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Public Policy Newsletter Article

San Diego City Council Moves forward on New Franchise Agreement, Traffic Mitigation Requirements

  • 2020-07-30T15:00:00.000+0000
  • San Diego
  • Author: Melanie Cohn

At Biocom’s San Diego Facilities Committee meeting on July 23rd, city representatives joined us to give presentations on San Diego’s new gas and electric franchise agreement, and the city’s Complete Communities program.

San Diego Gas & Electric has been the sole provider of natural gas and electric utility services for San Diego since 1920. The current franchise agreement, finalized in 1970, is set to expire in January. San Diego is California’s largest city to have franchise agreements with its utilities.

City Council’s July Environment Committee meeting included consultant recommendations for a new franchise agreement: a minimum bid in the terms should be $62 million, franchise fees should be 3.5% for natural gas and 3% for electric with a 20-year term for the bidder the city chooses, and if a new franchise agreement is not feasible, the city should consider municipalization.

The next step will be releasing the terms of the franchise agreement as an invitation to bid. In August, the city with gather those bids and prepare to bring them in front of the full council.

The Complete Communities initiative is a broad proposal to change how the city plans housing, transit, parks, and other amenities. The goal of the program is to create additional affordable and other housing close to transit and amenities in accordance with the city’s Climate Action Plan.

Staff from the city’s Planning Department joined our committee meeting to discuss the mobility choices and housing components of Complete Communities. Most notable for our members, the mobility choices element includes a change from Level of Service (LOS) to Vehicle Miles Traveled (VMT) for calculating traffic impacts of new developments. New state legislation requires this change; whereas LOS counted traffic delay, the new VMT metric measures overall auto use. A new fee structure will be imposed on projects not located near transit to fund amenities in underserved communities.

Complete Communities is scheduled to go to City Council for a final vote in September.