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Home My WebLink AboutSS4 - UUD 101 - PowerPoint (Staff)January 27, 2015 Agenda Item No. SS4 UNDERGROUND UTILITY ASSESSMENT DISTRICTS Background Procedures Policies Public Works Department A Well-Engineered Machine January 27, 2015 Council Study Session Governing Laws, Polices, and Rules 1911 Improvement Act 1913 Municipal Improvement Act 1915 Improvement Bond Act 1931 Majority Protest Act Streets and Highways Code Proposition 218 Council Policy L -28 Municipal Code Chapters 3.33, 15.32 California Public Utilities Commission Southern California Edison (Edison) Phone and Cable companies (Telecom) t What is undergrounding? • Removing overhead electric, phone, cable TV lines and poles and placing them underground What are the benefits? • Aesthetic, system reliability, access and property values What is an Assessment? • Levy or charge on a private property for improvements (typically on the property tax bill) CITY OF m N e w p o rt Beach FAQs Contact Us Search... I Want To... v City Deparnrents & Servims . Pubhc Works -Capital Iv roverrent Prooram UTILITY UNDERGROUND ASSESSMENT DISTRICTS 0 Share & Book"rk ti Print Property owners interested in forming an utility underground assessment district can request the Resister to have City of Newport Beach to administer the formation process. There are three ways property Assessment District owners can underground the existing overhead utilities: updates delivered m your inbox. 1. Rule 20A - Projects that fall under Rule 20A are paid for by all utility ratepayers, not just those who live in the area to be undergrounded. To qualify for full funding, projects must provide a benefit to the general public, not just the affected customers in the area by satisfying one or more of the below criteria; • unusually heavy concentration of overhead facilities • heavily traveled area • qualifies as an arterial or major collector road in the general plan • within or passing through a civic, recreational, or scenic area 2. Rule 20B- Projects that fall under Rule 20B allow property owners to elect to form an underground utility assessment district when Rule 20A does not apply. See General District Formation Process for additional informati on forming a district 3. Rule 20C - Projects that fall under Rule 20C enables property owners to privately fund undergrounding the overhead facilities if neither of the above apply. General inquiries pwinfaa�newportheachca.ccov. low. 1 Rule 20A Funds Funds collected from all Edison ratepayers California Public Utilities Commission sets Rule 20A policies to use allocations for utility underground areas that provide general public benefit: — Unusually Heavy Concentration of Overhead Facilities 4 — Heavily Traveled — Designated as an Arterial or Major Collector Road — Within, or Passes Through Civic, Recreational or Scenic Area Rule 20A Funds Funds collected from all Edison ratepayers City typically receives $275,000 per year City has saved annual credits and purchased a combined total of approx. $2mil in credits Rules allow a max of 5 -years of mortgaging 20A funds, (i. e. 5 years @$275, 000 = $1,3 75, 000) ❖ Typical projects range in the $3mil to $5mil range K East Coast Highway g y West Coast Highway Jamboree, MacArthur Newport Blvd � /•Y any &,uWn�ym 4 � NF WPORI Y. Underground Utility Districts ` PcnPtu PV (Rule 20A) .�wN East Coast Highway g y West Coast Highway Jamboree, MacArthur Newport Blvd � /•Y any &,uWn�ym � NF WPORI / PcnPtu PV bAY P�q - `.viw3ir'W'..�wPPW d a.s�cnw�u`.i .s.uau.vxcu,.- iu..u,os.n. v<wP n.¢xr w.aaams F I ' 8 , X13 �..,» 18 �.� «., : 1- 12 ,: .• O� a OCEAN 4, City Council Priority No. 1— n Design ,r 1 ,11#1 Other Future Rule 20A- Projects • Hospital Road — Superior to Old Newport Blvd • Superior Ave — Placentia to south of Ticonderoga • San Joaquin Hills Road — Spyglass Hills Rd to El Capitan - � I Rule 20B Projects 'vately Initiated Funds Collected from Property Owners ❖Allows property owners to form Underground Utility Assessment Districts (UUAD) ❖Funded through special property assessments ❖Edison discounts the undergrounding cost by allocating the cost equivalency of an overhead electric system — usually about 20% ❖Minimum eligibility requirements projects ❖Cost historically range from $10,000 to $25,000 per property Underground Assessment at. & Utility Districts 9 T Pubbe Works lkpartm nt � 1� L 0 % 598 B 107 � IN•M.I SIJU• �� - n.. i '• •'•s.. 0 <umYAN 93105 • .. iwe•" \fir 102 Z • 13 ". .::' "•r �, .... ., 70 3 Moog 0,16 /•r' CuY BwNury t5 _ / � µ"ms ..111 .. >9 � � ce4 1' 'b•F� 4 ? °•w� ( ... t00 )n .�5 hoYLa �i 12 81 Da:' IM ° 96 ♦� n x.iva.nwe �wr...e.• PAG'IFIC OCEAN 1 i f 1 1 I : %�� 5 59H � I d5C I % 598 B 107 � IN•M.I SIJU• �� - n.. i '• •'•s.. 0 <umYAN 93105 • .. iwe•" \fir 102 Z • 13 ". .::' "•r �, .... ., 70 3 Moog 0,16 /•r' CuY BwNury t5 _ / � µ"ms ..111 .. >9 � � ce4 1' 'b•F� 4 ? °•w� ( ... t00 )n .�5 hoYLa �i 12 81 Da:' IM ° 96 ♦� n x.iva.nwe �wr...e.• PAG'IFIC OCEAN 1 Current Potential 20B Projects Gathering Petitions District Location (Bounded By) Parcels Estimated Project Cost Petition Cost Estimate (per parcel) Estimated Petition Collection Status 111 Newport Blvd / 23rd St / Ocean Front W / 31st St 278 $3,990,000 $14,500 40% 113 Balboa Island - Big Island 1,176 $25,250,000 $21,500 0% 114 Cliff Dr / Tustin Ave / 15TH St and Irvine Ave 249 $5,725,000 $23,000 35% 115 Bayside Dr / Heliotrope Ave / Ocean Blvd and Jasmine Ave 100 $2,566,300 $25,700 30% 116 Balboa Blvd / River Ave / 38th St and Rivo Alto 96 $2,011,300 $21,000 60% 116B River Ave / 47th Street, Balboa Blvd., 38th Street and Seashore Drive 172 $2,985,900 $17,500 25% 117 Acacia Ave / Pacific Or / Coast Hwy and Carnation Ave 272 $5,027,700 $18,500 40% 118 Newport Heights 510 $12,656,000 $25,000 20% 119 Marguerite Ave /Poppy Ave /5th Ave /Ocean Blvd 670 TED TBD 0% E Totals 3,523 $60,212,200 Utility Undergrounding District Animation Example Before After N Current Rule 20B Procedure Property Owner Submits a Request to form a District City Prepares Preliminary Boundary Map City /Utilities Prepare Rough Order of Magnitude (ROM) Cost Estimate ❖ City Prepares Petition Package & Delivers to Proponents ❖ Proponents Gather Property Owner Signatures on Petition ❖ Need 60% of Owners to Sign N Current Rule 206 Procedure With 60% verified by city staff, item is placed on Council agenda to request advancing city funds to design the new underground system: City requests Edison to design the system ❖ After Edison design is complete, AT &T and cable TV design their systems • ®• Project is then bid by Edison N Current Rule 206 Procedure ❖ Assessment District formation begins: ❖ Assessment Engineer's report developed Identifies actual cost per parcel ❖ Official ballots and voting process ❖ City Public Hearing and vote tabulation by City Clerk (50% + 1 is required to pass) ❖ Property owners provided a 30 -day assessment pre- payment window ❖ Bonds are issued ❖ Edison & utility construction ❖ Residents hook -up to the underground system ❖ Process is complete — Any savings are refunded Construction Details Trenching and installation of vaults Undergrounding of utility lines in public right -of -way Removal of wires and poles Repaving of affected roadways and concrete alleys Construction Details Residential and Business Service Connections Responsibility of Property Owners ...Every property owner within a district shall construct the service connection on his property between the facilities and the termination facility on the structure being served... Not included in assessments Costs typically range $2,500 to $5,000 ❖ $0 for redeveloped properties (already completed by prior permit requirements) _ -M Policy Guidance ❖City facilitation of district formation ❖Reducing the petition process from 60% to 50% ❖Reducing Edison and other costs ❖Accelerating the delivery time period ❖Position on City owned parcels ❖Purchasing other Agency 20A credits ❖Leveraging opportunities Policy Guidance City Facilitation of District Formation ✓ City Website and Resource Documents ✓ Staff Resources for formation ❑ Community Meetings Hosted by Staff ❑ Post Cards, Mailings & Outreach ❑ City Council Policy Supporting UUAD's Policy Guidance Reducing the Petition Process from 60% to 50% ✓ 60% is Current Procedure ✓ Based on Laws, Codes & Common Practice ✓ Property Owner Rights ✓ 60% reduces the risk District failure and of City advanced funds ✓ Good indication if the properties will approve the ballot assessment ✓ Resident driven process to assess properties ❑ Difficulty in collecting petitions ❑ Less than 60% is an Option (50% min) Policy Guidance Reducing Edison and Telecom Costs ✓ Economies of scale for design, construction and financing ❑ Work with Edison and Telecom's to reduce costs where possible ❑ Use above ground pad transformers instead of underground transformer vaults where possible ❑ Alternative construction delivery methods ❑ District formation costs Above Ground vs. Below Ground Policy Guidance Accelerating the Delivery Time Period ✓ Active City Facilitation ❑ Future Discussion with Edison and telecoms ❑ Continue momentum with petition gathering and voting Policy Guidance City Owned Parcels ✓ Parks, Fire Stations and other City owned land are often in undergrounding areas ✓ Policy L -28 speaks to voting on the assessment on a case by case basis ❑ Amend the policy to include the City's desire to participate in the undergrounding process for the purposes of the petition ❑ Petition proponents can count City owned land as part of their petition gathering (up to 10 %) Policy Guidance Purchasing Other Agency 20A Credits ✓ History of buying other agency excess credits ✓ Average $0.50 per $1.00 ✓ Help expedite list of 20A projects ✓ City -wide beautification ❑ Pursue purchasing other Agency 20A credits Policy Guidance Leveraging Opportunities ✓ Adjacent 20A and 206 projects ✓ Coordinate with necessary City Projects ❑ City owned parcels ❑ Purchase 20A Agency credits ❑ Further City facilitation Council Policy L -20 (portion of) The City Council recognizes and is sensitive to the fact that assessments are a cost to the taxpayer, either directly as an assessment against the taxpayer's property or through the payment of assessments for benefits to City -owned land. As a result, the voting of City land in favor of an assessment can have significant impact on property owners. On the other hand, the City Council is also sensitive to benefits that can be provided to taxpayers, property owners and the City as a whole through the proper use of the assessment process. As a result, the decision of how to vote City land, either for an assessment or against an assessment, is a policy decision that must be made by the City Council on a case by case basis. Next Steps Questions Public Input ❖ Suggested Practice changes for further follow -up ❖ Suggested Policy changes for further follow -up