ADMINISTRATIVE REPORT



                                     Date: October 10, 1995
                                     Dept. File No. 120 616(5003)


   TO:       Vancouver City Council

   FROM:     General Manager of Engineering Services 

   SUBJECT:  Agreement for Gas Main on Burrard Bridge


   RECOMMENDATION

        THAT  the City  enter  into  an  agreement  with  BC  Gas  for  the
        installation  and  maintenance of  a new  gas  main on  the Burrard
        Bridge on terms  and conditions satisfactory to the  City's General
        Manager of Engineering  Services and the Director of Legal Services
        and  that the Director of  Legal Services be  authorized to execute
        such an agreement on behalf of the City.

   COUNCIL POLICY

   Legal  agreements  regarding  major  utility  rights-of-way  are  to  be
   approved by Council

   PURPOSE

   This report  seeks Council's approval for the City to enter into a legal
   agreement with BC Gas for the gas main on the Burrard Bridge.

   BACKGROUND

   The  existing 12-inch  diameter high  pressure gas  main on  the Burrard
   Bridge  is located there pursuant to  an agreement dated in 1955 between
   the City and B.C.  Electric Company.   This agreement has since  expired
   and the successor to B.C.  Electric, BC Gas, now wish to rebuild the gas
   line to maintain its functional adequacy.

   Although there  is a  general agreement  in place with  BC Gas  to cover
   their facilities in the city, staff are negotiating a separate agreement
   for  the Burrard Bridge, wherein  BC Gas would  assume all related costs
   and liabilities  for the  new gas  line and indemnify  the City  for all
   costs related to their use of the bridge for a term of 30 years.





   COMPENSATION TO THE CITY

   At the  June 27,  1995  meeting, Council  directed that  this report  be
   deferred pending  a review of the  issue of fees in  connection with the
   proposed agreement with BC Gas.

   The  issue  of fees  has been  reviewed  by Engineering  Services staff.
   Based  on this  review, it is  recommended that  BC Gas  be permitted to
   construct and maintain the new gas main on the bridge without paying the
   City a fee.  The reasons are as follows:

   1.   By  indemnifying the  City  for all  liabilities  the agreement  in
        itself represents a significant benefit to the City.

   2.   The City does  not incur any  costs related to  the bridge and  its
        maintenance as a result of the gas main.

   3.   BC Gas do  not pay any  fees on their  facilities elsewhere in  the
        city.   However, they do  pay the City about  $1.7 M annually  as a
        grant-in-lieu of taxes based on their gross revenue.

   4.   A fee  on  the Burrard  Bridge may  cause BC  Gas to  apply for  an
        increase  in its  regulated rates,  which if  approved by  the BCUC
        would pass payment of the fee on to consumers in Vancouver.

   CONCLUSION

   The  General Manager of Engineering  Services recommends that  BC Gas be
   permitted to  rebuild and maintain the  gas line on the  Burrard Bridge,
   subject  to entering into an  agreement satisfactory to  the Director of
   Legal Services and the General Manager of Engineering Services.

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