COUNCIL AGENDA: 04-05-2022
FILE NUMBER:
ITEM: 22-437
2.7 T-31060.024.007\1901999_2
TO: HONORABLE MAYOR
AND CITY COUNCIL
FROM: Nora Frimann
SUBJECT: SEE BELOW DATE: March 24, 2022
SUBJECT: AMENDMENT TO AGREEMENT WITH KEYES & FOX, LLP FOR
LEGAL SERVICES RELATED TO THE SAN JOSE CLEAN ENERGY
PROGRAM
RECOMMENDATION
Adopt a resolution authorizing the City Attorney to negotiate and execute a seventh amendment to the agreement with Keyes & Fox, LLP for legal services related to the San José Clean Energy program, extending the term through December 31, 2023 with no increase in the maximum amount of compensation.
OUTCOME
Execution of the seventh amendment to the agreement with Keyes & Fox, LLP will allow this law firm to continue to provide legal services related to the San José Clean Energy program.
BACKGROUND
On March 14, 2019, the City entered into an agreement with the law firm of Keyes & Fox, LLP (“Keyes”) for an initial term retroactive from January 10, 2019 through December 31, 2021 and a total compensation amount not to exceed $40,000, to provide legal services related to the San José Clean Energy program, including representing the City and San José Clean Energy in regulatory proceedings before the California Public Utilities Commission as well as providing general regulatory and compliance advice (“Agreement”).
On May 23, 2019, the City and Keyes entered into a First Amendment to the Agreement to revise the scope of services, update the list of authorized compensation rates, and increase the amount of total compensation allowed to $87,000. On July 19, 2019, the City and Keyes entered into a Second Amendment to the Agreement to revise the
HONORABLE MAYOR AND CITY COUNCIL
March 24, 2022
Subject: Amendment to Agreement for Legal Services with Keyes & Fox, LLP
T-31060.024.007\1901999_2
scope of services, update the list of authorized compensation rates, and increase the amount of total compensation allowed to $109,000. On February 27, 2020, the City and Keyes entered into a Third Amendment to the Agreement to update the list of authorized compensation rates and increase the amount of total compensation allowed to $145,000. On September 4, 2020, the City and Keyes entered into a Fourth Amendment to the Agreement to revise the scope of services and increase the amount of total compensation allowed to $320,000. On May 4, 2021, the City Council authorized the City Attorney to negotiate and execute a Fifth Amendment to the Agreement increasing the amount of total compensation allowed to $570,000. On December 13, 2021, the City and Keyes entered into a Sixth Amendment to the Agreement to update the list of authorized compensation rates and extend the term through June 30, 2022, with no increase in the amount of total compensation allowed, under the City Attorney’s authority to execute amendments pursuant to the provisions of San José Municipal Code Section 4.04.055.
ANALYSIS
In August 2016, the City issued a Request for Qualifications seeking to establish a pool of qualified law firms to provide legal advice and assistance related to establishing, operating and terminating California Community Choice Aggregation (“CCA”) programs, including: general advice relating to establishing, operating and terminating a CCA; advising the City on regulatory requirements for CCAs; representing the City as necessary in front of various regulatory bodies; power procurement, including drafting short and long term power purchase agreements; bond and financing counsel to advise the City and possibly prepare legal opinions on various funding options or security for power purchases; rate setting advice and the statutory constraints affecting utility rates.
On March 14, 2019, the City entered into an agreement with Keyes, one of the firms selected for the pool of qualified law firms, to provide legal services related to the San José Clean Energy (“SJCE”) program, including legal representation in regulatory proceedings before the California Public Utilities Commission (“CPUC) as well as general regulatory and compliance advice.
In particular, for cost-control, efficiency, and effective advocacy, SJCE engages in several annual or bi-annual proceedings at the CPUC through a coalition of CCAs operating in Pacific Gas and Electric Company’s (“PG&E”) territory (together with SJCE, the “Joint CCAs”). These proceedings include PG&E’s General Rate Case (“GRC”) and Energy Resource Recovery Account (“ERRA”) applications. In the GRC, the CPUC approves PG&E’s generation rates. SJCE’s rates are set with reference to those rates.
In the ERRA proceedings, the CPUC considers whether PG&E’s fuel and purchased power costs are reasonable and can be recovered in rates. The key concern for the Joint CCAs is that the annual Power Charge Indifference Account fee that CCA customers pay is determined in the ERRA proceedings. Keyes represents the Joint CCAs before the CPUC in the PG&E’s GRC and ERRA applications.
HONORABLE MAYOR AND CITY COUNCIL
March 24, 2022
Subject: Amendment to Agreement for Legal Services with Keyes & Fox, LLP
T-31060.024.007\1901999_2
Keyes also provides the City with specialized regulatory and compliance support. This service includes but is not limited to maintaining and updating SJCE’s compliance calendar; conducting City filings in a manner consistent with the CPUC requirements; and assisting staff with the preparation of major bi-annual and annual compliance filings such as the Integrated Resource Plan, the Renewable Portfolio Standard (“RPS”) annual procurement plan, the RPS compliance report, and the Power Source Disclosure report, among others.
Keyes has provided legal, regulatory, and compliance services to the City for three years. The City Attorney’s Office and SJCE desire to extend the term of the Agreement to December 31, 2023 to allow Keyes to continue to provide these services for a total term of approximately five years.
CONCLUSION
To ensure the continued delivery of legal services in support of the San José Clean Energy program, staff recommends extending the term of the Agreement through December 31, 2023 with no increase in the maximum amount of compensation.
CLIMATE SMART SAN JOSE
The recommendation in this memorandum aligns with one or more Climate Smart San José energy, water, or mobility goals.
PUBLIC OUTREACH
This memorandum will be posted on the City’s website as part of the April 5, 2022 City Council Agenda.
COORDINATION
This memorandum has been coordinated with the Community Energy Department.
HONORABLE MAYOR AND CITY COUNCIL
March 24, 2022
Subject: Amendment to Agreement for Legal Services with Keyes & Fox, LLP
T-31060.024.007\1901999_2
CEQA
Not a Project; File No. PP17-003, Agreements/Contracts (New or Amended) resulting in no physical changes to the environment. NORA FRIMANN Acting City Attorney
By /s/ Lynne Lampros
______________________
LYNNE LAMPROS
Senior Deputy City Attorney
For questions, please contact Lynne Lampros, Sr. Deputy City Attorney, at (408) 535-1900.