Collection of Fee - 2008 - Idaho Power Underground Distribution Facilities - 1/8/2008
~~IDAHO
~POWER@
An IDACORP Company
January 8, 2008
The Honorable Nancy C. Merrill
City of Eagle, Idaho
Eagle City Hall
660 E. Civic Lane
P.O. Box 1520
Eagle, ID 83616
Re: Letter Agreement Regarding Plans to Underground Certain Distribution Facilities
Located within Eagle, Idaho.
Dear Mayor Merrill:
The intent of this letter is to establish procedures that Idaho Power Company and the City of
Eagle, Idaho will follow to pay for the cost of burying certain electrical distribution lines located
within the corporate boundaries of the City of Eagle, Idaho. The parties agree as follows:
1. On or about November 19, 2004, in Order No. 29634, the Idaho Public Utility
Commission, in Case No. IPC-E-04-04, approved a Settlement Stipulation (the "Settlement
Stipulation:) among the City of Eagle, Idaho (the "City"), Idaho Power Company ("Idaho
Power" or the "Company").
2. Since full payment of certain costs identified in Paragraphs 9 and 10 of the Settlement
Stipulation, Idaho Power has neither retained nor invoiced the City for any amounts associated
with the 3% franchise fee. Instead, pursuant to Paragraphs 12 and 13 of the Settlement
Stipulation and a memorandum from Idaho Power to the City dated May 29, 2007, the Company
has remitted the full 3% franchise fee to the City, 66.67% of which is being held by the City for
the sole purpose of undergrounding future distribution lines located within the City in
accordance with Paragraph 11 of the Settlement Stipulation.
P.O. Box 70 (83707)
1221 W Idaho St.
Boise, ID 83702
The Honorable Nancy C. Merrill
Page 2 of 3
January 8, 2008
3. The City has identified certain electrical distribution lines located within the corporate
limits of the City that it wishes to have buried in conformance with the Settlement Stipulation.
Those distribution facilities are located on the map identified as Exhibit I hereto. The total cost
of undergrounding the facilities identified in Exhibit I is $492,355.00 which includes the actual
cost of engineering those facilities plus the Company's Work Order cost of constructing the
facilities. At an interest rate of 8.1 % for a term of approximately two (2) years, the total
estimated cost of the project is $518,441.93.
4. As set forth in the Settlement Stipulation, the City intends to pay the total estimated
cost identified in Paragraph 3 herein by way of the Idaho Power franchise fee amount held by the
City and identified in Paragraph 2 herein plus 66.67% of the 3% franchise fee collected by Idaho
Power on behalf of the City between October I, 2007 and December 31, 20 I 0 or earlier if the
total cost is collected and paid prior to December 31, 2010.
5. Upon execution of this Letter Agreement, the City agrees to remit to Idaho Power the
sum of $195,424.28.
6. The estimated remaining balance of the cost of the project, $323,017.65, will be paid
by the City to Idaho Power as follows:
7. Beginning on or about January 1, 2008 and quarterly thereafter until the estimated
remaining cost identified in Paragraph 7 is paid in full by the City to Idaho Power, the Company
shall submit a report to the City identifying the franchise fees collected on the City's behalf for
the previous quarter. Furthermore, beginning on or about January I, 2008, and quarterly
thereafter until the estimated remaining cost identified in Paragraph 7 is paid in full, Idaho Power
shall invoice the City in an amount equal to 66.67% of the 3% franchise fee collected on behalf
of the City. Said invoiced amount shall be paid by the City to Idaho Power within thirty (30)
days from the date of mailing of the invoice from Idaho Power to the City.
8. Pursuant to Paragraph 12 of the Settlement Stipulation, the City agrees to take
any and all action necessary to reduce its franchise fee from 3% to no more than I % and Idaho
Power shall have no obligation after December 31, 2010 to collect and pay franchise fees to the
City above 1 %. Idaho Power and the City agree that the remaining balance and any accrued
interest shall be paid in full by the City by extending the 3 percent franchise fee beyond
December 31, 2010, until said balance and accrued interest is paid as described herein.
The Honorable Nancy C. Merrill
Page 3 of 3
January 8, 2008
By signing this Letter Agreement, the City of Eagle, Idaho and Idaho Power Company are
accepting the above-described procedures, terms and conditions as amending the Settlement
Stipulation. All other provisions of the Settlement Stipulation are to remain unchanged
If you have any questions, please do not hesitate to contact me at (208) 388-6477.
Yo=;t;~
Layne Dodson
Community Relations Representative
Capital Region
cc: City Clerk, City of Eagle, Idaho
We acknowledge and accept the requirements and procedures outlined in this Letter Agreement.
FOR THE CITY 0 EAGLE, IDAHO
FOR IDAHO POWER COMPANY
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