HomeMy WebLinkAboutResolution - 2019-R0407 - LP&L Property Interest - 11/05/2019 Resolution No. 2019-RO407
Item No. 6.17
November 5, 2019 RESOLUTION
WHEREAS, the Electric Utility Board of the City of Lubbock has approved, and
recommended adoption to the City Council of the City of Lubbock, certain Capital
Improvement Projects providing for the upgrade of Lubbock Power & Light's system
to 115 kV, which encompasses construction of Lubbock Power & Light electric
transmission line facilities and the construction of related electric substations,includincy
but not limited to the following Capital Improvement Projects: CIP 92469 (Substation
Rebuild—Holly), CIP 92470 (Substation Rebuild—Oliver), CIP 92466
(Autotransfonmr—Co-op), CIP 92477 (69/115kV Line Rebuild: Holly-Southeast),
CTP 92478 (69/115kV Line Rebuild: Holly-Slaton), CIP 92480 (69/115kV Line
Rebuild: Southeast-Oliver), (collectively, the "EIectric Project");
WHEREAS, the City Council of the City of Lubbock has approved, through
adoption of the budget for Lubbock Power& Light, the Electric Project;
WHEREAS, the Electric Project serves the public interest of the citizens of the
City of Lubbock in providing needed electric utility infrastructure reliability related
improvements ("Electric Facilities");
WHEREAS, the Electric Project contemplates the rebuild of lines following the
routes of currently existing transmission line facilities;
WHEREAS, numerous real property interests are in need of acquisition to
construct the Electric Facilities due to the inadequate nature of the existing rights to
accommodate the rebuilds.
WHEREAS,the City Council has the power and authority to acquire real property
interests for use by Lubbock Power & Light,
WHEREAS, the Initial Offers (herein so called) of the City of Lubbock to
purchase the real property interests necessary for construction of the Electric Facilities
are based upon a Detailed Market Study Approach, as described on Exhibit "A",
attached hereto and made apart hereof (the "Market Study"), the Market Study
providing for the value of the real property interests to be acquired, and the damages,
if any, to any of the owners' remaining property (the "Initial Offer Amount");
WHEREAS, in the event the owner(s) of the Property Interest, as defined below,
do not accept the Initial Offer Amount, Final Offers (herein so called) of the City of
Lubbock to purchase the Property Interest will be based on an appraisal of the value of
the Property Interest, and the damages,if any,to any of the owners' remaining property
(the "Final Offer Amount");
WHEREAS,due to the volume of the property interests necessary for completion
of the Electric Facilities, and to avoid unnecessary duplication and time consumptive
activities by the City Council, the City Council finds that it is advisable and in the best
interest of the citizens of the City of Lubbock, to delegate certain authority to the
Director of Electric Utilities, or his designee, to provide Initial and Final Offers and to
accept counter offers, based upon defined price criteria, regarding such real property
interest acquisition activities;
WHEREAS, the delegation of authority will reduce the City of Lubbock's costs
for the activities related to acquisition of the necessary Property Interests and enhance
the timely construction and completion of the EIectric Facilities;
WHEREAS, the public interest is served by the authority delegated herein and
the City Council so finds;
WHEREAS, nothing contained herein shall be deemed to be authority to take or
acquire property by eminent domain; rather, the City Council shall make such
determinations independent of this Resolution, and this Resolution serves as a mere
delegation of the process of making offbrs required by law, accepting counteroffers
within the amounts herein specified and prescribing authority to close and fund
voluntary transactions related to acquisition of the Property Interests; NOW,
THEREFORE,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
The City Council hereby finds that the public welfare and convenience require
the acquisition by the City of Lubbock of interests in real property necessary, in whole
or in part, for the Electric Facilities (the "Property Interests"), each to serve the public
and the citizens of the City of Lubbock, Texas. The recitals and preambles of this
resolution are hereby adopted as further findings of the City Council.
BE IT FURTHER RESOLVED BY THE CITY COUNCIL OF THE CITY OF
LUBBOCK:
The Director of Electric Utilities, and his designees, are hereby authorized to
make,execute, and deliver, for and on behalf of the City of Lubbock, Initial Offers and
Final Offers to purchase (the "Offer" or "Offers"), and to accept counteroffers to sell
("Settlement Amounts"), the Property Interests, within the parameters set forth herein:
A. The Initial Offer, as delegated herein, shall be the Initial Offer Amount and
the Final Offer, as delegated herein, shall be the Final Offer Amount.
B. The Settlement Amounts, as delegated herein, shall not exceed:
1) The greater of.
a) One Hundred Thousand and No/100 Dollars ($100,000.00);
and
b) For those properties (i)with an Initial Offer Amount or Final
Offer Amount, as applicable, of more than One hundred
Thousand and No/100 Dollars ($100,000.00), but less than
Five Hundred Thousand and No/100 Dollars ($500,000.00),
as prescribed above; and (ii) with an Initial Offer Amount or
Final Offer Amount, as applicable, less than One Hundred
Thousand and No/100 Dollars ($100,000.00), but counter
offers exceed One Hundred Thousand and No/100 Dollars
($100,000.00), Settlement Amounts shall not exceed an
amount equivalent to the Initial Offer Amount or Final Offer
Amount, as applicable,of the subject Property Interests,plus
twenty percent (20%) of that amount.
C. Offer(s) or Settlement Amounts greater than those above referenced are to
only be approved by action of the City Council of the City of Lubbock,
Texas. For the purposes of this resolution, closing costs to be borne by the
City of Lubbock (the "Closing Costs"), in closing transactions to acquire
the Property Interests, are not to be included in the authorized expenditure
limitations prescribed in this resolution.
BE IT FURTHER RESOLVED BY THE CITY COUNCIL OF THE CITY OF
LUBBOCK:
The Director of Electric Utilities, or his designee, is hereby authorized (i) to
execute or accept for and on behalf of the City of Lubbock(a)contracts for the purchase
of the Property Interests ("Agreements"), by and between the City and the owner(s) of
the Property Interests, in conformance with the terms of the delegation provided herein
or upon other terms and provisions acceptable to the Director of Electric Utilities and
in form acceptable to the General Counsel of Lubbock Power & Light; (b) easements
for the Property Interests; and (c) any other documents necessary for closing the
transactions contemplated by the Agreements; and (ii) to expend funds as authorized
in the budget for the Project to acquire the Property Interests.
BE IT FURTHER RESOLVED BY THE CITY COUNCIL OF THE CITY OF
LUBBOCK:
The Director of Electric Utilities, or his designee, shall report to the Electric
Utility Board of the City of Lubbock, at a frequency of not less than once every month,
of all activities taken under the authority delegated hereunder.
BE IT FURTHER RESOLVED BY THE CITY COUNCIL OF THE CITY OF
LUBBOCK:
Nothing herein shall be deemed to prohibit the Director of Electric Utilities from
determining to place any offer or counteroffer otherwise delegated by the City Council
under the terms of this resolution on an agenda for consideration by the City Council
in the event special circumstances exist which the Director of Electric Utilities opines
necessitates consideration by the City Council.
Passed by the City Council this 5th day of November, 2019.
DANIEL M. PO -, MAYOR
ATTEST:
r_0 g�dt J, A/--- —
eb cea Garza. City Secret •y
APPROVED AS TO CONTENT:
- LJIM6�4
David McCal a, Director of Electric Utilities
APPROVED AS TO FORM:
Richard Casner, P&L General Counsel
"Exhibit A"
to Council Resolution
Detailed Market Study Approach
Prepared For:
Lubbock Power & Ught
1301 Broadway, Lubbock,TX
David McCalla
-
Richard cCasnee
0000mmumt
Prepai ed By:
Legacy PSG, Inc.
CA
Ps One Briercrott Office Park
rxoa:crseswcescaoue Lubbock, TX 7941.2
I n novation-7'ea mworl:-Excel len ce
Prepared:
September 6, 2019
GAO`
One Briercroft Office Park
Lubbock,TX 79412
PROJECT SERVICES GROUP
PSG; Phone: (866)228-3001
Detailed Market Study Approach
The process outlined below is intended to deliver a close approximation of the fair market value on which to base an
initial offer for the acquisition of easements. The market study involves the following steps related to the request from
the client to provide data to assist in negotiations for right-of-way easements.
1. Legacy and the appraiser will conduct a detailed survey of the approved project route to establish the
following parameters to use for the valuation of individual properties:
a. Identify different land use types along the approved route to recognize land values by type.
b. Identify location issues, such as proximity to commercial centers, industrial areas or other major
concentrations of land types that can affect land values. The "Location Factor" will be accounted for
by creating analysis zones throughout the approved route and using zone specific data to arrive at
property values.
c. Identify a range of impacts that would result in damage to the remainder of the property,this will include
the size of the easement to be acquired relative to the remainder of the property,etc. after the purchase.
The"Damage to the Remainder Factor' will be expressed as a percentage to decrease the adjusted land
value(i.e., minus 90%--- minus 75% --- minus 60%--- minus 50%--- minus 30%---minus 10%)
2. The appraiser will research recent sales and prepare an analysis of land values based on identified land use types
on the approved project route. This analysis will establish a value for each land use type, expressed in a value
per square foot, acre, or other appropriate expression of value. The appraiser will deliver a Recent Sales Book
for documentation of the files associated with the project.
3. Legacy will then assign a land type to each parcel on the approved route, based on the experience gained
working to identify land types for the project. Legacy will also use the Age and Condition Factor as well as the
Damage to the Remainder factor to determine a Detailed Market Study value for each parcel.
4. An easement value will be calculated using the Detailed Market Study value and exhibit area measurement
furnished by the survey company. The Market Study value for each easement will be reported in a table
reflecting all the information used to establish this value and will become a part of the permanent records for
the project.
The Market Study is prepared by an appraiser in accordance with the appraisers best understanding of the current
Uniform Standards of Professional Practice. Although it is not an appraisal some appraisal concepts and methods
are utilized. The market study report, opinions, and conclusions are developed, and reports are prepared, in
conformity with the requirements of the code of Professional Ethics&Standards of Professional Appraisal Practice
of the Appraisal Institute.
A Market Study requires complete in-depth and accurate data, effective valuation models, and proper management
of resources. The appraiser must rely upon valuation equations, tables, and schedules developed through
mathematical analysis of market data. The data requires interpretation of the influences of economic, social;
physical,environmental,and governmental forces. The object of a Market Study is to produce equitable valuations
at low costs and more time efficient, so that it may not impede on the project deadlines. Individual property
appraisals often require on-site inspections, which require more time and increased costs.
Page I 1 Prepared for Lubbock Power& Light