HomeMy WebLinkAboutCity Council Resolution 20-068 Accepting funding for Rule 20A creditsRESOLUTION NO.20-068
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SARATOGA
TO ACCEPT FUNDING FROM THE CITY OF BURLINGAME FOR PURCHASE OF
SARATOGA'S RULE 20A CREDITS AND TO CLOSE OUT UNDERGROUNDING CIP
PROJECTS
WHEREAS, the Rule 20A Program was established by the California Public Utility
Commission (CPUC) in 1967 with a goal to eliminate the concentration of overhead utility lines
and wooden poles along major arterial streets, civic centers, and downtowns, and;
WHEREAS, Rule 20A created "Credits" that could accumulate until enough were
banked to finance an undergrounding project, and;
WHEREAS since the Program's inception the City has completed seven undergrounding
projects including a project in the Village, and;
WHEREAS, in 1998, the City began developing a Rule 20A project along Saratoga Ave
from Fruitvale Ave. to Baroni Ct. (Undergrounding Project No. 8) with the intention to
ultimately underground all wires and wooden poles along Saratoga Ave. from Fruitvale Ave to
the Village (Heritage Lane) in subsequent phases, and;
WHEREAS, PG&E went bankrupt in the early 2000s and during the pause of the
Program, the City's Undergrounding Project No. 8 expired, and;
WHEREAS, early this year, Staff looked into re-establishing an undergrounding project
along Saratoga Avenue and discussions with PG&E led to the determination the purchasing
power of a credit had fallen to 16% of what the Credit was worth in 1998, leaving the City with
insufficient credits accumulated for the project, and;
WHEREAS, PG&E allows cities to transfer credits to other cities based on a mutual
agreement, and;
WHEREAS, On October 20, 2022, the City of Burlingame offered to purchase
Saratoga's 4,027,766 Rule 20A Credits for a payment of 30 cents per Credit ($1,208,329.80);
and
WHEREAS, given the diminishing value of Rule 20A Credits, the decades it takes to
bank enough Credits to perform a project, PG&E's potential new bankruptcy problems, and
pending CPUC proceedings that may sunset the current Rule 20A Program for something
different, the City Council authorizes the acceptance of Burlingame's offer and directs that
payment will be deposited into the unallocated Capital Improvement Reserve; and
WHEREAS, the City has established a Rule 20A Undergrounding Project Capital
Improvement Project and a Quito Road Undergrounding Project for fees collected from the
original Quito Road Subdivision applicant for the future undergrounding of utilities on Quito
Road near Twin Creeks Road, and;
WHEREAS, as a consequence of transferring the City's Rule 20A credits to Burlingame,
and no undergrounding project intended for the near future, the City will close out the Rule 20A
Undergrounding Project CIP and the Quito Road Undergrounding CIP and refund the collected
fees back to the applicant through the following budget adjustments:
Account Description Account Number Increase Decrease
To appropriate revenue from the transfer of Saratoga's RULE 20A Credits to the City of
Burlingame, for submittal into the Capital Improvement Reserve
Rule 20A transfer payment 1 1 1.8101.46391 $1,208,329.80
Account Description Account Number Increase Decrease
To eliminate the appropriated expenditure budget in the Quito Road Undergrounding CIP
Project and appropriate a revenue refund payment
Rule 20A refund community benefit fee 411.9171.002.46711 $98,744
Rule 20A expenditure 411.9171-002.81 161 $98,744
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of
Saratoga hereby:
1. Directs the City Manager to sign the Memorandum of Understanding proposed by
the City of Burlingame on October 20, 2020 and to take all actions necessary to implement the
MOU;
2. Approves the above budget adjustments and refund payment as described above.
BE IT FURTHER RESOLVED, the above and foregoing resolution was passed and
adopted at a regular meeting of the Saratoga City Council held on the 21 st day of October 2020
by the following vote:
AYES: Mayor Howard A. Miller, Vice Mayor Mary -Lynne Bernald, Council Members
Yan Zhao, Rishi Kumar
NOES:
ABSENT:
ABSTAIN:
d
Howard X Miller, Mayor
A T:
DATE: l 0
Debbie Bretschnei er, MC
City Clerk
1299850.3