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HomeMy WebLinkAbout12135 Background Paper for Proposed RESOLUTION DATE:AGENDA ITEM # M-2 May 9, 2011 DEPARTMENT: Law Department Thomas J. Florczak, City Attorney TITLE A RESOLUTION ENGAGING WILLIAM H. McEWAN TO PROVIDE LEGAL SERVICES RELATING TO PARTICIPATION IN PUC PROCEEDINGS CONCERNING BLACK HILLS' RATE REQUEST ISSUE Should the City engage William H. McEwan to provide legal services relating to the Colorado Public Utility Commission’s proceedings in Docket No. 11AL-387E, and any related proceedings, concerning Advice Letter No. 643 and other rate filings by Black Hills/Colorado Electric Utility Company, LP? RECOMMENDATION Approve the engagement. BACKGROUND The City’s electric bill paid to Black Hills for 2010 was approximately $3.2 million. Black Hills Energy has filed Advice Letter No. 643 to implement a general rate increase via a General Rate Schedule Adjustment of 22.2% to base rates. This would result in a substantial increase in the City’s power costs. It would be in the best interest of the City to engage the services of legal counsel experienced in PUC rate increase regulation to assist the City in evaluating the rate increase and participating in the PUC proceeding. Mr. McEwan has such experience and will be representing other customers in the PUC proceeding. FINANCIAL IMPACT Funds for services to be performed and costs expended in such representation shall be paid from the Council Contingencies account. The costs of participating in the rate increase proceeding may be offset by reduction of the City's energy costs attributable to any reduction in the amount of Black Hill's rate increase. RESOLUTION NO. 12135 A RESOLUTION ENGAGING WILLIAM H. McEWAN TO PROVIDE LEGAL SERVICES RELATING TO PARTICIPATING IN PUC PROCEEDINGS CONCERNING BLACK HILLS' RATE REQUEST WHEREAS, Black Hills/Colorado Electric Utility Company, LP ("Black Hills”) furnishes and sells electricity to the City and its residents under a franchise granted in 2010, and WHEREAS, Black Hills has filed with the Colorado Public Utilities Commission its Advice Letter No. 643 to implement a general rate increase of 22.2% to base rates ("Rate Case”). WHEREAS, the base rate increase would result in a substantial increase in the City’s power costs; and WHEREAS, it would be in the best interest of the City to engage the services of special legal counsel experienced in rate regulation to assist the City in evaluating the request and participating in the Rate Case; and WHEREAS, William H. McEwan has such experience and is familiar with the structure and activities of Black Hills in providing and furnishing electricity, and WHEREAS, pursuant to Section 6-7 of the Charter of the City, the City Attorney consents to and approves the engagement of William H. McEwan as special counsel to provide legal services relating to the PUC proceedings involving the Rate Case. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The Legal Services Agreement between William H. McEwan and the City of Pueblo, a copy of which is attached hereto, having been approved as to form by the City Attorney, is hereby approved. The City Attorney is authorized to execute the engagement letter on behalf of the City. SECTION 2. Funds for services to be performed and costs expended in such representation shall be paid from the Council Contingencies account. INTRODUCED: May 9, 2011 By: Leroy Garcia COUNCILPERSON ORIGINAL LEGAL SERVICES AGREEMENT THIS LEGAL SERVICES AGREEMENT ( "Agreement ") is entered into between Pueblo, a Municipal Corporation (hereafter "Client ") and William H. McEwan (hereafter "Attorney ") on the date entered below In consideration of the mutual promises contained herein, the parties agree as follows 1 Client hereby retains Attorney, to represent it as Special Counsel regarding Colorado Public Utility Commission proceedings in regard to Black Hills /Colorado Electric Utility Rate Case, Docket No 11A-387E and related proceedings. Pursuant to §6 -7 of the Pueblo Charter, the City Attorney approves retention of Attorney, who shall serve solely under his direction. The representation of Client under this Agreement is to be undertaken jointly with representation of the Board of Water Works of Pueblo and the Fountain Valley Authority in the same proceeding(s). 2. It is agreed that the attorney with principal responsibility for performing and supervising the work for Client shall be William H. McEwan. Client understands that the current billing rate for such attorney is $145 per hour Attorney reserves the right to associate with other lawyers to assist in representation of the Client, if in Attorney's reasonable judgment that becomes necessary The Client understands that the current billing rate for other lawyers does not exceed $145 00 per hour Other personnel, such as law clerks and paralegal assistants, may be assigned to Client's matters in the discretion of Attorney It is understood that the above stated rates may be modified over time. Attorney's periodic statements to the Client shall reflect the current rates in effect at the time the service was performed. 3 Out -of- pocket expenses incurred on behalf of Client, such as filing costs, service of process, travel, photocopying, expert witness fees, and deposition and transcript costs, will be in addition to the costs of legal services and Client agrees to pay all of said out -of- pocket expenses. 4 Client understands that Attorney will submit itemized bills for time and expenditures on a periodic, but not more frequent than monthly, basis. Client agrees that, subject to appropriations for such legal services, it shall keep all billings paid on a current basis, and shall not allow overdue balances to accumulate unless it is specifically agreed to by Attorney in writing. Client shall endeavor to advise Attorney when no remaining available funds exist in any appropriation for the legal services. 5 Fees for representation of multiple parties represented jointly shall be shared on an equal basis, provided, however, that fees and costs incurred for representation that benefits or serves the interests of only one or more parties but less than all parties shall be divided only among the parties benefited or interested in such representation. By executing this Agreement, Client waives any potential conflict of interest arising from the joint representation which may exist as of the date of execution of this Agreement. 6 The provisions set forth in Exhibit "A ", attached hereto shall constitute additional terms of this Agreement, as if set forth in full herein. This Agreement becomes effective when it has been signed by the Client and delivered to the Attorney This Agreement shall be binding on the parties, their heirs, successors, and assigns. ATTORNEY Dated May 12, 2011 By tiAtilumc . Ufa, William H. McEwan PUEBLO, a Municipal Corporation Dated /Y X2 2a1J By . • Its �' /, Exhibit "A" State - Mandated or Related Contract Clauses As used in this section, "Contractor" shall mean the firm or entity (whether referred to as Consultant, Company, Contractor, Architect, Accountant or by other term) entering into this Agreement with Pueblo, a Municipal Corporation (which may be referred to in this Agreement as City, Client, Customer or by other term) PERA LIABILITY Contractor shall reimburse the City for the full amount of any employer contribution required to be paid by City to the Public Employees' Retirement Association ( "PERA ") for salary or other compensation paid to a PERA retiree performing contracted services for the City under this Agreement. Contractor shall fill out the questionnaire attached as Exhibit "1" and submit the completed form to City as part of the signed Agreement. STATE - IMPOSED MANDATES PROHIBITING ILLEGAL ALIENS FROM PERFORM -ING WORK UNDER THIS CONTRACT (a) At or prior to the time for execution of this Contract, Contractor shall submit to the Purchasing Agent of the City its certification that it does not knowingly employ or contract with an illegal alien who will perform work under this Contract and that the Contractor will participate in either the E- Verify Program" created in Public Law 208, 104 Congress, as amended and expanded in Public law 156, 108 Congress, as amended, that is administered by the United States Department of Homeland Security or the "Department Program" established pursuant to section 8 -17 5- 102(5)(c), C.R.S that is administered by the Colorado Department of Labor and Employment in order to confirm the employment eligibility of all employees who are newly hired for employment to perform work under this Contract. (b) Contractor shall not: (I) Knowingly employ or contract with an illegal alien to perform work under this Contract; (II) Enter into a contract with a subcontractor that fails to certify to Contractor that the subcontractor shall not knowingly employ or contract with an illegal alien to perform work under this Contract. (c) The following state - imposed requirements apply to this Contract: (I) The Contractor shall have confirmed the employment eligibility of all employees who are newly hired for employment to perform work under this Contract through participation in either the E- Verify Program or Department Program. (II) The Contractor is prohibited from using either the E- Verify Program or Department Program procedures to undertake pre- employment screening of job applicants while this Contract is being performed. Y (III) If the Contractor obtains actual knowledge that a subcontractor performing work under this Contract knowingly employs or contracts with an illegal alien to perform work under this Contract, the Contractor shall be required to A. Notify the subcontractor and the Purchasing Agent of the City within three (3) days that the Contractor has actual knowledge that the subcontractor is employing or contracting with an illegal alien, and B Terminate the subcontract with the subcontractor if within three (3) days of receiving the notice required pursuant to subparagraph (c)(III)A. above the subcontractor does not stop employing or contracting with the illegal alien, except that the Contractor shall not terminate the contract with the subcontractor if, during such three (3) days, the subcontractor provides information to establish that the subcontractor has not knowingly employed or contracted with an illegal alien. (IV) The Contractor is required to comply with any reasonable request by the Colorado Department of Labor and Employment (hereinafter referred to as CDLE) made in the course of an investigation that CDLE is undertaking pursuant to its authority under ' 8- 17.5- 102(5), C.R.S (d) Violation of this Section by the Contractor shall constitute a breach of contract and grounds for termination. In the event of such termination, the Contractor shall be liable for City's actual and consequential damages. (e) Nothing in this Section shall be construed as requiring the Contractor to violate any terms of participation in the E- Verify Program. EXHIBIT "1" COLORADO PUBLIC EMPLOYEES RETIREMENT ASSOCIATION SUPPLEMENTAL QUESTIONNAIRE TO BE ANSWERED BY ANY BUSINESS PERFORMING SERVICES FOR THE CITY OF PUEBLO Pursuant to section 24 -51- 1101(2), C.R.S., salary or other compensation from the employment, engagement, retention or other use of a person receiving retirement benefits (Retiree) through the Colorado Public Employees Retirement Association (PERA) in an individual capacity or of any entity owned or operated by a PERA Retiree or an affiliated party by the City of Pueblo to perform any service as an employee, contract employee, consultant, independent contractor, or through other arrangements, is subject to employer contributions to PERA by the City of Pueblo Therefore, as a condition of contracting for services with the City of Pueblo, this document must be completed, signed and returned to the City of Pueblo (a) Are you, or do you employ or engage in any capacity, including an independent contractor, a PERA Retiree who will perform any services for the City of Pueblo? Yes _, No X (b) If you answered "yes" to (a) above, please answer the following question. Are you an individual, sole proprietor or partnership, or a business or company owned or operated by a PERA Retiree or an affiliated party? Yes , No If you answered "yes" please state which of the above entities best describes your business. (c) If you answered "yes" to both (a) and (b), please provide the name, address and social security number of each such PERA Retiree. Name Name Address Address Social Security Number Social Security Number (If more than two, please attach a supplemental list) Failure to accurately complete, sign and return this document to the City of Pueblo may result in your being denied the privilege or doing business with the City of Pueblo If you answered "yes" to both (a) and (b), you agree to reimburse the City of Pueblo for any employer contribution required to be paid by the City of Pueblo to PERA for salary or other compensation paid to you as a PERA Retiree or paid to any employee or independent contractor of yours who is a PERA Retiree performing services for the City of Pueblo You further authorize the City of Pueblo to deduct and withhold all such contributions from any moneys due or payable to you by the City of Pueblo under any current or future contract or other arrangement for services between you and the City of Pueblo Signed May 12, 2011 Idldluc+t sawOo+r 4 Name William H. McEwan Title Attorney For purposes of responding to question (b) above, an affiliated party includes (1) any person who is the named beneficiary or cobeneficiary on the PERA account of the PERA Retiree; (2) any person who is a relative of the PERA Retiree by blood or adoption to and including parents, siblings, half - siblings, children, and grandchildren, (3) any person who is a relative of the PERA Retiree by marriage to and including spouse, spouse's parents, stepparents, stepchildren, stepsiblings, and spouse's siblings, and (4) any person or entity with whom the PERA Retiree has an agreement to share or otherwise profit from the performance of services for the City of Pueblo by the PERA Retiree other than the PERA Retiree's regular salary or compensation.