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2017 Ballot Issue: Municipalization-Related Items

On Nov. 7, 2017, Boulder voters will consider three municipalization-related ballot items. Use this page to learn more about what's on the ballot. For all election information, visit the city's 2017 election page.


Ballot Question 2L: Extension and raise of the Utility Occupation Tax to continue funding the city’s exploration of municipalization

Ballot Language

SHALL CITY OF BOULDER TAXES BE INCREASED $4,000,000 ANNUALLY (IN THE FIRST YEAR) THROUGH AN INCREASE OF UP TO THAT AMOUNT IN THE CURRENT UTILITY OCCUPATION TAX IN THE YEAR 2018; AND $3,000,000 IN THE YEAR 2019; AND SHALL THE PORTION OF THE CITY’S UTILITY OCCUPATION TAX APPROVED BY VOTERS ON NOVEMBER 1, 2011, WHICH IN 2017 WAS IN THE AMOUNT OF $2,015,710, BE EXTENDED FROM ITS CURRENT EXPIRATION DATE OF DECEMBER 31, 2017 THROUGH DECEMBER 31, 2022; AND SHALL THE EXTENSION AND THE ANNUAL INCREASE IN THE TAX BE USED TO FUND COSTS ASSOCIATED WITH A MUNICIPAL ELECTRIC UTILITY THAT WILL SUPPORT BOULDER’S CLEAN ENERGY GOALS AND THE COMMUNITY’S COMMITMENT TO THE PARIS CLIMATE AGREEMENT, IMPROVE SYSTEM RELIABILITY, AND CREATE ENERGY RELATED BUSINESS OPPORTUNITIES, PROVIDED THAT IF THE CITY OF BOULDER DECIDES NOT TO PROCEED WITH A MUNICIPAL ELECTRIC UTILITY, THE TAX SHALL EXPIRE AFTER COSTS ASSOCIATED WITH THE MUNICIPAL UTILITY EFFORT ARE PAID; AND SHALL THE INCREASED AND EXTENDED PORTION OF THE TAX BE SUBJECT TO THE SAME TERMS AND CONDITIONS AS THE ORIGINAL TAX AND ALL EARNINGS THEREON (REGARDLESS OF AMOUNT) CONSTITUTE A VOTER APPROVED REVENUE CHANGE, AND AN EXCEPTION TO THE REVENUE AND SPENDING LIMITS OF ARTICLE X, SECTION 20 OF THE COLORADO CONSTITUTION?

FOR THE MEASURE ____ AGAINST THE MEASURE____ 

Read Ordinance 8189 for more information.

What it means

If approved, this ballot item would increase and extend the portion of the city’s Utility Occupation Tax (UOT) that funds municipalization.

Currently, this portion of the UOT collects about $2.1 million per year through Boulder residents’ Xcel Energy bills. This funding, approved by Boulder voters in 2011, is set to expire at the end of 2017. City Council has placed an extension and increase of this tax on the ballot to fund the municipalization effort for the next three years.

What is the total revenue the tax will collect?

Approximately $17 million, spread over five years.

Will the tax be collected evenly each year?

No. The tax will be collected in these increments:

Year

Total Collected

Increase over current tax

2018

$6,015,710

$4,000,000

2019

$5,015,710

$3,000,000

2020

$2,015,710

$0

2021

$2,015,710

$0

2022

$2,015,710

$0

Why is the tax collection amount different for 2018 and 2019?

The tax will provide funding for three years of litigation and staff work, but would extend the tax for five years to minimize the impact on the electric ratepayers.  The finance department has provided information regarding the projected budget impacts of the proposed ballot question. By increasing the amount collected in 2018 and 2019, budget impacts to the city’s General Fund are reduced. 

Where can I see the UOT on my current Xcel bill?

For residential customers, the UOT is assessed on pages 2 and 3 of your Xcel Energy bill. The city has prepared a sample bill to help you find it on your bill .

Page 2

Page 3

The UOT collected on your bill includes both the portion of a tax that replaces the franchise fee and the portion that funds municipalization. On the ballot this year, voters will be asked to consider extending and raising only the portion that funds municipalization. 

What will be the impact on my Xcel Bill in 2018 and 2019 if voters approve the measure?

Since the UOT is based on your energy use, this amount will be different for every customer. The city has created estimates using Xcel’s average customer data for each customer class to give you a sense of the impact on your bill each month:

 

2018

2019

Annual UOT Increase

$4,000,000

$3,000,000

Monthly Bill Increase

Residential

$2.37

$1.78

Commercial

$3.53

$2.64

Secondary General

$73.62

$55.22

Primary General

$1,333.91

$850.43

Transmission General

$24,942.18

$18,706.64

 

Assuming your energy use remains about the same in years 2020 through 2022, you should see a UOT similar to what you’re experiencing today. 

If passed, what would the UOT fund?

The Utility Occupation Tax will fund several critical functions associated with the municipalization exploration project, including legal and engineering costs related to ongoing litigation and transition planning, as well as salaries for a few key employees.

The expenses break down as follows:

Regulatory and Legal

$5,000,000

Detailed Design

$4,500,000

SUBTOTAL

$9,500,000

30% Contingency

$2,800,000

SUBTOTAL

$12,300,000

Staffing Expenses

$4,200,000

TOTAL

$16,500,000

In more detail, what will this fund?

The city’s third application to the Public Utility Commission - the regulatory body that will decide whether to approve the electrical facilities that the city will acquire - introduced the concept of a “go/no-go” decision. The go/no-go is a decision milestone for the council to determine whether to move forward with the creation of the utility or take an off-ramp. Because the city will have completed condemnation and received bids for the construction to separate from Xcel, the city would know the total costs of acquisition, transition and separation. Staff anticipates that the go/no-go decision will occur in 2019 or 2020.

Based on the Commissioner’s preliminary rulings, the city will be allowed to continue exploring those items necessary to get to the point of the go/no-go decision, the city will need to fund staffing and litigation costs. This funding will allow the city to take three necessary steps toward municipalization: 

  1. The effort to acquire the assets would proceed, with appraisals, offers and potentially litigation to determine the costs of acquisition.
  2. An application would be made to Xcel, through its FERC (Federal Energy Regulatory Commission) regulated OATT (Open Access Transmission Tariff), to allow the city utility to connect to Xcel’s transmission network. This process is necessary for the substation engineering portion of the costs of separation.
  3. City engineers would work with Xcel and a third-party engineer to perform the detailed design and specification work necessary to be able to solicit bids for the separation construction. This process is necessary to determine the costs of separation of the distribution portion of the system. 

Staff projects that the final decision about whether to proceed to separate the distribution systems will occur in 2019 or 2020. 

Total funding necessary to reach the go/no go decision in 2020 would be approximately $16.5 million.

The regulatory and legal expenses included are associated with current and future proceedings before the Public Utilities Commission, the condemnation proceeding before the District Court. The significant contingency amount is necessary based on the difficulty of estimating costs, to be prepared in the event of appeals of any of the decisions, and any potential stranded cost proceedings before the Federal Energy Regulatory Commission.

 


Ballot Question 2P: Extending council’s authority to hold executive sessions to discuss legal strategy related to municipalization

Ballot Language

Shall Section 9 of the Charter be amended pursuant to Ordinance 8202 to:

(1) amend the requirements for notices of executive sessions regarding legal advice and negotiation strategy regarding municipalization to align processes more closely with state law;

(2) prohibit any discussions about negotiating a franchise or other settlement discussions that would terminate Boulder's effort to operate an independent municipal electric utility; and

(3) extend the authority to hold executive sessions until December 31, 2023?

For the Measure ____ Against the Measure ____

Read Ordinance 8202 for more information.

 

What it means

In 2014, Boulder voters gave City Council the authority to conduct meetings in private to discuss legal strategy related to municipalization. This authority is set to expire at the end of 2017.

If passed, this measure would extend council’s authority to conduct executive sessions until 2023 with a few modifications:

  • Council would not be permitted to discuss franchise agreements (agreements with Xcel Energy) in private; these discussions would occur in regular public meetings, or by confidential attorney-client means like confidential memos or one-or-two-person meetings.
  • The charter section would include language from state law regarding notices.

What happens in executive sessions?

Council uses executive sessions to discuss legal strategy related to municipalization. They are not permitted to vote or make decisions in meetings; however, they can seek legal advice from the City Attorney’s Office.

How often does council meet in executive session?

Unlike regular meetings, there is not set schedule for executive sessions. On average, council meets about once per quarter in executive sessions. These meetings are noticed publicly.

Could council still discuss legal matters related to municipalization in private without executive sessions?

Yes, council members could meet with staff from the City Attorney’s Office, but would be limited to groups of one or two. They would not be permitted to meet in private in groups larger than two council members. This makes it more challenging for council members to hear questions from their council colleagues – and to get the same responses from attorneys.

Does council have the authority to meet in executive session to discuss any other city issue?

No.

 


Ballot Question 2O: Amending the charter to ensure final voter approval prior to issuing bonds ​

Ballot Language

Shall Section 178 of the Charter be amended pursuant to Ordinance 8193 to require a vote at a general or special election prior to the enterprise incurring debt for construction to separate the existing utility system for the City to provide electricity to customers of the City by a separate system.

For the Measure ____ Against the Measure ____

Read Ordinance 8193 for more information.

What it means

If City Council decides to move forward with this project and issue debt to acquire assets and fund the start up of a local electric utility, it would be required to seek the approval of voters during an election first. 

What is the "go/no-go" decision?

Council has used the term “go/no-go” to describe the point in time where the city will have sufficient information to decide whether to move forward with the electric utility. Over the next two to three years, the city anticipates gaining clarity on separation construction costs, the costs associated with acquisition of Xcel’s electric assets and transition costs to stand-up an electric utility.

If the city reaches this point, voters will make the final “go/no-go” decision on whether to proceed with creating a municipal electric utility.

When can I anticipate being asked to make a "final voter approval"?

City staff anticipate reaching the “go/no-go” decision point in 2019 or 2020. 

 


Contact Us

Address Phone Email Executive Director

1101 Arapahoe Ave.

Boulder, CO 80302

303-441-3274

[email protected]

Heather Bailey

[email protected]

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