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Home My WebLink AboutRes2022-058 Purchase Transformers & Repeal Res22-101 Sponsored by: Bower CITY OF SEWARD,ALASKA RESOLUTION 2022-058 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, REPEALING RESOLUTION 2021-101 AND AUTHORIZING THE CITY MANAGER TO PURCHASE FROM VIRGINIA TRANSFORMER CORPORATION THREE HIGH-VOLTAGE TRANSFORMERS IN A NOT-TO-EXCEED AMOUNT OF $2,664,716, INCLUDING FREIGHT CHARGES OF$298,000 FOR INSTALLATION IN THE FORT RAYMOND (2) AND LAWING (1) SUBSTATIONS, AND APPROPRIATING FUNDS WHEREAS, on September 13, 2021, the city council adopted Resolution 2021-101: Authorizing the City Manager to Purchase Seven Electric Transformers in an amount not to exceed $4,800,000, which includes a 15% contingency, to Help Ensure Service Reliability for Seward Residents and Businesses While also Allowing the City to Meet Future Load Growth and Appropriating Funds; and WHEREAS,On February 14, 2022, the city council adopted Resolution 2022-2023: Providing for the Authorization, Sale, Issuance and Delivery of City of Seward, Alaska, Electric Revenue Bond in the Aggregate Principal amount of Not to Exceed Ten Million Dollars ($10,000,000) to Finance Certain Details of Said Bond; and Providing for Related Matters; and WHEREAS, the initial bond amount was $19,500,000 and was reduced to $10,000,000, this reduction reduced the scope of work and reduced the transformer purchased indicated in Resolution 2021-101; and WHEREAS, the existing transformers in the Fort Raymond (2) and Lawing (1) substations are old and have surpassed their service life; and WHEREAS,the new transformers for the Fort Raymond and Lawing substations will be upgraded to increase system capacity from 69kV to 115kV; and WHEREAS, these new transformers will improve system reliability to electric customers in and around the City of Seward; and WHEREAS,the new transformers are custom built and could take up to 72 weeks for delivery, the Electric Department is working to have them available for installation in late summer or fall of 2023: and WHEREAS,the new transformers are part of a larger infrastructure project to rebuild the "backbone"of Seward's electric transmission system to help ensure service reliability for the next 35 to 40 years. CITY OF SEWARD,ALASKA RESOLUTION 2022-058 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD,ALASKA that: Section 1. The City Manager is hereby authorized to purchase three high-voltage substation transformers from Virginia Transformer Corporation in a not-to-exceed amount of $2,664,716, including freight charges of$298,000. Section 2.Funding in the amount of$2,664,716 for the transformers is hereby appropriated to the Electric Critical Infrastructure Project Fund 15340-0000-8101 from the approved Electric Revenue Bond designated for this project. Section 3. This resolution shall take effect immediately upon adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 25th day of April,2022. H C Y AIjB;ALASKA hristy Terr /, Mayor AYES: DeMoss,Wells, McClure,Calhoon, Osenga,Terry /`� NOES: None ABSENT: Casagranda ABSTAIN: None ATTEST: rends J. Ball , MMC City Clerk (City Seal) \\\ OF SE{y's1 !. ( SEAL •• t - i City Council Agenda Statement r Meeting Date: April 25, 2022 � To: City Council Through: Janette Bower, City Manager -- From: Rob Montgomery, General Manager - Electric Agenda Item: Resolution 2022-058: Repealing Resolution 2021-101 and Authorizing the City Manager to Purchase from Virginia Transformer Corporation Three High- Voltage Transformers for the Fort Raymond (2) and Lawing (1) Substations in the Not-to-Exceed Amount of $2,664,716, Including Freight Charges of $298,000, and Appropriating Funds Background and justification: On September 13, 2021, the city council adopted Resolution 2021-101: Authorizing the City Manager to Purchase Seven Electric Transformers in an amount not to exceed $4,800,000, which includes a 15%contingency,to Help Ensure Service Reliability for Seward Residents and Businesses While also Allowing the City to Meet Future Load Growth and Appropriating Funds. On February 14, 2022, the city council adopted Resolution 2022-2023: Providing for the Authorization, Sale, Issuance and Delivery of City of Seward, Alaska, Electric Revenue Bond in the Aggregate Principal amount of not to Exceed Ten Million Dollars ($10,000,000) to Finance Certain Details of Said Bond; and Providing for Related Matters. The initial bond amount was $19,500,000 and was reduced to $10,000,000. This reduction reduced the scope of work and reduced the transformer purchased indicated in Resolution 2021-101. Much of the materials and equipment making up Seward's electric transmission system is old and beyond its service life. Included in this equipment are two transformers in the Fort Raymond Substation and another in the Lawing Substation. The purchase and installation of these transformers are part of a larger infrastructure project to rebuild the"backbone"of Seward's electric transmission system to help ensure service reliability for the next 35 to 40 years. The work is also an opportunity to upgrade the system and associated equipment from 69kV to a more robust 115kV so that the City is prepared to serve future growth in the area. Since the transformers are customer built and may take up to 72 weeks for delivery, the Electric Department is working to get the transformers ordered so they're available for installation in late summer or fall of 2023. Comprehensive and Strategic Plan Consistency Information This legislation is consistent with (citation listed): Comprehensive 3.7.1.4 "Continue to upgrade and expand utilities to meet existing needs and Plan: encourage future development." Strategic Plan: Reduce Energy Costs—Expand customer base within the Seward Electric utility area Other: Certification of Funds Total amount of funds listed in this legislation: $ 2,664,716 This legislation (✓): Creates revenue in the amount of: $ X Creates expenditure in amount of: $ 2,664,716 Creates a savings in the amount of: $ Has no fiscal impact Funds are (✓): Budgeted Line item(s): 15340-0000-8101 X Not budgeted Not applicable Unassigned Fund Balance and Available Unrestricted Cash Balance Information Fund (✓): General SMIC Electric Wastewater Boat Harbor Parking F1 Water F1 Healthcare Motor Pool X Other Electric Bond Unassigned Fund Balance*: $ *unaudited numbers Available Unrestricted Cash Balance*: $ Finance Signature: Az Attorney Review,/ Administration Recommendation RxYes X Adopt Resolution Not applicable Other: