Ordinance 1264
PACIFICORP FRANCHISE

ORDINANCE NO. 1264

AN ORDINANCE APPROVING A NON-EXCLUSIVE FRANCHISE WITH PACIFICORP FOR THE OPERATION AND MAINTENANCE OF A SYSTEM TO PROVIDE ELECTIC SERVICES, DELEGATING TO THE CITY ADMINISTRATOR AUTHORITY TO ENTER INTO SAID FRANCHISE, AND DECLARING AN EMERGENCY.

WHEREAS, the City of Junction City (City) and PacifiCorp have agreed to terms of a Franchise Agreement for the operation of a system within the public rights of way to provide electric services; and

WHEREAS, the City has jurisdiction and exercises regulatory management authority over all City public rights of way pursuant to the City Charter and State law. The City’s purpose for exerting its management authority over the public rights of way is to protect and efficiently manage the public’s resources, to ensure fair and non-discriminatory access to the public right of way, and to protect the public health, safety and welfare; and

WHEREAS, no Person may occupy or encroach on a public right of way without the permission of the City. The City grants permission to use public rights of way through Franchise Agreements and construction permits; and

WHEREAS, the City holds the health, safety, welfare, quality of life and opportunities to prosper, as well as such physical assets such as the public right of way, in trust for all of its citizens and has a fiduciary responsibility to assure that any use of City resources, especially its public ways, benefits all of the citizens and, where it is deemed appropriate, allows for the recovery of a fair and reasonable compensation from private entities using public resources; now, therefore:

THE CITY OF JUNCTION CITY ORDAINS AS FOLLOWS:

Section 1. Authorization. The City Council hereby approves the Franchise Agreement attached as Exhibit A and delegates to and authorizes the City Administrator to sign and enter into the Franchise Agreement.

Section 2. Emergency Clause. For the preservation of the peace, health and safety of Junction City, Oregon, due to the expiration of Ordinance No. 1200, an emergency is declared to exist, and this ordinance shall become immediately operative and in force retroactively from and after the date of adoption by the Junction City Council. Grantee’s acceptance shall be filed with the City Recorder within 30 days of adoption by the Junction City Council and approval by the Junction City Mayor.

Read in full for its first reading on the 10th day of August, 2021.

Read by title only, for its second reading this 10th day of August, 2021.

Passed by unanimous vote of the Council this 10th day of August, 2021.

Approved by the Mayor this 10th day of August, 2021.

ATTEST:		APPROVED:
________________________		___________________________
Kitty Vodrup, City Recorder		Beverly A. Ficek, Mayor

Exhibit A

Franchise Agreement between the City of Junction City (City) and PacifiCorp

SECTION 1. Grant of Franchise. The City hereby grants to PacifiCorp the nonexclusive right, privilege and authority to construct, maintain, operate, upgrade, and relocate its electrical distribution and transmission lines and related appurtenances, including underground conduits and structures, poles, towers, wires, guy anchors, vaults, transformers, transmission lines, and communication lines (collectively referred to herein as "Electric Facilities") in, under, along, over and across the present and future streets, roads, highways, bridges, sidewalks, trails, public easements on private property, alleys, parks, places or grounds, public ways and public places (collectively referred to herein as "Public Ways") within the City, for the purpose of supplying and transmitting electric power and energy to the inhabitants of the City and persons and corporations beyond the limits thereof. This Franchise does not limit PacifiCorp's ability to provide other utility services such as telecommunications and cable television, but does not allow PacifiCorp to provide these services under this Franchise. PacifiCorp shall be required to enter into separate franchise agreements for these services. This Franchise does not alter in any way the terms of any written easement between PacifiCorp and City or other governmental entity.

SECTION 2. Term. The term of this Franchise is for ten (10) years commencing on the date of acceptance by PacifiCorp as set forth in Section 3 below.

SECTION 3. Acceptance by PacifiCorp. Within thirty (30) days after PacifiCorp’s receipt of an enacted franchise ordinance, PacifiCorp shall file an unqualified written acceptance thereof with the City; otherwise the ordinance and the rights granted herein shall be null and void.

SECTION 4. Non-Exclusive Franchise. The right to use and occupy the Public Ways of the City shall be nonexclusive and the City reserves the right to use the Public Ways for itself or any other entity that provides service to City; provided, however, that such use shall not unreasonably interfere with PacifiCorp's Electric Facilities or PacifiCorp's rights granted herein.

SECTION 5. City Regulatory Authority. In addition to the provisions herein contained, the City reserves the right to adopt such additional ordinances and regulations as may be deemed necessary in the exercise of its police power for the protection of the health, safety and welfare of its citizens and their properties or in the exercise of any other rights, powers, or duties required or authorized under the Constitution and laws of the United States, of Oregon, or under City Ordinances or the City Charter.

SECTION 6. Indemnification and Insurance.

6.1 Indemnification. The City shall in no way be liable or responsible for any loss or damage to property or for any injury to, or death of, any person that may occur in the construction, operation or maintenance by PacifiCorp of its Electric Facilities. PacifiCorp shall indemnify, defend and hold the City harmless from and against any claims, demands, liens and all liability or damage of whatsoever kind on account of PacifiCorp's use of the Public Ways within the City or PacifiCorp's failure to remove or relocate Electric Facilities in accordance with the Franchise. PacifiCorp shall pay the costs of defense plus reasonable attorneys' fees and costs, for any claim, demand or lien brought thereunder. The City shall: (a) give prompt written notice to PacifiCorp of any claim, demand or lien with respect to which the City seeks indemnification hereunder; and (b) permit PacifiCorp to assume the defense of such claim, demand, or lien. If such defense is not assumed by PacifiCorp, PacifiCorp shall not be subject to liability for any settlement made without its consent. Notwithstanding any provision herein to the contrary, PacifiCorp shall not be obligated to indemnify, defend or hold the City harmless to the extent any claim, demand or lien arises out of or in connection with any grossly negligent or willful act of the City, its officers, agents or employees.

6.2 Insurance.

(A) PacifiCorp shall maintain public liability and property damage insurance that protects PacifiCorp and the City, as well as the City's officers, agents, and employees, from the claims referred to in Section 6.1 of this Franchise. The insurance shall provide coverage at all times of not less than $2,000,000 combined single limit for bodily injury liability and property damage liability per occurrence with an annual aggregate limit of not less than $5,000,000. The limits of the insurance shall be subject to any changes as to maximum constitutional and statutory limits of liability imposed on municipalities of the State of Oregon during the term of the Franchise. The insurance shall be without prejudice to coverage otherwise existing and shall name as additional insureds the City and its officers, agents, and employees. Notwithstanding the naming of additional insureds, the insurance shall protect each insured in the same manner as though a separate policy had been issued to each, but nothing herein shall operate to increase the insurer's liability as set forth elsewhere in the policy beyond the amount or amounts for which the insurer would have been liable if only one person or interest had been named as insured. The coverage must apply as to claims between insureds on the policy. The insurance shall provide that the insurance shall not be canceled or materially altered without thirty (30) days prior written notice first being given to the City. If the insurance is canceled or materially altered within the term of this Franchise, PacifiCorp shall provide a replacement policy with the same terms. PacifiCorp agrees to maintain continuous uninterrupted coverage, in the terms and amounts required, for the duration of the Franchise.

(B) PacifiCorp shall maintain on file with the City a certificate of insurance certifying the coverage required above. The adequacy of the insurance shall be subject to the approval of the City. Failure to maintain liability insurance shall be cause for immediate termination of this Franchise by the City.

(C) In the alternative to providing a certificate of insurance to the City certifying liability insurance coverage as required in Section 6.2(A), PacifiCorp may provide the City with an annual statement regarding its self-insurance. PacifiCorp's self-insurance shall provide at least the same amount and scope of coverage for PacifiCorp and the City, its officers, agents and employees, as otherwise required under Section 6.2(A). The adequacy of such self-insurance shall be subject to the City's review and approval. Upon PacifiCorp's election to provide self-insurance coverage under this Section 6.2(C), any failure by PacifiCorp to maintain adequate self-insurance may be cause for the City to declare a forfeiture or immediately terminate this Franchise.

SECTION 7. Annexation.

7.1 Extension of City Limits. Upon the annexation of any territory to the City, the rights granted herein shall extend to the annexed territory to the extent the City has such authority. All Electrical Facilities owned, maintained, or operated by PacifiCorp and located any public ways within the annexed territory shall thereafter be subject to all of the terms within this Franchise.

7.2 Notice. When any territory is approved for annexation to the City, the City shall, not later than ten (10) working days after passage of an ordinance approving the proposed annexation, provide to PacifiCorp: (a) each site address to be annexed as recorded on county assessment and tax rolls; (b) a legal description of the proposed boundary change; and (c) a copy of the City's ordinance approving the proposed annexation. The notice shall be mailed to:

PacifiCorp Customer Contact Center Attn: Annexations P.O. Box 400 Portland, Oregon 97207-0400

With a copy to:

PacifiCorp Attn: Office of the General Counsel 825 N.E. Multnomah, Suite 2000 Portland, Oregon 97232

Additional or increased fees or taxes, other than ad valorem taxes, imposed on PacifiCorp as a result of an annexation of territory to the City shall become effective on the effective date of the annexation if notice is given to PacifiCorp not later than ten (10) business days after the effective date of the annexation. However, if notification of the effective date of the annexation is provided to PacifiCorp later than the ten (10th) business day after the effective date of the annexation, the additional or increased fees or taxes payable by PacifiCorp will become effective on the date of the notification.

SECTION 8. Facilities and Service Standards.

8.1 Applicable Laws. All Electrical Facilities installed or used under authority of this Franchise shall be used, constructed and maintained in accordance with applicable federal, state and City laws, codes and regulations.

8.2 Permits. Except in the case of an emergency, PacifiCorp shall, prior to commencing new construction or reconstruction work in the public right-of-way, streets, or other public places, apply for a permit from the City. Such permit shall not be unreasonably withheld, conditioned, or delayed, as long as PacifiCorp abides by all applicable City ordinances, rules, regulations and requirements.

8.3 Emergency Repairs. In the event that emergency repairs are necessary, PacifiCorp shall notify the City as soon as reasonably practical and shall use reasonable efforts to notify the City prior to performing the emergency repairs. PacifiCorp may immediately initiate such emergency repairs and shall apply for all appropriate permits as soon as possible, but not to exceed five (5) business days following discovery of the emergency. PacifiCorp must comply with all State and City ordinances, rules and regulations relating to excavations or construction, including payment of permits and license fees.

8.4 Location Standards. All Electric Facilities shall be located and constructed so as to cause minimum interference with the Public Ways of the City and shall be constructed, installed, maintained, cleared of vegetation, renovated or replaced in accordance with applicable rules, ordinances and regulations of the City. The City shall have the right to observe and inspect all location, construction or installation of PacifiCorp's Electrical Facilities subject to the provisions of this ordinance and to make such inspections as it shall find necessary to ensure compliance with all laws, rules and regulations. PacifiCorp is responsible for all work performed by or for PacifiCorp or its agents.

8.5 Damage and Restoration. If, during the course of work on its Electrical Facilities or at any time PacifiCorp disturbs the surface of the public right-of-way, PacifiCorp shall at its own cost and expense and in a manner preapproved by the City promptly replace and restore the right-of-way to a condition comparable to that which existed before the work commenced. When an opening is made by PacifiCorp in a hard surface pavement in any public right-of-way, PacifiCorp shall promptly refill the opening and restore the surface to a condition satisfactory to the City. The City reserves the right, after providing notice and a reasonable opportunity to cure to PacifiCorp, to remove and/or repair any work done by PacifiCorp which, in the determination of the City is inadequate or unsafe. The City may, after providing notice and a reasonable opportunity to cure to PacifiCorp, refill and/or repave any opening made by PacifiCorp in the right-of-way at the expense of PacifiCorp. All costs of such remediation, including costs of inspection and supervision, shall be paid by PacifiCorp.

8.6 Moratorium. No newly overlayed street or new constructed street shall be excavated by PacifiCorp for a period of five (5) years from the time of completion of the street overlay or construction unless authorized by the City, in writing.

8.7 Undergrounding. In addition to the required installation of underground electric distribution lines as may be provided by applicable state laws or regulations, PacifiCorp shall place all newly-constructed or newly-relocated electric distribution lines underground as may be required by City ordinance, rule, or regulation. The expense of forced underground conversions shall be paid by PacifiCorp, but PacifiCorp may recover its costs from its customers in accordance with state statute, administrative rule or regulation. Nothing in this paragraph shall prevent the City and PacifiCorp from agreeing on a case-by-case basis to a different form of cost recovery or another mechanism for funding an underground project that is consistent with state statutes, administrative rules or regulations.

8.8 City Use. The City shall have the right without cost to use all poles and suitable overhead structures owned by PacifiCorp within the Public Ways for City wires or attachments used in connection with its fire alarms, police signal systems or other governmental purposes; provided, however, that any such uses shall be for activities owned, operated or used by the City for a non-commercial public purpose. Provided further, that PacifiCorp shall assume no liability nor shall it incur, directly or indirectly, any additional expense in connection therewith, and the use of the poles and structures by the City shall be in such a manner as to prevent safety hazards or interferences with PacifiCorp's use. Nothing herein shall be construed to require PacifiCorp to increase pole size, to alter the manner in which PacifiCorp attaches its equipment to poles, or to alter the manner in which it operates and maintains its Electric Facilities. City attachments shall be installed and maintained in accordance with the reasonable requirements of PacifiCorp and the current edition of the National Electrical Safety Code pertaining to such construction. Further, City attachments shall be attached or installed only after written approval by PacifiCorp, which shall not be unreasonably withheld, in conjunction with PacifiCorp's standard pole attachment application process. PacifiCorp shall have the right to inspect, at reasonable intervals, such attachments to ensure compliance with this Section 8.8 and to require the City to remedy any defective attachments.

8.9 Excavation and Trenching. PacifiCorp shall have the right to excavate the Public Rights of Way to install or replace its Electrical Facilities such as underground conduits, subject to the conditions and requirements of the City. Before such excavation, PacifiCorp shall provide City with at least thirty (30) days written notice; however this (30) thirty day notice requirement does not apply to emergency installations. PacifiCorp shall allow the City, at its own expense, to share the trench of PacifiCorp to lay its own conduit therein, provided that such action by the City will not unreasonably interfere with PacifiCorp's Electrical Facilities, unreasonably delay project completion or conflict with applicable codes and regulations, including without limitation the National Electrical Safety Code. Trenching or excavation costs incurred under this section shall not be charged to the City. All excavations made by PacifiCorp in the public right-of-way shall be properly safeguarded for the prevention of accidents. PacifiCorp's responsibility for maintaining repairs to the surface areas disturbed by PacifiCorp's work shall end upon the occurrence of either PacifiCorp's reconstruction of the rights-of-way in a manner approved by the City or upon subsequent work at the same location by another person or entity franchised, permitted or licensed by the City to do such work.

8.10 City Notice. Before commencing any street improvements or other work within a Public Way that may affect PacifiCorp's Electric Facilities, the City shall give at least ten (10) working days written notice to PacifiCorp. In the event that emergency repairs are necessary, City may immediately initiate such emergency repairs and shall notify PacifiCorp of such repairs.

8.11 Access to Facilities. No structures, buildings or signs shall be erected below PacifiCorp's facilities or in a location that prevents PacifiCorp from accessing or maintaining its facilities. Nothing in this Franchise shall be construed to prevent the City from constructing, grading, paving, repairing and/or altering any Public Rights of Way; laying down, repairing or removing water or sewer pipes; or constructing or establishing any other public work or improvement. All such work shall be done, insofar as practicable, so as not to injure or prevent the unrestricted use and operation of PacifiCorp's Electric Energy System under this Franchise. However, if any portion of PacifiCorp's Electric Energy System interferes with the construction or repair of any Public Rights of Way or public improvement, including construction, repair or removal of a sewer or water main, the City may direct PacifiCorp to relocate as provided in Section 9 of this Franchise.

8.12 Service Standards. PacifiCorp shall comply with those applicable rules, tariffs, and regulations prescribed by the Oregon Public Utility Commission with respect to rates to be charged and the conditions, quality, character and standards of service furnished. PacifiCorp shall maintain and operate an adequate and safe system for the distribution of electric energy in the City. PacifiCorp shall use due diligence to maintain continuous and uninterrupted 24-hour a day service. PacifiCorp shall promptly remove graffiti on Electric Facilities upon notice from City. Under no circumstances shall PacifiCorp be liable for an interruption or failure of service caused by an act of God, unavoidable accident or other circumstances beyond the control of PacifiCorp or through no fault of its own.

8.13 Maps. Upon request, PacifiCorp shall provide maps to the City showing the location of PacifiCorp's Facilities in the Public Rights of Way on a scale the City and PacifiCorp agree upon. PacifiCorp shall also provide such maps in an electronic format acceptable to the City and PacifiCorp. The level of detail in maps provided by PacifiCorp shall be limited to that which is needed for the City's administration of the Public Rights of Way in order to protect PacifiCorp's confidential business information and the security of PacifiCorp's Electric Energy System.

8.14 Non-Interference. PacifiCorp's Electric Energy System and its Electric Facilities shall be constructed, maintained and repaired in such manner as not to interfere with pre-existing sewers, water pipes, or any other property of the City, or with any other facilities that may have been laid in the Public Rights of Way by or under the City's authority. The provisions of this section remain subject to the removal and relocation provisions of Section 9.

SECTION 9. Removal or Relocation of Electric Facilities.

9.1 Public Interest Removal, Relocation or Temporary Rearrangement. The City reserves the right to require PacifiCorp to remove, relocate or temporarily rearrange overhead Electrical Facilities within the Public Ways in the interest of public convenience, necessity, health, safety or welfare at no cost to the City. Within 60 days after written notice, or within a longer, mutually-agreed upon time period if despite PacifiCorp's diligent efforts, removal, relocation, or temporary rearrangement is not reasonably practical within 60 days, PacifiCorp shall promptly commence the removal, relocation or temporary rearrangement of its Electrical Facilities. Before requiring a relocation or temporary rearrangement of Electric Facilities, the City shall, with the assistance and consent of PacifiCorp, identify an alignment for the relocated or rearranged Electric Facilities within the Public Ways of the City. The City shall assign or otherwise transfer to PacifiCorp all right it may have to recover the cost for PacifiCorp's relocation or rearrangement work and shall support the efforts of PacifiCorp to obtain reimbursement. In cases of capital improvement projects undertaken by the City, PacifiCorp shall convert existing overhead distribution facilities to underground. The City acknowledges that PacifiCorp may be allowed to collect such costs from its customers associated with conversion from overhead to underground distribution facilities consistent with OAR 860-022-0046, the Oregon Public Utility Commission rule on forced conversions.

9.2 Private Interest Removal or Relocation. PacifiCorp shall not be obligated to pay the cost of any removal or relocation that is required or made a condition of a private development. If the removal or relocation of Electrical Facilities is caused directly or otherwise by an identifiable private development or is made for the convenience of a private customer, PacifiCorp may charge the expense of the removal or relocation to the private developer or private customer. For example, PacifiCorp shall not be required to pay relocation costs in connection with a road widening or realignment where the road project is made a condition of or caused by a private development. In such event, the City shall require the developer to pay PacifiCorp for such removal or relocation costs as part of its approval procedures.

9.3 Failure to Relocate, Remove, or Rearrange. If PacifiCorp fails to relocate, remove, rearrange, or alter any Electric Facilities as requested by the City within the timeframe established by the City, provided such time frame complies with the standards provided in Section 9.1, the City may upon notice to PacifiCorp cause the Electric Facilities to be relocated, removed, rearranged, or altered by qualified contractors at PacifiCorp's sole expense. Upon receipt of demand for payment from the City, PacifiCorp shall promptly reimburse the City for all costs the City incurred to relocate, remove, rearrange or alter Electrical Facilities, including any costs incurred to collect payment from PacifiCorp.

SECTION 10. Subdivision Plat Notification. Before the City approves any new subdivision and before recordation of the plat, the City shall mail notification of such approval and a copy of the plat to PacifiCorp:

PacifiCorp

Attn: Property Management/ Right-of-Way Department

825 N.E. Multnomah, Suite 1700

Portland, Oregon 97232

SECTION 11. Vegetation Management. PacifiCorp may prune or cause to be pruned, using proper utility, agricultural practices and in accordance with any needed permits, any tree in or overhanging the public rights-of-way which interferes with PacifiCorp's facilities, subject to the following conditions: PacifiCorp may not prune trees until five (5) business days after written notice has been given to the owner or occupant of the premises abutting the public right-of-way in or over which the tree is growing. The owner or occupant shall have five (5) business days from receipt of the notice to have such trees pruned by a qualified line clearance arborist at his or her own expense in accordance with PacifiCorp's standards for reliable utility service. If the owner or occupant fails to do so in compliance with the notice, PacifiCorp may prune such tree at its own expense. Notwithstanding the notice requirements within this paragraph, in the event of an emergency, PacifiCorp may prune the tree or trees as necessary to abate the emergency. For the purposes of this paragraph, emergencies exist when it is necessary to prune a tree or trees in order to restore electrical services or to protect the public from imminent danger or to prove imminent destruction of property.

SECTION 12. Compensation.

12.1 Franchise Fee. In consideration of the rights, privileges, and franchise hereby granted, PacifiCorp shall pay to the City from and after the effective date of the acceptance of this franchise, an amount equal to five percent (5%) of its gross revenues derived services provided within the corporate limits of City. This amount shall be paid in monthly installments. The term "gross revenue" as used herein shall be construed to mean any revenue of PacifiCorp derived from the sale and use of electric power and energy within the municipal boundaries of the City after adjustment for the net write-off of uncollectible accounts (accounts which, despite PacifiCorp's best efforts, have been uncollectible for 12 months or more) and corrections of bills theretofore rendered. Gross revenues shall not include proceeds from the sale of bonds, mortgages or other evidence of indebtedness, securities, stocks, or sales at wholesale from one utility to another when the utility purchasing the service is not the ultimate customer and is not located within City boundaries, or revenue from joint pole use. All amounts paid under this Section 12 shall be subject to review by the City; provided, that only payments which occurred during a period of thirty-six (36) months prior to the date the City notifies PacifiCorp of its intent to conduct a review shall be subject to such review. Notwithstanding any provision to the contrary, at any time during the term of this Franchise, the City may elect to increase the franchise fee amount as may then be allowed by state law. The City shall provide PacifiCorp with prior written notice of such increase following adoption of the change in percentage by the City. The increase shall be effective sixty (60) days after City has provided such written notice to PacifiCorp.

12.2 No Credit against Other City Charges, Billing Statements. Payment of the compensation owed under this Franchise shall not exempt PacifiCorp from the payment of any other license fee, tax or charge on the business occupation property or income of PacifiCorp that may be now or in the future lawfully imposed by the City or by another taxing authority, except as may be otherwise provided in the ordinance or ordinances imposing such other license fees, taxes or charges. Percentage amounts charged to PacifiCorp over three and one half percent (3.5%) of Gross Revenue may be noted or itemized separately on any bill to any customer or user of services furnished by PacifiCorp under this Franchise, subject to the City's prior review and approval of the initial bill statement noting the charges and itemization.

12.3 Interest. Franchise fee payments not received by the City by the due date shall be assessed interest equal to the rate of one percent (1%) over the existing prime rate as published in The Wall Street Journal, compounded daily. Interest shall be due on the entire late payment from the date on which the payment was due until the date on which the City receives the payment.

12.4 Report. Accompanying each payment to the City, PacifiCorp shall file with the City a written report containing an accurate statement in summarized form of its calculation of the amount of the payment. Such statement shall be verified by an officer or other authorized representative of PacifiCorp and shall set forth its gross revenues according to their accounting subdivision and any deductions claimed for the period. Such reports shall be in a form satisfactory to the City.

12.5 Alternative Compensation. If, for any reason, the Franchise fee or compensation is invalidated or amended by the final decision or act of a court or governmental authority of competent jurisdiction, then the highest reasonable Franchise fee or compensation allowed by such court or governmental authority shall be the Franchise fee or compensation charged under this ordinance.

12.6 Acceptance of Payment and Recomputation of Amount Owed. No acceptance of any payment pursuant to this Section 12 shall be construed as an accord that the amount paid is, in fact, the correct amount, nor shall any acceptance of payments be construed as a release of any claim the City may have for further or additional sums payable. All amounts paid under this Section 12 shall be subject to audit by the City, provided that only payments which occurred during a period of thirty-six (36) months prior to the date the City notifies PacifiCorp of its intent to perform an audit shall be subject to such audit. If City's audit discloses that PacifiCorp has paid ninety-five percent (95) or less of the principal amount owing for the period under audit, PacifiCorp agrees to pay the City the proper amount due and owing plus a penalty payment equal to five percent (5%) of any underpayment within thirty (30) days of written notice from the City. If such payment is not received within thirty (30) days of written notice from the City, then interest shall be compounded daily from the date on which the payment was due until the date on which the City receives the payment, such interest to be calculated at one percent (1%) over the existing prime rate as published in the Wall Street Journal.

12.7 Escrow. If PacifiCorp disputes the City's determination of underpayment under this Section 12, PacifiCorp shall place the amount the City asserts is owed, plus any underpayment penalties, in an escrow account at a financial institution with instructions agreed to by the City until final resolution.

12.8 Right to Audit. The City and its agents and representatives shall have authority to arrange for and conduct audits within a reasonable day's commute to Junction City, upon no less than thirty (30) days prior written notice. The City may determine the scope of audit in each instance, subject to the provisions of Section 12.6 of this Franchise.

SECTION 13. Extension and Renewal. At least 120 days prior to the expiration of this Franchise, PacifiCorp and the City shall either agree to extend the Term of this Franchise for a mutually acceptable period of time or the parties shall demonstrate good faith efforts towards renegotiation of a replacement Franchise. PacifiCorp shall have the continued right to use the Public Ways of the City as set forth herein in the event an extension or replacement Franchise is not entered into upon expiration of this Franchise, provided both parties are participating in good faith negotiations. Notwithstanding the above, upon 365 days after the expiration of this Franchise, if both parties have failed to reach an agreement regarding the extension of the Term or a replacement Franchise, the City may: 1) grant an extension of time to extend the Term or renegotiate a replacement Franchise; 2) demand that PacifiCorp remove its Electrical Facilities and restore the City rights-of-way to a safe and operable condition comparable in quality and construction to that of the surrounding area; or 3) declare PacifiCorp's Electrical Facilities within the City rights of way forfeited and escheated to the City.

SECTION 14. No Waiver. Neither the City nor PacifiCorp shall be excused from complying with any of the terms and conditions of this Franchise by any failure of the other, or any of its officers, employees, or agents, upon any one or more occasions to insist upon or to seek compliance with any such terms and conditions.

SECTION 15. Transfer of Franchise. PacifiCorp shall not transfer or assign any rights under this Franchise to another entity, except transfers and assignments by operation of law, or to affiliates, parents or subsidiaries of PacifiCorp which assume all of PacifiCorp's obligations hereunder, unless the City shall first give its approval in writing, which approval shall not be unreasonably withheld, conditioned or delayed; provided, however PacifiCorp may assign, mortgage, pledge, hypothecate or otherwise transfer without consent its interest in this Franchise to any financing entity, or agent on behalf of any financing entity to whom PacifiCorp (1) has obligations for borrowed money or in respect of guaranties thereof, (2) has obligations evidenced by bonds, debentures, notes or similar instruments, or (3) has obligations under or with respect to letters of credit, bankers acceptances and similar facilities or in respect of guaranties thereof. In determining whether City will consent to any transfer, the City may inquire into the technical, legal and financial qualifications of the respective transferee. PacifiCorp will assist the City with such inquiry. The City shall not unreasonably delay or withhold its consent to such transfer.

SECTION 16. Amendment. At any time during the term of this Franchise, the City or PacifiCorp may propose amendments to this Franchise by giving thirty (30) days written notice to the other party of the proposed amendment(s) desired, and both parties thereafter, through their designated representatives, will, within a reasonable time, negotiate in good faith in an effort to agree upon mutually satisfactory amendment(s). However, no amendment to this Franchise shall be effective unless mutually agreed upon by the City and PacifiCorp and formally adopted as an ordinance amendment which is accepted in writing by PacifiCorp.

SECTION 17. Non-Contestability--Breach of Contract.

17.1 No Action. Neither the City nor PacifiCorp will take any action for the purpose of securing modification of this Franchise before either the Oregon Public Utility Commission or any court; provided, however, that neither shall be precluded from taking any action it deems necessary to resolve differences in interpretation of the Franchise or collection of amounts owed hereunder. In the event that a new law or rule is adopted by the State of Oregon and the new law or rule conflicts with the terms of this Franchise, the parties agree to make good faith efforts to reconcile the Franchise terms with the new law or rule.

17.2 Breach. In the event PacifiCorp or the City fail to fulfill any of their respective obligations under this Franchise, the City or PacifiCorp, whichever the case may be, will have a breach of contract claim and remedy against the other in addition to any other remedy provided by law, provided that no remedy which would have the effect of amending the specific provisions of this Franchise shall become effective without such action which would be necessary to formally amend the Franchise.

SECTION 18. Notices. Unless otherwise specified herein, all notices from PacifiCorp to the City pursuant to or concerning this Franchise shall be delivered to the City of Junction City, Post Office Box 250, and Attn: City Administrator Junction City, OR 97448, or such other address as City may advise by written notice. Unless otherwise specified herein, all notices from the City to PacifiCorp pursuant to or concerning this Franchise shall be delivered to the Customer and Community Affairs Vice President, Pacific Power, 825 NE Multnomah, Lloyd Center Tower Suite 2000, Portland, Oregon 97232, and such other office as PacifiCorp may advise the City of by written notice.

SECTION 19. Severability. If any section, sentence, paragraph, term or provision hereof is for any reason determined to be illegal, invalid, or superseded by other lawful authority including any state or federal regulatory authority having jurisdiction thereof or unconstitutional, illegal or invalid by any court of common jurisdiction, such portion shall be deemed a separate, distinct, and independent provision and such determination shall have no effect on the validity of any other section, sentence, paragraph, term or provision hereof, all of which will remain in full force and effect for the term of the Franchise or any renewal or renewals thereof.

SECTION 20. Additional Remedies. In addition to any rights set out elsewhere in this Franchise, as well as its rights under City ordinance, the City reserves the right at its sole option to apply any of the following, alone or in combination:

(A) Impose a financial Penalty of up to $1,000 per Franchise violation per occurrence; or,

(B) Suspend PacifiCorp's Franchise rights related to the violation until PacifiCorp corrects or otherwise remedies the violation.

(C) The City Council may revoke this Franchise in the event that any provision becomes invalid or unenforceable and the City Council expressly finds that such provision constituted a consideration material to the grant of the Franchise.

SECTION 21. Termination and Remedies.

21.2 Termination. In addition to any other rights set out elsewhere in this Franchise, the City reserves the right to terminate this Franchise if:

(A) PacifiCorp fails to pay required Franchise fees under this Franchise, to remove, relocate, or rearrange Facilities as provided in this Franchise, or fails to properly excavate or restore Public Rights of Way as provided in this Franchise and does not cure the same within a reasonable time period;

(B) PacifiCorp is found by a court of competent jurisdiction to have practiced any fraud or deceit upon the City;

(C) There is a final determination from a court of competent jurisdiction that PacifiCorp has failed, refused or neglected or is otherwise unable to obtain or maintain required permits for the operation of its Electric Energy System and does not cure the same within a reasonable time period.

21.3 Abandonment. If PacifiCorp intends to discontinue using its Electric Facilities within all or part of a particular portion of the Public Rights of Way and does not intend to use said Facilities again in the future, PacifiCorp shall submit to the City, for the City's approval, a completed application describing the structures or other Facilities and the date on which PacifiCorp intends to discontinue using such Facilities. PacifiCorp may elect to remove the Facilities or request that the City permit them to remain in place. The City may require PacifiCorp to remove the Electric Facility from the Public Rights of Way or to modify the Electric Facility in order to protect the public health and safety or otherwise serve the public interest. Any such modification or removal shall be done at PacifiCorp's own cost. If PacifiCorp is permitted to abandon its Electric Facilities in place, upon consent of the City, the ownership of Electric Facilities in the Public Rights of Way shall transfer to the City and PacifiCorp shall have no further obligation therefore. PacifiCorp's sale of a portion of its Electric Energy System shall not, by itself, be considered a "discontinued use" under this Section.

SECTION 22. Choice of Law. This contract shall be governed by and construed in accordance with the laws of the State of Oregon, even if Oregon's choice of law rules would otherwise require application of the law of a different state.

SECTION 23. Captions. Throughout this Franchise, captions to sections are intended solely to facilitate reading and to reference the sections and provisions of this Franchise. The captions shall not affect the meaning and interpretation of this Franchise.

SECTION 24. Ordinance No. 1200. The provisions of this Franchise replace and are in lieu of any otherwise applicable provisions of Junction City Ordinance No. 1200, An Ordinance Authorizing the City of Junction City to Grant a Non-Exclusive Electric Utility Franchise to PacifiCorp. Ordinance No. 1200 governs the use of Public Rights-of-Way and Public Places from the effective date of Ordinance No. 1200 to the effective date of this Franchise.

Approved:
________________		Date: _________________
Jason Knope, City Administrator
Accepted: Grantee accepts the Franchise and Ordinance and agrees to be bound by its lawful terms and conditions.
By:__________________________		Date: _________________
Printed Name: ________________
Title:________________________