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2013-344ORDINANCE NO. 2013-3� AN ORDINANCE OF THE CITY OF DENTON, TEXAS AUTHORIZING AND APPROVING A MEMORANDUM OF UNDERSTANDING BY AND BETWEEN THE CITY OF DENTON, TEXAS AND MESQUOAKEE, LLC, A TEXAS LIMITED LIABILITY COMPANY FOR THE PROVISION OF ELECTRIC SERVICES FOR THE DEVELOPMENT KNOWN COMMONLY AS THE HILLS OF DENTON; PROVIDING THE CITY MANAGER WITH AUTHORITY TO PERFORM SAID MEMORANDUM OF UNDERSTANDING AND TO EXPEND FUNDS AS NECESSARY; PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, COMPASS BANK, the former owner of the said real property commonly known as the "Hills of Denton" to MESQUOAKEE, LLC, a Texas Limited Liability Company (hereafter "MLLC") which has plans to develop the said real property known generally as the "Hills of Denton," MLLC has requested that the City further enter into this Memorandum of Understanding and the City has conditioned its agreement upon the simultaneous approval by the City Council of that certain agreement entitled as the "Third Extension to the Agreement by and between the City of Denton, Texas and Denton 288, L.P." for water and wastewater services to said development (hereafter the "Third Extension);" and WHEREAS, the City is of the opinion that the above Memorandum of Understanding is in the best interests of the City and provides for the measured electric service growth of a new potential large development north of the City of Denton, and further that a valid governmental purpose is served by said Memorandum of Understanding; NOW THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. The recitations and factual statements contained in the Preamble of this �m ...............� ordinance are true and correct and are deemed to be a part of this Ordinance. SECTION 2. The City Manager, or his designee, is hereby authorized to execute a "Memorandum of Understanding by and between the City of Denton, Texas and Mesquoakee, LLC" ("MOU") providing for the development of electric services; such MOU being in substantially the form of the document which is attached hereto and made a part of this ordinance for all purposes; as well as to exercise all rights and duties of the City of Denton, Texas under the MOU. SECTION 3. The City Manager, or his designee, is hereby authorized to expend funds as necessary as provided for in the MOU. SECTION 4. This ordinance is effective on the date of approval thereof. PASSED AND APPROVED this the �,�� m� day of �, �� '�, 2013. 1 � � �/ m � � � � �`� �..:., �� ,� �� I�.. � � .F3 � �� `t..� �� H �, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY ,,4, � � � � By; ,��, � � �� ,.� � �� w � ... .. � � _.... � 1' � f� �' � � � � �[ �7 LEGAL FORM: ANITA BURGESS, CITY ATTORNEY �� ° � � � � r 4 �',r� � . BY� .�� . . �� ...��::.::°' !� l ... � �..... mm.... Page 2 ALAN W. TOMPKINS PRESIDENT & GENERAL COUNSEL r L 1601 ELM STREET, SUITE 4000 DALLAS, TEXAS 75201 OFFICE: (214) 720-1600 FACS�M�LE: (214) 442-5553 November 26, 2013 Mr. Brent A. Heath, P.E. Executive Manager of Energy Delivery Denton Municipal Electric 1701 C. Spencer Rd. Denton, Texas 76205 Re. Memorandum af Understanding hy and between Denton Municipal Electric ("DME") and Mesquoakee, LLC ("Owner') regarding potentially furnishing Electric Utility 5ervice to the Hills of Denton. Dear Mr. Heath: The purpase of this letter agreement is to provide a memorandum of understanding between the parties hereto, relating to certain real property owned by Owner in Denton County, Texas, commonly known as the Hills of Dentan, described on Exhibit "A" hereto (the "Real Property" being an approxirnate 2,121 acre tract of land situated in Denton County, Texas (alter- natively, being hereafter referred to as the "Development"). This letter agreement describes the conceptual agreernents with respect to certain matters as described below between the parties, but nothing in this letter agreement is intended to create any binding legal obligations on either party hereto, until such time as fully documented agreements are negotiated and executed by the parties and approved by the Denton City Council with respect to the matters described below. The effective date of this Memorandum of Understanding shall be the same date as the date that the Third Extension to the Agreement by and between the City of Denton, Texas and Denton 288, L.P. for the Provision of Sanitary Sewer and Water Facilities (attached hereto as Exhibit "E") is approved by the Dentan City Council" DME has expressed an interest in providing certain electric utility services to Owner with respect to the Development, and Owner is willing to work with DME to reach agreement on the manner and means by which such electric utility services would be provided to the De- velopment, and in connection therewith the parties hereby confirm their conceptual agreernent with respect to the following: 1. DME desires to acquire approximately eight (8) acres of the Real Property as depicted on Exhibit "B" as "Site 5" (the "DME Substation Tract"), for the construction and use by DME as an electrical utility substation. DME also desires to additionally obtain from Owner certain easements over the Real Property to and from the DME Substation Tract to facilitate access and use of the DME Substation Tract. DME is willing to provide certain reasonable and aesthetically pleasing landscaping buffer areas, berrns and fencing around the DME Substation Tract at DME's sole expense, the specific details of which have yet to be negotiated between the parties hereto. Owner is willing to negotiate with DME to finalize the terms of such acquisition and grant of easements relating to the DME Substation Tract, and the documentation to evidence such transactions, subject however, to finalizing the specific terms and conditions of the same and also subject to the other terms of this letter agreement. 2. Exhibit "C" attached hereto depicts the areas of the Real Property which are currently served by DME or Co-Serv Electric Cooperative ("CoServ") (in other words, are subject to dual certification by either DME or CoServ) with respect to providing electric utility services. DME desires to provide to Owner electric utility services over the portions of the Real Property depicted on Exhibit "C " as DME served areas, as well as those portions of the Real Property depicted on Exhibit "C" which are dually-certificated areas as well as certain portions of the Real Property depicted on Exhibit "C" as singly Co-Servi certificated service areas. The parties acknowledge that the consent and agreement of Co-Serv may be required in order to allow DME to provide utility services to all such areas of the Property, and Owner agrees that DME may discuss the terms and conditions upon which Co-Serv would so consent and approve the same. Once the City has determined whether or not a transaction regarding certification by and between the City and CoServ, may be reached, regarding the subject of certification for electric utility service with CoServ, then the City will be ready to move forward with an offer regarding electric service for all of the Real Property; or alternatively, for only that portion of the Real Property that is certificated by the City. The parties acknowledge that attached as Exhibit "D" is a letter from DME to Owner dated May 7, 2013 (the "DME Letter°), whereby DME made certain proposals to Owner with respect to providing electric utility service to the Real Property. Provided all such final terms and conditions arranged by DME and Co-Serv are fully disclosed to Owner and are acceptable to Owner (including without limitation the means and manner in which electric utility services are provided to the Real Property, which shall be at least those proposed in the DME Letter), then Owner agrees to elect DME as the sole electric utility provider for such areas so arranged by DME and so approved by Owner, subject however, to the parties negotiating the necessary documentation to fully describe the provision of a11 such electric utility services. 3. As described in the DME Letter, DME is willing to provide at its expense certain electric utility infrastructure improvements to those areas of the Real Property that DME will serve as utility provider as described in Section 2 above, and certain street lighting improvements (that will at a minimum satisfy all then current Denton Code requirements, which will include all poles, fixtures, controls, conduit, wiring and other electric equipment and devices), in exchange for Owner's conveyance of the DME Substation Tract to DME. Owner will grant to DME certain utility easements over the Real Property for the installation of such improvements. The parties have yet to reach final agreement on the specific details of the same and the timing of installation, but are willing to continue such negotiations subject to the other terms and condi- tions of this letter agreement. If this letter agreement sets forth your understanding of the general parameters and conditions upon which the parties hereto shall continue to discuss and negotiate further documents evidencing their final agreement to the itexns described herein, please execute this letter agreement below where indicated. Sincerely, MESQ�CI��I��, LLC, a Texas limited liability company : � Tom�.-�1c��s, � �a manager Apt�roved and acknowledged bY: THE CITY OF DENTON, TEXAS A TEXAS MUNICIPAL CORPORATION By: Denton Municipal Electric ap , _ +``�.., � � � � � �' 13y'. �' �.. : ��,_.�.�� m..�,�t�cr�_.. Phil iTl��, General Manager, DME �j� t � � �'� �� .l.'�;r �°� 4r��si�� . n ��t jiiy �. 5 � z � �� 3� �,�i `+ � ', � " � �� I ��' ��' � �� v �� E � �� =,:n�� J� ,�� ,� � ;� -=� �ig t ��r �' J. �A1'fia^ 5llrt tN•• ...'�� .•� ( �,�,� � �.,i _ __ . � r � I ( '�i �$ � s� " � � „� �§ � I � �� e �� ; a .y .. p� �r L'�'�.:-�-"_ µ��'I� �� `r �' �, �� { � � t � ; �� .. �� ri f . ^ $" f#k��'{ ' `" ` C��' r'.� ��pb�A'�� . . F.M. 31�� .� �i� a�>a'o�.�.a�.:s�� #�[�`��'��r��ie�i�i ; � ��r{#j��r� � {[[a�� ( �� ` �; [ � � `� �- an t°a �' s„ � �� 7`�p� '+��,�,,. r ��. � ' � �� e ' �r�. � �� ,�'�. 1�.+{i�_'~ P7 �`�,. � a�` ,y,�� t , �y,��,�. TM' F' ie'.} L A�4C� h�i �d �� , �$ �I _, eg� VY '� �.c„� � �'� ��. � r., ` �1 ° y„f`:, . N E � rx A cx� c.�� ..�. r �y � J 'S 3 " �a' �, �..„ S�} �, r ,a_ � � "° ' n �r �i r �` � a. ,� �" r� ' �— �–� � yy �}� �� , a � � �+ i�' #�' A,b'Mi'�i �li � 8 L � '.Y 4 ,� k � xy � e F � Y C.a � g� � S � K t 7`�. �,3� ,�,! '�' I [� �.,,y e.n ` � on '�. � r t. � �$y�P � �a � � �� PY r;}�` ,V � °�� a � s� s�d� ) k�� G' � ' ;�: �P* � �y �ki �`�'�' � '� i'f ,v . - � a ;��' �« ,� ra � +'� � . a -�, �.. ' .�, 4 � Y:s �. ,� +' ��y...�ak p,�.a ��w 8U , .�,u �c"!� ' ,^.�{ '�� t% ;..�"Fw _.-.W�� ' � 3 .,e., ., _...... .. .,...s.....w....,.— ......... ______ — . � .; ,,�,� �,�,� ��i�D TI�L� �11��E`f Piburn & Caason,LLC �+ »M1 HILLS OF DENTON .�.;�. �.ro.�rca °�`" `°`"'�` � 2120.3861 GROSS ACRES ' ��°`� " '� f ��.. s$c NPr['� NSarn �+ {�t �$ �U XkW ��: �$ir gg,y , ... ....w DENTON COUNiY, TEXAS �•�°"�°°�^°�* ��°^ r� —., t � t � � 3 �,� ud ! � ,�y,� , r� � r_y �{ " �r � ,�_ � �,�; ' .,.rr�"' �rs?.��.,, as n, � ��C?�q��. ,� , C yp ��,� ��.,�� ° �'' � � a. `'b� �`�' �` �� ' %�v � , ,�' r ,� �r � � � tF',i r�. �° �" .�9' �• { � �J � ,". kr v" t ) �.�5 .. !au /p � �` ,!� } �' �� '� I bf,r:'.�, !fl`` 'tr ° � ff, s t„ ',uyrr ��=� '' �`!:��d,�.,. �� , ;��, �„��$�� a ��„ �� _ DME Certification Areas for the Hills of Denton i � � I I I 1 ,___ �� . ,1 . �� , �,_.��. __ � � �; ; �,m .- r-��. � .� a«snuu�•wr.arounen �'- _ O Total Acres - 2146 DME Cert Acres 595.35 27.7% —�'°µ�°� DMEJCoServ CertAcres 962.19 44.9% `"''�� CoServCertAcres 588.62 27.4% Acres In Red __ —_.. ,�. i � � I h ?�,.�W��= T:sz`q� �r',.,!BJ` �, ;� .� �� .. �� ,: _ _._ .�� I � � a p � Ij I ! � : —.�__. 1 � p 1 � t� t.�ti � � � �i j � ,i 1 � i _.—._ ... ...., w.,. ...... J � I i ..'. � �.. -� � _ -"- � .� ��_ EXHIBIT 4 �. � I �� 1659 ��r��r° Road l•:�re��fze�a� t�e�ar�r°�°aaro�� °s ��sarara�a�raf#a° t�a��a��;' __ - L�cr�ltart, 1 c�x�a.� 7��f�.� May 7, 2013 Robert R. Harper, III Real Estate Investment and Development Manager Unity Hunt, Inc. 1601 Elm Street, Suite 4000 Dallas, Texas 75201 Re: Hills of Denton Dear Mr. Robert R. Harper, III: Denton Municipal Electric (DME) would like to thank you for this opportunity to provide seivice information for your property located on the northwest corner of Locust Road and Loop 288. The information that you provided shows there are over 2,120 acres of developable land with uses including single family, townhome, multi-family, commercial, office/commercial, town center commercial, and town center residential. The proposed development plan shows the property to be developed over seven different phases. The Public Utility Commission of Texas electric utility certification for this development includes land that is contained within three different classifications of PUC cei�tification: single certified to DME, dually certified to DME and CoServ, and single certified to CoSeiv. DME can serve approximately 73% of the total area encompassed by your proposed development plan which includes all of the land uses previously mentioned. Based on the Hills of Denton Development Plan Map we were provided, DME has developed a draft plan to extend electric service to all portions of the development that DME can serve. The draft plan includes DME serving the interior of the entire development with an underground electric distribution system. Due to the large development area, installation of overhead circuits will be required along portions of the development perimeter to be able to provide a reliable and robust system. DME will install looped distribution circuits that have multiple ties and service points that will benefit your development and tenants. Service to each phase of the development is proposed to be provided with underground distribution utilizing current DME design and planning standards for each of the different proposed development uses. DME will install its electric primary and secondary voltage cables and conductors, transformers, switchgears, and other associated equipment in developer provided easements and not along public rights-of-way. Required easements will be worked out in mutually beneficial locations with the developer and shall be provided by the developer at no additional cost to DME. From our recent discussions DME is willing to exchange, in-kind, the developer paid street lighting cost for the land proposed for a new DME substation site. A number of substations sites have been reviewed and DME is agreeable to substation site #5 — which has been indicated as your preferred substation site. The DME substation site will be approximately 8 acres in size to accommodate the substation footprint and surrounding landscaped buffer areas described below. The substation site will include landscaped areas exterior to a 10 foot tall decorative fence. DME will work with you on possibly implennenting an aesthetically pleasing berm as you requested on or near the perimeter of the substation property. Again, DME thanks you for this opportunity to provide information related to providing electric and street lighting service to the Hills of Denton. When you are ready to start your development, our Engineering and Operations departments are ready to work with you and your development personnel to layout and provide reliable service to your development. Should you have any questions, or need additional information, please do not hesitate to contact me. Sincerely, Brent A. Heath, P.E. ^ .LJ�� i�I�a�C Executive Manager Energy Delivery Denton Municipal Electric 940-349-7180 Brent.Heath@cityofdenton.com