HomeMy WebLinkAbout9/8/2010 - STAFF REPORTS - 2.G. P A`M sA�
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Date: September 8, 2010 CONSENT CALENDAR
Subject: APPROVAL OF A PIPELINE INSPECTION AGREEMENT WITH SFPP,
LP, RELATED TO THE GENE AUTRY TRAIL UPRR BRIDGE WIDENING
PROJECT, CITY PROJECT 01-04
From: David H. Ready, City Manager
Initiated by: Public Works and Engineering Department
SUMMARY
Kinder Morgan owns and operates a 22" petroleum pipeline within the Union Pacific
Railroad, and is requiring the City to enter into an agreement providing for their
inspection of construction occurring around the pipline.
RECOMMENDATION:
1) Approve Agreement No. , with SFPP, L.P., a Pipline Inspection Agreement
related to the Gene Autry Trail UPRR Bridge Widening Project, City Project 01-
04; and
2) Authorize the City Manager to execute all necessary documents.
STAFF ANALYSIS:
On September 2, 2009, the City Council approved a Cooperative Agreement with
Riverside County, whereby the County will administer the construction phase of the
City's Gene Autry Trail UPRR Bridge Widening Project (City Project 01-04). The
County has combined construction of the City's project with the adjacent Palm
Drive/Gene Autry Trail 1-10 Interchange project.
Construction is underway on the projects, and work is scheduled to begin on widening
the railroad bridge. Kinder Morgan owns and operates a 22" petroleum pipeline within
the railroad right-of-way, and the pipeline runs under the existing railroad bridge.
Construction of the widened bridge has the potential to impact the existing pipeline, and
Kinder Morgan is requiring that the City provide for their inspection of work that has the
potential to impact its pipeline.
Item No. 29G *
City Council Staff Report
September 8, 2010- Page 2
Kinder Morgan Pipeline Inspection Agreement
Kinder Morgan has provided a Pipeline Inspection Agreement to facilitate the City's
payment of estimated costs for their inspection and oversight of construction occurring
near their pipeline. The agreement has been reviewed by the City Attorney, and is
recommended for approval.
FISCAL IMPACT:
Kinder Morgan has estimated the cost to provide inspection of their pipeline at $35,000.
Pursuant to the terms of the Agreement, upon execution of the Agreement the City is
required to advance the estimated cost of $35,000 to Kinder Morgan. In the event their
inspection time extends beyond a two month period, an additional deposit of$15,000 for
each subsequent month is required. Ultimately, Kinder Morgan will provide a final
accounting of inspection services provided, and will refund any monies owed to the City
or will invoice the City for monies owed to Kinder Morgan.
This project is federally funded, and costs are covered by the federal grant at 88.53%.
The local match of eligible costs of 11.47% is covered by Regional Measure A funds.
Sufficient funds are available in account 261-4491-50214 ($30,985.50), and 134-4497-
50214 ($4,014.50). No local miscellaneous General Funds will be required for this
project.
SUBMITTED:
Prepared by: Recommended by:
v
Marcus L. Fuller David J. Barakian
Assistant Director of Public Works Director of Public Works/City Engineer
Approved by:
Thomas J. Wil 'n, Asst. City Manager David H. Ready, nager
Attachments:
1. Pipeline Inspection Agreement
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PIPELINE INSPECTION AGREEMENT
This PIPELINE INSPECTION AGREEMENT (this "Agreement') is made and entered
into this day of , 2010 (the "Effective Date"), by and between the City of
Palm Springs ("The Agency") and SFPP, L.P. ("SFPP'), with reference to the following facts:
A. WHEREAS, SFPP owns, operates and maintains one 22" petroleum product pipeline
and related appurtenances (the "Pipeline") located in the right of way of the Union Pacific
Railroad, San Bernardino County, California.
B. WHEREAS, Agency is planning to construct an overpass at Palm Drive/ Gene Autry
Trail and Union Pacific Railroad intersection (the "Project").
C WHEREAS, the construction of the Project will require inspection of the Pipeline, and
will therefore require SFPP to provide pipeline engineering services (the "Engineering
Activities") to review Agency's plans for the Project and coordinate with Agency during the
progress of the Project,
D WHEREAS, Agency and SFPP desire to enter into an agreement whereby the Agency
agrees to reimburse SFPP and SFPP agrees to provide, itself or through its consultants and
contractors, certain pipeline inspection services (the "Services");
NOW, THEREFORE, in consideration of the terms and conditions contained herein,
along with other good and valuable consideration, the sufficiency of which is hereby
acknowledged, SFPP and Agency hereby agree as follows:
1. Agency shall provide SFPP with at least 10 days written notice prior to
performing any construction activities in the Subject Property. If any activities to be
undertaken by Agency require any sampling, boring, excavation, ditching or other
disruption of the soil or subsurface of the Subject Property, Agency shall obtain SFPP's
written approval prior to commencing any such activity. Upon receipt of notice from
Agency, SFPP shall coordinate with Agency to provide the Services during the period of time
when Agency is performing construction activities near the pipeline easement in the Subject
Property. Notices shall be delivered by courier, overnight mail, or certified mail to the attention
of Kinder Morgan Area Manager, Bill Toepfer, Kinder Morgan, 2051 E. Slover, Bloomington, CA
92316, (909) 873-5152.
2. Agency shall pay SFPP the actual cost incurred by SFPP in performance of the
Services, plus SFPP's normal additives for reimbursable projects (the "Actual Cost'). SFPP
estimates the cost of such Services, including additives shall be $35,000.00 (the "Estimated
Cost') , which includes but is not limited to: (i) consultant and contractor charges, (ii) equipment
and materials, (iii) SFPP labor, (iv) engineering (including 42% for labor additives), and (v)
19.4% for administrative overhead costs.
3. On or before the Effective Date, Agency shall deliver payment to SFPP in the
amount of the Estimated Cost. Such payment must be received by SFPP prior to the
performance of any Services under this Agreement. When the final accounting of the Actual
Cost of the Services performed by SFPP is completed, SFPP will submit an itemized billing to
Agency for review, together with either: (i) an invoice, to the extent the Actual Cost exceeds the
Estimated Cost; (ii) a check from SFPP, to the extent the Estimated Cost exceeds the Actual
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Cost. If the Actual Cost exceeds the Estimated Cost, Agency shall pay SFPP the excess
amount within 30 days after receiving such invoice from SFPP. SFPP shall maintain records for
3 years of the actual costs incurred and charged or allocated in the performance of the Services
in accordance with generally accepted accounting principles.
4. In the event that the inspection time exceeds two months, Agency shall forward
an additional payment of $15,000 at the end of the first month and each succeeding month to
cover the next month's estimated inspection cost until the construction activities impacting the
subject facilities are completed.
5. To the extent permitted by applicable law, Agency agrees to release, defend,
and to protect, indemnify and hold harmless SFPP, its parent, affiliates, and subsidiaries, and
its and their respective directors, officers, agents and employees, from every kind or character
of damages, losses, liabilities, expenses, demands or claims, including any and all costs and
fees arising out of litigation or settlement of any claims (collectively, "Losses"), to the extent the
Losses are caused by, arise from or relate to, directly or indirectly, the negligence, recklessness
or willful misconduct of Agency, its agents, employees in connection with this Agreement or the
Subject Property. Agency further agrees that it shall pay, in proportion to its obligation pursuant
to this Section 5, all damages, costs and expenses (including attorneys' fees) in connection
therewith or any matter resulting therefrom. Agency shall not settle any such action or suit
without SFPP'S prior written consent. This indemnification obligation shall survive expiration or
termination of this agreement.
To the extent permitted by applicable law, SFPP, L.P., Kinder Morgan Operating L.P.
"D", Kinder Morgan G.P., Inc., and Kinder Morgan Management, LLC (collectively and
individually, for purposes of this paragraph, "SFPP") agree to release, defend, and to protect,
indemnify and hold harmless Agency, its affiliates, and its and their respective directors,
officers, agents and employees, from every kind or character of damages, losses, liabilities,
expenses, demands or claims, including any and all costs and fees arising out of litigation or
settlement of any claims (collectively, "Losses"), to the extent the Losses are caused by, arise
from or relate to, directly or indirectly, the negligence, recklessness or willful misconduct of
SFPP, its agents, employees in connection with this Agreement or the Subject Property. SFPP
further agrees that it shall pay, in proportion to its obligation pursuant to this Section 5, all
damages, costs and expenses (including attorneys' fees) in connection therewith or any matter
resulting therefrom. SFPP shall not settle any such action or suit without Agency's prior written
consent. This indemnification obligation shall survive expiration or termination of this
agreement.
UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR
ANY INDIRECT, SPECIAL, CONSEQUENTIAL OR PUNITIVE DAMAGES
6. This Agreement contains the entire agreement between Agency and SFPP with
respect to the subject matter hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives as of the Effective Date.
[Signatures on the following page.]
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Pipeline Inspection Agreement
City of Palm Springs, SFPP, L.P.
2010
City of Palm Springs
By:
Name:
Title:
SFPP, L.P.,
By: Kinder Morgan Operating L.P. "D", its general partner
By: Kinder Morgan G.P., Inc., its general partner
By: Kinder Morgan Management, LLC, the delegate of Kinder Morgan G.P., Inc.
By:
Name:
Title:
[Pipeline Inspection Agreement Between City of Palm Springs and SFPP, L.P., 2010]
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