Utility Committee Agenda and Packet 2017 10 27

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`, Cityof Om Louisville COLORADO - SINCE 1878 UTILITY COMMITTEE COMMUNICATION SUBJECT: DATE: POWERLINE UNDERGROUNDING FUND MARCH 31, 2017 PRESENTED BY: EMILY KROPF, ASSISTANT TO THE CITY MANAGER SUMMARY: The City's franchise agreement with Xcel requires the company to budget and allocate 1% of the preceding year's electric gross revenues for Louisville to bury existing overhead facilities underground. To use the 1°/0 fund, City staff must select projects that are located in the right-of-way and at least 750 feet in length. Staff is looking for comments on the following issues: • Which projects, if any, should staff direct Xcel to start the design process for at this time? • Should the City consider during the biennial budget process investing any funding outside of the 1°/0 fund for undergrounding? The additional cost to bury CenturyLink's lines have not been included in the City's five-year Capital Improvement Plan. Background There are several factors to consider when prioritizing projects. First, it can be difficult to identify a specific cost for undergrounding as some projects are more expensive than others due to various challenges (i.e. type of infrastructure, geographic location, other utility lines). Second, a power line that has private services lines connected to it for residences or commercial properties may not result in a significantly improved appearance as the poles that connect the private services lines would remain unless the City picked up the additional cost to bury those lines. Third, undergrounding may not result in more consistent service. Xcel has found that burying utility lines does not necessarily improve service reliability as the majority of issues that result in outages involve other unexpected issues like animal interference or equipment failure. Staff has previously used the Xcel 1% fund to bury overhead lines in the downtown business district when we could cost-effectively do so as part of construction activity immediately adjacent to the overhead lines and to avoid undergrounding work at a later date that would damage recently installed asphalt and concrete work (the "dig once" approach). The current balance of the fund is $1,574,940. Xcel allows for a 3 -year borrow ahead, which adds another $800,000 to the fund, resulting in a total of about $2,375,000. Staff recommends maintaining a minimum balance of $500,000 to use in conjunction with future capital projects (i.e. traffic signals on State Highway 42). Therefore, the total amount available is about $1,875,000. UTILITY COMMITTEE COMMUNICATION