HomeMy WebLinkAboutReso 2008-139 - Take and Pay contracts
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RESOLUTION NO. 2008 - 139
A RESOLUTION OF THE CITY COUNCIL OF REDDING AUTHORIZING
THE ELECTRIC UTILITY DIRECTOR TO ENTER INTO ONE OR MORE
T AKE-AND-PAY CONTRACTS, AUTHORIZING CITY PARTICIPATION IN
THE M-S-R ENERGY AUTHORITY, AND PARTICIPATION BY REDDING
ELECTRIC UTILITY WITH REPRESENTATION ON THE NEW M-S-R
ENERGY AUTHORITY BY EITHER THE ELECTRIC UTILITY DIRECTOR
OR THE ASSISTANT ELECTRIC UTILITY DIRECTOR.
WHEREAS, on August 3, 2007, the City Council directed the Electric Utility Director to
negotiate a Take-and-Pay contract and a long-term natural gas storage agreement; and
WHEREAS, negotiations have advanced to the point, subject to market conditions, where
Take-and-Pay contracts can be signed within the next several weeks; and
WHEREAS, the M-S-R Commission has recommended formation of a new Joint Powers
Agency, the M-S-R Energy Authority, to enter into a Take-and-Pay contract with CitiGroup; and
WHEREAS, Article 1 of Chapter 5 of Division 7 of Title I of the Government Code of the
state of California authorizes and empowers local agencies to form joint powers authority, and Article
4 of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California authorizes
and empowers such an authority to issue bonds for the purpose of financing public capital
improvements, working capital, liability, and other insurance needs, and projects whenever there are
significant public benefits.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Redding that:
1. The Mayor is authorized to execute the Joint Exercise of Powers Agreement of the M-S-R
Energy Authority ("Authority") hereby making the City of Redding a participant in the
Authority;
2. The City appoints the Assistant Electric Utility Director-Resource Planning as its
Commissioner and the Electric Utility Director as its alternate on the new Authority
Commission.
BE IT FURTHER RESOLVED by the City Council of the City of Redding that:
1. The Electric Utility Director is authorized to execute and/or authorize one or more Take-and
Pay contracts on behalf of the City of Redding or through participation in the Authority,
subject to the following conditions:
A)
The City Attorney confirms that the bonds associated with the Take-and-Pay
contract(s) are non-recourse to the City;
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B) The expected discount on an annual basis is $.75 or more per Dth;
C) The aggregate quantity of Take-and-Pay natural gas inclusive of all contracts(s) will
not exceed 7000 Dth/dy for the years 2008-20 I 0, and will not exceed 8500 Dth/dy for
the years 2011-2038;
2. Subject to the aforementioned conditions, the Electric Utility Director is further authorized to
execute and/or authorize all ancillary contractual documents including, but not limited to, the
Natural Gas Supply Agreement with the Authority, when execution of said contract is
necessary to undertake a Take-and-Pay contract.
I HEREBY CERTIFY that the foregoing resolution was introduced, read, and adopted at a
regular meeting of the City Council on the l;t day of July, 2008, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
COUNCIL MEMBERS:
COUNCIL MEMBERS:
COUNCIL MEMBERS:
COUNCIL MEMBERS:
Bosetti, Dickerson, Jones, Murray, and Stegall
None
None
None
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MAR LE S STEGALL, M or
Attest:
Form Approved:
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CONNI~ ST,~OHi\1A Yt<:pcf?;; Clerk
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RICHARD A. DUVERN , City Attorney
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