"I think you're going to sense some frustration from this council, and it would be appropriate for you to step back and explain how we got into this position," said Orinda City Council member Dean Orr as he led off the public questioning of Pacific Gas and Electric representatives regarding how a multi-million dollar utility undergrounding project went from "on track" to derailed in a matter of months.
The plan to improve one of Orinda's most heavily traveled thoroughfares began in 2004 when the City Council established an Underground Utility District on Miner Road between Camino Pablo and Lombardy Lane. "Miner Road was selected among three potential sites," reads the staff report, "because it was the most scenic road that would aesthetically benefit from the removal of utility poles and appurtenant wires. Undergrounding of the overhead utilities would also improve public safety" by "removing roadside obstructions and reducing risks under fire, earthquake, and high wind conditions." But the project languished "due to a lack of priority and funding" by PG&E.
By 2013, PG&E representatives were back, meeting with city staff, scheduling workshops - and making a February 2014 presentation to the City Council in which corporate staff delivered the glad tidings that PG&E would finally show Miner Road some love. "They specified that this project was deemed fully funded prior to 2011 and that, as a result, the project was considered 'grandfathered' by PG&E."
"At that time," said city manager Janet Keeter, "we started having more serious discussions." But, "after a number of conversations with PG&E, with our city attorney, their attorney, it was determined very recently that ... the project could not proceed as it was scoped because the costs far exceeded the credits that the city had in the Rule 20A program" - an electric tariff that enables PG&E to underground 30 miles of overhead lines across the Bay Area each year. Projects are nominated by local or county governments with costs recovered via electric rates after the work ends.
Council members were not amused and pressed, one after another, for answers.
"I think the initial communication from PG&E was not accurate," said PG&E's public affairs manager. "We thought Orinda would be one of those projects that would be grandfathered in - even though the costs were escalated, and we could borrow out ... 30-plus years. ... We thought that this would be eligible for that kind of a funding process. I think originally that's what we communicated to the city, and that was not accurate."
"When I heard that the project costs had escalated to the extent they had - and heard that they were considering [Orinda] as a grandfathered project," said Orinda City Attorney Osa Wolff, "I asked for confirmation ... I didn't want Orinda to end up holding the bag for the cost overruns if it turned out PG&E didn't have clear CPUC authorization for covering those cost overruns. And when I researched it and talked to their attorney, it became clear to me that they did not have PUC authorization to cover the increased costs in our project's case. They had very limited grandfathering authority with respect to six jurisdictions, and we are not one of those six." Council members were also advised by PG&E that is has no other source of funding available to help.
After another 30 minutes of continued intense probing of the PG&E personnel, the City Council clarified the project's importance again, and directed city staff to continue exploring with PG&E other possible ways to get the undergrounding project back on track.
The plan to improve one of Orinda's most heavily traveled thoroughfares began in 2004 when the City Council established an Underground Utility District on Miner Road between Camino Pablo and Lombardy Lane. "Miner Road was selected among three potential sites," reads the staff report, "because it was the most scenic road that would aesthetically benefit from the removal of utility poles and appurtenant wires. Undergrounding of the overhead utilities would also improve public safety" by "removing roadside obstructions and reducing risks under fire, earthquake, and high wind conditions." But the project languished "due to a lack of priority and funding" by PG&E.
By 2013, PG&E representatives were back, meeting with city staff, scheduling workshops - and making a February 2014 presentation to the City Council in which corporate staff delivered the glad tidings that PG&E would finally show Miner Road some love. "They specified that this project was deemed fully funded prior to 2011 and that, as a result, the project was considered 'grandfathered' by PG&E."
"At that time," said city manager Janet Keeter, "we started having more serious discussions." But, "after a number of conversations with PG&E, with our city attorney, their attorney, it was determined very recently that ... the project could not proceed as it was scoped because the costs far exceeded the credits that the city had in the Rule 20A program" - an electric tariff that enables PG&E to underground 30 miles of overhead lines across the Bay Area each year. Projects are nominated by local or county governments with costs recovered via electric rates after the work ends.
Council members were not amused and pressed, one after another, for answers.
"I think the initial communication from PG&E was not accurate," said PG&E's public affairs manager. "We thought Orinda would be one of those projects that would be grandfathered in - even though the costs were escalated, and we could borrow out ... 30-plus years. ... We thought that this would be eligible for that kind of a funding process. I think originally that's what we communicated to the city, and that was not accurate."
"When I heard that the project costs had escalated to the extent they had - and heard that they were considering [Orinda] as a grandfathered project," said Orinda City Attorney Osa Wolff, "I asked for confirmation ... I didn't want Orinda to end up holding the bag for the cost overruns if it turned out PG&E didn't have clear CPUC authorization for covering those cost overruns. And when I researched it and talked to their attorney, it became clear to me that they did not have PUC authorization to cover the increased costs in our project's case. They had very limited grandfathering authority with respect to six jurisdictions, and we are not one of those six." Council members were also advised by PG&E that is has no other source of funding available to help.
After another 30 minutes of continued intense probing of the PG&E personnel, the City Council clarified the project's importance again, and directed city staff to continue exploring with PG&E other possible ways to get the undergrounding project back on track.
Reach the reporter at:
Lamorinda Weekly, Moraga CA