City Council Minutes 2015 07 14 - Laserfiche WebLink

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City Council Meeting Minutes July 14, 2015 Page 14 of 26 KILOWATT CAPACITY OF COMMUNITY SOLAR WITH CLEAN ENERGY COLLECTIVE — 2 "d Reading — Public Hearing Mayor Muckle requested a City Attorney introduction. City Attorney Light introduced Ordinance No.1695, Series 2015. Mayor Muckle opened the public hearing and requested a staff presentation. Public Works Director Kowar explained the Clean Energy Collection proposal for an investment in community solar panel arrays. The proposal provides for a lease purchase agreement for community solar capacity in the amount of 145,890 watts. The proposal was based upon a return on investment for electricity usage at the Sid Copeland Water Treatment Facility and Louisville Sports Complex, which experience peaking factors escalating average monthly bill costs. The proposed 15 -year agreement provides for a lease purchase of 606 solar panels representing 145.89 kilowatts of capacity with an initial estimated annual output of 245,686 kilowatt-hours of energy. The proposal represents non tax exempt financing at a rate of 4.75% until April 24, 2018. The City may then, through written communication, request a tax exempt rate at 3.50 %. This results in a net reduction in the City's costs for electricity over a 20 year life cycle of $631,883. Staff supported the lease agreement and believes it will increase the solar capacity within the City by 50% and help offset the demand rates for the City's larger facilities. He introduced Amy Thompson from Clean Energy Collection, who would address Council's questions. Staff Recommendation: Staff recommended the City Council approve the lease with Alpine Bank. COUNCIL COMMENT Council member Lipton requested more information on the non -tax exempt financing, which could be converted to a tax exempt financing at a later time. City Attorney Light explained for the initial period of five years, in order for the private investors to get the tax exemption, there cannot be public use of the financing facility. Restrictions prohibit ownership to rest with the City during the initial five year period. After five years the City may request a tax exempt rate to convert it to a beneficial public use for tax purposes. Public Works Director Kowar explained there are specific attorneys who review the agreement for qualification, which affects the lending rate Alpine Bank can offer. PUBLIC COMMENT