passed ordinance

*Amend Intergovernmental Agreement with Portland General Electric Company for operation and maintenance services for the Portland Hydroelectric Project for $1,250,000 (amend Contract 30006171)

infrastructure utilities
procurement
iga

Department: Water
Introduced by: Former Commissioner Mingus Mapps
Status: Passed

Impact statement

Purpose & background

The City of Portland’s Hydroelectric Project (Project) is located on the Bull Run River, approximately ten miles northeast of the City of Sandy, Oregon. The Project falls under the jurisdiction of the Federal Energy Regulatory Commission (FERC). Portland Water Bureau’s Hydroelectric Power Bureau (HPB) currently purchases certain repair and maintenance services from Portland General Electric Company (PGE) as required in the operation of the Project’s 10 miles of 57Kv Transmission Line located in the Bull Run Watershed. Portland Water Bureau’s HPB has the sole and exclusive generation rights to the energy. Repair and maintenance of the 57Kv line is critical to the daily operational and contractual element required to produce and send the hydroelectric power generated at the Project to PGE. The City’s Power Sales Agreement with PGE requires these services to be provided by the City. Portland Water Bureau’s HPB does not have the capability to perform these services for itself. Portland Water Bureau HPB’s current Intergovernmental Agreement (Agreement) with PGE is to provide repair and maintenance services for the 57Kv transmission lines which allow the Project to send hydroelectric power to PGE . The existing Agreement’s initial five-year term has passed; however, the Agreement has an automatic reoccurring roll over clause for consecutive one (1) year periods. After extended negotiations with PGE both Portland Water Bureau and PGE have agreed to continue with the one-year extensions for a period of five years beginning in Fiscal Year (FY) 2023-24 and ending in FY 2027-28. Portland Water Bureau’s HPB and PGE have a mutual desire to continue their working relationship. PGE costs have been determined to be reasonable for these services. Portland Water Bureau’s HPB desires to continue the Agreement with PGE for the required repair and maintenance services. City Code allows the Portland Water Bureau’s HPB to enter this Agreement with PGE under the conditions described in Code Section 3.110.010, Ordinance No. 147822.

Financial impacts

The total increase to the current Agreement is $1,250,000 bringing the total Agreement to $2,500,000. Funding in the amount of $490,000 is available in the FY 2023-24 Budget and additional funding will be requested in the future Portland Water Bureau HPB’s Budgets. The proposed Agreement will not result in a change in the staffing levels to Portland Water Bureau’s HPB.

Community impacts

There are no impacts to the community.

▸ Full text (the legislation as adopted)

The City of Portland ordains: Section 1. The Council finds: The Portland Hydroelectric Project (Project) generates electric power and is located on the Bull Run River, approximately 10 miles northeast of the City of Sandy, Oregon. Since 1982, the City has sold electric power generated by the Project to the Portland General Electric Company (PGE). Portland Water Bureau owns approximately 10 miles of 57Kv overhead electrical transmission line that interconnects the Project with PGE’s Dunns Corner Substation. Portland Water Bureau does not have the capability to service and maintain the line and consequently entered into an Intergovernmental Agreement (Agreement) in 2017 with PGE to perform those services. The original Agreement was in the amount of $1,000,000 and approved through Ordinance No. 188580. In 2022, the Agreement was amended to add $200,000 for a total amount of $1,200,000. In 2023, the Agreement was amended to add $50,000 for a total amount of $1,250,000. Additional funds in the amount of $1,250,000 are necessary to continue PGE’s operation and maintenance of the Portland Water Bureau’s transmission line through June 30, 2028. The additional funds will bring the Agreement’s total amount to $2,500,000. Funding in the amount of $490,000 is available in the FY 2023-24 Budget. Additional funds will be requested in FY 2024-25 through 2027-28 Budgets. NOW, THEREFORE, the Council directs: The Portland Water Bureau Director is authorized to add additional funds to Intergovernmental Agreement No. 30006171, generally in accordance with the Amendment attached as Exhibit A. The Auditor is authorized to draw and deliver checks chargeable to the Hydropower Fund when demand is presented and approved by the proper authorities. The Portland Water Bureau Director is authorized to execute amendments to the Agreement, including amendments increasing the total compensation upon funding availability. The Agreement will be automatically renewed, dependent on funding availability, for successive terms of one year unless the Portland Water Bureau or PGE terminates the Agreement. Section 2. The Council declares that an emergency exists because PGE did not trim vegetation around the Project’s transmission line during the 16 months the parties conducted contract negotiations; therefore, this Ordinance shall be in full force and effect from and after its passage by the Council.

Tally

4 yea 0 nay 1 other