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HomeMy WebLinkAboutOrdinance No. 19575ORDINANCE NO, 19575 AN ORDINANCE AUTHORIZING THE INSTITUTION OF PROCEEDINGS IN EMINENT DOMAIN FOR THE ACQUISITION BY CONDEMNATION OF REAL AND PERSONAL PROPERTY USED FOR RENDERING ELECTRICAL UTILITY SERVICE AND PRIMARILY LOCATED IN THE WILLOW CREEK AREA, AND OWNED BY LANE ELECTRIC COOPERATIVE, INC, AND/OR LANE COUNTY ELECTRIC COOPERATIVE, INC. The City Council of the City of Eugene finds that: 1. The City of Eugene has authority under both the Eugene Charter and applicable state law to institute proceedings in eminent domain far the acquisition by condemnation of real and personal property far public purposes, including for the improvement and expansion of the City of Eugene's electrical distribution systems and the reallocation of electric utility service areas. 2. Management of the growth of the City of Eugene is guided ,in the first instance by the Metropolitan Area General Plan Metro Plan, a land use comprehensive plan. The Metro Plan requires the City to take steps to assure that the Eugene Water & Electric Board is the provider of electrical utility service within the urban growth boundary. The Metro Plan also requires the City to make electrical service available to designated special light industrial tracts in the Willow Creek area within the urban growth boundary. The orderly and economic provision of electrical service to this area is necessary to implement state law as refined in the Metro Plan. The provision of such service is necessary far the economic well-being of citizens of the City of Eugene. The Metro Plan contains the fallowing policies relevant to the provision of electrical service in the Willow Creek area:. a. Fundamental Principle No. 6 states that the Metro Plan 'pis based on the premise that Eugene and Springfield . are the logical providers of services accommodating urban levels of development within the urban growth boundary." Metro Plan, p. II-1.~ b. Growth Management Element Policy No. 16 commands that, "Eugene and Springfield and their respective utility branches, Eugene Water and Electric Board and Springfield Utility Board, shall be the water and electrical service providers within the urban growth boundary." Metro Plan, p. II-B-6.~ c. Economic Element Policies Nas. 6, 17, 2l, and Ordinance - l 22 require the, City of Eugene,to increase the supply of light industrial, land, particularly for .large scale light manufacturing users, and to aggressively pursue an annexation, servicing and coning program for designated special light industrial sites. €Metro Plan, pp, III-B-~5 and III-B-6.} d. The Metro Plan diagram designates a large parcel in the Willow Creek area as "Special Light Industrial." The designation of this parcel and six other special light parcels in the metropolitan area, occurred after a canvass of the entire .area for suitable parcels for this type of use. The Willow Creek parcel is the premier special light industrial site in the Eugene-Springfield area. 3. Because of these Metro Plan policies, the City of Eugene has spent considerable public funds extending sanitary sewers to the Willow Creek area and constructing public improvements in that area. Since 1982, the City has extended the West Eugene sewer trunk line to the Willow Creek area at a cast of $2,7 million. Investments in streets, storm drainage, and other public improvements have totalled $823,DDD.DD, Much of the area was annexed to the City of Eugene in 1984-82 and 1987. Without industrial development, the return an this public investment in the area will be minimal, 4, Cost and reliability of electrical service are key concerns to industries who are targeted to locate in the Willow Creek area. According to the Metro Partnership, several companies indicated they would not locate in the Willow Creek area unless their concerns about cost and reliability of electrical service were resolved. There have been a number of other cases where electrical power would have been a serious issue if negotiations had progressed. Prospective industries have indicated a preference for EWEB service due to EWEB's proven ability to provide highly reliable, low-cost electric service. Companies already located in the Willow Creek area have also expressed concerns about the cost and reliability of electrical service from Lane Electric Cooperative ~LEC}. 5. At current rates, typical electric bills of existing Willow Creek customers would drop by as much as 34~ if those customers were served by EWER, dependent upon customer classification and monthly use. According to a study conducted for EWER by the consulting firm of R.W. Beck, Willow Creek customers will save $4,3 million aver 2Q years if EWEB serves them due primarily to these lower rates. ~. before full industrial development in the area can occur, substantial expenditures on new electric facilities will be needed. The R.W. Beck report concludes that the cast to Ordinance - 2 provide service to Willow Creek would be $2.65 million lower if EWEB serves the area. These savings are due primarily to elimination of duplicative facilities necessary to connect EWE~'s service areas which straddle the Willow Creek area and because EWEB's operating expenses are lower than LEC's. 7, EWEB presently services property to the north, east, west, and partly to the south of the Willow Creek area. EWEB currently has electrical substations .2 and 1.5 miles from the Willow Creek area. EWEB will construct electric circuits through the Willow Creek area to serve its present customers. EWEB must make this investment regardless of which utility services the Willow Creek area. LEC will need to duplicate this investment in order to serve the Willow Creek area. 8, EWEB presently provides the southwest area of Eugene with an urban level of electric service that is highly reliable. LEC currently provides a rural level of reliability for electric service to the area, with frequent and longer interruptions of service. In order for LEC to upgrade its f acilities to provide an urban level of electrical service to the Willow Creek area, it will need to make substantial expenditures. EWEB will be able to provide power to users in the Willow Creek area more cheaply than LEC and at lower rates. 9. The R.W, Beck report states that existing customers of LEC will not pay significantly cheaper rates if LEC services the Willow Creek area. 10. Under CRS 758.4701}, when a municipality condemns another person's equipment, plant ar facilities for rendering utility service, it acquires the utility's territorial allocation that is served by the acquired properties. Condemnation of the assets of Lane Electric Cooperative, Inc. used to provide electric service to the Willow Creek area is necessary to effect a reallocation of the service territory from LEC to EWEB. This reallocation will result in the least private injury to LEC if it occurs at the present time before significant investments have been made by LEC in electrical facilities far the area. ll. Attempts to negotiate a transfer of territory between the utilities have failed, Negotiations in 1971, 1979, and 1987 were unsuccessful. An agreement was reached in 1975 and submitted to the Public Utility Commissioner by the utilities. This agreement was rejected by the PUC and abandoned by the parties. 12. The policies of the Metro Plan, the interests of the citizens of the City of Eugene in economic diversification, avoidanc a of duplication of investments in electrical distribution facilities, the least cost and injury to purchasers of electricity, and improved marketability of industrial property Drdinance -~ 3 in the Willow Creek area can best be served if EWEB provides electrical service to the billow Creek area, The least private injury to LEC will occur if the transfer of territory occurs soon. The City Council concludes that a public necessity exists for the acquisition of property owned by LEC for any of these reasons and does not rely on the accuracy of any particular finding made above in reaching this conclusion. 13. Lane Electric Cooperative is presently providing electricity to customers within the City of Eugene and using public right-of~-way for these purposes. LEC has no franchise from the City of Eugene for this purpose. Now, therefore, based an the above findings, the findings set out in the staf f report, and the record and testimony before the Council, THE CITY CF EUGENE DOES CRDAIN AS F4LLCWS: Section 1. Based generally on the above findings, which are adopted and incorporated herein, the City Council determines that it is necessary to acquire ownership of the real and personal property of the electric distribution system located in the Willow Creek area and owned by Lane County Electric Cooperative, Inc. and/ar Lane Electric Cooperative, Inc., a description of which is attached hereto as Exhibit "A" and incorporated herein as though fully set forth. Section 2. The City Council directs that the City of Eugene, acting by and through the Eugene Water & Electric Board, at least twenty ~ 20 3 days prior to the filing of any action for condemnation shall make a written offer to the owners or parties having an interest in the property described in Exhibit "A" attached hereto, of a stated amount as compensation therefor and that if that offer is not accepted that proceedings in eminent domain be instituted for the condemnation of the above described property. Section 3. The City Council declares that acquisition of title to the property described on Exhibit "A" is necessary far the public welfare and for the public purposes described in part in the above findings, that acquisition of the property and service to the affected territory by EWEB is consistent with the greatest public good and least private injury, and that acquisition of the property is authorized under the laws of the State of Oregon and the Charter, ordinances, Metropolitan ,Area General Plan and policies of the City of Eugene. Section 4. The City Council further declares that the property described on Exhibit "A" shall be used by the City of Eugene far public purposes at the earliest possible date and, in Ordinance ~- 4 any event, na later than ten years from the date this Ordinance is adopted by the Council and approved by the Mayar. Passed by the City Council this loth day of August, 1988. City Recor er ti 1988. Ordinance - 5 Approved by the N~ayar this 10th dax of Auau EXHIBIT "A" TO CITY CF EUGENE ORDINANCE N0. 19575 All rights. title, and interest in all real and personal property composing the equipment, plant, and facilities owned or controlled by Lane Electric Cooperative, Inc. and/ar Lane County Cooperative, Inc., used to specifically serve the service area of Lane Electric Cooperative located within the city limits of the City of Eugene and south of West 11th Avenue and west of Bertelsen Road, and including, but not limited to all electric distribution facilities owned by Lane Electric Cooperative and/or Lane County Electric Cooperative, located in the southwest portion of the City of Eugene and within the city limitsf more specifically located west of Bailey Hill Road, south of Royal Avenue, east of Greenhill Road, and north of the existing southern border of the city limits. These electric distribution facilities include, but are not limited to, all poles, boxes, conductors, conduits, transformers, switches, meters, lighting, and other associated facilities utilized to provide electric service and operating at less than 15,004 volts ~15kV~; and the "west 11th Avenue Substation", including transformers, conductors, and associated facilities an Bertelsen Road, south of west 11th Avenue. The following electric facilities awned by Lane Electric Cooperative and located within the above-described area are excluded: poles, conductors, connectors, and other associated facilities used for an existing Lane Electric Cooperative 34.5 kV electric transmission circuit located in part on Bertelsen Road, West 18th Avenue, and Four oaks Grange Road.