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Home My WebLink About1996 - MINUTES - 5/28/1996009,;, CITY OF PALM SPRINGS CITY COUNCIL MINUTES MAY 28, 1996 An Adjourned Regular Meeting of the City Council of the City of Palm Springs, California, was called to order by Mayor Kleindienst, in the Council Chamber, 3200 T'alnquitz Canyon Way, on Wednesday, May 28, 1996 at 4:00 p.m., at which time, the City Attorney announced items to be discussed in Closed Session, and at 5:30 p.m., the meeting was convened in open session. ' ROLL CALL: Present: Councilmembers Barnes, Hodges, Oden, Spurgin, and Mayor Kleindienst Absent: None The meeting was opened with the Salute to the Flag, and a moment of silence REPORT OF POSTING OF AGENDA: City Clerk reported that the agenda was posted in accordance with Council procedures on May 24, 1996. REPORT OF CITY ATTORNEY ON MATTERS DISCUSSED IN CLOSED SESSION (All Entities) -See items on Page 3 of agenda this date. HOUSING AUTHORITY: FINANCING AUTHORITY: INDUSTRIAL DEVELOPMENT AUTHORITY - No business PUBLIC COMMENTS: a) Comments concerning Item 1: Art Lyons, resident, stated he was on the negotiating committee, and was available for questions. Joy Schlendorf expressed pleasure that the Council was going to cancel the option with CalEnergy; that data suggests that by 1998, the kwh rate will be 8 cents, which is the rate the City will have to beat; that she was concerned that an added one cent price for Palm Springs is equal to 12.5 % increase in utility tax; and that if the City charges more than the cost for delivery, it would not be in the community's best interest; that the transient occupancy tax is not a donation, but a tax, and until the convention center debt is paid, the General Fund subsidizes the Community Promotion Fund. Dick Sroda, resident, stated that the option contract is the same as what was available last week, and he was told it was not available. He commented about another City's problems with employee "scams" and asked what audit protection the City has, and when the last occasion was that departments were audited. Steve Fericker, resident, staled that everyone has worked hard on this matter, and lie realized there is a lot of controversy, and he questioned what the status is of training City staff to take over, and not to continue with hiring consultants. Mark Allen, Iilinova, staled that concerning the rates in 1998, the City is both residential and commercial use driven, and is trying to reduce costs for everyone; that Palm Springs wants to make sure it is the lowest cost provider, with good customer service, economic development and City growth; that, currently, the two classes will not get full relief under the open access SCE or PUC plan until 2001-2002. LEGISLATIVE ACTION: 1. MUNICIPALIZATION ELECTRICAL (147- 004) On May 22, 1996, the Council continued recommendation concerning review of CalEnergy option agreement to supply power and consideration of approving additional (147- option agreements. 004) 0098 Council Minutes 5-28-96, Page 2 MUNICIPALIZATION ELECTRICAL (Continued) City Attorney stated that this is an innovative and creative project., and many people still do not see its potential; that concerning the availability of the contract, he would have spoken with Mr. Sroda had he contacted him; that the proposal involves the cancellation of one option agreement, and entering into two new option agreements; that at the last meeting, the new option agreements were ready, but not the cancellation, and without the cancellation in place, the City could have had a legal liability. He reviewed details of the Assistant City Manager's report on file with the City Clerk, in particular, explaining how the effort to secure the FERC wheeling order was to be funded; that during the nu:anthne, a process was established to select a permanent supplier, which culminated in the reduction from 36 proposals to 14 bids, to five companies, with an interest in a 100% (147 load supply; that CalEnergy was contacted as to how the geothermal would be pulled in, 004) at which point it suggested canceling the agreement, and that it would not pay any further payments - although the City had already received its $97,000 advance check; that staff was not willing to do that, because of the commitment of no General Fund dollars for the project, and sought interest from the suppliers as to an option agreement; that two of the five companies were selected - Portland General and Illinova; and he explained the terms of the option agreement as detailed in the Assistant City Manager's report. He reported that the two companies will each pay an option fee of $150,000, and if the FERC approval is granted, and the Council decides for whatever reason not to proceed, the obligation is to refund any unexpended funds; that if the decision is to remain with SCE, a mechanists is included to repay the option license fee to them; that whichever of the two companies is selected, it will repay the option fee to the other licensee's $150,000; that he did not believe the two companies would ante this kind of money if they did not think the project would succeed and that the Council had a strong commitment to moving forward: and that the effort has the sarong potential to bring early rate relief to local electricity customers. Councilmember Hodges stated that there should be no question about proceeding; that Mr. Lyons should be thanked for all of his work; that this is a pressing issue and one which will result in helping every citizen in Palm Springs and it must be! continued forward; and that she felt the Council, and prior Council, are and were totally committed to it. Councilmember Spuugin stated that the cost of energy is the greatest economic development issue facing the City, and its solution will result in hiring new businesses to Patin Springs. Councilmember Barnes noted that the Building Industry Association is also very anxious to have it proceed, and continues to show interest and encouragement for going forward. Mayor stated that it will help the residents and spur economic growth, but it will also help existing businesses and tourist related businesses see reduced costs. Minute Order 5740 approving cancellation and release with CallEinergy (A3665); Minute Order 5741 establishing a new short list; Minute Orders 5742 and 5743 approving Illinova Energy (A3666) and Portland General Electrical Company (A3667) option agreements, was presented; after which, it was moved by Hodges, seconded by Spurgin, and unanimously carried, that M05740 through 5743 be adopted. AIRPORT LEASE ASSIGNMENT - STATIC CONTROL Recommendation: That the Council ratify the assigmnenl of Lease Agr #3308, from ' Static Control Services, a division of Richmond Technology, Inc., to Static Control (051-� Services, a division of Richmond Technology, Inc., a wholly -owned subsidiary of Illinois 066) Tool Works, Inc., a Delaware Corporation. City Manager reviewed [lie memorandum of the Director of Transportation. Minute Order 5744 as recommended, was presented; after which, it was moved by Spurgin, seconded by Barnes, and unanimously carried, that M05744 be adopted. ADDED STARTERS: None 0099 Council Minutes 5-28-96, Page 3 REPORTS & REQUESTS: CITY COUNCIL reports or requests a) Councilmember Hodges requested that the road race for 1997 be put on an early ' agenda before August. She also requested information in response to a concern expressed to her whether construction type noise, i.e., jackhammering, is permitted on holiday weekends at 8 a.m. near hotels. She also shared an article from a 1984 issue of the Desert Suit concerning redevelopment in the Desert - Highland Gateway area, and observed that not much has changed. b) Mayor and Councilmembers reported on various civic and community organizational meetings and events which they attended, subsequent to the last regular meeting. PUBLIC reports or requests STAFF reports or requests ADJOURNMENT There being no further business at 6:45 p.m., Mayor declared the meeting adjourned to a Joint Meeting with the Tribal Council, Thursday, May 30, 1996, at 5 p.m., at the Spa Hotel. /JUDITH SUMICH City Clerk