CC Resolution No. 9476RESOLUTION NO. 9476
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CUPERTINO
AUTHORIZING PARTICIPATION IN THE ASSOCIATION OF BAY AREA
GOVERNMENTS' POWER PURCHASING POOL
WHEREAS, the City of Cupertino is currently purchasing natural gas and related
transportation and distribution services from Pacific Gas & Electric (PG &E); and
WHEREAS, energy rates in the Bay Area are among the highest in the nation,
particularly for natural gas and electricity; and
WHEREAS, deregulation of the natural gas industry in 1986 and deregulation of the
electric services industry currently under consideration by the California Public Utilities
Commission and the State legislature is creating new opportunities for local governments to
lower their energy costs through collective action; and
WHEREAS, there are no existing power purchasing pools for Bay Area local
governments interested in lower energy costs; and
WHEREAS, bulk purchasing of natural gas has proven itself to be a legal and cost -
effective means to achieve reduction in energy costs through the use of a competitive bid
program; and
WHEREAS, it would greatly benefit the City of Cupertino to be prepared to take
advantages of any coming changing in the regulation of the electric market; and
WHEREAS, the City of Cupertino is a member /associate member of the Association of
Bay Area Governments (ABAG); and
WHEREAS, ABAG, in conjunction with New Energy Ventures, Inc. (NEV), proposes to
form a Power Purchasing Pool Program to aggregate natural gas needs of interested ABAG
members and associate members, to collectively negotiate a purchase of natural gas and
transportation services through a competitive request for proposals, and to negotiate an
agreement with PG &E for distribution of natural gas.
NOW, THEREFORE, BE IT RESOLVED, that the City Council hereby authorizes the
participation of the City of Cupertino in the ABAG Power Purchasing Pool to undertake a bulk
purchasing program for natural gas on behalf of the City of Cupertino and other ABAG members
or cooperating members.
BE IT FURTHER RESOLVED, that the City Manager, or his/her designee, is authorized
to enter into a subscription agreement with ABAG, in substantially the form set forth in the
attached Exhibit A appointing ABAG as the agent for the City of Cupertino in negotiating a
Resolution No. 9476 • •
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distribution agreement with PG &E, issuing a Request for Proposal for the purchase and
transportation of natural gas and negotiation of a contract with the responsive, responsible
contractor proposing the lowest costs.
BE IT ALSO RESOLVED, that the City Manager is authorized to execute and deliver the
contracts negotiated by ABAG on behalf of the City of Cupertino and is appointed the City's
representative on ABAG's Power Purchasing Committee to oversee the operation of Power
Purchasing Pool program.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of
Cupertino this 16th day of October, 1995, by the following vote:
Y=
AYES:
Bautista, Burnett, Koppel, Sorensen, Dean
NOES:
None
ABSENT:
None
ABSTAIN:
None
ATTEST: APPROVED:
City Clerk Mayor, City Cupertino
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Exhibit A
POWER PURCHASING PROGRAM
SUBSCRIPTION AGREEMENT
No. 96.01
This Agreement made effective the day of , 1995, between the
Association of Bay Area Governments (ABAG), a joint powers entity created pursuant to
California Government Code Sections 6500 et. seq., and the City of Cupertino (City), a
California Corporation.
RECITALS .
A. The City currently purchases natural gas, and natural gas transportation and distribution
from Pacific Gas & Electric (PG &E).
B. ABAG, with the assistance of New Energy Ventures, Inc. (NEV), has organized a
program for the bulk purchase of natural gas and for natural gas transportation and
distribution services on behalf of interested members of ABAG (Power Purchasing
Program).
C. ABAG's Power Purchasing Program has the potential to generate cost savings in the
City's use of natural gas.
Therefore, in consideration of the mutual promises contained in this Agreement, the
parties agree to perform as follows:
1. Scope of Services.
(a) The City hereby appoints ABAG its exclusive agent from the effective date of this
Agreement until the Expiration Date as defined in Section 2 or until this
Agreement is terminated in accordance with its terms, with all powers reasonably
necessary to accomplish the following:
(1) Negotiate an agreement with PG &E for the distribution of natural gas to
some or all of the locations at which PG &E currently distributes natural
gas to the City (PG &E Agreement) .
(2) Issue a Request for Proposal (RFP) for the purchase and delivery of
natural gas to the PG &E distribution system.
(3) Negotiate a contract with the responsive, responsible entity proposing the
lowest cost for furnishing and transporting natural gas (Natural Gas
Purchase Contract).
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(b) City acknowledges that ABAG will be aggregating some or all of the natural gas
requirements of the City and other members and associate members of ABAG and
that the RFP process, negotiations and contracts contemplated under subsection
1(a) will be performed on behalf of the City and other ABAG members. City will
use reasonable efforts to transmit, or cause to be transmitted to ABAG such
information as may be necessary for ABAG to determine the City's natural gas
needs based on past usage patterns and to efficiently aggregate the City's natural
gas needs with those of other ABAG members participating in the Power
Purchasing Program, including utility bills and locations of utility meters.
(c) ABAG will act on behalf of the City and other members of ABAG
participating in the Power Purchasing Program as described in subsection 1(a) of
this Agreement.
2. Term. This Agreement is effective as the date first set forth above and shall expire on
the earlier of the projected date of the expiration of the fast Natural Gas Purchase
Contract or the date the City fails to execute and deliver the Natural Gas Purchase
Contract or the PG &E Agreement pursuant to Section 4(b) (Expiration Date). This
Agreement may terminate prior to the expiration date in accordance with the provisions
of Section 10 of Exhibit A.
3. Compensation.
(a) Upon execution and delivery of the Natural Gas Purchase Contract and PG &E
Agreement, the City shall be obligated to pay transaction fees to ABAG to cover
ABAG's costs in implementing the Power Purchasing Program. ABAG's
transaction fees will not exceed six cents ($.06) per decatherm of natural gas
delivered to the City during the term of the Natural Gas Purchase Contract.
(b) The amount or method of determining of ABAG's fees will be identified in the
Rate Proposal described in Section 4(a).
(c) Subject to Section 3(a), on the first day of each [month/quarter /or exact dates],
ABAG will send an invoice for its fees to City for review. City will pay the
invoice within thirty (30) days of receipt or submit a written statement within that
time stating the basis for the City's disapproval of all or a portion of the invoice.
Fee disputes will be resolved by mutual agreement [or submitted to arbitration
under Section 13 of Exhibit A].
4. Participation.
(a) Upon completion of ABAG's negotiation of a PG &E Agreement and a Natural
Gas Purchase Contract, such agreements and a Rate Schedule containing (1) the
proposed total unit cost of natural gas as transported to identified City meter
locations; (2) the total unit cost of natural gas transferred to identified City
locations last year; and (3) ABAG's fees shall be submitted to the individual
identified in Section
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(b) The City shall within ( working days of the date of the Rate
Schedule deliver to ABAG:
(1) Duly authorized and validly executed originals of the Natural Gas
Purchase Contract and PG &E Agreement; or
(2) The City's rejection of the agreements and/or fees; or
(3) The City Council resolution withdrawing from the Power Purchasing
Program.
5. Power Purchasing Pool Committee. Upon execution and delivery of the PG &E
Agreement and the Natural Gas Purchase Contract, the City Manager or his designee,
shall be the City's representative to the Power Purchasing Pool Committee. The Power
Purchasing Pool Committee shall provide policy direction for the Power Purchasing
Program. The Committee's powers shall include admission of new Participants and the
extension of the PG &E Agreement and the Natural Gas Purchase Contract, under rules
and procedures adopted by the Committee.
6. Approvals. The City Representative may grant any approval, or give any direction
required by this Agreement, in writing or orally. Written approvals or directions may be
transmitted physically, by facsimile or electronically. Oral approvals will be confirmed
in writing by either party.
7. Written Notices. Written notices shall be transmitted to the following:
ABAG: ,
Association of Bay Area Governments
P.O. Box 2050
Oakland, CA 94604 -2050
Facsimile:
Electronic Mail:
Public Agency: Carol Atwood
City of Cupertino
10300 Torre Avenue
Cupertino, CA 95014
8. Attorneys' Fees. In the event either of the parties brings an action or legal proceeding
due to an alleged breach of this Agreement, the prevailing party shall be entitled to
recover reasonable attorneys' fees and costs as determined by a court of competent
jurisdiction.
9. Subcontractors. ABAG may not subcontract any portion of the work under this
Agreement without the City's prior written consent. The City hereby consents to
ABAG's contracting with NEV.
10. Ownership of Files, Reports, Photographs, and Related Documents. Upon
completion of the work or termination of the Agreement, any and all files, reports,
photographs, plans, specifications, drawings, data, maps, models and related documents
respecting in any way the subject matter of this Agreement, whether prepared by ABAG,
the City or third parties and in whatever media they are stored shall remain or shall
become the property of the City and the City shall acquire title to, and copyright
ownership of, all such documents. The City hereby grants to ABAG an irrevocable
license to retain a copy of all records covered by this section for ABAG's files.
11. Other Contract Provisions. This Agreement shall be subject to the other standard
provisions which are set forth in the attached Exhibit A -1, which is incorporated by this
reference.
IN WITNESS WHEREOF, the parties have hereunto set their hands effective the date and year
first above written.
ASSOCIATION OF BAY AREA GOVERNMENTS
by:
Eugene Y. Leong, Executive Director
Approved as to legal form and content:
by:
Kenneth K. Moy, Legal Counsel
City of Cupertino
by:
Donald D. Brown, City Manager
Approved as to legal form and content:
by:
Charles T. Kilian, City Attorney
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EXHIBIT A -1
STANDARD CONTRACT PROVISIONS
1. Assignmen . This Agreement shall not be assigned, transferred, hypothecated, or
pledged by either party without prior written consent of the other.
2. Amendment. This Agreement may be amended at any time, but only by a writing signed
by both parties.
3. Time of Essence. Time is of the essence in this Agreement.
4. Waiver. The waiver by either party of a breach by the other of any provision of this
Agreement shall not constitute a continuing waiver or a waiver of any subsequent breach
either of the same or a different provision of this Agreement.
5. $ggdino-q. The descriptive headings used in this Agreement are for convenience only
and shall not control or affect the meaning or construction of any of its provisions.
6. Entire Agreement. This Agreement is entire as to all of the performances to be rendered
under it. This Agreement supersedes any and all other contracts either oral or in writing
between ABAG and City with respect to the subject matter hereof and contains all of the
covenants and agreements between the parties with respect to such matter. Each party to
this Agreement acknowledges that no representations, inducements, promises, or
contracts, orally or otherwise, have been made by any party, or anyone acting on behalf
of any party, which are not embodied herein, and that no other contract, statement, or
promise not contained in this Agreement shall be valid or binding.
7. Controlling Law. This Agreement and all matters relating to it shall be governed by the
laws of the State of California
8. Binding on Successors, Etc. This Agreement shall be binding upon the successors,
assigns, or transferees of ABAG or City as the case may be. This provision shall not be
construed as an authoriTation to assign, transfer, hypothecate, or pledge this Agreement
other than as provided above.
9. Severability. Should any part of this Agreement be declared unconstitutional, invalid, or
beyond the authority of either party to enter into or carry out, such decision shall not
affect the validity of the remainder of this Agreement, which shall continue in full force
and effect; provided that, the remainder of this Agreement can, absent the excised
portion, be reasonably interpreted to give effect to the intentions of the parties.
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10. Termination. If, through any cause, either party fails to fulfill in timely and proper
manner its obligations under this Agreement, or if such party violates any of the
covenants, conditions, contracts, or stipulations of this Agreement, the other party has the
right to terminate this Agreement by giving written notice to the breaching party
specifying the effective date of termination. Notice of termination shall be given at least
five (5) days before its effective date. This section does not relieve the other party of
liability to the other for damages arising out of a breach of this Agreement.
11. Records /Audit. ABAG shall keep complete and accurate books and records of all
financial aspects of its relationship with City in accordance with generally- accepted
accounting principles. ABAG shall permit authorized representatives of City and/or any
of City's governmental grantors to Inspect, copy, and audit all data and records of ABAG
relating to its performance of services under this Agreement. ABAG shall maintain all
such data and records intact for a period of three (3) years after the date that services are
completed hereunder or this Agreement is otherwise terminated.
12. Prohibited Interest. ABAG's officers, employees or agents shall neither solicit nor
accept gratuities, favors or anything of monetary value from contractors, potential
contractors, or parties to subcontracts.
13. Insurance Requirements.
(a) ABAG shall, at its own expense, obtain and maintain in effect at all times during
the life of this Agreement the following insurance:
(1) Workers' compensation insurance as required by law.
(2) Comprehensive general liability insurance coverage of One Million
Dollars (51,000,000) in the aggregate for products and/or completed
operations and One Million Dollars ($1,000,000) per occurrence for
automobiles.
(3) Professional liability insurance with minimum liability limits of Two
Million Dollars ($2,000,000) in the aggregate.
(b) All ABAG's insurance policies shall contain an endorsement providing that
written notice shall be given to City at least thirty (30) days prior to termination,
cancellation, or reduction of coverage in the policy or policies, and all policies
shall be carried by an insurance company or companies acceptable to City.
(c) In addition, each policy or policies of insurance described in subparagraph (2)
above shall contain an endorsement providing for inclusion of City and its
directors, officers, agents, and employees as additional insureds with respect to
the work or operations in connection with this Agreement and providing that such
insurance is primary insurance and that no insurance of City will be called upon
to contribute to a loss.
(d) Promptly upon execution of this Agreement, ABAG shall deliver to City
certificates of insurance evidencing the above insurance coverages. Such
certificates shall make reference to all provisions or endorsements required herein
and shall be signed on behalf of the insurer by an authorized representative
thereof. ABAG agrees that at any time upon written request by City to make
available copies of such policies certified by an authorized representative of the
insured.
(e) The foregoing requirements as to types and limits of insurance coverage to be
maintained by ABAG and approval of policies by City are not intended to, and
shall not, in any manner limit or qualify the liabilities and obligations otherwise
assumed by ABAG pursuant to this Agreement, including, but not limited to,
liability assumed pursuant to ABAG's insurance policies under Subsections (a)(2)
of this section.
(� ABAG shall require all subcontractors to comply with the insurance requirements
described in Section 13(a )-(d), inclusive.
(14. Arbitration. Any dispute between ABAG and the City regarding the interpretation,
effects, alleged breach or powers and duties arising out of this Agreement shall be
submitted to binding arbitration. The arbitrator shall be selected by agreement between
the parties by lot from a list of up to six (6) arbitrators with each party submitting up to
three (3) arbitrators.]