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RFD- 3557 Bylaws   Item #   9. d.    
Regular Council Meeting Agenda
Meeting Date: 04/23/2019  
Title:    C-1064-19 -Second and Third Reading - Natural Gas Franchise Agreement - Pungur-Buick
Department: Corporate Services  
Strategic Vision Element: Where People Choose to Live - A dynamic city with an exceptional quality of life Related Goal: Spruce Grove has a robust, growing economic base that generates balanced revenues to support the City’s high standards for services and programs.

Information
Request for Decision Summary
To finalize the process authorizing the municipality to enter a new natural gas franchise agreement for the purpose of changing the method of collection of franchise fees and increasing the rate as approved in the 2019 - 2021 Corporate Plan.

Proposed Motion
That second reading be given to Bylaw C-1064-19 - Natural Gas Franchise Agreement.

That third reading be given to Bylaw C-1064-19 - Natural Gas Franchise Agreement.
Background/Analysis
A Natural Gas Franchise Agreement exists to grant exclusive rights within a Municipal Area to:
  • provide natural gas distribution service;
  • construct, operate, and maintain the natural gas distribution system; and 
  • use portions of roads, rights-of-way, and other lands owned, controlled or managed by the municipality for such use and which are necessary to provide natural gas distribution.
A franchise fee is paid to the municipality in exchange for these rights.

In the 2019 - 2021 Corporate Plan, a service change initiative proposed changing the rate calculation method and increasing the rate charged to natural gas franchise ratepayers within the community.  The Corporate Plan initiative proposed changing the rate calculation method to the one more commonly used by municipalities and increasing the rate to 25% in 2019 ( page 300 - Corporate Plan 2019 - 2021). The Corporate Plan was approved by Council November 26, 2018.  

First reading was given to this bylaw on February 11, 2019.

After first reading was given to this bylaw, the municipality submitted the application package to ATCO Gas and Pipelines Ltd.  ATCO then provided the municipality with the required information to be advertised.  Residents had a 14 day time period from the advertisement date to submit any concerns to the municipality.  There were no concerns submitted.  ATCO was notified that the notice of objection time period had passed without concern and they submitted the information required for the Alberta Utilities Commission (AUC) to support the application.  The application was reviewed by AUC, a hearing was conducted and they rendered a positive decision.  ATCO has now submitted a signed franchise agreement for submission with this request for decision.  After second and third reading and municipal signing by the Mayor and Chief Administrative Officer,  the agreement will take effect and franchise fee changes will be effective May 1.

Second and Third reading of Bylaw C-1064-19 is the final step in the process.
Options/Alternatives
n/a
Consultation/Engagement
n/a
Implementation/Communication
n/a
Impacts
n/a

Fiscal Impact
Financial Implications:
The financial impact of the 2019 change is as outlined on page 300 of the Corporate Plan.  Revenue projection for 2019 $661,072.  Estimated impact to ratepayer $3.75 per month.
Attachments
Bylaw C-1064-19
COPY - Schedule A - ATCO Agreement

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