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CITY OF SEWARD, ALASKA
RESOLUTION 2010 -076
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD,
ALASKA, AUTHORIZING THE CITY MANAGER TO ENTER INTO A
SOLE SOURCE CONTRACT WITH CHUGACH ELECTRIC
ASSOCIATION TO REPAIR THE TRANSMISSION LINE AND TO SPEND
UP TO $1,000,000 FOR THE TOTAL PROJECT AND APPROPRIATING
FUNDS
WHEREAS, the electrical transmission line has damage in several places between Seward
Highway Mile marker 18 to 37; and
WHEREAS, these damages pose an immediate threat to the City's electrical power and the
City Electric Department does not have the capability for the repairs; and
WHEREAS, during a June 21 working session the City Council was presented an estimate
provided by Dryden & LaRue, Inc. Their estimated repair and self generation cost was $830,000 to
$1,500,000, these figures included $234,000 to $500,000 operating the City's emergency back up
generators. The generator operating cost depends on the time the power is off in support of the
repairs. The low estimate is based on if all repairs are accomplished simultaneously, thereby,
reducing the time the power is off. If the repairs are not done simultaneously the backup generator
cost could rise as high as an estimated $492,000; and
WHEREAS, Chugach Electric Association can execute the repairs and charge the City their
cost; and
WHEREAS, Seward City Code §6.10.120(A)(7) exempts the City from the requirements of
competitive procurement procedures where the City may contract for services with a public utility
corporation at a price or rate determined by state or other government authority; and
WHEREAS, over the years, the Regulatory Commission of Alaska approved CEA tariffs for
costs of various work activities, and CEA will charge the City its costs in accordance with approved
tariffs; and
WHEREAS, the City Council finds that it is in public interest to waive the normal bid
process per SCC 6.10.130 to pursue a sole source contract with Chugach Electric Association to
accomplish the repairs, based on: 1) RCA's approval of Chugach's costs; 2) Chugach's technical
expertise and greater capabilities; and 3) the urgency of the repairs. The City Manager notified the
City Council of the pending emergency contract during the work session of June 21, 2010.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
,,„ OF SEWARD, ALASKA that:
CITY OF SEWARD, ALASKA
RESOLUTION 2010 -076
Section 1. The City Manager is authorized to enter into a contract with Chugach
Electric Association in substantially the form presented at this meeting for a cost not
to exceed $500,000 and to spend up to $1,000,000 for the repairs and operating the
backup generators.
Section 2. The Seward City Council hereby determines that it is in the public interest
to waive the normal bidding process per Seward City Code 6.10.120(A)(7) for the
reasons described in the recitals above, which recitals are incorporated herein by this
reference.
Section 3. Funds will come from the Electric Departments Major Repair and
Replacement Fund 502- 0000 - 3071 -0501 and the Transmission Line Fund 208 -208X-
5390.
Section 4. This resolution shall take affect immediately upon its adoption.
PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this the 9th of
August, 2010.
THE CITY SEWARD, ALASKA
Willard E. unham, Mayor
AYES: Valdatta, Smith, Bardarson, Keil, Shafer, Dunham
NOES: None
ABSENT: Amberg
ABSTAIN: None
ATTEST:
Je cn Lewi C fC
City Clerk , .'' p F SE&ti .,
(City Seal) �3� V •
•
I• SEAL
4,) tomi
Council Agenda Statement
Meeting Date: August 9, 2010 � of sett,
Through: Phillip Oates, City Manager -�
1 &AS1�
From: John Foutz, Manager Electric Utility
Agenda Item: Transmission Line Repair Contract with Chugach
Electric Association
BACKGROUND & JUSTIFICATION:
The bulk power to the City of Seward is provided by a radial transmission line. The City owns
approximately 40 miles of transmission line, most in heavily steep sloped forested areas. The
transmission line is damaged in several places due to falling trees between Seward Highway Mile
Markers 18 to 37. These damages pose an imminent and immediate threat to the City's electrical
power and the City Electric Department does not have the capability for the repairs. Dryden &
LaRue, Inc. estimated a conservative repair cost of $830,000, this includes between $234,000 to
$500,000 operating the City's emergency back up generators. The generator operating cost depends
on the time the power is off in support of the repairs. The city manager notified the City Council of
the pending emergency contract during the work session of June 21, 2010. Chugach Electric
Association has the technical expertise and capabilities to execute the repairs and will charge the
City their cost. Seward City Code §6.10.120(A)(7) exempts the City from the requirements of
competitive procurement procedures where the City may contract for services with a public utility
corporation at a price or rate determined by state or other government authority. Over the years, the
Regulatory Commission of Alaska approved CEA tariffs for costs of various work activities, and
CEA will charge the City its costs in accordance with approved tariffs.
CONSISTENCY CHECKLIST: Where applicable, this resolution is consistent with the Seward
City Code, Charter, Comprehensive Plans, Land Use Plans, Strategic Plan and City Council Rules of
Procedures.
Other:
ATTORNEY REVIEW: Yes X No
FISCAL NOTE:
The funding for this work will come from reserves in the Electric Enterprise Fund retained
earnings account. Funds will come from the Electric Departments Major Repair and
Replacement Fund 502- 0000 - 3071 -0501 and the Transmission Line Fund 208 -208X -5390.
Approved by Finance Department:
RECOMMENDATION:
Seward City Council approve Resolution 2010 -0'7(, authorizing the City Manager to enter into a
sole source contract with Chugach Electric Association to repair the electric transmission line for an
amount not -to- exceed $500,000 and appropriating funds of up to $1,500,000 for all repairs and
operating backup generators.
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