AN ORDINANCE, GRANTING TO NEMAHA-MARSHALL ELECTRIC COOPERATIVE ASSOCIATION, INC., A KANSAS NOT FOR PROFIT RURAL ELECTRIC COOPERATIVE CORPORATION, ITS SUCCESSORS AND ASSIGNS, AN ELECTRIC FRANCHISE, AND PRESCRIBING THE TERMS THEROF AND RELATING THERETO.

BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF MARYSVILLE, KANSAS

SECTION 1. That in consideration of the benefits to be derived by the City of Marysville, Kansas (“City”), and its citizens and its habitants, there is hereby granted to Nemaha-Marshall Electric Cooperative Association, Inc., (“Nemaha-Marshall” or “Company”), said Company being a Kansas not for profit corporation, the right, privilege, and authority for a period of twenty (20) years from the effective date of this ordinance, to occupy and use the several streets, avenues, alleys, bridges, parks, parking facilities, public utility easements and public places of the City, for the placing and maintaining of equipment and property necessary to carry on the business of selling and distributing electricity for all purposes to the City and its citizens and inhabitants, and through said City and beyond the limits thereof; to obtain said electricity from any source available; and to do all things necessary or proper to carry on said business in the City of Marysville, Kansas. Provided, such use and occupation of the several streets, avenues, alleys, bridges, parks, parking facilities, public utility easements and public places shall be in such manner as to incommode the public the least. Provided, further, all poles and wires shall be so placed, maintained and used as to not interfere with the rights of other wire using companies lawfully authorized to use the said streets and public places.

SECTION 2. As further consideration for the granting of this franchise, and in lieu of any city occupation, license, or revenue taxes, the Company shall pay to the City during the term of this franchise five percent (5%) of its gross cash receipts from the sale of electric current and energy to users within the corporate limits of said City, such payment to be made monthly for the preceding monthly period. The Company shall furnish to the City a statement showing its total gross receipts from the sale of electric current and energy to users within the limits of City during said period. The governing body of said City shall have the right to examine the books and records of the Company sufficient to verify said statement.

Gross cash receipts shall not include other operating revenues received by the Company, which are not related to the “sale of electricity”. These include, but are not limited to, delayed payment charges; connection disconnection, reconnection, and collection fees; return check charges; customer project contributions; and temporary service charges. The City retains the right at the end of the 5th year, 10th year and 15th year of this franchise to renegotiate the rate of the franchise fee upon giving notice of its intent to do so at least 120 days prior to the expiration of each term. The payments and compensation herein provided shall be in lieu of all other licenses, taxes, charges, and fees, except that the usual general property taxes and special ad valorem property assessments, sales and excise taxes or charges made for privileges which are not connected with the electric energy business.

SECTION 3. That Company, its successors and assigns, in the construction, maintenance, and operation of its electric transmission, distribution and street lighting system, shall use all reasonable and proper precaution to avoid damage or injury to persons and property, and shall hold and save harmless the City from any and all damage, injury or expense caused by the negligence of the Company, its successors and assigns, or its agents or servants. The Company shall obtain such permits prior to commencing work in the streets, avenues, alleys, bridges, parks, parking facilities and public places as the City may from time to time require. Any street lighting system shall be subject to any lawful ordinance(s) of the City of Marysville, passed by said City in the reasonable exercise of its police powers.

SECTION 4. If any action, either at law or equity, be brought against the City in any court for damages or for any cost or expense to the City for the fault, negligence or omission of the Company in doing or failing to do all things necessary or required by this franchise, the Company, its successors or assigns shall pay all costs, damages and expenses for which said City may be held liable or be incurred by said City; the Company shall save and hold harmless the City of Marysville from any of such costs, damages and expenses.

SECTION 5. The Company shall promptly locate, remove, relocate, or adjust any Facilities located in the right-of-way, City’s easements, or platted utility easements which contain City utilities or facilities if reasonably necessary and requested by the City for a Public Project. Such location, removal, relocation, or adjustment for a particular Public Project shall be performed by the Company without expense to the City, its employees, agents, or authorized contractors, and shall be specifically subject to rules and regulations of the City pe1iaining to such.

The Company, it successors or assigns, in the construction, maintenance including without limitation, tree trimming, and operation of its electric transmission, distribution and street lighting system, shall use reasonable and proper precaution to avoid damage or injury to persons or property. In making any and all excavations and other work and improvements and in exercising any rights or privileges under this franchise, the same shall be done in accordance with the lawful ordinances of the City of Marysville, passed by said City in the reasonable exercise of its police powers.

SECTION 6. That Company will obtain approvals from the Kansas Corporation Commission (“Commission”), only as may be required by law, of any arrangement existing under this ordinance. It is the right and responsibility of the Company to determine what regulatory application and approvals may, or may not be, necessary.

SECTION 7. Within twenty (20) days from and after the passage and approval of this ordinance, Company shall file with the City Clerk of the City of Marysville, Kansas, its unconditional written acceptance of this ordinance. Said ordinance shall become effective and be in force and shall be and become a binding contract between the parties hereto, their successors and assigns, from and after the expiration of sixty (60) days from its final passage, approval and publication as required by law, and acceptance by the Company.

SECTION 8. That this ordinance, when accepted as above provided, shall constitute the entire agreement between the City and Company relating to this franchise and the same shall supersede and cancel any prior understandings, agreements, or representations regarding the subject matter hereof, or involved in negotiations pertaining thereto, whether oral or written. /

SECTION 9. This franchise is granted pursuant to the provisions of K.S.A. 12- 2001. Nothing in this ordinance shall be construed as granting to the Company, its successors or assigns, the exclusive use of any right-of-way, street, or alley for the purposes or uses named in this ordinance or any exclusive franchise, privilege or right whatsoever. In case of failure on the part of the Company, its successors or assigns, to comply with any of the provisions of this ordinance, or if the Company, its successors or assigns, shall do or cause to be done any act or thing prohibited by or in violation of the terms of this grant, then upon such finding by a court of competent jurisdiction, the Company, its successors or assigns, shall forfeit all rights and privileges granted herein and this franchise and all rights thereunder shall terminate. Provided, that such cause for forfeiture of this franchise shall continue uncorrected for a period of sixty (60) days after written notice from the governing body of the City to comply with the provisions of this ordinance.

SECTION 10. Should any regulatory commission, or any other governmental agency or unit having control or jurisdiction over the Company, take any action with respect to this: franchise ordinance, which would or may preclude the Company from recovering from its customers any cost provided for hereunder, the parties shall renegotiate -this ordinance in accordance with the administrative ruling and any appeal thereof. Upon written request of either the City or the Company, the franchise shall be reopened and renegotiated at any time upon any of the following events:

a. Change in federal, state, or local law, regulation, or order which materially affects any rights or obligations of either the City or the Company, including but not  limited to the scope of the grant to the Company or the compensation to be received by the City; or

b. Change in the structure or operation of the electrical energy industry which materially affects any rights or obligations of either the City of the Company, including by not limited to the scope of the grant to the Company or the compensation to be received by the City; or

c. Any other material and unintended change or shift in the economic benefit to the City or a change the Company did not anticipate upon accepting the grant of this Franchise.

SECTION 11. This Franchise shall be assignable only in accordance with the laws of the State of Kansas, as the same may exist at the time when any assignment is made. If any clause, sentence, or section of this Franchise shall be held to be invalid, it shall not affect the remaining provisions of this Franchise. This Franchise shall be construed according to the laws of the State of Kansas.

SECTION 12. Upon termination of this Franchise, whether by lapse of time, by agreement between the Company and City, or by forfeiture, the City shall have the right to purchase Company’s facilities if and as provided by the provisions of K.S.A. 12-811, 66-1,176 and 66-1,176b, where and as may be applicable. In the event the City elects not to exercise its right to purchase the Company’s facilities and equipment according to the provisions of the applicable statutes, the Company shall have the right to remove any and all of its facilities and equipment used in its business within a reasonable time after expiration, but in such event, it shall be the duty of the Company, immediately upon and during the removal; (a) to cooperate with the City and its agents to permit the installation of all necessary facilities and other equipment necessary or convenient for the provision of electric energy to residents of the City; and (b) to restore the streets, avenues, alleys, parks, and other public ways and grounds from which said facilities and other equipment have been removed, to the equivalent condition as they were before the removal was effected.

SECTION 13. The words and terms as used herein shall have the following meanings:

Public Improvement shall mean any existing or contemplated public facility, building, or capital improvement project, financed by the City, including without limitation, streets, alleys, sidewalks, sewer, water, drainage, Right-of-way improvement, and Public Projects.

Public Project shall mean any project planned or unde1iaken and financed in whole or in paid by the City of any governmental entity for construction, reconstruction, maintenance, or repair of public facilities or improvements, or any other purpose of a public nature paid for with public funds.

Public Project for Private Development shall mean a Public Project, or that portion thereof, arising solely from a request or requirement of a third party primarily for the benefit and us of a third party.

Right-of-Way shall mean present and future streets, alleys, rights-of-way, and public easements, including easements dedicated to the City in plats of the City for streets and alleys.

(08-22-2016)