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Home My WebLink About06 SOUTHERN CALIFORNIA EDISON'S STREET LIGHT ACQUISITION PROGRAM PARTICIPATIONAGENDA REPORT LST1 MEETING DATE: AUGUST 4, 2015 TO: JEFFREY C. PARKER, CITY MANAGER Agenda Item 6 Reviewed: City Manager Finance Director /Z: FROM: DOUGLAS S. STACK, DIRECTOR OF PUBLIC WORKS/CITY ENGINEER SUBJECT: SOUTHERN CALIFORNIA EDISON'S STREET LIGHT. ACQUISITION PROGRAM PARTICIPATION SUMMARY For the last few years, local governments have been able to request Southern California Edison (SCE) provide a valuation of a community's street light system for the purpose of local government acquisition. The street lights in question are those that are owned and maintained by SCE and for which cities are responsible for paying both energy and maintenance charges, in addition to other taxes and miscellaneous fees. SCE has notified the City that new requests for street light valuations will no longer be accepted as of the close of business on August 15, 2015 unless a valuation fee of $10,000 has been received. RECOMMENDATION Staff recommends that the City Council 1. Authorize an appropriation of $10,000 for the valuation fee from the Street Lighting Fund (Fund 142), and 2. Authorize staff to complete required application materials and submit payment to SCE in the amount of $10,000. FISCAL IMPACT Approval of this item will result in an appropriation of $10,000 from the Street Lighting Fund (Fund 142). The current fund balance is $1.24M. CORRELATION TO THE STRATEGIC PLAN This item contributes to the fulfillment of the City's Strategic Plan Goal C: Financial Strength, by implementing Strategy 1, which is to identify ways to improve cost neutrality. DISCUSSION AND BACKGROUND For a number of years cities throughout the SCE service area have been evaluating methods to acquire their local street lighting systems from SCE. While evaluating SCE invoices for street lighting for fiscal year 2014-15, staff determined that nearly 70% of the costs incurred are for maintenance charges. Staff has completed a cursory analysis of the system and believes that should the City purchase the 3,500 street lights in the system from SCE, annual maintenance costs could be reduced by 40%. A greater savings is possible if the system is retrofitted to an LED lighting standard. Given the opportunity for long-term savings and local control of the infrastructure, staff believes it is important to submit an application with SCE for the Street Light Acquisition Program prior to the programs closing. This will ensure the City of Tustin does not forfeit its right to participate in Street Light Acquisition Program August 4, 2015 Page 2 the program and ultimately eliminate the City's ability to purchase the street lighting system if it is determined that doing so is both practical and feasible. To participate in the program, the City must submit payment to SCE in the amount of $10,000 no later than August 15, 2015. This payment is a fee required to begin the valuation process. Should the City decide not to move forward and SCE has not started valuation work, the $10,000 fee will be refunded. It is unclear what the total cost of acquiring the local street lighting system will be and whether doing so will make financial sense for the City. However, staff believes evaluating the opportunity is an important first step in the process. The City will have one year from the date the valuation report is received to complete and execute a sales agreement with SCE. Stack, P. E. Public Works/City Engineer Attachment(s): 1. SCE LS- Street Light Customers Memorandum, dated 6/16/15 2. SCE Request for Advance Payment, dated 7/10/15 51pryC IIBm11015 Caul IImY MI5 EStt lfl Pax Roan Pap>.aWn.O CEIVD To SCE LS -1 Street Light Customers Ui 2 0 2015 From: John King, SCE Street Light Project Manager TSTI U. LIC WORKS DEPT Date: June 16, 2015 f Subject: Closure of SCE's Street Light Acquisition Program Given recent advancements in technology and SCE's commitment to provide cost effective street light service, SCE plans to close its LS -1 Street Light Acquisition Program as of August 15, 2015. SCE will no longer accept new requests for street light valuations as of the close of business on August 15, 2015. Local governments have an opportunity to enter the valuation queue and be included by requesting an invoice and paying the $10,000 valuation fee by no later than August 15, 2015. Local government customers who have already requested an invoice, paid the $10,000 valuation fee, or received their valuation report remain eligible to purchase street lights. Local government customers who receive their valuation report before August 15, 2015, will have until August 15, 2016, to complete and execute a sales agreement with SCE. Customers who enter the valuation queue prior to August 15, 2015 but receive their valuation report after August 15, 2015, will have one year (365 days) from the date that SCE provides the valuation report to complete and execute a sales agreement with SCE. If a local government chooses not to move forward and SCE has not started valuation work, SCE will refund the $10,000 fee. It is also important to note that SCE is planning to file its AB 719 implementation plan on July 1s', 2015. In this filing, we plan to propose a tariff and program designed to provide local governments with opportunities to finance and repay LED retrofit costs for SCE -owned street lights. We invite you to compare the costs and benefits of this new program to that of the LS -1 Streetlight Acquisition Program. For any questions or additional information concerning opportunities related to SCE -owned street lights or for Energy Efficiency opportunities for LS -2 and LS -3 customer -owned lights, please contact your account manager, your local public affairs region manager, or me. Sincerely, John King Streetlight Project Manager Southern California Edison Email: Iohn.king(o-bsce.com Phone: 626-278-4057 Version 21 May 2015 JCK 51 )I.Il Iif IL9nV (I\�.V.IFf 11t,V L1 �JED V,i U)ISO\ „I I: R,b 1110%.11.' langpnn, City of Tustin Attn: Douglas S. Stack PE Director of Public Works/City Engineer\ 300 CENTENNIAL WAY, TUSTIN, CA 92780 TUSTIN, Request For Advance Payment C E I V E D Document # 7590006704 Document Date 07/10/2015 )L 6 2015 Customer# 10067023 SCE Contact John King JB . WORKS DEPT. Telephone # 626-815-7256 (BC) Description Amount Advance Payment - Street Light Valuation SCE Project# : Tustin If paving by chec RE&PAYk FCCT. OVED NO. NT OR # k. Dlease follow instructions on Bi stu b below Instructions for wire or ACH payments: JP Morgan Chase Bank New York, NY ABA#: 021000021 Acct#: 323-394434 SCE Taxpayer ID No. 95-1240355 Ref: Customer# 10067023 - Document# 7590006704 - John King $10,000.00 Failure to properly identify your customer and document number may delay your project Please detach and return payment stub with payment CutHere ----------------------------------------------------------- Payment Stub Customer 10067023 Document 7590006704 (BC) Make check payable to Southern California Edison. Please include customer and document# on the check. City of Tustin Attn: Douglas S. Stack PE Director of Public Works/City Engineer 300 CENTENNIAL WAY, TUSTIN, CA 92780 $10,000.00 Enter top amount you paid Is 10, A — Southern California Edison Attn: Accounts Receivable PO Box 800 Rosemead, CA 91771-0001