HomeMy WebLinkAboutOrdinance #3935 ORDINANCE NO. 3935
AN ORDINANCE OF THE CITY OF HUNTINGTON BEACH
AMENDING ORDINANCE NO. 3354 WHICH GRANTED
AN OIL PIPELINE FRANCHISE
WHEREAS, in April 1997, the City Council adopted Ordinance No. 3354 which granted a
franchise to Torch Operating Company to construct, operate and maintain a pipeline for the
transportation of oil; and
DCOR, LLC subsequently became successor in interest to Torch Operating Company,
NOW, THEREFORE, the City Council of the City of Huntington Beach does hereby ordain
as follows:
SECTION 1. The terms and conditions of the franchise awarded by this ordinance are
contained in the "Assignment and Amendment of Franchise Agreement between the City of
Huntington Beach and DCOR, LLC and Torch Operating Company," a copy of which is attached
hereto as Exhibit"A" and incorporated by this reference as though set forth herein.
SECTION 2. The City Clerk shall cause this ordinance to be posted in three places
designated by the City Council within the City and to be published by title with a brief summary at
least once within fifteen days after its adoption in a daily, semi-weekly or weekly newspaper,
published in the County of Orange or the City and circulated in the City, which is selected by the
City Council for that purpose.
PASSED AND ADOPTED by the City Council of the City of Huntington Beach at a regular
meeting thereof held on the 1.9th day of March , 2012 .
Mayor
ATTEST: INITIA-T-ED AND APPROVED:
9"4 CYVC
City Clerk 07 Director of Economic Development
REVI AND APPROVED:
APPROVED AS TO FORM:
Ci Manager
��h 7 q-
City Attorne ,,
67960 1
Exhibit"A" - Ordinance No 3935
ASSIGNMENT AND AMENDMENT OF FRANCHISE AGREEMENT
BETWEEN THE CITY OF HUNTINGTON BEACH AND
DCOR,LLC PURSUANT TO CITY'S
PIPELINE FRANCHISE ORDINANCE
THIS ASSIGNMENT AND AMENDMENT OF FRANCHISE AGREEMENT (this
"Amendment") is made and entered into this .57 "" day of 201Z,by
and between the CITY OF HUNTINGTON BEACH, a municipal corporation of the State of
California (hereinafter referred to as "CITY'), and PLAINS EXPLORATION AND
PRODUCTION COMPANY, a Delaware corporation ("PXP" or "Assignor") and DCOR,
LLC, a Texas limited liability company("DCOR or Assignee or Franchisee"),pursuant to the
CITY's "Pipeline Franchise Ordinance" as set forth in Chapter 3.44 of the Huntington Beach
Municipal Code(Section 3.44.010, et seq.).
RECITALS
WHEREAS, by Ordinance No. 3354, the City Council granted to Torch Operating
Company a franchise for the construction, operation and maintenance of a pipeline system for
the transportation of oil, gas and other hydrocarbon substances (the "Franchise Agreement");
and
Said Franchise Agreement is due to expire on February 20, 2013; and
Assignor wishes to assign to Assignee all of its rights and obligations under the
Franchise Agreement with the CITY,'pursuant to Huntington Beach Municipal Code Chapter
3.44; and
PXP and DCOR have requested that the CITY consent to the assignment and
amendment of the Franchise Agreement to DCOR following interim transfers from TORCH
OPERATING COMPANY to NUEVO ENERGY COMPANY to PLAINS EXPLORATION
AND PRODUCTION COMPANY, and finally from PLAINS EXPLORATION AND
PRODUCTION COMPANY to DCOR; and
Unless specifically amended by this Amendment the parties agree that the assignment
of the Franchise Agreement will not affect past obligations created by Ordinance No. 3354,
the Franchise Agreement or any revisions thereto, and;
The Franchise Agreement and Huntington Beach Municipal.Code ("HBMC") requires
the prior written consent of the CITY for the assignment thereof, and;
The City Council has determined that consent to the assignment and extension of said
Franchise Agreement by the granting of this Amendment would be consistent with the public
interest, convenience and necessity,
1
10-2748nO235
Exhibit"A" - Ordinance No 3935
NOW, THEREFORE,the CITY, PXP and DCOR agree as follows:
1. GRANT
The CITY hereby approves the assignment of the Franchise Agreement from Assignor
to Assignee and amends the Term of the Franchise Agreement for a term commencing on the
date this Amendment is approved by the City Council and extended through February 19,
2028, subject to all limitations, restrictions and conditions set forth in the Franchise
Agreement incorporated herein by specific reference, and subject to all terms and conditions
contained within HBMC Chapter 3.44 incorporated herein by specific reference. If any terms
referenced in the Franchise Agreement or the HBMC are in conflict with this Amendment the
terms of this Amendment shall govern, followed by the HBMC, followed by the Franchise
Agreement, except that any term more protective of the CITY's rights and remedies shall
govern regardless of which agreement or code sections are thereby referenced. The CITY
hereby grants to DCOR the right, privilege and franchise to lay, construct, maintain, operate,
renew, repair, change the size of, remove or abandon in place one or more existing pipes and
pipelines for the collection, transportation or distribution of oil, water, gas, gasoline,
petroleum, wet gas, or other hydrocarbon substances, together with all manholes, valves,
appurtenances and service connections necessary or convenient for the operation of said pipes
or pipelines including conduits, cathodic protection devices, wires, cables and other
appurtenances necessary or convenient for the exercise of DCOR's business, in, under and
along certain streets, roads, highways, alleys, lanes and other public ways within CITY as
herein designated or as may subsequently be authorized pursuant to Section 3.44.330 of the
HBMC.
2. APPLICATION OF GRANT
This Amendment and the Franchise Agreement shall apply to that portion of the
pipeline system within the territorial limits of CITY in existence on the date this Amendment
is approved by the City Council as follows:
Eight-inch natural gas pipeline running from DCOR's Platform Eva onshore to the
Southern California Gas Company metering station near Los Patos Avenue as depicted
on those certain alignment drawings titled TORCH OPERATING COMPANY -
PLATFORM EVA GAS GATHERING PIPELINE SYSTEM and comprised of
drawing numbers 32-A-001-G, 32-PA-101-G through 32-PA-104-G and 32-PA-107-
G. Said drawings are made a part hereof by reference.
Eight-inch crude oil pipeline running from DCOR's Platform Eva to DCOR's
onshore separation facility known as "Fort Apache" and located near the intersection
of Heil Avenue and Algonquin Avenue as depicted on those certain drawings titled
"TORCH OPERATING COMPANY - PLATFORM EVA 8" OIL PIPELINE
SYSTEM" and comprised of drawing numbers 32-A-001-L, 32-PA-101-L through 32-
PA-1II-L, inclusive, 32-P-203-L and 32-P-302-L. Said drawings are made a part
hereof by reference.
2
i o-274snoz35
Exhibit"A" - Ordinance No 3935
Six-inch crude oil pipeline running from DCOR's Fort Apache facility to the "Sunset
Heights Tie-in" located near the intersection of Heil Avenue and Golden West Street
as depicted on those certain "Alignment Drawings" titled TORCH OPERATING
COMPANY — FORT APACHE TO - SUNSET HEIGHTS OIL GATHERING
PIPELINE SYSTEM and comprised of drawing numbers 32-A-001-L, 32-PA-101-L
through 32-PA-105-L, inclusive. Said drawings are made a part hereof by reference.
In addition to these three pipelines, DCOR operates the following pipelines located in and
around the Los Patos Gas Meter Site:
1. Two-inch natural gas pipeline consisting of 175 feet in length; and
2. Three-inch natural gas pipeline consisting of 129 feet in length
DCOR also operates the following pipelines located in and around its Fort Apache facility:
1. Four-inch water pipeline consisting of 448 feet in length.
2. Four-inch crude oil pipeline consisting of 307 feet in length.
3. Six-inch crude oil pipeline consisting of 30 feet in length.
3. INCORPORATION OF PIPELINE FRANCHISE ORDINANCE AND
DEFINITIONS
The CITY's consent to the assignment and amendment of the Franchise Agreement is
granted upon and subject to the rules, regulations, restrictions, terms and conditions of the
CITY's "Pipeline Franchise Ordinance" as recently amended and set forth in Chapter 3.44 of
the HBMC, a copy of which is attached hereto as Exhibit"A," and incorporated herein by this
reference. All references in this Amendment and the Franchise Agreement to specific
sections of the HBMC are references to those sections as they now exist and are reflected in
said Exhibit "A." The words and phrases in this Amendment and the Franchise Agreement
shall have the identical meaning as provided in Section 3.44.040 of the HBMC.
4. COMPENSATION TO CITY
DCOR shall pay the following fees to the CITY with respect to the rights and
privileges granted to DCOR hereunder:
4.1 Base Granting Fee. DCOR shall pay the CITY the sum of ten thousand
($10,000.00) as a one-time base granting fee within thirty (30) days following the execution
of this Amendment.
4.2 Base Annual Fee and Adjustments. A base annual fee shall be paid
within thirty (30) days after the end of each calendar year during the term of the Franchise
Agreement, as amended herein, including all of 2011, as follows:
3
1 a-2748nO235
Exhibit"A" - Ordinance No 3935
Pipeline Size Length Fee Total Due
and Type in feet per foot
2"Gas 175' $0.590 $ 103.25
3"Gas 129' $0.590 $ 76.11
8"Gas 3,724' $1.197 $ 4,457.63
4"Water 448' $0.590 $ 264.32
4"Oil 307' $0.590 $ 181.13
6"Oil 30' $0.895 $ 26.85
6"Oil 13,201.77' $0.895 $11,815.58
8"Oil 8,284.35' $1.197 $ 9,916.37
26,299.12 - $26,841.24
See HBMC Section 3.44.290 when calculating annual adjustments to the Base Annual Fee using the
Consumer Price Index-Los Angeles-Riverside-Orange County area(1982-1984=100).
The base annual fee shall be subject to proration pursuant to Section 3.44.300 of the
HBMC.
4.3. Base Construction Charges. Pursuant to HBMC Section 3.44.280,
DCOR shall pay at the time of installation, relocation or replacement of any pipeline or other
facility covered by the Franchise Agreement, a base construction charge established, and
amended from time to time,by resolution of the City Council.
4.4 Payments to City. Payment is due thirty (30) days after the CITY's
invoice date and a ten percent (10%) per month late penalty and eighteen percent (18%)
annual interest cost will be charged for any delinquent payment. The CITY will also withhold
any permits and/or not renew licenses if any payment is delinquent. Payments should be
mailed to the City Treasurer, City of Huntington Beach, P. O. Box 711, Huntington Beach,
CA 92648-0711.
4.5. Faithful Bond Performance. On or before the effective date of this
Amendment, Franchisee shall file and thereafter at all times during the term of the Franchise
Agreement keep on file with the City Treasurer a corporate surety bond approved by the City
Attorney running to the CITY in the penal sum of One Hundred Thousand Dollars
($100,000). In the event that said bond, after it has been so filed, shall at any time during the
term of the Franchise Agreement become insufficient, in the sole opinion of the City Council,
Franchisee agrees to renew said bond within ten (10) days after written notice to do so from
the City Treasurer. At such time, the bond shall be increased by a rate set forth by the City
Council, with a surety to be approved by the City Attorney, conditioned that Franchisee shall
well and truly observe, fulfill and perform each condition of the Franchise Agreement, as
amended, and that in case of any breach of condition of the bond the whole amount of the
penal sum shall be deemed to be liquidated damages and shall be recoverable from the
principal and sureties of the bond. If said bond is not.filed prior to the effective date of this
Amendment, the approval of this Amendment may be denied and the ordinance granting the
Franchise Agreement repealed at any time prior to the filing of said bond and any money paid
4
10-2748170235
Exhibit"A" - Ordinance No 3935
in consideration for the approval of this Amendment shall be deemed forfeited. In the event
that said bond, after it has been so filed, shall at any time during the term of the Franchise
Agreement become insufficient, Franchisee agrees to renew said bond, subject to the approval
of the City Attorney, within ten (10) days after written notice to do so from the CITY.
5. ASSIGNMENT
Assignor hereby assigns all of its right, title, and interest, and delegates all of its
obligations responsibilities and duties, in and to the Franchise Agreement,to Assignee.
Assignee hereby accepts the assignment of all of Assignor's obligations
responsibilities and duties under the Franchise Agreement and all of Assignor's rigY►t,title and
interest in and to the Franchise Agreement.
CITY hereby consents to the assignment from Assignor to Assignee.
Notwithstanding the foregoing, Assignor agrees to defend and indemnify the CITY, its
elected or appointed officials, agents, officers and employees from any and all claims, actions,
judgments, liabilities, proceedings and costs, including reasonable attorneys' fees and other
costs of defense and damages, resulting from Assignor's performance prior to the CITY's
approval of the assignment of the Franchise Agreement and resulting from Assignee's
performance after the assignment of the Franchise Agreement, provided however, that after
the assignment of the Franchise Agreement the CITY shall first look to Assignee to satisfy all
claims, actions,judgments, liabilities, proceedings and costs, including reasonable attorneys'
fees and other costs of defense and damages resulting from Assignee's performance.
Assignee agrees to indemnify the CITY, its elected or appointed officials, agents,
officers and employees from any and all claims, actions, judgments, liabilities, proceedings
and costs, including reasonable attorneys' fees and other costs of defense and damages,
resulting from Assignee's performance after the CITY's approval of the assignment of the
Franchise Agreement.
The CITY, in executing its consent to this Assignment, does not release Assignor from
any claims or remedies it may have against Assignor under the Franchise Agreement.
The parties acknowledge and agree that the Franchise Agreement will continue in full
force and effect until the assignment has been completed as evidenced by execution by all
parties of this Amendment.
6. LIABILITY INSURANCE.
The policy of liability insurance required by HBMC Chapter 3.44 shall be issued to
DCOR and name the CITY and its officers, agents, and employees as additional insureds. It
shall further indemnify for all liability for personal and bodily injury, death and damage to
property arising from activities conducted pursuant to the Franchise Agreement by providing
coverage thereof, including but not limited to:
5
1 0-2 74 8/7023 5
Exhibit"A" - Ordinance No 3935
(a) Negligent acts or omissions of DCOR and the agents, servants -and
employees thereof, committed in the conduct of operations under the
Franchise Agreement.
(b) Provide combined single limit liability insurance in the amount of five
million dollars ($5,000,000).
(c) Be noncancellable without thirty (30) days written notice thereof directed
to the CITY.
7. ENVIRONMENTAL IMPAIRMENT LIABILITY INSURANCE.
The policy of environmental impairment liability insurance or other environmental
insurance policy as approved at the sole discretion of the CITY as required by HBMC Chapter
3.44 shall insure liability for environmental impairment including cleanup cost endorsed for
"Sudden and Accidental" contamination or pollution. Such coverage shall be in an amount
and form to meet all applicable state and federal requirements but in no event less than five
million dollars ($5,000,000) per'occurrence.
(a) If written with an annual aggregate limit, the policy limit should be three
(3) times the above-required occurrence limit.
(b) If written on a claims made form, such insurance shall be endorsed to
provide an extended reporting period of not less than two (2) years
following termination or cancellation of the Franchise Agreement.
8. WORKERS' COMPENSATION INSURANCE.
The policy of workers'compensation insurance, shall:
(a) Have been previously approved as to substance and form by the California
Insurance Commissioner.
(b) Cover all employees of DCOR who in the course and scope of their
employment conduct or do work involving operations under the Franchise
Agreement.
(c) Provide for every benefit and payment presently or hereinafter conferred
by Division 4 of the Labor Code of the State of California upon an injured
employee, including vocational rehabilitation and death benefits.
(d) Be noncancellable without thirty (30) days written notice thereof directed
to the CITY.
9. INSURANCE--FILING.
DCOR shall file with the CITY prior to commencement of any franchise operations
either certified copies of said policies or a certificate of insurance for each of the required
policies executed by the company issuing the policy, certifying that the policy is in force and
providing the following information:
6
1 0-274 8/7023 5
Exhibit"A" - Ordinance No 3935
(a) The policy number.
(b) The date upon which the policy will become effective and the date upon
which it will expire.
(c) The names of the insured and any additional insureds.
(d) Subject of the insurance.
(e) The type of coverage provided by the insurance.
(f)._Amount of_limit_of_coverage.provided_b_y_the_insurance.
(g) A description of all endorsements that form a part of the policy.
(h) In addition to the insurance requirements in this section the insured shall
also agree to defend, indemnify and hold harmless CITY against loss,
damage or expense by reason of any suits, claims, demands, judgments
caused by insured in the performance of the franchise as provided in
HBMC Chapter 3.44.
Any franchise operation shall not commence until DCOR has complied with the
aforementioned provisions of this section, and any such operation shall be suspended during
any period that DCOR fails to maintain said policies in full force and effect.
10. FORCE MAJEURE
The obligations of any party hereunder, other than the obligation to pay money, shall
be suspended for so long as such party is unable, in whole or in part, to carry out its
obligations under this Amendment and the Franchise Agreement by reason of an act of God,
strike, walkout or other industrial disturbance, act of the public enemy, war, blockade, public
riot, lightning, fire, storm, flood, explosion governmental action, governmental delay, restraint
or inaction, the unavailability of equipment or materials, or any other cause, whether similar
or dissimilar to the types specifically enumerated above, which is beyond the reasonable
control of the party claiming the right to suspend its obligations. Such affected party shall
provide prompt written notice to the other of the details of the "force majeure," and shall use
all reasonable diligence to remove, eliminate or otherwise minimize the force majeure
situation as quickly as is practicable. Nothing herein contained shall require a party to settle a
labor dispute contrary to the wishes of such party.
11. SURRENDER
DCOR shall have the right to surrender its rights under the Franchise Agreement and
be relieved of the obligation to pay the base annual fee herein provided for at any time after
the effective date hereof by filing written notice of its intention to surrender said right with the
City Clerk of the CITY; provided, however that DCOR shall comply with the provisions of
the existing"Pipeline Franchise Ordinance" as set forth in the HBMC relating to removal or
abandonment of facilities.
7
10-2748n0235
Exhibit "A" - Ordinance No. 3935
12. ENTIRE AGREEMENT
This Amendment and the Franchise Agreement contain the entire agreement of the
parties and supersedes any prior understandings or agreements between DCOR and the CITY
with respect to the matters addressed in this Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Amendment of Franchise Agreement to be executed by and through their authorized officers
on the date and year first above written.
DOOR, LLC CITY OF HUNTINGTON BEACH, a
municipal corporation of the State of
B ! �/2!�� California
{ dk r re h
print name
ITS: (circle one)Chairman/Presiden ice President
Mayor
By:
VCity Clerk 3/b(jxqp)
name v
ITS: (circle one ecre hief Financial Officer/Asst. INITIA ED AND APPROVED:
Secretary-Treasurer � �/�/
J
"=�C.i/
Director of Economic Development
PLAINS EXPLORATION AND(,,,
PRODUCTION COMPANY '
REVIE �ND APPROVED:
B .
rv,tA,se- A. 4Z-"<.SL C' Manager
print name
ITS: (circle one)Chairman/Presiden ice President
ANE��7 APPROVED AS TO FORM:
By:
' City Xttdmey } /1
print name
ITS: (circle one)Secretary/Chief Financial Officer 't. /�•,3 �l
Secre -Treasurer
Exhibit: A. HBMC Chapter 3.44
8
10-2748nO235
Exhibit"A" - Ordinance No 3935 e .� T
Chapter 3.44
PIPELINE FRANCHISES
(2319-10/78,2676-2/84,3850-1/10,3889-9/10)
Sections:
I. GENERAL PROVISIONS AND DEFINITIONS
3.44.010 Short Title
3.44.020 General Provisions
3.44.025 Franchise Required When
3.44.030 Pole Lines
3.44.040 Definitions
3.44.050 Term
3.44.060 Acceptance of Franchise Agreement
3.44.070 Nonexclusive Franchise
3.44.080 Maps
3.44.090 Repealed—Ordinance No. 3889-9/10
3.44.100 Liability Insurance
3.44.105 Environmental Impairment Liability Insurance
3.44.110 Workers' Compensation Insurance
3.44.120 Insurance--Filing
3.44.130 Faithful Performance Bond
3.44.140 Repealed—Ordinance No. 3889-9/10
3.44.150 Repealed—Ordinance No. 3889-9/10
3.44.160 Forfeiture
3.44.170 Value of Franchise
3.44.180 State Highways
3.44.190 Eminent Domain
3.44.200 Publication Date
3.44.210 Assignment
3.44.220 Hold Harmless
3.44.230 Standards
3.44.231 Conflicting Improvements
3.44.240 Defective Facilities
3.44.250 Hazardous Substances
3.44.251 Damage to Public Property Generally
H. COMPENSATION
3.44.252 Public Utility Not Transmitting Oil or Products Thereof
3.44.253 Length
3.44.255 Public Utility Transmitting Oil or Products Thereof
3.44.256 Non-Public Utility Franchises
3.44.260 Basic Granting Fee
3.44.270 Base Annual Fee
3.44.271 Payments to City
3.44.280 Base Construction Charges
3.44.290 Adjustments--Base Annual Fee
3.44.300 Proration of Payments
3.44.310 Records
III. CONSTRUCTION
3.44.320 Construction Requirements
3.44.330 New Installation or Replacement
3.44.340 Permits
City of Huntington Beach Municipal Code Chapter 3.44 Page 1 of 16
9/15/10
Exhibit"A" - Ordinance No 3935
3.44.350 Work On and Restoration of Streets
3.44.360 Failure to Comply Timely
3.44.370 Completion Statement
3.44.371 Responsibility
3.44.380 Facilities
3.44.386 Shoring
3.44.390 Ordinary Repair
3.44.400 Breaks or Leaks
3.44.410 Emergency Equipment
3.44.420 Removal or Abandonment of Facilities
3.44.430 Failure to Comply
3.44.440 Abandonment "In Place" Conditions
3.44.447 Operation After Franchise Expiration—Revocable License
IV. SPECIAL PROVISIONS FOR PETROLEUM PIPELINES
3.44.450 Rights Granted
3.44.460 Materials Used
3.44.470 Approvals
3.44.480 Reports
3.44.490 Payments Due
3.44.500 Cost of Relocation
I. GENERAL PROVISIONS AND DEFINITIONS
3.44.010 Short Title. This chapter shall be known and cited as "Pipeline Franchise Ordinance."
(2319-10/78)
3.44.020 General Provisions. Every franchise hereafter granted by the City to lay, construct,
maintain, operate, renew, repair, change the size of,remove or abandon in place pipes and
pipelines for the collection,transportation or distribution of oil, gas, gasoline,petroleum,wet
gas,hydrocarbon substances, or other substances,together with all manholes, valves,
appurtenances and service connections necessary or convenient for the operation of said pipes or
pipelines including conduits, cathodic protection devices,wires, cables and other appurtenances
necessary or convenient for the exercise of the franchisee's business, in, under, along or across
any and all streets within the City of Huntington Beach except as otherwise provided in the
particular franchise agreement, shall be granted upon and be subject to the rules, regulations,
restrictions and terms and conditions of this chapter, in addition to those rules, regulations,
restrictions,terms and provisions set forth in the particular franchise agreement. (2319-10178,
3889-9/10)
3.44.025 Franchise Required When. It is unlawful for any person, firm or corporation to
exercise any privilege or franchise to lay or maintain any pipes or conduits in or under any
public street, or alley in the City, for the transmission of gas,water, heat, steam, or other
substance or to exercise any franchise or privilege for the erection or maintenance, in or upon
any public street or alley in the City, of any telephone,telegraph, electric light or power poles,
wires, or system, or for the erection of any pole or wire for the purpose of transmitting electrical
energy or current, without first having procured a franchise to do so unless such person, firm or
corporation is entitled to do so by direct and unlimited authority of the Constitution of the state
or the Constitution of the laws of the United States. (3850-1/10)
3.44.030 Pole Lines. Nothing in this chapter or in any franchise agreement granting such a
franchise shall be construed to permit the grantee to construct new poles or other facilities
aboveground. (2319-10178)
City of Huntington Beach Municipal Code Chapter 3.44 Page 2 of 16
9/15110 .
Exhibit"A" - Ordinance No 3935
3.44.040 Definitions. For the purpose of this chapter, the following terms, phrases, words and
their derivations shall have the meaning given herein:
(a) "Council" shall mean City Council of the City of Huntington Beach. (3889-9/10)
(b) "Code" shall mean the Huntington Beach Municipal Code.
(c) "Department" shall mean the Public Works Department of the City of Huntington Beach.
(3889-9110)
(d) "Director" shall mean the Public Works Director of the City of Huntington Beach. (3889-9110)
(e) "Franchisee" or "grantee" shall mean the person to whom the franchise is granted, and any
person to whom it is lawfully assigned.
(f) "Facilities" or "appurtenances" shall mean,all property owned or used by the franchisee, in
connection with the franchise, including but not limited to,pipelines,pump stations, and
service connection with the franchisee's facilities,whether installed by the franchisee as
named or originally granted under this franchise or its predecessors or assignors, erected,
constructed, laid, operated or maintained in, upon, over, under, along or across any street
pursuant to any right or privilege granted by the franchise. (3889-9/10)
(g) "Franchise payment period" shall mean the time period between the effective date of the
franchise agreement granting the franchise and December 31 of the same calendar year, and
each calendar year thereafter, during the life of the franchise. (3889-9/10)
(h) "Franchise report period" in all cases shall mean the time period between the effective date of
the franchise agreement granting the franchise through and including December 31 of that
calendar year, and each calendar year thereafter, during the life of the franchise. (3889-9/10)
(i) "Highway" or "street" shall mean any public highway, freeway(except a state freeway),
street,road, alley, lane or court or other public easement, and above and below the same,
which now exists or which may hereafter exist in the City of Huntington Beach. (3889-9/10)
(j) "Main" shall mean any pipeline or conduit laid in, along or approximately parallel with any
street for the collection, transmission or distribution of any hydrocarbon substances.
(k) "Major street" shall mean any street or portion thereof designated as a major secondary
highway in the circulation element of the Huntington Beach General Plan.
(1) "Minor street" shall mean all streets in the City other than those designated as "major" or
"secondary highways" in the circulation element of the Huntington Beach General Plan.
(3889-9/10)
(m)"Person" shall mean any individual,person, firm, partnership or corporation.
(n) "Section" shall mean a section of the Huntington Beach Municipal Code, unless some other
code or statute is mentioned.
(o) "Service connection" shall mean the wire,pipes, or conduits connecting the building or place
where the service or hydrocarbons supplied by the franchisee is used or delivered, or is made
available for use or delivery,with the supply line or supply main in the highway or with such
supply line or supply main on private property. (2319-1 or78)
(p) "Shall" is mandatory; "May" is permissive. (3889-9/10)
City of Huntington Beach Municipal Code Chapter 3.44 Page 3 of 16
9/15/10
Exhibit"A" - Ordinance No 3935
3.44.050 Term. Unless the franchise agreement granting the franchise provides otherwise, the
term of the franchise shall be fifteen(15) years. (2319-10n8,3889-9/10)
3.44.060 Acceptance of Franchise Agreement. The franchisee shall enter into a written
agreement with the City of Huntington Beach which grants the franchise and sets forth the terms
and provisions therein. The franchisee shall, within thirty(30) days after the passage of the
ordinance granting the franchise, file with the City Clerk of the City of Huntington Beach a
written acceptance of the terms and conditions of said ordinance. The franchise shall be null and
void if the written acceptance is not filed within the prescribed time. (2319-10/78, 3889-9/10)
3.44.070 Nonexclusive Franchise. The granting of the franchise shall not be construed to
prevent the City from granting identical or similar franchise to any person other than the
franchisee. Nothing herein contained shall ever be construed so as to exempt the franchisee from
compliance with all ordinances,rules or regulations of the City now in effect or which may be
hereafter adopted which are not inconsistent with the terms of the franchise. (2319-10/78,3889-9/10)
3.44.080 Maps. Within ninety(90) days following the date on which any facilities or
appurtenances have been laid, removed or abandoned under the franchise,the franchisee shall
file a map or maps with the Department showing the accurate "as built" location, depth, and size
of the facilities or appurtenances so laid, removed or abandoned. (2319-1078,3889-9/10)
3.44.100 Liability Insurance. The policy of liability insurance required by this chapter shall be
issued to franchisee and name the City and its officers, agents, and employees as additional
insureds. It shall further indemnify for all liability for personal and bodily injury, death and
damage to property arising from activities conducted pursuant to the franchise by providing
coverage thereof, including but not limited to: (3889-9/10)
(a) Negligent acts or omissions of franchisee and the agents, servants and employees thereof,
committed in the conduct of franchise operations.
(b) Provide a combined single limit liability insurance in the amount of five million dollars
($5,000,000). (3889-9/10)
(c) Be noncancellable without thirty(30) days written notice thereof directed to the City of
Huntington Beach. (231 s-10178,3889-9/10)
3.44.105 Environmental Impairment Liability Insurance. The policy of environmental
impairment liability insurance or other environmental insurance policy as approved at the sole
discretion of the City as required by this Chapter shall insure liability for environmental
impairment including cleanup cost endorsed for"Sudden and Accidental" contamination or
pollution. Such Coverage shall be in an amount and form to meet all applicable state and federal
requirements but in no event less than five million dollars $5,000,000 per occurrence. (3889-9/10)
(a) If written with an annual aggregate limit,the policy limit should be three (3)times the above-
required occurrence limit. (3889-9/10)
(b) If written on a claims made form, such insurance shall be endorsed to provide an extended
reporting period of not less than two (2)years following termination or cancellation of this
franchise. (3889-9/10)
3.44.110 Workers' Compensation Insurance. The policy of workers' compensation insurance,
required by this chapter, shall:
(a) Have been previously approved as to substance and form by the California Insurance
Commissioner.
City of Huntington Beach Municipal Code Chapter 3.44 Page 4 of 16
9115110
Exhibit"A" - Ordinance No 3935
(b) Cover all employees of franchisee who in the course and scope of their employment to
conductor do work pursuant to the franchise operations. (3889-9/10)
(c) Provide for every benefit and payment presently or hereinafter conferred by Division 4 of the
Labor Code of the State of California upon an injured employee, including vocational
rehabilitation and death benefits. (3889-9/10)
(d) Be noncancellable without thirty(30) days written notice thereof directed to the City of
Huntington Beach.
(2319-10178,3889-9/10)
3.44.120 Insurance--Filing. Franchisee shall file with the City Clerk prior to commencement
of any franchise operations either certified copies of said policies or a certificate of insurance for
each of the required policies executed by the company issuing the policy, certifying that the
policy is in force and providing the following information: (3889-9/1o)
(a) The policy number.
(b) The date upon which the policy will become effective and the date upon which it will expire.
(c) The names of the insured and any additional insureds.
(d) Subject of the insurance.
(e) The type of coverage provided by the insurance.
(f) Amount of limit of coverage provided by the insurance.
(g) A description of all endorsements that form a part of the policy.
(h) In addition to the insurance requirements in this section the insured shall also agree to defend,
indemnify and hold harmless the City of Huntington Beach against loss, damage or expense
by reason of any suits, claims, demands,judgments caused by insured in the performance of
the franchise as provided in Section 3.44.220. (3889-9/10)
Any franchise operation shall not commence until franchisee has complied with the
aforementioned provisions of this section, and any such operation shall be suspended during any
period that franchisee fails to maintain said policies in full force and effect. (2319-lo/78)
3.44.130 Faithful Performance Bond. On or before the effective date of the franchise
agreement granting the franchise, franchisee shall file and thereafter at all times during the life of
the franchise keep on file with the City Treasurer a corporate surety bond approved by the City
Attorney running to the City in the penal sum of One Hundred Thousand Dollars ($100,000). In
the event that said bond, after it has been so filed, shall at any time during the life of the franchise
become insufficient, in the sole opinion of the City Clouncil,the franchisee agrees to renew said
bond within ten (10)days after written notice to do so from the City Treasurer. At such time,the
bond shall be increased by a rate set forth by City Council, with a surety to be approved by the
City Attorney,conditioned that franchisee shall well and truly observe, fulfill and perform each
condition of the franchise and that in case of any breach of condition of the bond the whole
amount of the penal sum shall be deemed to be liquidated damages and shall be recoverable from
the principal and sureties of the bond. If said bond is not filed prior to the effective date of the
ordinance granting the franchise,the award of the franchise may be set aside and the ordinance
granting the franchise repealed at any time prior to the filing of said bond and any money paid in
consideration for said award of franchise shall be deemed forfeited. In the event that said bond,
after it has been so filed, shall at any time during the life of the franchise become insufficient,
franchisee agrees to renew said bond, subject to the approval of the City Attorney, within ten (10)
days after written notice to do so from the Director. (2319-10/78,3889-9110)
City of Huntington Beach Municipal Code Chapter 3.44 Page 5 of 16
9/15110
Exhibit"A" - Ordinance No 3935
3.44.160 Forfeiture. The franchise is granted and shall be held and enjoyed upon each and
every condition contained in the franchise agreement, including such conditions contained herein
as are incorporated by reference in said franchise agreement, and shall be strictly construed
against the grantee. Any neglect, failure or refusal to comply with any of the terms and
provisions of the franchise agreement shall constitute grounds for the suspension or forfeiture of
the franchise, shall give to the grantee not less than thirty(30) days notice in writing of any
default thereunder. If the grantee does not, within the noticed period, begin the work of
compliance or after such beginning does not prosecute the work with due diligence to
completion,the Council may hold a hearing, at which the grantee shall have the right to appear
and be heard, and thereupon the Council may determine whether such conditions are material and
essential to.the franchise and whether the grantee is in default with respect thereto and may
declare the franchise suspended or forfeited. Notice of said hearing shall be given to the grantee
by certified mail not less than five (5) days before said hearing. (2319-10/78)
3.44.170 Value of Franchise. The grantee of any franchise awarded to a public utility, by
accepting the terms and conditions thereof, stipulates and agrees that in any proceeding for the
purpose of adjusting the rates of the grantee, no greater value shall be placed upon the franchise
than the actual cash paid therefor by the grantee. (2 31 9-1 017 8)
3.44.180 State Highways. If any street or portion thereof becomes a state highway, except for
the right to continue to collect franchise payments in such other rights as by law remain with the
City, the state shall succeed to all rights reserved to the City by the franchise. (2319-10178,3889-9/10)
3.44.190 Eminent Domain. No franchise granted by the City shall in any way impair or affect
the right of the City or any successor in authority to acquire the property of the grantee by
purchase or condemnation, and nothing contained in such a franchise shall be construed to
contract away,modify or abridge either for a term or in perpetuity the City's right of eminent
domain in respect to any public utility. (2319-10/78,3889-9/10)
3.44.200 Publication Costs. The grantee shall pay to the City within thirty (30) days after
receiving a statement therefore, all advertising and publishing costs, including the cost of
publishing the granting of the franchise, if necessary. (2319-10/78,3889-9/10)
3.44.210 Assignment. The grantee shall not directly or indirectly sell,transfer, assign or lease
the franchise or any part thereof, or allow any other person or entity to operate any pipeline or
related facility subject to the franchise, except with the written approval of the Council which
may be withheld at its sole and absolute discretion. Such sale,transfer, assignment, or lease shall
be made only by filing with the Council a copy of the duly executed instrument of such sale,
transfer,assignment or lease and a written request for the consent of the Council to such sale,
transfer,assignment or lease. If such duly executed instrument and such written request is not
filed with the Council before the expiration of thirty(30) days after the effective date of such
sale,transfer, assignment or lease,then, upon the expiration of said thirty(30) days,the franchise
shall be subject to forfeiture and the Council may, without notice,revoke the franchise. As a
condition to the granting of consent to such sale,transfer, assignment or lease,the Council may
impose such additional terms and conditions upon the franchisee and upon the grantee or
assignee, which the Council may deem to be in the public interest. Such additional terms and
conditions shall be expressed by Council resolution. Nothing herein contained shall be construed
to grant to the grantee the right to sell,transfer, assign or lease the franchise, or any part thereof,
except in the manner aforesaid. This section applies to any assignment,whether by operation of
law,by a voluntary act of the grantee or otherwise and includes a transfer of more than fifty
percent (50%)of the voting stock of any corporate grantee or the change in identity of any
general partner of a franchisee which is a partnership,whether to a third party or to any
subsidiary,parent, or affiliated agency of franchisee. (2319-10178,3889-9110)
3.44.220 Hold Harmless. The grantee shall be responsible to the City and shall defend,
indemnify and hold harmless the City and its officers and employees from all damages or liability
City of Huntington Beach Municipal Code Chapter 3.44 Page 6 of 16
9/15/10
Exhibit"A" - Ordinance No 3935
arising from the use, operation or maintenance of the facilities erected, constructed, laid, operated
or maintained thereunder. (2319-10/78,3889-9/10)
Franchisee hereby agrees to protect, defend, indemnify and hold harmless City, its officers,
elected or appointed officials, employees, agents, and volunteers from and against any and all,
claims, damages, losses, expenses,judgments, demands defense costs, and consequential damage
or liability of any kind or nature, however caused, including those resulting from death or injury
to franchisee's employees and damage to franchisee's property, arising directly or indirectly out
of the obligations or operations herein undertaken by franchisee, caused in whole or in part by
any negligent act or omission of the franchisee, any subfranchisees, anyone direcly or indirectly
imployed by any of them or anyone for whose acts any of them may be liable, including but not
limited to concurrent active or passive negligence, except where caused by the active negligence,
sole negligence, or willful misconduct of the City. Franchisee shall conduct all defense at its sole
cost and expense and City shall approve selection of franchisee's counsel. City shall be
reimbursed for all costs and attorney's fees incurred by City in enforcing this obligation. This
indemnity shall apply to all claims and liability regardless of whether any insurance policies are
applicable. The policy limits do not act as a limitations upon the amount of indemnification to
be provided by franchisee. (3889-9110)
3.44.230 Standards. All facilities erected, constructed, laid, operated or maintained under the
provisions of the franchise shall be erected, constructed, laid, operated or maintained in
accordance with and conforming to all the ordinances, codes, rules and regulations now or
hereafter adopted by or prescribed by the Council. (2319-10/78)
3.44.231 Conflicting Improvements. If the City or any other public entity constructs or
maintains any storm drain, sewer structure, or other facility or improvement under or across any
facility of the grantee maintained pursuant to the ordinance, the grantee shall provide at no
expense to the City or other public entity such support as shall be reasonably required to support,
maintain and protect grantee's facility. (3889-9/10)
3.44.240 Defective Facilities. If any portion of any street shall be damaged by reason of
defective facilities laid or constructed under the franchise, the grantee shall, at its own expense,
repair any such defect and put such street in as good condition as it was before such damage was
incurred,to the satisfaction of the City. If the grantee,within ten (10) days after receipt of
written notice from the City, instructing it to repair such damage, shall fail to commence to
comply with such instructions, or, thereafter, shall fail diligently to prosecute such work to
completion,then the City immediately may do whatever work is necessary to carry out said
instructions at the cost and expense of the grantee, which cost and expense, by the acceptance of
the franchise,the grantee agrees to pay upon demand. If such damage constitutes an immediate
danger to the public health or safety requiring the immediate repair thereof,the City without
notice may repair such damage and the grantee agrees to pay the reasonable cost thereof upon
demand. (2319-10/78,3889-9/10)
3.44.250 Hazardous Substances. Prior to the issuance of any excavation permit for the
construction or installation of any pipeline for the transmission of flammable liquids or gases,
written approval shall be obtained from the Director. Said approval may be withheld at the sole
and absolute discretion of the Director. Said approval may be based on the determination that no
undue fire hazard will be created to life or property in the areas through which the proposed
pipeline will be located. To make such determination, consideration shall be given to: (3889-9/10)
(a) Type of hydrocarbon to be transmitted.
(b) Density of population or structural development in the area through which the pipeline will
be located.
(c) Adequacy of water supplies for fire control purposes.
City of Huntington Beach Municipal Code Chapter 3.44 Page 7 of 16
9/15/10
Exhibit"A" - Ordinance No 3935
(d) Extent of available public fire protection facilities.
(e) Number and location of shutoff valves in line. (2319-10/78)
3.44.251 Damage to Public Property Generally. Any damage done directly or indirectly to
any public property by grantee, in exercising directly or indirectly any right, power, or privilege
under this franchise, or in performing any duty under or pursuant to the provisions of this section,
shall be promptly repaired by grantee at its sole cost and expense to as good a condition as it was
befor such damage was incurred, and to the satisfaction of the Director. If the franchisee,within
ten(10) days after receipt of written notice from the City, instructing it to repair such damage,
shall fail to commence to comply with such instructions, or thereafter, shall fail to diligently
prosecute such work to completion,the City immediately may do work necessary to carry out
said instructions and the cost and expense of the franchisee, which cost and expense,by the
acceptance of the franchise,the franchisee agrees topay upon demand. If such damage
constitutes an immediate danger to the public health or safety requiring the immediate repair
thereof, the City without notice may repair such damage and the franchisee shall pay all costs
incurred. (3889-9/10)
H. COMPENSATION
3.44.252 Public Utility Not Transmitting Oil or Products Thereof. The franchisee of any
franchise awarded to a public utility or non-public utility not transmitting oil or products thereof,
as consideration for such franchise, shall annually pay to the City in lawful money of the United
States,within thirty(30) days after the end of each calendar year and during the life of the
franchise for each and every year, including the year of granting the franchise a franchise fee
negotiated as part of the franchise agreement(unless preempted by State Law) arising from the
use, operation or possession of the franchise. (3889-9/10)
3.44.253 Length. Whenever the length of any wire,pipe or conduit is a factor in calculating any
payment due under any franchise granted by the, all service connections shall be excluded in determining
such lengths. (3889-9/10)
3.44.255 Public Utility Transmitting Oil or Products Thereof. The franchisee of any franchise
awarded for a pipeline transmitting oil or products thereof which has been determined by the Public
Utilities Commission to be a public utility, as consideration for such franchise, shall, within thirty(30)
days after the end of each calendar year and during the life of the franchise for each and every year,
including the year of granting the franchise,.annually pay to the City in lawful money of the United
States, a fee in the following amounts as required by State law. In the event these referenced fees
increase pursuant to State law, the fees referenced herein shall increase by the same: (3889-9/10)
Pipelines with an Internal Diameter of: Base Rate Per Lineal Foot
0-4 inches .088
6 inches .132
8 inches .176
10inches .220
12inches .264
14 inches .308
16 inches .352
18 inches .396
20 inches .440
22 inches .484
24 inches .528
26 inches .572
28inches .616
30 inches 660
(3889-9/10)
City of Huntington Beach Municipal Code Chapter 3.44 Page 8 of 16
9115/10
Exhibit"A" - Ordinance No 3935
For pipelines with an internal diameter not listed above, the fees shall be in the same proportion to the
fees of a twelve (12)-inch-diameter pipe as the diameter of the unlisted pipe is to twelve (12) inches.
(3889-9/10)
The amount of the fee or charge provided for in this paragraph shall be multiplied by the Consumer Price
Index, all Urban Consumers (CPI-U) for the Los Angeles-Riverside-Orange County Area for the month
of September immediately preceding the month in which payment is due and payable, and divided by the
Consumer Price Index, All Urban Consumers (CPI-U for the Los Angeles-Riverside-Orange County
Area for June 30, 1989, (1982-84=100.0)). (3889-9/10)
3.44.256 Non-Public Utility Franchises. The franchisee of any franchises awarded to other than a
public utility transmitting oil or oil products thereof, as further consideration for such franchise including
the extension,renewal, or continuation of a previously granted franchise, shall pay to the City in lawful
money of the United States the following fees: (3889-9/10)
3.44.260 Basic Granting Fee. In the event of an initial grant of franchise or franchises which
extend, renew, or continue previously granted franchises, a base granting fee shall be required as
established, and amended from time to time, by resolution of the City Council. (2319-10/78,
2676-2/84)
3.44.270 Base Annual Fee. A base annual fee shall be paid by franchisee within thirty (30)
days after the end of each calendar year including the year of granting the franchises, according to
the franchise payment period as defined in this chapter, in the following amounts: (2319-10/78,
2676-2/84,3889-9/10)
Pipelines with an Internal Diameter of: Amount Per Lineal Foot
0-4 inches .590
6 inches .895
flinches 1.197
10inches 1.485
12inches 1.787
14inches 2.092
16 inches 2.377
18 inches 2.682
20inches 2.984
22 inches 3.272
24 inches 3.574
26inches 3.879
28inches 4.164
30 inches 4.469
The base annual rate applicable to pipelines with an internal diameter falling between incremental size
categories shall pay a rate determined by adding the price corresponding to the lower size to a figure
computed by multiplying the difference between the higher and lower price times the multiplier. The
multiplier will be determined by dividing the difference between the size of the pipe and the lower size
category by the difference between the two size categories. In determining the number of feet of
pipeline upon which the annual fee will be computed, the greatest number of feet of pipeline covered by
the franchise during the calendar year for which payment is due will be utilized. The base annual fee
shall be paid no later than 30 days and a penalty at the rate of ten (10)percent per month or fraction
thereof beyond the payment date shall be charged,but in no event shall said penalty exceed fifty(50)
percent. (3889-9/10)
The City reserves the right to adjust the base fees established hereunder at any time after the effective
date of the ordinance. (3889-9/10)
City of Huntington Beach Municipal Code Chapter 3.44 Page 9 of 16
9/15/10
Exhibit"A" - Ordinance No 3935
3.44.271 Payments to City. Payment is due 30 days after the City's invoice date and a 10%per
month late penalty and 18% annual interest cost will be charged for any delinquent payment.
The City will also withhold any permits/not renew licenses if any payment is delinquent.
Payments should be mailed to the City Treasurer, City of Huntington Beach, P.O. Box 711,
Huntington Beach, CA 92648-0711. (3889-9110)
3.44.280 Base Construction Charles. The holder of the franchise shall pay at the time of
installation, relocation or replacement of any segment of pipe or pipeline, or any other facility
covered by the franchise agreement, a base construction charge established, and amended from
time to time, by resolution of the City Council. (2319-10178,2676-2/84)
3.44.290 Adiustments--Base Annual Fee.
The amount of each base annual fee as specified in the above section shall be revised every year, in
accordance with the following formula: (3889-9110)
(a) The Consumer Price Index, All Urban Consumers (CPI-U) for the Los Angeles-Riverside-
Orange County area(1982-84=100) as published by the United States Bureau of Labor
Statistics ("Bureau"), shall be defined as the"index,"and such index as it stands on August
1, 2010 shall be defined as the"base index" and the index for the month of September
immediately preceding the fee payment date shall be defined as the"current index;"
(3889-9/10)
(b) If the current index differs from the base index,then the-base annual fee shall increase or
decrease by the percentage increase or decrease between the current index and the base index,
provided that, if the current index drops below the base index, no adjustment shall be made.
The base annual fee shall be multiplied by an adjustment factor determined by dividing the
current index by the base index. (3889-9110)
For example, if the base index is 185.0 and the current index is 190.5,the annual franchise fee shall be
(i.e. 190.5/185.0= 1.0297),times the base annual fee,provided however, under no circumstances shall
the multiplying factor be less than one, nor shall the annual franchise fee calculated using said factor, be
less than the base annual fee. If the Bureau shall revise the index, the parties hereto shall accept the
method of revision for conversion recommended by the Bureau; and (3889-9/10)
(c) If the Bureau discontinues the preparation or publication of the CPI-U, All Urban Consumers
for the Los Angeles-Riverside-Orange County area(1982-84=100), and if no transposition
table prepared by the Bureau is available, then the amount of each annual franchise fee shall
be computed by reference to such other price index as may be chosen by the City, and the
City shall be the sole judge of comparability of successive indices and its determination on
this point shall be final and conclusive. In no event shall the annual franchise fee adjustment
by reference to such other price index be less than the base annual fee as set forth herein.
(3889-9/10)
(d) Publication and Administrative Issuance Costs. The franchisee shall pay to the City within
thirty (30) days after receiving a statement therefore, all administrative and other costs
incurred by the City processing the application for a franchise, including but not limited to
the preparation of any reports, statements or studies pursuant to the California Environmental
Quality Act(Public resources Code Section 21000, et seq.) and any similar federal statute, or
any successor statute, and for any and all advertising and publishing costs, including the cost
of publishing the ordinance, if necessary, incurred in connection with the granting of the
franchise. (3889-9/10)
(e) The base annual fee may also be amended from time to time by resolution of the City
Council. (3889-9/10)
City of Huntington Beach Municipal Code Chapter 3.44 Page 10 of 16
9/15110
Exhibit"A" - Ordinance No 3935
3.44.300 Proration of Payments. In the event of abandonment of facilities with the approval of
the City as elsewhere in this chapter provided, or in the event of removal of such facilities by the
franchisee, or in the event of the grant of a franchise with an initial franchise payment period of
less than one year, the annual franchise fee required under the aforementioned sections shall be
prorated for the calendar year in which such removal or abandonment or grant occurs as of the
end of the calendar month in which removed, abandoned or granted. (2319-10178,3889-9/10)
3.44.310 Records. Franchisee shall keep and preserve for a period of five(5)years subsequent
to the date of the most recent franchise fee determination all the records necessary to determine
the amount of such franchise fee.
At all reasonable times,the franchisee shall permit the City or its duly authorized representative
to examine all property of the franchisee erected, constructed, laid, operated or maintained
pursuant to the franchise, together with any appurtenant property of the franchisee, and to
examine and transcribe any and all books, accounts,papers, maps, and other records kept or
maintained by the franchisee or under its control which concern the operations, affairs,
transactions, property or financial condition of the franchisee with respect thereto. Said records
shall be made available to the City at a location in the County of Orange. (2319-10/78,3889-9/10)
III. CONSTRUCTION
3.44.320 Construction Requirements. Pipelines and appurtenances shall be constructed and
maintained in a good workmanlike manner in conformity with applicable law and the terms and
conditions of any City ordinance, rule or regulation now, or as hereafter amended, adopted or
prescribed by the City. All pipes pipelines and appurtenances will be installed in accordance
with the latest revision of the"American Standard Code of Pressure Piping ASA B31.4."
(2319-10178,3889-9/10)
3.44.330 New Installation or Replacement. New installations or replacements of pipelines and
appurtenances and all other facilities necessary for the installation, operation, maintenance, and
safety of pipelines and conduits shall be laid and maintained only pursuant to applicable law and
permit issued by the Department. All such installations or replacements shall be reviewed by the
Director as to the most desirable location in the streets of the City and his decision shall be final
and binding on the franchisee. (2319-10/78, 3889-9/10)
3.44.340 Permits. Where the provisions of any City ordinance, resolution or regulation,which
shall be in force at that time, require the issuance of an excavation, encroachment or other type of
permit, the franchisee shall not commence any excavation or encroachment work under the
franchise until it shall have obtained such permit from the Department except in cases of
emergency affecting public health, safety or welfare or the preservation of life or property, in
which case the franchisee shall apply for such permit not later than the next business day.
(3889-9/10)
The application of the franchisee for such permit shall show the following facts: the length and
proposed location of the pipeline and/or appurtenance intended to be installed, and such other
facts as the Department may require. The franchisee shall pay any and all permit inspection fees
required by the Department. (2319-10178,3889-9/10)
3.44.350 Work On and Restoration of Streets. The work of constructing, laying,replacing,
maintaining, repairing or removing all pipelines and appurtenances authorized under the
provisions of this chapter in, over, under, along or across any street shall be conducted with the
least possible hindrance to the use of the street for purposes of travel. As soon as such work is
completed, all portions of the street which have been excavated or otherwise damaged thereby
shall promptly and in a workmanlike manner be repaired,replaced or restored and placed in as
good condition as before the commencement of such work and shall be done to the satisfaction of
the Director at the expense of the franchisee, and in accordance with the terms and conditions of
any City ordinance, resolution or regulation. For streets that have been rehabilitated within three
City of Huntington Beach Municipal Code Chapter 3.44 Page 11 of 16
9/15110
Exhibit"A" - Ordinance No 3935
(3) years prior to the proposed work,the City shall require the resurfacing, or other treatment, of
the entire lane widths of the street as directed by the Director. For those streets that have not
been rehabilitated by the City within three (3) years prior to the proposed work, the restoration
shall be in full compliance with City requirements. All restoration, repair or replacement work
shall be done to the satisfaction of the Director at the expense of the franchisee in accordance
with all applicable law. In the event that the franchisee shall fail or neglect to make such
highway repair, replacement or restoration work, ten(10) days after notice therefore has been
given franchisee by the Director,the City may repair, replace or restore said highway at the
expense of franchisee. Franchisee agrees to pay to the City the cost of performing such work.
The amount so chargeable shall be the direct cost of such work plus the current rate of overhead
being charged by the City for reimbursable work. (2319-10/78,3889-9/10)
3.44.360 Failure to Comply Timely. In the event that the franchisee fails to complete the work
within the time specified in the permit, the City may require the franchisee to pay to the City not
more than five hundred dollars ($500)per day as liquidated damages for each day construction
extends beyond the time specified in the permit. (3889-9/10)
Whenever the franchisee fails to complete any work required by the terms and provisions of the
franchise, and the permits issued thereunder, within the time limits required thereby,the City
may complete or cause to be completed any and all such work at the expense of the franchisee.
The franchisee agrees to pay to the City the cost of performing such work. The amount so
chargeable to franchisee shall be the direct cost of such work plus the current rate of overhead
being charged by the City for reimbursable work. (2319-10/78,3889-9/10)
3.44.370 Completion Statement. Upon the completion of the construction of any pipelines or
other facilities constructed pursuant to said franchise, the franchisee shall submit a statement to
the Director, identifying the permit or permits issued by the Department, the total length of
pipeline,pipeline material, diameter of pipeline, the construction of which was authorized under
such permit or permits, and the total length of pipeline or facilities actually laid and as-built
drawings. (2319-10/78,3889-9/10)
3.44.371 Responsibility. In addition to any indemnification set forth herein, franchisee shall be
specifically responsible to the City and shall save the City, its officers, agents, and employees,
free and harmless from all damages or liability arising from any damage or injury suffered by any
person by reason of any excavation or obstruction being improperly guarded during any work
authorized pursuant to the franchise or the failure to neglect of the franchisee to properly
perform, maintain, or protect any phase of such work. (3889-9110)
3.44.380 Facilities. The franchisee shall have the right to construct, maintain and repair such
traps, manholes, conduits,valves, appliances, attachments and other facilities as may be
necessary or convenient for the proper maintenance and operation of the pipelines under said
franchise, and said facilities shall be kept flush with the surface of the street and so located as to
conform to applicable law including any ordinance, resolution or regulation of the City, or of any
permit issued by the Department in regard thereto and shall not interfere with the use of the street
for travel. The franchisee shall have the right subject to such ordinances, resolutions and
regulations as are now or may hereafter be in force,to make all necessary excavations in said
street for the construction, maintenance and repair of said facilities; provided, however, that the
franchisee shall first obtain an excavation permit from the Department for doing any such work.
(2319-10/78, 3889-9110)
3.44.386 Shoring. The franchisee shall provide at its sole cost such shoring or other support as
shall be reasonably required to support, maintain, and protect franchisee's facilities in connection
with any storm drain or sewer construction by the City or in connection with any facility
constructed by City, or by any successor agency. (3889-9/10)
3.44.390 Ordinary Repair. The franchisee shall be privileged to excavate in the road or street
for line repair for the number of days agreed upon by the franchisee and the Department
City of Huntington Beach Municipal Code Chapter 3.44 Page 12 of 16
9/15110
Exhibit"A" - Ordinance No 3935
provided, however, that the franchisee shall first obtain an excavation permit from the
Department for the doing of any such work. (2319-10/78,3889-9/10)
3.44.391 Relocation of Pipelines and Facilities. The City reserves the right to change the
grade,to change the width or to alter or change the location of any street over which the franchise
is granted. If any of the pipelines, facilities or appurtenances heretofore or hereafter constructed,
installed or maintained by the franchisee pursuant to the franchise on, along, under, over, in,
upon or across any street are located in a manner which conflict.in any way with the change of
grade,traffic needs, operation, maintenance, improvements, repair, construction, reconstruction,
widening, alteration or relocation of the street,the franchisee shall relocate permanently or
temporarily any such facility at no expense to the City upon receipt of a written request from the
Director to do so, and shall commence such work on or before the day specified in such written
request which date shall be not less than thirty(30) days from receipt of such written request.
Franchisee shall thereafter diligently prosecute such work to completion. (3889-9/10)
The City reserves the right for itself, and all other public entities which are now or may later be
established,to lay, construct, repair, alter, relocated and maintain subsurface or other facilities or
improvements of any type or description in a governmental but not proprietary capacity within
the streets over which the franchise is granted. If the City or any other public entity finds that the
location or relocation of such facilities or improvements conflicts with the facilities laid,
constructed or maintained under the franchise, whether such facilities were laid before or after
the facilities of the City or such other public entity were laid,the franchisee of such franchise
shall at no expense to the City or public entity, on or before the date specified in a written request
from the Director, which date shall be not less than thirty(30) days after the receipt of such
notice and request to do so, commence work to change the location either permanently or
temporarily of all facilities so conflicting with such improvements to a permanent or temporary
location in said streets to be approved by the Director and thereafter diligently prosecute such
work to completion. (3889-9/10)
3.44.400 Breaks or Leaks. If any portion of the street shall be damaged by reason of breaks or
leaks in any pipe, conduit, or appurtenance constructed or maintained under the franchise, the
franchisee thereof shall, at its own expense, immediately following written or oral notification
thereof, promptly repair any such damage and put such street in as good condition as it was in
before such damage or leak, all to the satisfaction of the Department. The franchisee shall obtain
an excavation permit from the Department for the doing of any such work. (2319-10/78,3889-9/10)
3.44.410 Emergency Equipment. At all times during the term of this franchise,the franchisee
shall maintain or arrange for, on a twenty-four(24)hour a day basis adequate emergency
equipment and a properly trained emergency crew within a radius of twenty-five (25) miles from
any facilities installed or maintained pursuant hereto for the purpose of shutting off the pressure
and the flow of contents of such facilities in the event of an emergency resulting from an
earthquake, act of war, civil disturbance, fire, flood, or any other cause or nature whatsoever.
(2319-10/78)
3.44.420 Removal or Abandonment of Facilities.
(a) At the expiration, revocation or termination of this franchise or the permanent discontinuance
of the use of all or a portion of its facilities,the franchisee shall, within thirty(30) days
thereafter make written application to the Director for authority either: (1)to abandon all or a
portion of such facilities in place; or(2) to remove all or a portion of such facilities. Such
application shall describe the facilities desired to be abandoned or removed by reference to
the map or maps required by Section 3.44.080 and shall also describe with reasonable
accuracy the physical condition of such facilities. The Director shall determine whether any
abandonment or removal which is thereby proposed may be effected without detriment to the
public interest and under what conditions such proposed abandonment or removal may be
safely effected and shall then notify the franchisee of his determination. The franchisee shall
City of Huntington Beach Municipal Code Chapter 3.44 Page 13 of 16
9/15/10
Exhibit"A" - Ordinance No 3935
pay to the City the cost of all tests required to determine the disposition of the application for
abandonment removal. (3889-9/10)
(b) Within thirty(30) days after receipt of such notice, the franchisee shall apply for a permit
from the Department to abandon or remove the facility and shall pay all fees and costs related
thereto. Such permit is to contain the conditions of abandonment or removal as may be
prescribed by the Director. Any abandonment shall be conditioned, in part, upon the
franchisee's compliance with the provisions set forth in this Chapter. (3889-9/10)
The franchisee shall, within ninety (90) days after obtaining such permit commence and
diligently prosecute to completion, the work authorized by the permit. If the franchisee applies
for authority to abandon all or a portion of its facilities in place, and the Director determines that
abandonment in place of all or part of the facilities may be affected without detriment to the
public interest, the franchisee shall pay to the City a fee which shall be computed as follows:
Pipelines with an Internal Diameter of Amount per Lineal Foot
0-12inches $15.00
14-18-inches $22.00
20-30 inches $28.00
(2319-10/78,3889-9/10)
3.44.430 Failure to Comply.
(a) If any facilities to be abandoned "in place" subject to prescribed conditions shall not be
abandoned in accordance with all such conditions the Director may make additional
appropriate orders, including an order that the franchisee shall remove any or all such
facilities. The franchisee shall comply with such additional orders.
(b) In the event that the franchisee shall fail to comply with the terms and conditions of
abandonment or removal as may be required by this chapter and within such time as may be
prescribed by the Director,the City may remove or cause to be removed such facilities at the
franchisee's expense. The franchisee shall pay to the City the cost of such work plus the
current rate of overhead being charged by the City for reimbursable work. (3889-9/10)
(c) If, at the expiration,revocation or termination of this franchise, or of the permanent
discontinuance of the use of all or a portion of its facilities,the franchisee shall,within thirty
(30) days thereafter, fail or refuse to make written application for the abovementioned
authority,the Director shall make the determination as to whether the facilities shall be
abandoned in place or removed. The Director shall then notify the franchisee of his
determination. The franchisee shall thereafter comply with the provisions of subsection(b)
of section 3.44.420. (2319-10/78)
3.44.440 Abandonment "In Place" Conditions. Facilities abandoned "in place" shall be
subject to the condition that if, at any time after the effective date of the abandonment,the
Director determines that the facility may interfere with any public project, franchisee or its
successor in interest must remove the facility at its expense when requested to do so by the City
or to pay City for the cost of such removal. (2319-10/78, 3889-9/10)
3.44.447 Operation After Franchise Expiration—Revocable License. If a franchise is to
expire within sixty days according to the franchise terms, and a new franchise has been
requested, but has not yet been granted,the franchisee may request the Mayor and City Council
to issue the franchisee a written revocable license, for a renewable term not to exceed one
hundred twenty(120) days from the expiration of the franchise,permitting the franchisee to
continue to locate its existing facilities in or upon public property in the City during the term of
the license. The Mayor and City Council may issue such a revocable license, subject to any
restrictions,terms, and conditions (including compensation), without limitation, that they deem
City of Huntington Beach Municipal Code Chapter 3.44 Page 14 of 16
9/15/1 o
Exhibit"A" - Ordinance No 3935
to be in the best interests of the City. Nothing herein requires the Mayor and City Council to
grant such a revocable license, nor does the issuance of such a revocable license require that the
Mayor and City Council grant the franchisee a new franchise. Upon request of the franchisee,the
City Clerk shall provide a revocable license application form. (3850-1/10)
IV. SPECLAL PROVISIONS FOR PETROLELIVI PIPELINES (3889-9/10)
3.44.450 Rights Granted. The franchisee granted a petroleum pipeline franchise shall have the
right during the life thereof to transport oil, gas, gasoline, petroleum, wet gas and other
hydrocarbon substances through the pipelines maintained under the franchise. If the franchisee
or assignee later qualifies before the Public Utilities Commission of the State of California as a
common carrier,the franchisee or assignee shall then have no right to continue to operate
hereunder after the date of such qualification except with the consent of the Council, granted
upon such additional terms and conditions as the Council may deem proper or as superseded by
statute. Such additional terms and conditions shall be expressed by resolution.
(2319-10178,3889-9/10)
3.44.460 Materials Used. All pipelines used or to be used for the transportation of oil, gas,
gasoline,petroleum,wet gas and other hydrocarbon substances shall be first class and standard.
material as set forth by current American Petroleum Institute pipeline specifications. (2319-10/78)
3.44.470 Approvals. On all pipelines laid pursuant to the franchise,the Director shall approve
where flush-valve connections shall be placed in the line. The availability of adequate water
supplies,the hydrocarbons transmitted in the line, and the location of control valves shall be
considered when making such determination. Such flush-valve connections shall be installed in
the manner prescribed by the Director. (2319-10/78)
3.44.480 Reports. The franchisee during the life of the franchise, within sixty(60) days after
the expiration of each franchise payment period, shall:
(a) File with the Director two copies of a verified report of the franchisee showing for the
immediately preceding franchise period,the length of lines in streets,the internal diameter of
such lines,the rate per foot per year and the total amount due the City. (3889-9/10)
(b) File with the Director a report in triplicate, showing the permit number of each permit
obtained for the installation of new mains during the immediately preceding franchise
payment period, together with the length and size of said mains. On this report the franchisee
shall show any change in franchise footage since the last franchise payment period
segregating such footage as to new mains laid, old mains removed, old mains abandoned in
place, and the footage of mains in territory annexed or incorporated since the last franchise
payment period. (2319-10/78)
(c) All payments should be mailed to the City Treasurer, City of Huntington Beach, P.O. Box
711,Huntington Beach, CA 92648-0711. (3889-9/10)
3.44.490 Payments Due. Except for pipelines lawfully maintained other than by the authority
granted by the franchise,the semi-annual payments shall accrue from the respective dates of
installation,whether before or after the effective date of the franchise agreement, and such
payments,together with the initial construction charges, if any, shall be due and payable semi-
annually. (2319-10178,3889-9/10)
3.44.500 Cost of relocation. Franchisee shall bear the costs of removing and relocating its
facilities used and maintained under this franchise if made necessary by any lawful change of
grade, alignment or width of any public street, way, alley or place, or for any public project, even
if franchisee's facilities are located on a private easement. If the grantee after reasonable notice,
fails or refuses to relocate permanently or temporarily its facilities located in, on, upon, along,
under, over, across or above any highway or to pave, surface, grade, repave, resurface or regrade
City of Huntington Beach Municipal Code Chapter 3.44 Page 15 of 16
9/15/10
Exhibit"A" - Ordinance No 3935
as required,pursuant to any provision of the franchise, the City or other public entity may cause
the work to be done and shall keep an itemized account of the entire cost thereof, and the grant
shall hold harmless the City, its officers and employees from any liability which may arise or be
claimed to arise from the moving, cutting, or alteration of any of the grantee's facilities, or the
turning on or off of water, oil, or other liquid, gas, or electricity. (2319-10/78,3889-9/10)
City of Huntington Beach Municipal Code Chapter 3.44 Page 16 of 16
9115/10
Ord. No. 3935
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) SS:
CTTY OF HUNTINGTON BEACH )
I, JOAN L. FLYNN, the duly elected, qualified City Clerk of the City of
Huntington Beach, and ex-officio Clerk of the City Council of said City, do hereby
certify that the whole number of members of the City Council of the City of Huntington
Beach is seven; that the foregoing ordinance was read to said City Council at a regular
meeting thereof held on March 5,2012, and was again read to said City Council at a
regular meeting thereof held on March 19,2012, and was passed and adopted by the
affirmative vote of at least a majority of all the members of said City Council.
AYES: Shaw, Harper, Dwyer, Hansen, Carchio, Bohr, Boardman
NOES: None
ABSENT: None
ABSTAIN: None
I,Joan L.Flynn,CITY CLERK of the City of Huntington
Beach and ex-officio Clerk of the City Council,do hereby
certify that a synopsis of this ordinance has been
published in the Huntington Beach Fountain Valley
Independent on March 29,2012.
In accordance with the City Charter of said City
Joan L. Flynn,City Clerk ' y Clerk and ex-offici lerk
Senior Deputy City Clerk of the City Council of the City
of Huntington Beach, California