City Charter - Chapter XIV

Utilities, Franchises and Permits

Section 14.1. General powers.

The city shall possess and hereby reserves to itself all the powers granted to cities by law to acquire, construct, own, operate, improve, enlarge, extend, repair, maintain, encumber, convey, dispose of or sell, either within or without its corporate limits, public utilities, including, but not by the way of limitation, aeronautical facilities, cemeteries, hospitals and public utilities for treating and supplying water and for supplying light, heat, power, gas, sewage treatment, garbage disposal, public transportation and facilities for the storage and parking of vehicles; and also to sell and deliver the products or services thereof, both within and without its corporate limits, subject to the limitations herein contained. The power to supply said utility services, as herein possessed and reserved, shall include the power to extract, process, manufacture, transport or purchase the same from others.

Section 14.2. Administration of municipally owned and operated utilities.

All municipally owned and operated utilities shall be administered as a regular department of the city government under the management and supervision of the city manager.

Section 14.3. Utility rates.

The council shall have power to fix such just and reasonable rates as may be deemed advisable for supplying the inhabitants of the city and others with such public utility services as the city may provide. There shall be no discrimination in such rates within any classification of users thereof, nor shall free service be permitted, but higher rates may be charged outside the corporate limits of the city.

Section 14.4. Ordinances for collection of public utility charges.

The council shall provide by ordinance for the collection of all public utility charges of the city. The ordinance shall provide at least:

1. That the city shall have as security for the collection of such utility charges a lien upon the real property supplied by such utility. The lien shall become effective immediately upon the supplying of the utility service and shall be enforced in the manner provided in the ordinance.
2. The terms and conditions under which utility services may be discontinued in case of delinquency in paying such charges.
3. That suit may be instituted by the city before a competent tribunal for the collection of such charges.
4. With respect to the collection of charges for utilities, the city shall have all the powers granted to cities by law.

Section 14.5. Disposal of utility plants and property.

Unless approved by the affirmative vote of three-fifths of the electors voting thereon at a regular or special election, the city shall not sell, exchange, lease or in any way dispose of any property, easements, equipment, privilege or asset belonging to and appertaining to any municipally owned public utility which is needed to continue operating such utility. All contracts, negotiations, licenses, grants, leases or other forms of transfer in violation of this section shall be void and of no effect as against the city.

The restrictions of this section shall not apply to the sale or exchange of any articles of machinery or equipment of any city owned public utility which are worn out or useless or which have been, or could with advantage to the service, be replaced by new and improved machinery or equipment, to the leasing of property not necessary for the operation of the utility, or to the exchange of property or easements for other needed property or easements. The provisions of this section shall not extend to the vacation or abandonment of streets, as provided by the statute.

Section 14.6. Accounts and finances of public utility.

Separate accounts shall be kept for each public utility owned and operated by the city. Such accounts shall be classified and made in accordance with generally accepted municipal utility accounting practice. Charges for all services furnished to, or rendered by, other city departments or agencies shall be recorded. An annual report shall be prepared to show fairly the financial position of the utility and the results of its operations which report shall be on file in the office of the clerk for inspection.

Section 14.7. Public utility franchises – Granting.

1. Public utility franchises and all renewals, and extensions thereof and amendments thereto shall be granted only by ordinance. No franchise shall be granted for a longer period than thirty (30) years.
2. No franchise ordinance which is not subject to revocation at the will of the council shall be enacted nor become operative until the same shall have first been referred to the people at a regular or special election and received the affirmative vote of three-fifths of the electors voting thereon. No such franchise ordinance shall be approved by the council for referral to the electorate before thirty (30) days after application therefore has been filed with the council nor until a public hearing has been held thereon, nor until the grantee named therein has filed with the clerk his unconditional acceptance of all the terms of such franchise. No special election for such purpose shall be ordered unless the expense of holding such election, as determined by the council, shall have been first paid to the treasurer by the grantee.
3. A franchise ordinance, or renewal or extension thereof, or amendment thereto, which is subject to revocation at the will of the council may be enacted by the council without referral to the voters, but shall not be enacted unless it shall have been complete in the form in which it is finally enacted and shall have so been on file in the office of the clerk for public inspection for at least four weeks after publication of a notice that such ordinance is on file.

Section 14.8. Same – Conditions.

All public utility franchises granted after the adoption of this Charter, whether it be so provided in the granting ordinance or not shall be subject to the following rights of the city, but this enumeration shall not be exclusive or impair the right of the council to insert in such franchise any provision within the power of the city to impose or require:

1. To repeal the same for misuse, non-use, or failure to comply with the provisions thereof;
2. To require adequate extension of plant and service and maintenance thereof at the highest practicable standard of efficiency;
3. To establish reasonable standards of service and quality of products and prevent unjust discrimination in service or rates;
4. To require continuous and uninterrupted service to the public in accordance with the terms of the franchise throughout the entire length thereof;
5. To use, control, and regulate the use of its streets, alleys, bridges and other public places and the space above and beneath them;
6. To impose such other regulations as may be determined by the council to be conducive to the safety, welfare and accommodation to the public.

Section 14.9. Same – Provisions for rates, fares and charges.

All public utility franchises shall make provision therein for fixing rates, fares and charges, and may provide for readjustments thereof at periodic intervals. The value of the property of the utility used as a basis for fixing such rates, fares and charges shall in no event include a value predicted upon the franchise, goodwill or prospective profits.

Section 14.10. Use of public places by utilities.

Every public utility shall pay such part of the cost of improvement or maintenance of streets, alleys, bridges and other public places as shall arise from its use thereof and shall protect and save the city harmless from all damages arising from said use. Every such public utility may be required by the city to permit joint use of its property and appurtenances located in the streets, alleys and other public places of the city by the city and other utilities insofar as such joint use may be reasonable practicable, and upon payment of reasonable rental therefore. In the absence of agreement and upon application by any public utility, the council shall provide for arbitration of the terms and conditions of such joint use and the compensation to be paid therefore.

Section 14.11. Temporary permits.

Temporary permits for public utilities, revocable at any time at the will of the council, may be granted by the council by resolution on such terms and conditions as it shall determine, provided that such permits shall in no event be construed to be franchises or amendments to franchises. All temporary permits shall be subject to the rights of the city to make independent audit and examination of accounts at any time and to require reports annually or at more frequent intervals as prescribed by resolution of the council. When the council deems it in the public interest, such permits may be exclusive.

Section 14.12. Existing franchises and permits.

All franchises and permits to which the City of Fremont is a party when this Charter becomes effective shall remain in full force and effect.

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