Attachment

UTILITY COMMITTEE AGENDA REVISED September 24, 2007 - 5:00 P.M. - Council Chambers - City Hall - City of Dover Public comments are welcomed on any item and will be permitted at appropriate times. When possible, please notify the City Clerk (736-7008 or e-m ail at Tm cdowell@dover.de.us) should you wish to be recognized. AGENDA ADDITIONS/DELETIONS 1. Proposed Amendments to the City of Dover Electric Service Handbook - Proposed Increases for Residential and Commercial Underground Extension Fee 2. Revised CIP's for 69KV Feeders 3 & 4 and St. Jones Substation 3. Bid Evaluation - Two (2) Substation Transformers 4. FY 07/08 Water/Wastewater Capital Improvement Project (CIP) Briefing (Continued from September 10, 2007 Meeting) 5. Modification of Maintenance Agreement - Persimmon Park Place Islands 6. Update - Verizon Franchise Agreement Negotiations 7. Adjournment by 6:00 P.M. /tm S:\ClerksOffice\Agendas&Minutes\Committee-Agendas\2007\09-24-2007 UTILITY Revised.wpd THE AGENDA ITEMS AS LISTED MAY NOT BE CONSIDERED IN SEQUENCE. THIS AGENDA IS SUBJECT TO CHANGE TO INCLUDE THE ADDITION OR THE DELETION OF ITEMS, INCLUDING EXECUTIVE SESSIONS.

ACTION FORM PROCEEDING: Utility Committee AGENDA ITEM NO: 09/24/2007 DEPARTMENT OF ORIGIN: Public Utilities – Electric Engineering DATE SUBMITTED: 08/23/2007 PREPARED BY: Ronald H. Lunt, Public Utilities Director SUBJECT: Proposed Increase for Residential and Commercial Underground Extension Fee REFERENCE: Electric Service Handbook Division III, Rules and Regulations, Section 3-36 RELATED PROJECT: N/A APPROVALS: City Manager, Finance Director EXHIBITS: Detailed Development Evaluation EXPENDITURE REQUIRED: $N/A AMOUNT BUDGETED: $N/A FUNDING SOURCE (Dept./Page in CIP & Budget): N/A TIMETABLE: To become effective upon Council’s approval. RECOMMENDED ACTION: Staff recommends increasing the Residential Underground Extension Fee from $850 per service to $1,200 per service. Additionally, staff recommends increasing the Commercial and Industrial Underground Extensions from $850 per electrical service to total material cost recovery. BACKGROUND AND ANALYSIS In September, 2006, the Electrical Engineering Division chose three reflective developments to study and developed a material list for the equipment needed to supply electrical service to these developments. From that study a “per lot” fee was developed to recover all the City supplied material costs and included in the City of Dover Electric Service Handbook, which currently requires an $850 residential underground extension fee (per lot) for new developments and/or extension requests. The $850 fee recovered the material and transformer costs of the new electrical distribution extension; it does not include labor. The fees in the Handbook also applied the same rate to Commercial and Industrial extensions where more than one customer was served. Due to the rising cost of material, staff felt it was necessary to re-evaluate the fee’s associated with providing the infrastructure for underground electric service extensions. The result of this re-evaluation, which used the same material lists as the 2006 study, is that the average cost for providing residential electric service is approximately $1,200 per service. Staff is also recommending that the Commercial and Industrial underground extensions be modified to recover 100% electrical material costs for all installations. New Development - Estimated Material Costs (July 2007) Average Cost Development Year Material Cost Transformer Cost Total Material Cost No. of Lots Per Lot 2006 $ 190,377.59 $ 45,888.00 $ 236,265.59 212 $ 1,114.46 Nottingham Meadows 2007 $ 240,106.56 $ 65,019.81 $ 305,126.37 212 $ 1,439.28 2005 $ 31,388.11 $ 11,792.81 $ 43,180.92 81 $ 533.10 Stone Ridge Dev 2007 $ 37,588.80 $ 13,065.61 $ 50,654.41 81 $ 625.36 2005 $ 166,154.46 $ 52,710.18 $ 218,864.64 303 $ 722.33 Clearview Meadows Dev. 2007 $ 275,849.56 $ 80,255.57 $ 356,105.13 303 $ 1,175.26 Pre-2007 Average per lot, material & transf. cost only 596 $ 836.09 2007 Average per lot, material & transf. cost only 596 $ 1,194.44

Text depicted with strikeout will be omitted. Text depicted with bold italic is proposed. 3-36. Underground Extensions a. Residential. The City will install underground extensions of primary, secondary and services (subject to Rules and Regulations of Underground Services) to serve customers in new developments. The developer will be required to install, at its expense, conduits, equipment and pads The developer will be required to provide and install, at their expense, all conduit(s), and install, at their expense, all equipment and pads (for example manholes, transformer pads, etc.) as designed by the City’s Engineering Department. In addition, a fee of $850 $1,200 per platted lot is required. The City will examine request for underground extensions individually in areas other than those planned initially for underground. b. Commercial and Industrial. The City will install underground extensions on or along public right-of-way or on a right-of-way on private property to serve more than one customer only one or more customers in areas where the existing distribution system is underground or an underground system is planned. The developer will be required to install, at their expense, conduits and equipment pad The developer will be required to provide and install, at their expense, all conduit(s), and install, at their expense, all equipment and pads (for example manholes, transformer pads, etc.) as designed by the City’s Engineering Department. In addition, reimbursement a fee of $850 100% of the cost of materials, including all equipment and transformers, per platted lot electrical service is required. Note: Secondary services shall continue to be installed and maintained by the customer from the City’s point of connection, such as the transformer or pedestal, to the customers meter socket, disconnect, CT cabinet or other mutually agreeable device located at the property line or mutually agreeable location.

ACTION FORM PROCEEDING: Utility Committee AGENDA ITEM NO.: 09/24/2007 DEPARTMENT OF ORIGIN: Public Utilities – Engineering Dept. DATE SUBMITTED: 09/07/2007 PREPARED BY: Ronald Lunt – Public Utilities Director SUBJECT: Revised CIP’s for 69 Kv Feeders 3 & 4 and St. Jones Substation REFERENCE: NA RELATED PROJECT: NA APPROVALS: City Manager, Finance Director EXHIBITS: Revised CIP forms EXPENDITURE REQUIRED: NA AMOUNT BUDGETED: NA (AS PER ATTACHED REVISED CIP SHEET) FUNDING SOURCE (Dept./Page in CIP & Budget): NA TIMETA BLE: Complete projects by the end of Fiscal Year 2009. RECOMMENDED ACTION: Approve the changes in scope, schedule, and expense related to the CIP’s for St. Jones Substation and 69 Kv Feeders 3 & 4. BACKGROUND AND ANALYSIS At the July 23, 2007, Utility Committee Meeting the Public Utility Director briefed the Committee on the changes to the scope of the 69 Kv Feeder project, which included constructing it as a design/build vs. a EPC and reducing it to two phase project vs. three phases. It was also discussed that the St. Jones Substation project would need to be accelerated to coincide with the 69 Kv Feeders 3 & 4 – Phase II construction. Since this briefing, staff has been preparing a detailed budget for both projects in an effort to update the CIP’s with reliable cost estimates. Furthermore, a stipulation of the bond sale mandates that all funds be spent within three years of the bond sale, the acceleration of the St. Jones Substation project will assist in complying with this requirement. As anticipated, the change is scope to the 69 Kv Feeder project will result in a saving of approximately $2,525,410. The St. Jones Substation project costs have increased due to increases in the price of metals, the switchgear, and related equipment. In FY 06 the project had been estimated to be 5.1M, it was reduced to 3.6M in FY 07 based on a temporary reduction in actual bid costs. The current estimates for the Substation are projected to be approximately 5.3M. The total costs related to the two projects are projected to be $17,598,158, a net reduction of $749,342 over previous FY07 estimates. Budget Amendments reflecting these changes will be prepared for approval as part of the first planned Budget Amendment.

69 KV Feeders 3 and 4 LOCATION & AREA MAP: FISCAL YEAR: 2006 - 2009 PROJECT NO.: EE0601 FUND: DEPARTMENT: Public Utilities – Electric Engineering NEW PROJECT?: NO DEPT. RANKING: 3 PROJECT DESCRIPTION: This project will install two new 69 Kv circuits starting at the Cartanza Substation and interconnecting with our existing 69 Kv network near Fulton and West Street. The completion of this project will provide redundancy to the existing transmission system and allow any one of the four transmission lines to be taken out of service due to a component failure, or for maintenance, without causing a large scale outage. Additionally, it should be able to supply future transmission capacity for at least 20 years. The project will be completed in two phases. Phase I of this project, with construction beginning in the spring of 2008, will build two new circuits to the St. Jones Substation location (located at the intersection of Kings Hwy. and Division Street); while it will not provide any interconnection or service at this location, it is an electrically appropriate mid-point in the project. Phase II of the project will begin in the fall of 2008 and continue the double circuits from St. Jones Substation to a point near Fulton and West Street where they will interconnect with our existing lines. Phase II also includes installing approximately four spans of transmission line at North Street, near the railroad tracks and the remove of obsolete lines along North Street near the Enterprise Industrial Park. NEED, JUSTIFICATION, BENEFIT: The existing two lines from the Cartanza Substation carry the entire system load. If one line should fail due to weather, accidents, or equipment failure during peak loading times approximately 50 percent of the electric customers would be out of power until the failure was resolved. Additionally, the current transmission lines share the same poles for approximately the first mile, if one of these support structures were to be knocked down, the entire City would be without power until the generation could be started and could take approximately ten hours before restoration would be completed. The addition of the two new circuits will provide a diverse path and double the transmission capacity. CONSEQUENCES OF DELAYING OR ELIMINATING THIS PROJECT: As previously discussed, prolonged, widespread outages on the transmission system and/or the operation of generation at a substantial economic loss during transmission maintenance (approximately $1M in FY07). THIS PROJECT IS RELATED TO THE FOLLOWING: St. Jones Substation EXPLANATION OF IMPACT ON OPERATING BUDGET: NA TIME-LINE/CURRENT STATUS: Started in FY 06 and completed in FY 09. COMMENTS: FIVE-YEAR COST BREAKDOWN SCHEDULE: Prior to 2008 FY 2008 FY 2009 FY 2010 FY 2011 After 2011 TOTAL Planning and Design 197,332 854,975 304,000 1,356,307 Land Construction 8,602,813 2,262,970 10,865,783 Miscellaneous Equipment Other TOTAL 197,332 9,457,788 2,566,970 $12,222,090 FINANCING: Prior to 2008 FY 2008 FY 2009 FY 2010 FY 2011 After 2011 TOTAL Electric Bond Proceeds 197,332 9,457,788 2,566,970 12,222,090 TOTAL 197,332 9,457,788 2,566,970 $12,222,090 IMPACT ON OPERATING BUDGET: Prior to 2008 FY 2008 FY 2009 FY 2010 FY 2011 After 2011 TOTAL TOTAL

St. Jones Substation LOCATION & AREA MAP: FISCAL YEAR: 2008 - 2009 PROJECT NO.: ES0004 FUND: DEPARTMENT: Public Utilities – Electric Engineering NEW PROJECT?: NO DEPT. RANKING: PROJECT DESCRIPTION: This project will replace the current St. Jones Substation in coordination with the new 69 Kv Feeders 3 & 4 project. The new station will consist of a bus tie for the two new 69 Kv circuits, installation of a new transformer and switchgear to replace the existing obsolete equipment, and converting the last 22 Kv substation to 69 Kv. NEED, JUSTIFICATION, BENEFIT: The installation of the bus tie will provide additional reliability to the transmission system by providing a protection scheme for line faults, allow the interconnection of the two new feeders at this location to provide greater reliability, and provide a dual transmission feed, with protection/isolation, to ensure that the substation continues to operate in instances where the transmission line fails. The current station transformer and equipment have reached their life expectancy and need to be replaced; therefore, this is an ideal time to convert the station to the 69 Kv system. This will facilitate the removal of approximately 6 miles of 22 Kv transmission lines, which will reduce the maintenance requirements and system losses. CONSEQUENCES OF DELAYING OR ELIMINATING THIS PROJECT: We would not be able to complete Phase II of the 69 Kv project, update the obsolete equipment, or remove the 22 Kv transmission system. THIS PROJECT IS RELATED TO THE FOLLOWING: 69 Kv Feeders 3 & 4 EXPLANATION OF IMPACT ON OPERATING BUDGET: NA TIME-LINE/CURRENT STATUS: Design and material procurement in FY 08, construction to begin in the fall of 2008 with completion scheduled for June of 2009. COMMENTS: This is a revised CIP due to the revision of the 69 Kv Feeders 3 & 4 to only two phases and to ensure that the bond funds are expended in three years. FIVE-YEAR COST BREAKDOWN SCHEDULE: Prior to 2008 FY 2008 FY 2009 FY 2010 FY 2011 After 2011 TOTAL Planning and Design $333,760 $134,840 $468,600 Land Construction $1,832,279 $3,075,189 $4,907,468 Miscellaneous Equipment Other TOTAL $2,166,039 $3,210,029 $5,376,068 FINANCING: Prior to 2008 FY 2008 FY 2009 FY 2010 FY 2011 After 2011 TOTAL Electric Bond Proceeds 2,166,039 2,690,907 $4,856,946 Depreciation Reserve 519,122 519,122 TOTAL $5,376,068 IMPACT ON OPERATING BUDGET: Prior to 2008 FY 2008 FY 2009 FY 2010 FY 2011 After 2011 TOTAL TOTAL

PROCEEDING: Utility Committee AGENDA ITEM NO.: 09/24/2007 DEPARTMENT OF ORIGIN: Public Utilities – Electric DATE SUBMITTED: 09/07/2007 PREPARED BY: Ronald H. Lunt – Public Utilities Director SUBJECT: Bid Evaluation: St Jones & Horsepond Substation Transformer REFERENCE: BID # 08-0004DPU RELATED PROJECT: 69 Kv Feeders 3 & 4 APPROVALS: City Manager and Finance Director EXHIBITS: Shaw Bid Evaluation Summary EXPENDITURE REQUIRED: $1,615,481 AMOUNT BUDGETED: See Explanation Below FUNDING SOURCE (Dept./Page in CIP & Budget): #1) 2007/2008 City of Dover Draft Budget, Page 150, Public Utilities – Electric Engineering, Horsepond 600 Transformer: Account #487-8300- 563-70-27, Project EE0803, budget $1,020,000, expense of $807,740.50. #2) Amended CIP Sheet and subsequent Budget Amendment for St. Jones Substation being proposed with a FY2007-08 Budget of $1,832,279 and expense of $807,740.50. TIMETABLE: Unit will be ordered upon Council approval and will ship approximately 46 weeks after order. RECOMMENDED ACTION: Staff recommends awarding the proposal to the lowest responsive bidder, Kuhlman Electric Corporation, in the amount of $1,615,481 which includes 2 transformers ($1,566,446), one set of spare parts ($4,905), and transformer field assembly ($44,110). BACKGROUND AND ANALYSIS The City of Dover solicited a Request for Proposals (RFP) for two (2) Substation Transformers; one transformer will be installed at the Horsepond Substation and the other at the St Jones Substation. Both are existing substations that will be undergoing upgrades due to the age and condition of the existing transformers. An RFP was solicited and advertised according to City Policy by the Contract and Procurement Manager under Number 08-0004DPU. Dover received a total of eight (8) proposals; one proposal was rejected as it contained an exception that was not acceptable. The remaining seven proposals were evaluated by Shaw Engineering Services and reviewed by staff. All proposals were evaluated based on the criteria included in the solicitation which included compliance with specifications, firm pricing, manufacturing experience in the USA, technical design data, core/coil type, factory capabilities, total weight, delivery time, and warranty. These evaluations are summarized in the attached spreadsheet under “RFP Engineering Evaluation Penalty Multiplier” which provides a quantitative analysis of the responsiveness of the proposal. Additionally, the transformers are also evaluated on a “total cost of operation” factor which quantifies the total energy losses (the energy costs to operate the transformer for the life of the transformer) coupled with the purchase price and spare parts cost. Utilizing this data, staff determined that the proposal from Kuhlman Electric Corp. is the most responsive and should be awarded the contract. Staff included the expense of the spare parts which includes a gasket set, one high and low voltage bushing, and one cooling fan with motor. Furthermore, staff recommends including the Turnkey installation for both transformers which includes unloading, assembly, oil filling/processing, field testing, and a five (5) year warranty. The Kuhlman proposal price is a firm price; however, it does contain the following payment requirements: • 20% down payment, • 30% fifteen weeks prior to scheduled shipment, • 30% 35 days prior to scheduled shipment, and • 20% upon shipment (Due net 15 days after receipt of transformer).

Request for Qoute #: 08-0004DPU HORSEPOND/ST JONES SUBSTATION TRANSFORMERS Transformer MVA: 20/27/33MVA Transformer Voltage HV / LV: 69/12.47KV Quantity of Order: 2 Bidder: Kuhlman Ronpartners HD Supply RW Chapman HD Supply Irby Waukesha Manufacturer: KUHLMAN WEG GE/PROLEC Delta Star Niagara Niagara Waukesha RFP Engineering Evaluation Penalty Multiplier 1 1.046 1.002 1.03 1.128 1.128 1.028 Quoted Price $1,566,466 $1,552,114 $1,736,000 $1,797,550 $1,560,000 $1,565,550 $2,006,600 Sum of Adders (spare parts, surge test, and test charge) $4,905 $4,740 $9,565 $3,722 $10,590 $10,590 $3,250 Subtotal (adders & quoted price) $1,571,371 $1,556,854 $1,745,565 $1,801,272 $1,570,590 $1,576,140 $2,009,850 RFP Evaluation Penalty Applied to Subtotal (Subtotal * eval. penalty) $1,571,371 $1,628,469 $1,749,056 $1,855,310 $1,771,626 $1,777,886 $2,066,126 Penalty for Energy Losses: $219,120 $213,600 $306,200 $240,800 $326,400 $326,400 $225,640 Total evaluated price (This includes all the criteria for the bases of the transformer award which includes Quoted Price, Adders, RFP $1,790,491 $1,842,069 $2,055,256 $2,096,110 $2,098,026 $2,104,286 $2,291,766 Evaluation, and Penalty for Energy Losses) Bid award ranking based on RFP evaluation criteria, losses, and 1 2 3 4 5 6 7 adders (excludes field assembly) Transformer field assembly $44,110 Not available $133,000 Not available $74,000 $75,000 Not available Bid Award Total Cost (based on Quoted Price, Adders, and Field Assembly $1,615,481.00 Unit Cost $807,740.50 Miscellaneous Information Delivery Lead time (wks): 46 wks aro* 54 wks aro 52wks aro as required. 53 wks aro 53 wks aro 54 wks aro Transformer Plant Location Crystal Spr, MS Tizayuca, MX Monterrey, MX Lynchburg, VA Buffalo, NY Buffalo, NY Wis or NC *After Receipt of Order

Memorandum Office of the City Manager P.O. Box 475 Dover, DE 19903 Phone: (302) 736-7005 Fax: (302) 736-7002 E-mail: tdeprima@dover.de.us To: Utility Committee Members From: Anthony J. DePrima, AICP City Manager Date: August 29, 2007 Subject: FY 07/08 Water/Wastewater Capital Improvement Project (CIP) Briefing The CIP sheets for the FY 07/08 Water/Wastewater Capital Improvement Projects to be discussed at the September 10, 2007 Utility Committee meeting are attached for your review. Thank you. /dej Attachment P.O. Box 475, Dover, DE 19903-0475 Community Excellence Through Quality Service

Memorandum Office of the City Manager PO Box 475 Dover, DE 19903 Phone: (302) 736-7005 FAX: (302) 736-7002 E-mail tdeprima@dover.de.us To: Utility Committee Members From: Anthony J. DePrima, AICP City Manager Date: August 28, 2007 Subject: Modification of Maintenance Agreement of Persimmon Park Islands In September of 2004 the City of Dover accepted the dedication of streets in Persimmon Park Place. This project had been developed with private streets, but over time they began to deteriorate and the Condominium Association was not able to care for them in the long term. The City agreed to take over ownership and responsibility once funding of their repair was secured through Community Transfer Funds provided principally by Representative Bruce Ennis. Maintenance, mostly grass cutting, of traffic islands were specifically reserved by the Condominium Association as their responsibility. Attached is the deed from the transfer of land and paragraph three (3) addresses this reservation. At the time the City did not want to send City mowing crews to this remote location and the Association agreed. Since then, there have been several occasions when the new Homeowners Association or the Condominium Association has requested the City to mow these areas. As you can imagine they are looking to save on their grass cutting expenses. I have maintained that we are not responsible. Recently we have learned that Representative Bruce Ennis has agreed to fund “bricking” the islands which will significantly reduce the cost of the maintenance. The question then becomes, should we modify the deed and take over responsibility of the islands? My recommendation is that we do not. I feel that the expense of maintaining these islands will be reduced to a cost of occasionally spraying for weeds. I feel that the Condominium Association can more than handle this responsibility and we should not be stretching our landscape crews any further. c:Tony/City Manager/Utility-Persimmon Park Islands