54-9-103 - Public power entity authority regarding common facilities -- Determination of needs -- Agreement requirements -- Ownership interest.
54-9-103. Public power entity authority regarding common facilities --Determination of needs -- Agreement requirements -- Ownership interest.
(1) (a) Notwithstanding Title 11, Chapter 13, Interlocal Cooperation Act, and Subsection11-14-103(1)(b)(xi), and in addition to all other powers conferred on public power entities, apublic power entity may:
(i) plan, finance, construct, acquire, operate, own, and maintain an undivided interest incommon facilities;
(ii) participate in and enter into agreements with one or more public power entities orpower utilities; and
(iii) enter into contracts and agreements as may be necessary or appropriate for the jointplanning, financing, construction, operation, ownership, or maintenance of common facilities.
(b) (i) Before entering into an agreement providing for common facilities, the governingbody of each public power entity shall determine the needs of the public power entity for electricpower and energy based on engineering studies and reports.
(ii) In determining the future electric power and energy requirements of a public powerentity, the governing body shall consider:
(A) the economies and efficiencies of scale to be achieved in constructing or acquiringcommon facilities for the generation and transmission of electric power and energy;
(B) the public power entity's need for reserve and peaking capacity, and to meetobligations under pooling and reserve sharing agreements reasonably related to the needs of thepublic power entity for power and energy;
(C) the estimated useful life of the common facilities;
(D) the estimated time necessary for the planning, financing, construction, andacquisition of the common facilities and the estimated timing of the need for an additional powersupply; and
(E) the reliability and availability of existing or alternate power supply sources and thecost of those existing or alternate power supply sources.
(2) (a) Each agreement providing for common facilities shall:
(i) contain provisions not inconsistent with this chapter that the governing body of thepublic power entity determines to be in the interests of the public power entity, including:
(A) the purposes of the agreement;
(B) the duration of the agreement;
(C) the method of appointing or employing the personnel necessary in connection withthe common facilities;
(D) the method of financing the common facilities, including the apportionment of costsof construction and operation;
(E) the ownership interests of the owners in the common facilities and other propertyused or useful in connection with the common facilities and the procedures for disposition of thecommon facilities and other property when the agreement expires or is terminated or when thecommon facilities are abandoned, decommissioned, or dismantled;
(F) any agreement of the parties prohibiting or restricting the alienation or partition of theundivided interests of an owner in the common facilities;
(G) the construction and repair of the common facilities, including, if the parties agree, adetermination that a power utility or public power entity may construct or repair the commonfacilities as agent for all parties to the agreement;
(H) the administration, operation, and maintenance of the common facilities, including, ifthe parties agree, a determination that a power utility or public power entity may administer,operate, and maintain the common facilities as agent for all parties to the agreement;
(I) the creation of a committee of representatives of the parties to the agreement;
(J) if the parties agree, a provision that if any party defaults in the performance ordischarge of its obligations with respect to the common facilities, the other parties may performor assume, pro rata or otherwise, the obligations of the defaulting party and may, if the defaultingparty fails to remedy the default, succeed to or require the disposition of the rights and interestsof the defaulting party in the common facilities;
(K) provisions for indemnification of construction, operation, and administration agents,for completion of construction, for handling emergencies, and for allocation of output of thecommon facilities among the parties to the agreement according to the ownership interests of theparties;
(L) methods for amending and terminating the agreement; and
(M) any other matter, not inconsistent with this chapter, determined by the parties to theagreement to be necessary and proper;
(ii) clearly disclose the ownership interest of each party;
(iii) provide for an equitable method of allocating operation, repair, and maintenancecosts of the common facilities; and
(iv) be approved or ratified by resolution of the governing body of the public powerentity.
(b) A provision under Subsection (2)(a)(i)(F) in an agreement providing for commonfacilities under this Subsection (2) is not subject to any law restricting covenants againstalienation or partition.
(c) Each committee created under Subsection (2)(a)(i)(I) in an agreement providing forcommon facilities under this Subsection (2) shall have the powers, not inconsistent with thischapter, regarding the construction and operation of the common facilities that the agreementprovides.
(d) (i) The ownership interest of a public power entity in the common facilities may notbe less than the proportion of the funds or the value of property supplied by it for the acquisition,construction, and operation of the common facilities.
(ii) Each public power entity shall own and control the same proportion of the electricaloutput from the common facilities as its ownership interest in them.
(3) Notwithstanding any other provision of this chapter, an interlocal entity may not actin a manner inconsistent with any provision of the agreement under which it was created.
Amended by Chapter 306, 2007 General Session