City Council Agenda Report
Meeting Date: August 20, 2024
From: Daniel S. Wall, P.E., Director of Public Works
Department: Public Works
Submitted by: Lissette Melendez, Project Engineer
Subject
Extension of Franchise Granted to Pacific Pipeline System, Inc.
Recommendation
A. Find that the proposed action is exempt from the California Environmental Quality Act (CEQA), in accordance with CEQA Guidelines Section 15301, because it consists of the maintenance, repair or minor alteration of existing facilities and equipment and involves negligible or no expansion of an existing use; and
B. Adopt Resolution No. 2024-017 finding and determining that the public interest and necessity require the time extension of Ordinance No. 1046 Granting a Franchise to Pacific Pipeline System, Inc. to maintain and operate a pressurized steel pipeline and appurtenances in and under Alameda Street.
Background
On May 20, 1997, the City of Vernon adopted Ordinance No. 1046 granting a franchise to Pacific Pipeline System, Inc. to install, maintain and operate a pressurized steel pipeline and appurtenances in and under Alameda Street. This Franchise was granted for a term of twentyfive years and with the possibility to request a time extension for an additional twenty-five years at the end of its first term by a resolution of the City Council without a public hearing.
In 1999, Pacific Pipeline System installed approximately 96 feet of twenty-inch diameter, insulated, pressurized steel petroleum pipeline, and a control cabinet in the median on Alameda Street to transmit oil and oil products. During the term of this franchise, Pacific Pipeline System has been making annual payments in accordance with the California Public Utilities Code Section 6231.5 and per Ordinance No. 1046. Pacific Pipeline states that there have not been any oil spills or leaks in the pipeline during the term of the agreement. According to their records, in 2008, a protective composite wrap was installed around the line to repair external corrosion. Pacific Pipeline has provided records of their annual payments from 2007 to 2024.
Ordinance No. 1046 expired in May 2022. Pacific Pipeline requested the extension in 2021 but the franchise extension was delayed until Pacific Pipeline provided maintenance and fee information requested by the City. The requested information was provided in July 2024 so the extension could proceed. The Public Works Department recommends the adoption of Resolution No. 2024-017 extending the agreement for 25 years.
Fiscal Impact
Approval of the extension of Ordinance No. 1046 will result in the continued annual payment from the franchisee resulting in additional revenue to the General Fund Franchises and Agreements Account No. 011-410-000-410300 estimated at $212.05. The franchise fee will be computed and increased annually by the September Consumer Price Index for the area as cited in the California Public Code Section 6231.5.
Attachments
1. Resolution No. 2024-017
2. Renewal Request
3. Ordinance No. 1046