facilities; and

(C) Undergrounding will improve the reliability of utility services by removing the potential for loss of service due to wire separation and/or damage to supporting structures as a result of traffic accidents, fire, earthquakes, winds, or other acts of God.

SECTION 2. All poles, overhead wires and associated structures, as those terms are defined by Downey Municipal Code Section 7500.3, within the District shall be removed and installed underground no later than December 31, 2027. Affected property owners must be ready to receive underground service within this time.

SECTION 3. The City Council authorizes Underground Utility District Work Credits to be used pursuant to CPUC Rule 20A.

SECTION 4. Within 10 days after the adoption of this Resolution, the City Clerk shall notify all affected utilities and all persons owning real property within the District. Notification by the City Clerk shall be made by mailing a copy of this Resolution, together with a copy of Chapter 5 of Article VII of the Downey Municipal Code, to affected property owners shown on the last equalized assessment roll and to the affected utilities.

SECTION 5. The establishment of the District is exempt from further review under the California Environmental Quality Act pursuant to CEQA Guidelines Section 15302(d).

SECTION 6. The City Clerk shall certify to the adoption of this Resolution.

APPROVED AND ADOPTED this 22nd day of April, 2025.

_______________________________

HECTOR SOSA
Mayor

ATTEST:

MARIA ALICIA DUARTE, CMC
City Clerk

APPROVED AS TO FORM:

JOHN M. FUNK
City Attorney

RESOLUTION NO. 25-8297
PAGE 3

I HEREBY CERTIFY that the foregoing Resolution was adopted by the City Council of the City of Downey at a Regular meeting held on the 22nd day of April, 2025, by the following vote, to wit:

AYES: Council Members:

NOES: Council Members:

ABSENT: Council Members:

ABSTAIN: Council Members:

_______________________________

MARIA ALICIA DUARTE, CMC
City Clerk

Downey City CouncilApril 22, 2025

Downey City Council
April 22, 2025