EWEB Resolution - street lights w 843 Procedure applicable to City of Eugene

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1982 ELECTRIC UTILITY CAPITAL BUDGET President Tiffany explained that the revised budget will be somewhat reduced for the next meeting to make sure that EWEB is operating just as tight as it can. He noted that the staff has been pouring over the budget and eliminating those things which cannot be put off, in an attempt to reduce expenses. He said he agreed that this is something that must be done, because the economic conditions in this area are poor. Garry Kunkel presented the following review of the proposed revised street lighting policy rates: "The following discussion of EWEB street lighting service results in a major departure from the method now in use. Representatives of several EWEB divisions and departments have cooperated in the development of the final recommended approach. In addition, staff has taken into account comments of local agency representatives. "HISTORY EWEB has been involved in providing street lighting since it became an entity in 1911. News accounts of the day indicate that on April 3, 1911, voters approved a city - sponsored $25.000 bond issue to be used for street lighting improvement - -later on in the year, on July 17, 1911, an additional bond issue of $30,000 was approved. Until 1948, Eugene's lighting system developed sporadically using various approaches to financing. During the early 1900's, there were cases in which, due to lack of city funds, some merchants themselves purchased and installed lighting systems in public rights of way and later deeded them to the city. By the early 1950 thoughts turned to replacing Eugene's 40 year old ornamental and incandescent lighting system with the then - modern mercury vapor system. At the time, EWEB was providing energy and maintenance to the lighting system. The city purchased the fixtures. During the next ten years, in -depth lighting studies were carried out with the aid of a task force appointed by the mayor. EWEB staff provided technical assistance. Finally, in 1960, the downtown area was fully converted from the ornamental, incadescent lighting system to a "high- intensity" mercury vapor system. About three years prior to the major conversion, a new financing arrangement was worked out with the City of Eugene and was subsequently used with other agencies which requested EWEB lighting services. Essentially, the arrangement provided that EWEB would design the system, purchase and install the fixtures, supply electric energy, and provide operation and maintenance services through a single rate per fixture. The rate was designed to recover the initial capital, labor, and installation costs over a 15 -year period. In addition to capital costs, the rate included power cost, factors for photocell replacement, lamp replacement, labor for both, lamp washing costs, contingency for vandalism, and an in lieu of tax factor. Since 1957, when the original street light rates now in effect were adopted, only one major revision has occurred. In 1974, rates per fixture were adjusted by $1.00 to cover increases in capital and non- capital costs (recognizing that the system had fixtures already on the amortization schedule as well as fixtures yet to be installed). In the years 1978, 1979. 1980 and 1981, the rate per fixture has been increased only to reflect the increased power cost component of each fixture. "TODAY'S LIGHTING SYSTEM EWEB presently provides lighting services to ten public agencies which contract for a total of 6,008 individual lighting fixtures. The City of Eugene is by far the largest single customer, now billed for 4,693 - -or 78 percent of all the lights in the metropolitan area. The next largest customer is Santa Clara Water District with 534 lights- -nine percent, followed by River Road Water District with 376, or six percent. 1981 1981 Est. 1982 BUDGET Actual BUDGET GENERAL PLANT: Buildings & Land $ 0 $ 11000 $ 191,950 Office Furniture & Equipment 19,900 37,000 46,923 Transportation Equipment 100,000 90,000 163,000 Tools 58,200 10,000 94,647 $ 178,100 $ 138,000 $ 496,520 STEAM MAINS $ 40,200 $ 2,000 $ 130,000 STEAM SERVICES $ 335,000 $ 180,000 $ 75,000 TOTAL ELECTRIC CAPITAL $8,572,000 $7,528,000 $1,858,220 President Tiffany explained that the revised budget will be somewhat reduced for the next meeting to make sure that EWEB is operating just as tight as it can. He noted that the staff has been pouring over the budget and eliminating those things which cannot be put off, in an attempt to reduce expenses. He said he agreed that this is something that must be done, because the economic conditions in this area are poor. Garry Kunkel presented the following review of the proposed revised street lighting policy rates: "The following discussion of EWEB street lighting service results in a major departure from the method now in use. Representatives of several EWEB divisions and departments have cooperated in the development of the final recommended approach. In addition, staff has taken into account comments of local agency representatives. "HISTORY EWEB has been involved in providing street lighting since it became an entity in 1911. News accounts of the day indicate that on April 3, 1911, voters approved a city - sponsored $25.000 bond issue to be used for street lighting improvement - -later on in the year, on July 17, 1911, an additional bond issue of $30,000 was approved. Until 1948, Eugene's lighting system developed sporadically using various approaches to financing. During the early 1900's, there were cases in which, due to lack of city funds, some merchants themselves purchased and installed lighting systems in public rights of way and later deeded them to the city. By the early 1950 thoughts turned to replacing Eugene's 40 year old ornamental and incandescent lighting system with the then - modern mercury vapor system. At the time, EWEB was providing energy and maintenance to the lighting system. The city purchased the fixtures. During the next ten years, in -depth lighting studies were carried out with the aid of a task force appointed by the mayor. EWEB staff provided technical assistance. Finally, in 1960, the downtown area was fully converted from the ornamental, incadescent lighting system to a "high- intensity" mercury vapor system. About three years prior to the major conversion, a new financing arrangement was worked out with the City of Eugene and was subsequently used with other agencies which requested EWEB lighting services. Essentially, the arrangement provided that EWEB would design the system, purchase and install the fixtures, supply electric energy, and provide operation and maintenance services through a single rate per fixture. The rate was designed to recover the initial capital, labor, and installation costs over a 15 -year period. In addition to capital costs, the rate included power cost, factors for photocell replacement, lamp replacement, labor for both, lamp washing costs, contingency for vandalism, and an in lieu of tax factor. Since 1957, when the original street light rates now in effect were adopted, only one major revision has occurred. In 1974, rates per fixture were adjusted by $1.00 to cover increases in capital and non- capital costs (recognizing that the system had fixtures already on the amortization schedule as well as fixtures yet to be installed). In the years 1978, 1979. 1980 and 1981, the rate per fixture has been increased only to reflect the increased power cost component of each fixture. "TODAY'S LIGHTING SYSTEM EWEB presently provides lighting services to ten public agencies which contract for a total of 6,008 individual lighting fixtures. The City of Eugene is by far the largest single customer, now billed for 4,693 - -or 78 percent of all the lights in the metropolitan area. The next largest customer is Santa Clara Water District with 534 lights- -nine percent, followed by River Road Water District with 376, or six percent.