HomeMy Public PortalAbout012-1982 - Authorizing excution of Contract with IMPAAMENDED ORDINANCE NO. 12-1982
An ordinance of the City of Richmond, authorizing
the execution and delivery of a Power Sales
Contract and Capacity Purchase Agreement by and
between the City of Richmond and the Indiana
Municipal Power Agency, and other matters con-
nected therewith.
WHEREAS, the City of Richmond (the "Member") is a municipal
corporation created and existing under the laws of the State of
Indiana and is a member in good standing of the Indiana Munici-
pal Power Agency (the "Agency"), a body corporate and politic
and political subdivision of the State of Indiana, created
pursuant to I.C. 8-1-2.2 (the "Act") and exercises thereunder a
part of the sovereign powers of the State of Indiana; and
WHEREAS, the Member owns and operates an electric utility
which furnishes retail electric service to the public and owned
and operated same on January 1, 1980; and
WHEREAS, the Member is required by law to provide customers
with an adequate, reliable and economical supply of electric
power and energy; and
WHEREAS, the Member is not financially capable of providing
the planning, financing, locating and building of needed new
facilities for generation and transmission; and
WHEREAS, representatives of the Member have received and
reviewed a Power Supply Study and other data compiled by R. W.
Beck and Associates, consulting engineer for the Agency, and
have attended meetings conducted by the Agency where the
consulting engineer, general counsel, bond counsel, the under-
writer and financial advisor to the Agency and counsel to the
underwriter have answered questions and provided information to
the Member and other members of the Agency and representatives
of said members with respect to the terms and conditions of the
Power Sales Contract (the "Contract"), the Capacity Purchase
Agreement (the "Agreement") and the Agency's acquisition of an
approximate 25% undivided ownership interest in Public Service
Company of Indiana, Inc.'s ("PSI") Gibson Unit No. 5 and
related facilities (the "Project") under a Joint Ownership and
Purchase Participation Agreement (the "Ownership Agreement")
among the Agency, PSI and other potential participants; and
WHEREAS, the Member understands that the Agency has deter-
mined to become the requirements supplier of electric power and
energy to its members for the period provided in the Contract
by resolution dated December 18, 1981; and
WHEREAS, the Member recognizes that the Power Supply Study
and other data compiled by R. W. Beck and Associates indicates
that said requirements approach will provide the Member with an
adequate, reliable and economical supply of electric power and
energy and a more economical power and energy supply than other
approaches outlined in said study and data and in presentations
by said consulting engineer at various meetings conducted by
the Agency and that this recognition provided the basis for
said resolution of the Agency; and
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WHEREAS, the Agency has been advised by Salomon Brothers
Inc, managing underwriter to the Agency, and by Morgan Guaranty
Trust Company, the Agency's financial advisor, that, in con-
nection with the Agency's financing of its interest in the
Project, contracts which provide for requirements purchases by
the members are necessary to obtain financing on favorable
terms; and
WHEREAS, the Agency caused to be prepared a requirements
Contract for execution by and between the Agency and the Member
and prepared similar contracts for other members of the Agency
and representatives of the Member have reviewed such Contract
and have obtained independent advice and counsel with respect
thereto where appropriate and said members have had an oppor-
tunity to review the contracts with the Agency and the Agency
has responded to said members by explaining and modifying the
contracts; and
WHEREAS, the Contract sets forth the terms and conditions
for sales of electric power and energy by the Agency to the
Member during the term of such Contract; and
WHEREAS, the Contract, consistent with the Agency's reso-
lution to become the requirements supplier of power and energy
to the Member and other members of the Agency, provides that
the Agency will sell and deliver to the Member, and requires
the Member to purchase and receive from the Agency, commencing
January 1, 1983, or such earlier date as shall be determined by
the Agency upon thirty days notice to the Member, electric
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power and energy required by the Member for the operation of
its municipal electric system pursuant to the terms of the
Contract; and
WHEREAS, the revenues derived by the Agency under the
Contract will be pledged, together with revenues derived by the
Agency from other power sales contracts, to secure the payment
of electric utility revenue bonds to be issued by the Agency;
and
WHEREAS, the Contract will become effective upon issuance
of an order of the Public Service Commission of Indiana
acceptable to the Agency approving the Project, including the
Agency's acquisition of and financing for an approximate 25%
undivided ownership interest in the Project, and will continue
in effect, if the Agency enters into an ownership agreement
with PSI for such interest in the Project and issues bonds to
finance such purchase, until April 1, 2032, unless terminated
pursuant to said Contract; and
WHEREAS, under the Contract the Agency has full responsi-
bility for planning and obtaining an adequate supply of power
and energy for the Member and other members of the Agency; and
WHEREAS, the Member owns and operates electric generating
facilities, which provide only a portion of the required
capacity for the present and future demand for electricity of
the Member, and such generating facilities can be more effi-
ciently and economically utilized by the Agency than by the
Member and thus provide cost benefits to the Member pursuant to
the terms and conditions of the Agreement; and
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WHEREAS, the Agency caused the Agreement to be prepared and
the Member by approving the execution of said Agreement deter-
mines to furnish Dedicated Capacity (as defined in the Agree-
ment) of its generating facilities to the Agency for the use and
benefit of all members of the Agency to provide cost benefits
to the Member; and
WHEREAS, pursuant to the terms and conditions of the Agree-
ment, the Agency will pay the Member on a monthly basis for
said Dedicated Capacity provided to the Agency in accordance
with the Agreement; and
WHEREAS, the power and energy from the Project, together
with the power and energy from the members' own generating
facilities which are scheduled as said Dedicated Capacity under
the Agreement and similar agreements among other members of the
Agency and the Agency, and power and energy purchased from
other utilities will be utilized by the Agency to meet the
power and energy needs of the members of the Agency, including
the Member; and
WHEREAS, the Contract and Agreement marked as Exhibits A
and B are attached hereto, incorporated herein by reference and
two (2) copies of each are on file in the office of the Clerk
for public inspection pursuant to I.C. 36-1-5-4; and
WHEREAS, based upon such advice and the foregoing facts,
the Member by this Ordinance hereby finds and determines to
approve the Contract and the Agreement;
NOW, THEREFORE, BE IT ORDAINED BY THE COMMON COUNCIL OF THE
MEMBER:
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SECTION 1. The Member is authorized pursuant to this
Ordinance to enter into the Contract and the Agreement in the
forms attached hereto as Exhibits A and B so that the Member
may provide its customers with an adequate, reliable and eco-
nomical supply of electric power and energy and join with other
members of the.Agency for the purpose of the Agency providing
the planning, financing, locating and building of needed new
facilities for generation and transmission and for other
purposes contemplated in the Contract and the Agreement.
SECTION 2. The Member's electric utility shall purchase
electric power and energy from the Agency under and pursuant
to the terms of the Contract. The Agency shall have full
responsibility for planning and obtaining an adequate supply of
power and energy for the Member pursuant to the Contract.
SECTION 3. The Member shall make Dedicated Capacity (as
defined in the Agreement) of its generating facilities avail-
able to the Agency under the Agreement for the use and benefit
of all members of the Agency to provide cost benefits to the
Member.
SECTION 4. The findings and determinations set forth in
the preambles to this Ordinance are hereby made findings and
determinations of the City of Richmond.
SECTION 5. By this Ordinance, the Mayor is hereby autho-
rized and directed to execute and deliver, and the Clerk is
hereby authorized to attest and seal, the Contract and the
Agreement with such modifications therein as they shall approve
by their execution thereof.
SECTION 6. All ordinances and parts of ordinances in
conflict herewith are hereby repealed.
SECTION 7. This Ordinance shall be in full force and
effect from and after its passage.
PASSED AND ADOPTED by the Common Council of the City of
Richmond, this (� day of _ , 1982.
COMMON COUNCIL OF THE CITY OF
RICHMOND, INDIANA
Presiding Officer
ATTEST:
C rk
(SEAL)
Presented by me, the undersigned Clerk of the City of
Richmond to the Mayor of said City for his/her approval on the
/y � day of , 1982 at .'oo &.m.
rem
%�►�..�.
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Approved by me, the undersigned Mayor of said City on the
�G day of 1982 at : oo 'CL.m.
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