WORKSHOP ITEM

TO: Mayor and Town Council

FROM: Shawn P. O’Malley, Town Engineer

MEETING DATE: April 15, 2002

SUBJECT: Undergrounding power lines within the Town of Jackson

Purpose of Workshop Agenda Item

In this workshop I would like to provide Council with information concerning the future undergrounding
of existing overhead power lines within the Town of Jackson.

It is my desire to provide Council with sufficient information such that the impact to the community,
utilities and the Town’s fiscal budget can be reviewed. Upon completion of this discussion it is hoped a
determination regarding the implementation of a Town/Lower Valley Energy (LVE) undergrounding
power program can be made.

Current State of Undergrounding Power Lines

Currently the Town includes the installation of “blank” conduit within all of the CIP projects being
constructed. These conduits are being installed under all intersections and across streets, in appropriate
locations as determined by LVE. These “blank” conduits are being installed by the Town to facilitate the
future undergrounding of power lines. In addition, all new large-scale developments are being required to
install underground power system necessary to serve the improvements.

It should be noted that the Town franchise agreement with LVE does not include provisions to require
that existing or new systems be located underground. The LVE franchise expires on June 3, 2016.

The Town franchise agreement with USWest/Qwest does not include provisions to require that existing or
new systems be placed below ground. This franchise expires on August 17, 2017.

The TCI Cable/AT&T Broadband franchise expires on May 8, 2002 and currently states:

“Aerial and Underground Construction. In those areas of the Service area where all of the
transmission or distribution facilities of the respective public utilities providing telephone
communication and electric service are underground, the Grantee likewise shall construct,
operate, and maintain all of its transmission and construction facilities underground; provided
that such facilities can be made capable of receive the Grantee’s cable and other equipment
without technical degradation of the System’s signal quality. In those areas of the Service Area
where the transmission or distribution facilities of the respective public utilities providing
telephone communications and electric services are both aerial and underground, the Grantee
shall have the sole discretion to construct, operate, maintain all of its transmission and
distribution facilities, or any part thereof, aerially or underground.”
Future State of Undergrounding Power Lines

It is my understanding that the Council would like to review the methods of adopting a policy that would
allow for a phased approach to the undergrounding of existing overhead power lines. Due to the length of
the existing franchise, it is my understanding that the Council does not wish to require undergrounding of
system as part of future or renegotiated franchise agreements with the utility companies.

Key Issues

1. REMOVAL OF OVERHEAD LINES PROVIDES A MORE ATTACTIVE TOWN

PRESENCE.

It is understood that the Town residents would receive substantial visual benefits from the
undergrounding of overhead power lines. It should also be understood that the
undergrounding of this utility shall require the installation of above ground pad mounted
transformers.

2. LOCATION OF POSSIBLE UNDERGROUNDING OF UTILITY.

The locations of undergrounding power systems shall depend upon the construction area
available to install pad mounted transformers and the phase (power supply) of the line. Due to
difficulties with maintenance and the space needed (approximately 10-foot by 20-foot) LVE
is not recommending that 3-phase power transformer be installed below ground.

3. COST OF UNDERGROUNDING POWER LINES.

It is estimated that the cost to underground existing above ground feeder lines would be
$40/linear foot. This would equate to the completion of 400 linear feet for $16,000.00.

A total project cost of approximately $1,600,000.00 would be required to underground the

exiting 40,758 feet of overhead feeder lines.

4. COST OF UNDERGROUNDING TRANSMISSION LINES (3 PHASE POWER).

It is estimated that the cost to underground existing above ground feeder lines would be
$80/linear foot. This would equate to the completion of 400 linear feet for $32,000.00.

A total project cost of approximately $4,400,000.00 would be required to underground all of

the exiting 54,967 feet of overhead transmission lines.

5. EXPENSE TO THE PUBLIC.

To remove the power poles from any given area in which power lines have been installed
below grade, it shall be necessary to underground the power to each house along the length of
the project. This shall be necessary for each residence within the project area prior to the
removal of the existing poles. It is estimated that the cost of undergrounding power to a
single residence is $600.00.
6. FUNDING AND EXPENSE TO THE TOWN.

Currently the Town receives approximately $110,000 in franchise fees for the gas and electric
utility. These funds are currently placed in the Town’s General Fund (101 account).

It is recommended that the level of funding for these projects be determined thru allocations
from the 5th cent (sales tax funding) the Town receives. In this way the undergrounding
program could be coordinated with the CIP projects. The level of funding would be included
within the total annual amount designated for expenditure on improvement projects. This
funding methodology would provide an annual “undergrounding power lines account” within
the 5th cent funds. This would be similar in the methods of expenditure and construction to
the Town’s current “Annual Street Maintenance” account.

7. CONTRACT ADMINISTRATION.

Should the Town desire to initiate a program to underground various power lines, I would
anticipate that the process to complete projects would be as follows:

a. The Town PW Department would work with LVE to determine the most reasonable
projects that could be completed. This would include not only a review of the length and
location of projects, which could be completed with the designated funds, but also a
visual impact review of proposed projects with the Town Planning Department.

b. The Town Engineer and LVE would review each project location to determine if future
cost savings (replacement/maintenance costs) to LVE would occur should the project be
completed. These future LVE costs would include but not be limited to: the replacement
of deteriorated poles, modification to existing transformers and junction boxes, required
tree trimming, etc. These estimated LVE costs would then be deducted from the total
cost to be realized by the Town.

c. The Town Engineer would then review the various projects with the Council to determine
the scheduling of work. The Council would provide approval of the work to be
implemented into the CIP program.

d. The Town Engineer would work with LVE in review of the project plans and
development of both the bid specifications and bid schedule. In addition, other utilities
currently located on LVE poles would be contacted and requested to underground as part
of the project.

e. LVE would advertise and complete contract administration of the work for the project.
LVE would provide payments to the contractor during the construction work. The Town
would be presented a construction total project cost (less deductions for LVE
maintenance/replacements costs, see item b above) and provide reimbursement funding
to LVE thru the term of a future (TBD) agreement/contract with LVE.

8. IMPLEMENTATION INTO THE CIP PROGRAM.

I would recommend that the project be coordinated from both a fiscal and a construction
standpoint with the Town’s CIP. This would allow the Town Engineering Department to
coordinate undergrounding projects with other Town improvements. This would reduce the
 possibility of completing “back-to-back” projects in same area of Town and increase the
efficiency of roadway/utility improvements.

9. ADDITIONAL UNDERGROUND UTILITIES.

I would recommend that the Town review the future need for underground conduit that may
be necessary for fiber optics. We should discuss the installation and additional costs of these
conduits.

It should be noted that much of “Qwest” and “TCI Cable/AT&T Broadband” systems are
currently located on LVE poles. Any project to be completed shall need to be coordinated
with these utilities. I would recommend that the Council and Town Attorney review the terms
of these agreements prior to the implementation of an undergrounding program.

Attachments

• Map of the power system grid within the Town of Jackson.