ORDINANCE NO. 2005 - 3

An ordinance granting the Wheatland Electric Cooperative, Inc. its successors and assigns, the franchise and right to construct, operate and maintain electric transmission and distribution lines or systems within the corporate limits of the City of Deerfield, State of Kansas, to transmit, distribute and sell electric energy to the City and its inhabitants, and to transmit electric energy through the City for distribution and sale to residents outside and beyond the City.

BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF DEERFIELD, STATE OF KANSAS:

Section 1. The Wheatland Electric Cooperative, Inc., a corporation organized and existing under and by virtue of the laws of the State of Kansas (hereinafter called the “Cooperative”), its successors, lessees or assigns, Cooperative being a cooperation, operating a system for the transmission of electric current between two or more incorporated cities in the State of Kansas, into and through which it has built transmission lines, is hereby granted a non-exclusive franchise, privilege and right for five (5) years from the effective date of this Ordinance, to construct, operate and maintain electric transmission and distribution lines or systems with the limits of the City of Deerfield, Kansas, (hereinafter called the “City”) (as said limits are presently constructed or may in the future be extended), to transmit distribute and sell electric energy to the City for distribution, and sale to residents outside and beyond the City.

Section 2. The grant herein made includes the further right and privilege to construct, operate, maintain and repair, relocate and extend said electric lines or systems including all poles, wires, cables, conductors, conduits, anchors, guys, transformers, transformer stations, and all fixtures and facilities necessary for the convenience of the Cooperative's business along, upon, over, under, through and across the streets, alleys, and public grounds, within the City (as said streets, alleys, and public grounds are presently laid out or as they may be laid in the future.)

Section 3. All electric lines or systems, poles, wires, cables, conductors, conduits, anchors, guys, transformers, transformer station, and all fixtures and facilities necessary for the operation of the Cooperative's business, shall be constructed, operated, maintained, repaired or relocated in such places and manner as will be consistent with necessity, and cause the least interference with other public uses of such streets, alleys or public grounds. The Cooperative shall provide and keep in force public liability insurance with limit of One Million Dollars ($1,000,000.00) for bodily injury and property damage and a Five Million Dollars ($5,000,000.00) umbrella policy, such policies naming both the Cooperative and the City as insured parties. The Cooperative shall maintain on file at the Office of the City Clerk a current Certificate of Insurance verifying such public liability coverage.

Section 4. As consideration for the granting of this franchise, the Cooperative shall:

(a)        Operate and maintain the existing standard street lighting system for the City and in the event of growth of the City or reasonable need for change, modification or improvement of said street lighting system as the Cooperative and the City may agree upon, and upon terms that are fair, reasonable and just to the Cooperative and the City and in accordance with the latest rates, rules and regulations filed with and approved by the State Corporation Commission of Kansas.

(b)        For the cost of operation and maintenance of its street lighting system, the City agrees to pay the Cooperative, at the latest public street lighting rate schedule or succeeding rate schedule which is filed with and approved by the State Corporation Commission of Kansas. (Current applicable Rate Schedule 88-SL).

(c)        The Cooperative agrees to sell and deliver unto the City during the period of this franchise such energy as may be required by the City for heat, power and other uses the Governing Body of the City shall direct, all in accordance with its current municipal power service rate schedule or any succeeding rate schedule filed with and approved by the State Corporation Commission of Kansas. (Current applicable Rate Schedule 88-M Frozen or 88-GS).

Section 5. As further consideration for the rights, privileges and franchise hereby granted, and in lieu of all occupation and licenses taxes, the Cooperative shall collect from its customers located within the corporate limits of the City, and pay to the City on a quarterly basis, an amount equal to three percent (3%) of the gross receipts from the sale of electric energy; Provided However; the City shall not be charged, or pay the franchise fee established by this Ordinance, for any electric energy sold to the City by the Cooperative, used exclusively by the City for its operation, maintenance or the providing of municipal services by the City. All payments required to be made under this Ordinance shall be made within thirty (30) days following close of the period for which payment is due.

The City shall have access to and the right to examine during normal business hours, those of the Cooperative’s books, receipts, files, records and documents that are necessary to verify the correctness of payments due hereunder. If it is determined that a mistake was made in the payment of any franchise fee required hereunder, such mistake shall be corrected promptly upon discovery, such that any under-payment by the Cooperative shall be paid within thirty (30) days of the recalculation and any over-payment by the Cooperative shall be discounted from the next payment(s) due.

Section 6. The Cooperative is hereby granted the privilege of trimming such trees as may interfere with the safe and proper construction and operation of the electric grounds of the City.

Section 7. All earth, materials, sidewalks, paving crossing, public improvements, or private property of any kind injured or removed by the Cooperative shall be fully repaired and replaced promptly by the Cooperative to the reasonable satisfaction of the City, or the private property owner affected. In the event the Cooperative neglects or refuses to make such repairs or neglects or refuses to replace such earth, materials, sidewalks, paving crossing, or improvements within a reasonable time, the Cooperative shall promptly reimburse the City for any and all expenses the City may incur in making such repairs or replacing such earth, materials, sidewalks, paving crossing, public improvements, or private property to meet the specifications and requirements of the City.

Section 8. The Cooperative agrees that for the term of this franchise, it will use its best efforts to maintain facilities and equipment sufficient to meet the current and future energy requirements of the City and its residents.

Section 9. The City acknowledges that certain information it might request pursuant to this franchise may be of a proprietary and confidential nature. If the Cooperative requests that any information provided by the Cooperative to the City be kept confidential due to such proprietary or commercial value, the City and its employees, agents, and representatives shall maintain the confidentiality of that information, to the extent allowed by law. If the City is requested or required by legal or administrative process to disclose any such confidential information, the City shall promptly notify the Cooperative of such request or requirement so that the Cooperative may seek an appropriate protective order or other relief. The City shall use all reasonable efforts to ensure that the confidentiality of the Cooperative’s confidential information is maintained.

Section 10. All work performed and facilities constructed under this franchise shall be performed and constructed in a safe and workman like manner in accordance with prescribed rules, regulations, and statutes of the City, state of Kansas, Kansas Corporation Commission, and all other entities with jurisdiction over the acts of the Cooperative. The Cooperative shall hold the City harmless from any and all claims and actions, litigation or damage, arising out of the passage of this Ordinance, the granting of this franchise, distribution of electric energy by the Cooperative, or the construction, erection, installation, maintenance, operations, or conduct of the Cooperative’s employees or agents, including court costs and reasonable attorney’s fees in making defense against any and all claims; Provided, However, that the Cooperative shall not hold the City harmless from claims and actions, litigation or damage arising out of the negligence of the City, its employees or agents.

Section 11. If any clause, sentence or section of this Ordinance is deemed invalid by any judicial, regulatory or legislative body having proper jurisdiction, the remaining provisions shall not be affected.

Section 12. Defaults under this Ordinance shall be governed by K.S.A. 12-2011.

Section 13. It shall not be a breach or default under this franchise if either party fails to perform its obligations hereunder due to Force Majeure. Force Majeure shall include, but not be limited to, the following: 1) physical events such as acts of God, landslides, lightning, earthquakes, fires, freezing, storms, floods, washouts, explosions, breakage or accident or necessity of repairs to machinery, equipment or distribution or transmission lines; 2) acts of others such as strikes, work-force stoppages, riots, sabotage, insurrections or wars; 3) governmental actions such as necessity for compliance with any court order, law, statute, ordinance, executive order, or regulation promulgated by a governmental authority having jurisdiction; and any other causes, whether of the kind herein enumerated or otherwise not reasonably within the control of the affected party to prevent or overcome. Each party shall make reasonable efforts to avoid Force Majeure and to resolve such event as promptly as reasonably possible once it occurs in order to resume performance.

Section 14. Any waiver of any obligation or default under this franchise shall not be construed as a waiver of any future defaults, whether of like or different character.

Section 15. No assignment of the Cooperative's rights granted by this Ordinance shall be effective without the prior written consent of the City.

Section 16. Within Sixty (60) days from and after the passage and approval of this Ordinance, the Cooperative shall file with the City Clerk of the City, its unconditional acceptance of this Ordinance.

Section 17. Any and all Ordinances in conflict with the terms hereof are hereby repealed. Ordinance No. 105 of the City is hereby repealed.

Section 18. This Ordinance shall become effective and be in force and shall be a binding contract between the parties hereto, their successors and assigns, from and after its passage and approval, publication as is required by law and acceptance by the Cooperative and the Kansas Corporation Commission.

Section 19. This franchise is granted pursuant to the provisions of K.S.A. 12-2001.

(7-5-05)