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HomeMy WebLinkAboutO-80-24ORDINANCE NO. AN ORDINANCE AMENDING VARIOUS SECTIONS OF CHAPTER 27 OF THE CODE OF ORDINANCES, RELATING TO "UTILITIES" BY AMENDING METHOD OF PURCHASE OF A UTILITY BY CITY; ESTABLISHING PROCEDURE FOR FIXING AND CHANGING RATES; PROVIDING SEVER- ABILITY CLAUSE; PROVIDING AN EFFECTIVE DATE. WHEREAS, the Council of the City of Sebastian finds and determines that in order to protect the public health, safe~ty and welfare of its citizens, it is essential that the City regulate water and sewer utility companies who desire to ope'rate within the Corporate limits of the City; and WHEREAS, the Council of the City of Sebastian has determined that it is in the public interest to assume jurisdiction over each utility who desires to operate within the corporate limits of the City with respect to the utility's authority, service, and rates to be charged; and WHEREAS, the Council has determined that certain amendments to Ordinance No. 0-78-6, the "Utilities Ordinance of the City of Sebastian" are in order. NOW, THEREFORE, Be It Ordained by the Council of the City of Sebastian, as follows: SECTION I. That Ordinance No. 0-78-6 is amended to read as set forth in Section II hereof. SECTION II. That Section 27-1 of the Code of Ordinances, City of Sebastian, Florida, is hereby amended to read as follows: Sec. 27-1 Definitions. A. "Utility" means water or sewer utilities serving subdivision, apartment and housing complexes, condominium, mobile home or trailer parks, industrial complexes, shopping centers and similar systems. "Utility" includes wells, pumps, tanks, treatment facilities, distribution systems, water meters, disposal facilities, force mains, pump stations, collection systems, service lines and pipes, real estate and easements necessary to such systems and includes every person, corporation, lessee, trustee, or receiver owning, operating, managing or controlling a utility system or proposing construction of a system or who is providing or proposes to provide water or sewer service to the public. Bo The word "City" as used herein refers to the City of Sebastian, Florida~ C. "Franchise" means a contract with the City by which the utility is licensed to conduct a particular business within a particular area for a given period of time. SECTION III. That Section 27-4 of the Code of Ordinances, City of Sebastian is hereby amended to read as follows: Sec. 27-4. Rates; Procedure for Fixing and Changing. (1) Except as provided in subsection (4) rates and charges being charged and collected by a utility shall be changed only by approval of the Council. The Council shall, either upon request or upon its own motion, fix rates which are just, reasonable, compensatory, and not unfairly discriminatory. (2) The Company and its successors and assigns shall at all times be limited in its charges for services furnished in accordance with its franchise to a schedule of charges which shall be presented to and approved by said Council. The initial water rates and other charges described in the franchise shall be the rates in effect pursuant to this grant until modified or changed by the parties. The Company may, if it deems it necessary to amend or change said schedule or charges, give the Council notice in writing of same. Within 60 days after notice as aforesaid, the Council shall authorize and hold a public hearing and within 30 days after such public hearing, if the Council shall decline to act, then the Company may forthwith put into effect such amendment or change of schedule. It is understood and agreed that if the Company should raise charges as hereinabove stated, the monies so collected shall be escrowed by the Company or shall post with the Council a good and sufficient Surety Bond, for a period of 90 days. In the event the Council should deny the raise at any time during this 90 day period, the Company shall refund to its customers the monies collected by virtue of the raise. However, upon the expiration of the said 90 day period, if no action is taken by the Council there- tofore, the monies shall become the funds of the Company and there shall be no further obligation on the part of the company to escrow any monies or in the case of a Surety Bond, said Surety Bond will no longer be in force, and the increase in charges shall continue the same as if the request of the Company had been granted. (3) The Council, in fixing rates, may determine the prudent cost of providing service during the period of time the rates will be in effect following the entry of a final order relating to the utility's rate request and may use such costs to determine the revenue requirements that will allow the utility to earn a fair rate of return on its rate base. (4) (a) The approved rates of any utility which receives all or any portion of its utility service from a governmental agency or from a water or sewer utility regulated by the Council and which redistributes that service to its utility customers shall be automatically increased or decreased without hearing, upon verified notice to the Council 90 days prior to its implementation of the increase or decrease that the rates charged by the governmental agency or other utility have changed. Provisions of this subsection shall not prevent a utility from seeking changes in rates pursuant to the provisions of subsection (2). (b) Before implementing a change in rates under this subsection the utility shall file an affirmation under oath as to the accuracy of the figures and calculations -3- upon which the change in rates is based and that the change will not cause the utility to exceed the range of its last authorized rate of return. Whoever makes a false statement in the affirmation required hereunder which he does not believe to be true in regard to any material matter shall be guilty of a felony of the third degree, punishable as provided in s. 775.082, s~ 775.083, Florida Statutes. (c) If, within 24 months of an adjustment in the rates as authorized by this subsection, the Council shall find that a utility did thereby exceed the range of its last ¥ authorized rate of return as set forth in paragraph (e) below, it may order the utility to refund the difference to the rate payers. This provisions shall not be construed to require a corporate performance bond not otherwise required. (d) Notwithstanding anything herein to the contrary, no utility may adjust its rates under this subsection more than two times in any 12-month period. (e) The Council shall by order each year establish a minimal authorized rate of return on common equity which shall reasonably reflect the minimum return on equity for an average water or sewer utility and which, for purposes of this section, shall be the last authorized rate of return for any utility which otherwise would have no established rate of return. Said minimal return on common equity shall not apply to any utility once an overall rate of return has been established for said utility in a proceeding which will result in the establishment of an authorized rate of return. SECTION IV. That Section 27-23 of the Code of Ordinances, City of Sebastian, Florida, is hereby amended to read as follows: Sec. 27~23, Grant. A. Upon public hearing and a determination by the Council that the granting of a franchise would be in the public interest, the franchise shall be granted by a resolution adopted by the City Council, in a form prepared by the appli- cant and approved by the City Attorney, to be effective as of the date of its adoption and shall continue in force and effect for a period of time not to exceed thirty (30) years or until such earlier time as the City shall elect to install or acquire its own water treatment and distribution system and/or its own sewerage collection and treatment system, and supply the same to individual units. If the City elects to install or acquire a water and/or sewer system in an area where a franchise has been granted and the term of said franchise is about'"to or has not expired, then the City shall notify the utility of its intent to acquire its system and terminate or modify said franchise in accordance with Section 27-25. B. Within sixty (60) days of the date of the adoption of the resolution granting a franchise, the franchise holder shall file with the Clerk of the City its written acceptance of the franchise, together with all of its terms and conditions including the provisions of this chapter. Failure to file said written acceptance within the time specified shall automatically repeal the resolution granting said franchise and such franchise shall be null and void and without further force and effect. C. The franchise holder shall supply the City Engineer one accurate set of as-built drawings (on sepia) for each utility, extension of modification thereof. SECTION Vo That the Code of Ordinances, City of Sebastian, Florida, is hereby amended by adding a section to be numbered 27-25 which said section reads as follows: Sec. 27-25. Purchase of Utility Within a reasonable time after the City has notified the utility of its intent to terminate the franchise and to acquire the systen, the franchise holder shall convey all of its facilities together with all easements to the City of Sebastian. Said conveyance by the utility shall be without encumbrance. At this time the franchise holder shall convey unencumbered all of its facilities together with all easements, to the City of Sebastian, without charge as to all property contributed to the utility, provided further, however, that the City shall have the right to purchase the remaining assets of the utility based on the average of the net original cost and a price as computed and agreed upon by three competent and qualified appraisers. The City shall select an appraiser, the Utility shall select an appraiser, and these two appraisers shall mutually agree upon and select a third independent appraiser and these three appraisers shall arrive at the value of the utility and the sales price involved. However, the City shall not be required to purchase and no value will be placed on additions or extensions to the system which were paid for as contributions-in-aid~ef-construction by any person, firm or corporation other than the Utility. At the end of the franchise period, the City shall not be required to pay to the Utility any amount for goodwill and the appraised value shall be based entirely upon physical assets only, and provided further that in the event said Board of Appraisers cannot agree as to the price to be paid by the City, then the City may file appropriate condemnation proceedings under Florida law. Any franchise granted by the City shall include the above require- ment. SECTION VI. That the Code of Ordinances, City of Sebastian, Florida, is hereby amended by adding a section to be numbered 27w26 which said section reads as follows: Sec. 27-26. Violations. Violation of this chapter and/or operating utility without first obtaining a franchise from the City in compliance -6- with the chapter, shall constitute a violation of this Code, and upon conviction shall be punishable as provided in Section 1-10 of this Code. Each day that violation occurs shall be considered a separate violation, SECTION VII, This Ordinance shall become effective immediately upon its passage. SECTION VIII. If any section, sub-section, sentence, clause, phrase, or portion of this ordinance is for any reason held invalid or unconstitutional by any court of competent jurisdiction, such portion shall be deemed a separate, distinct and independent provision and such holding shall not affect the validity of the remaining portions hereof. CITY OF SEBASTIAN P~tt Flood, Jr., ~lq~ayor ATTEST: ~iiy CleFk - · I HEREBY CERTIFY that the foregoing Ordinance was finally approved and passed by the City Council of the City of Sebastian, Florida, this ~~ day of ~~, 19 ~ (S E A L) I HEREBY CERTIFY that Notice of Public Hearing of the foregoing Ordiannce was given in accordance with Section 166.041 of the Florida Statutes, on/F~~ /~~' 1980, in the Vero Beach Press Journal, a newspaper of general circulation in the City of Sebastian, Florida; that said Ordinance passed on first reading on ~~ /~j /~8~ , / 1980, and that said Ordinance passed a second and final reading and was adopted by the City Council of the City of Sebastian, Florida, on 0...~. ~, ~ , 1980. fCit9 Ct[erk,