WHEREAS,the Town is authorized to grant the right to build and operate gas works to a person and to authorize such person to charge and collect from customers such rent as may be agreed upon, and to enter into a contract with such persons to supply the municipality with gas and heat, and to pay therefore such sums as may be agreed upon between the parties, pursuant to C.R.S. § 31-15-707(1)(c); and


WHEREAS, any such franchise giving or granting to any person the right or privilege to erect, construct, operate or maintain gasworks, gas plant or system within the City or to use the streets or alleys of the City for such purpose shall be granted by ordinance, pursuant to C.R.S. § 31-32-101; and


WHEREAS, the Town previously granted a franchise to Atmos Energy Corporation (“Atmos”) to supply those residing within the Town with gas and heat, which franchise expires on September 7, 2015; and


WHEREAS, Atmos has requested the Town Board of Trustees grant a new franchise so that it may continue to supply Town residents with gas and heat; and


WHEREAS, the Town and Atmos have agreed to the terms upon which the parties will enter into a franchise agreement for the provision of gasworks, gas plant or systems, as more fully set forth herein; and


WHEREAS, Atmos has caused all notices required by law to be published, and this ordinance has been introduced and read before final passage as required by law; and


WHEREAS, the Town Board of Trustees finds and declares that an emergency exists requiring this ordinance to become effective upon final reading and adoption because it is in the best interest of the public health, welfare, peace and safety of the citizens of the Town for the term of the franchise granted herein to begin immediately upon expiration of the current franchise term.




Section 1.       Chapter 5, Article III of the Keenesburg Municipal Code, Gas Franchise, is hereby repealed and re-enacted to read as follows:



Gas Franchise


Sec. 5-3-10.    Definitions.


For the purpose of this franchise, the following words and phrases shall have the meaning given in this Article. When not inconsistent with the context, words used in the present tense include the future tense, words in the plural number include the singular number and words in the singular number include the plural number. The word "shall" is mandatory and "may" is permissive. Words not defined in this Article shall be given their common and ordinary meaning.


Board or Town Board refers to and is the legislative body of the Town of Keenesburg.


Company refers to and is Atmos Energy Corporation, a Texas and Virginia corporation, and its successors and assigns.


Distribution Facilities refer to and are only those facilities reasonably necessary to provide gas within the Town.


Facilities refer to and are all facilities reasonably necessary to provide gas into, within and through the Town and include plants, works, systems, lines, equipment, pipes, mains, underground links, gas compressors and meters.


Gas or Natural Gas refers to and is such gaseous fuels as natural, artificial, synthetic, liquefied natural, liquefied petroleum, manufactured, or any mixture thereof.


PUC refers to and is The Public Utilities Commission of the State of Colorado or other authority succeeding to the regulatory Weld of The Public Utilities Commission of the State of Colorado.


Residentsmeans all persons, businesses, industries, governmental agencies, and any other entities whatsoever, presently located or hereinafter to be located, in whole or in part, within the territory of the Town.


Revenues refer to and are those amounts of money which the Company receives from its customers within the Town for the sale of gas under rates, temporary or permanent, authorized by the PUC and represents amounts billed under such rates as adjusted for refunds, the net write-off of uncollectible accounts, corrections or other regulatory adjustments.


Streets and Other Public Places refer to and are streets, alleys, viaducts, bridges, roads, lanes, easements, public ways and other public places in said Town.


Town refers to and is the Town of Keenesburg, Weld County, Colorado, and includes the territory as currently is or may in the future be included within the boundaries of the Town of Keenesburg.


Sec. 5-3-20.    Grant of Franchise.  


The Town hereby grants to the Company, for the period specified and subject to the conditions, terms and provisions contained in this Ordinance, the non-exclusive right to use the Streets and Other Public Places within the Town to furnish, transport, sell and distribute gas to the Town and to all persons, businesses and industries within the Town, the non-exclusive right to acquire, construct, install, locate, maintain, operate and extend into, within and through the Town all facilities reasonably necessary to provide gas to the Town and to all persons, businesses and industries within the Town and in the territory adjacent thereto; and the non-exclusive right to make reasonable use of all Streets and Other Public Places as may be necessary to carry out the terms of the Ordinance.


Sec. 5-3-30.    Term of Franchise.  


The term of this franchise shall be in full force and effect from and after its passage, approval and publication as required by law and upon acceptance thereof in writing by the Company within thirty (30) days of final passage and the terms, conditions and covenants hereof shall remain in full force and effect for a period of fifteen (15) years, beginning September 8, 2015, and expiring September 8, 2030.


Sec. 5-3-40.    Non-Exclusivity of Franchise.


This franchise and the right to use and occupy said Streets and Other Public Places shall not be exclusive, and the Town reserves the right to grant the use of said Streets and Other Public Places to any person during the period of this franchise.


Sec. 5-3-50.    Franchise Fee.  


In consideration for the grant of this franchise, the Company shall collect and remit to the Town a sum equal to five percent (5%) of the revenues derived annually from the sale of gas within the Town, excluding the amount received from the Town itself for gas service furnished it. Franchise Fee payments shall be made in quarterly installments not more than thirty days following the close of the month for which payment is to be made. Quarters shall end on March 31, June 30, September 30, and December 31. Payments at the beginning and end of the franchise shall be prorated.

Sec. 5-3-60.    Franchise Fee Payment in Lieu of Certain Other Fees.  


Payment of the franchise fee by the Company is accepted by the Town in lieu of any occupancy tax, license tax, permit charge, inspection fee or similar tax, assessment or excise upon the pipes, mains, meter, or other personal property of the Company or on the privilege of doing business in connection with the physical operation thereof, but does not exempt the Company from any lawful taxation upon its real property or other tax not related to the franchise or the physical operation thereof. Payment of the franchise fee does not exempt the Company from sales taxes, license fees, use taxes, head taxes, building permit fees, land use fees, development impact fees, ad valorem property taxes, or other taxes, fees or charges that are required to be paid pursuant to the ordinances of general application that are not pursuant to the rights and privileges herein granted or for the privilege of doing business within the Town and for the use of the Streets and Other Public Places. The Company shall be responsible for obtaining all applicable Town approvals and permits for the installation of pipelines, conduits, transmission lines and cables, and for excavation, although the permit fee for such excavation or installation of pipelines, conduits, transmission lines or cables shall not be required.


Sec. 5-3-70.    Change of Franchise Fee.


The Company shall report to the Town, within sixty (60) days of execution, the terms of any franchise or any change of franchise in any other municipality that contains a franchise fee or other significant financial benefit greater than the franchise fee or other significant financial to the Town contained in this franchise. The Company shall also report about such other provisions that may be beneficial to the Town. If the Board of Trustees decides that the franchise fee or other significant financial benefit should be incorporated into the franchise, such change shall be provided for by ordinance; any such change shall not be considered an amendment, renewal or enlargement of this franchise.


Sec. 5-3-80.    Conduct of Business.  


The Company may establish, from time to time, such rules, regulations, terms and conditions governing the conduct of its business as shall be reasonably necessary to enable the Company to exercise its rights and perform its obligations under this franchise; provided, however, that such rules, regulations, terms and conditions shall not be in conflict with the laws of the State of Colorado or the Town.


Sec. 5-3-90.    Tariffs on File.  


The Company shall keep on file in its nearest office copies of all its tariffs currently in effect and on file with the PUC. Said tariffs shall be available for inspection by the public.


Sec. 5-3-100.  Compliance with PUC Regulations.  


The Company shall comply with all rules and regulations adopted by the PUC.


Sec. 5-3-110.  Compliance with Company Tariffs.  


The Company shall furnish gas within the Town to the Town and to all persons, businesses and industries within the Town at the rates and under the terms and conditions set forth in its tariffs on file with the PUC.


Sec. 5-3-120.  Applicability of Company Tariffs.  


The Town and the Company recognize that the lawful provisions of the Company's tariffs on file and in effect with the PUC are controlling over any inconsistent provision in this franchise dealing with the same subject matter.


Sec. 5-3-130.  Service Standards.


(a)        The Company shall maintain and operate its Facilities and render efficient service in accordance with the rules and regulations of the PUC, applicable terms and conditions of Town Code, and this franchise.


(b)        Maps. When required for a public health or safety purpose, the Company shall identify for the Town the location of its Distribution Facilities within the Streets and Other Public Places. Any maps provided by the Company to the Town shall be deemed confidential and will be provided solely for the Town’s use. The Town agrees to maintain the confidentiality of any non-public information obtained from the Company to the extent allowed by law.

(c)        Plans. Before commencement of installation of pipes within the Streets and Other Public Places, the Company shall prepare and submit to the Town a map showing the location, size and depth of lines, locations of shutoff valves and gates, and all appurtenances incident to the Distribution Facilities. In addition, the Company shall submit a construction plan including a construction schedule, showing the streets and alleys where excavations will be simultaneously open at any given time, making provision for traffic routing in the event of interruption, setting forth the places where pavement cuts are expected, and where underground boring will occur for pipe installation. Construction may then proceed upon approval of said map and plan and the issuance of a street cut permit by the Town. Nothing herein shall be construed to limit application of the Town’s ordinances pertaining to installation of pipelines, conduits, transmission lines and cables as well as ordinances pertaining to excavation to the activities of the Company, except as provided herein.


(d)        Use of Trenches. If the Company opens a trench to install its Facilities, the Company shall provide reasonable advance notice to the Town so as to permit the Town to install Town facilities in the same trench at the Town’s expense. The Town shall share in the cost of the trenching if used by the Town, on a pro rata basis. The Town’s installation of its facilities shall not interfere with the Company’s Facilities or delay the commencement or completion of the Company’s construction project within the Streets and Other Public Places.

(e)        Access to Premises. To the extent allowed by law, Company shall have the right to enter the premises of consumers at reasonable times for the purpose of reading meters, inspecting gas appliances, pipes and equipment and for the purpose of ascertaining loads, making necessary tests and installing, disconnecting or removing meters.



Sec. 5-3-140.  Location of Facilities.  


The Company shall locate its Facilities within the Town in a manner to meet with the approval of the Town. Company facilities shall not unreasonably interfere with the Town's water mains, sewer mains or other municipal use of Streets and Other Public Places. Company facilities shall be located so as to cause minimum interference with public use of Streets and Other Public Places and shall be maintained in good repair and condition.


Sec. 5-3-150.  Excavation and Construction.  


All construction, excavation, maintenance and repair work done by the Company shall be done in accordance with all applicable ordinances, resolutions, rules, regulations and standards of the Town and further in a timely and expeditious manner that minimizes the inconvenience to the public and individuals. All such construction, excavation, maintenance and repair work done by the Company shall comply with all applicable state, federal and local codes and is subject to inspection and approval by the Town to ensure that said work has been performed in accordance with applicable Town ordinances, resolution, rules, regulations and standards. Such inspections and approvals may include, but are not limited to, proposed locations for Facilities in the Streets and Other Public Places, disturbance of pavements, sidewalks and surfaces of the Streets and Other Public Places or adjoining landscaping. All public and private property whose use conforms to restrictions in easements disturbed by Company construction or excavation activities shall be restored as soon as practicable by the Company at its expense to substantially its former condition. The Company shall comply with the Town's requests for reasonable and prompt action to remedy all damage to private property adjacent to streets or dedicated easements where the Company is performing construction, excavation, maintenance or repair work. The Town reserves the right to restore property and remedy damages caused by Company activities at the expense of the Company in the event the Company fails to perform such work within a reasonable time after notice from the Town.


Sec. 5-3-160.  Relocation of Company Facilities.  


If at any time the Town requests the Company to relocate any distribution gas main or service connection installed or maintained in Streets and Other Public Places in order to permit the Town to change street grades, pavements, sewers, water mains or other Town works, such relocation shall be made by the Company at its expense.Following relocation, the Company, at its expense, shall restore all property to substantially its former condition.


Sec. 5-3-170. Service to New Areas.


If during the term of this franchise the boundaries of the Town are expanded, the Town will promptly notify Atmos in writing of any geographic areas annexed by the Town during the term hereof (“Annexation Notice”). Any such Annexation Notice shall be sent to Atmos by certified mail, return receipt requested, and shall contain the effective date of the annexation, maps showing the annexed area and such other information as Atmos may reasonably require in order to ascertain whether there exist any customers of Atmos receiving natural gas service in said annexed area. To the extent there are such Atmos customers therein, then the gross revenues of Atmos derived from the sale and distribution of natural gas to such customers shall become subject to the franchise fee provisions hereof effective on the first day of Atmos’ billing cycle immediately following Atmos’ receipt of the Annexation Notice. The failure by the Town to advise Atmos in writing through proper Annexation Notice of any geographic areas which are annexed by the Town shall relieve Atmos from any obligation to remit any franchise fees to Town based upon gross revenues derived by Atmos from the sale and distribution of natural gas to customers within the annexed area until Town delivers an Annexation Notice to Atmos in accordance with the terms hereof.


Sec. 5-3-180.  Restoration of Service.  


In the event the Company's gas system, or any part thereof, is partially or wholly destroyed or incapacitated, the Company shall use due diligence to restore its system to satisfactory service within the shortest practicable time.


Sec. 5-3-190.  Supply and Quality of Service.  


The Company shall make available an adequate supply of gas to provide service in the Town. The Company's facilities shall be of sufficient quality, durability and redundancy to provide adequate and efficient gas service to the Town. If, during the term of this franchise, there occurs a failure or partial failure of the supply of gas available to the Company because of depletion of such supply, the Company shall take all reasonable steps to obtain an additional gas supply from other sources to be delivered to the Company. Notwithstanding Section 5-3-240, if the Company fails to secure an additional gas supply for service to its customers, the franchise rights granted herein shall be subject to forfeiture under Section 5-3-280.


Sec. 5-3-200.  Safety Regulations by the Town.  


The Town reserves the right to adopt, from time to time, reasonable regulations in the exercise of its police power which are necessary to ensure the health, safety and welfare of the public, provided that such regulations are not destructive of the rights granted herein. The Company agrees to comply with all such regulations, in the construction, maintenance and operation of its facilities and in the provision of gas within the Town.


Sec. 5-3-210.  Inspection, Audit and Quality Control.  


The Town shall have the right to inspect, at all reasonable times, any portion of the Company's system used to serve the Town and its residents. The Town also shall have the right to inspect and conduct an audit of Company records relevant to compliance with any terms of this Ordinance at all reasonable times. The Company agrees to cooperate with the Town in conducting the inspection and/or audit and to correct any discrepancies affecting the Town's interest in a prompt and efficient manner.


Sec. 5-3-220.  Assignment.  


The Company may, without consent by the Town, transfer or assign this franchise and the rights granted hereunder to a parent, subsidiary or affiliate of the Company, provided that such parent, subsidiary or affiliate provides, within ten (10) business days of transfer or assignment, written acceptance to the Town of such transfer or assignment and agrees to assume all obligations of the Company hereunder and to be bound to the same extent as was the Company. For any transfer or assignment of this franchise or any rights granted hereunder to a party that is not a parent, subsidiary or affiliate of the Company, the Town’s prior written consent shall be required, which consent shall not be withheld or delayed provided the assignee demonstrates it has the legal, technical and financial qualifications to assume the franchise obligations. The proposed assignee shall be presumed financially qualified unless its long term unsecured debt rating is less than investment grade as rated by both S&P and Moody’s, and the proposed assignee shall be presumed to be legally and technically qualified to assume the franchise obligations if such transfer of ownership or control is approved by the Colorado Public Utilities Commission, or such other agency as shall then have jurisdiction over such transfer or ownership or control.


Sec. 5-3-230.  Saving Clause; Severability.  


If a court of competent jurisdiction declares any portion of this franchise to be illegal or void, the remainder of the Ordinance shall survive and not be affected thereby. The Town Board of Trustees declares it would have passed this ordinance and each part or parts hereof irrespective of the fact that any one part or parts be declared unconstitutional or invalid.


Sec. 5-3-240.  Force Majeure.


Notwithstanding anything expressly or impliedly to the contrary contained herein, in the event Company is prevented, wholly or partially, from complying with any obligation or undertaking contained herein by reason of any event of force majeure, then, while so prevented, compliance with such obligations or undertakings shall be suspended, and the time during which Company is so prevented shall not be counted against Company for any reason. The term “force majeure,” as used herein, shall mean any cause not reasonably within Company control and includes, but is not limited to, acts of God, strikes, lockouts, wars, terrorism, riots, orders, or decrees of any lawfully constituted federal, state or local body; contagions or contaminations hazardous to human life or health; fires, storms, floods, wash-outs, explosions, breakages or accidents to machinery or lines of pipe; inability to obtain or the delay in obtaining rights-of-way, materials, supplies, or labor permits; temporary failures of gas supply; or necessary repair, maintenance or replacement of facilities used in the performance of the obligations contained in this Ordinance.


Sec. 5-3-250.  Indemnity and Insurance.


(a)        The Company shall indemnify, defend and hold harmless the Town from and against all liability or damage and all claims, demands or liens arising out of the Company’s operations within the Town or related to or arising out of the exercise by the Company of any rights and privileges hereby granted. The Company shall maintain insurance in an amount not less than $1,000,000, and shall furnish a certificate of insurance to the Town so showing.

(b)       As an alternative to providing a certificate of insurance to the Town certifying liability insurance coverage as required by subsection (a), the Company may provide the Town with an annual statement regarding its self-insurance. The Company’s self-insurance shall provide at least the same amount and scope of coverage for the Company and the Town, its officers, agents and employees, as otherwise required by subsection (a).   Upon the Company’s election to self-insure under this subsection (b), any failure of the Company to maintain adequate self-insurance shall be a material breach and the franchise shall be subject to forfeiture as set forth in Section 5-3-280.


(c)       The Town shall provide prompt written notice to the Company of the pendency of any action against the Town arising out of such exercise by the Company of said rights and privileges and be permitted at its own expense to appear and defend, or assist in the defense of the same. The obligations of this Section shall not extend to any liability or damage and all reasonable expenses accruing against the Company arising out of the negligence, recklessness, or willful and wanton misconduct of the Town, its officers, employees, agents, representatives, or contractors.


Sec. 5-3-260.  Town’s Right to Condemn.


Nothing herein shall be construed to restrict any rights of the Town to condemn or acquire the Facilities of the Company or to otherwise restrict the Company's opportunity to conduct business in the Town as provided by C.R.S. § 31-15-707, or other applicable state or federal law.


Sec. 5-3-270.  Right to Removal of Facilities.


Upon the termination of this franchise, if the Company has not acquired an extension or renewal thereof and accepted same, the Company may remove its Facilities from the Streets and Other Public Places of the Town, provided that the Town has had ample time and opportunity to purchase, condemn or replace said Facilities. In so removing its Facilities, the Company shall, at its own expense and within a reasonable time not to exceed one hundred eighty (180) days, restore all property affected by removal operations to their pre-existing condition, to the satisfaction of the Town.


Sec. 5-3-280.  Forfeiture.


If the Company fails to perform any of the terms and conditions of this franchise, the Town may notify the Company of the specific failure and shall allow the Company a reasonable time within which to remedy the failure, not to exceed one hundred twenty (120) days, or such additional time as may be agreed to by the parties. The Town reserves the right to declare a forfeiture of this franchise for the breach of a substantial and material provision thereof. No forfeiture shall be declared until the Company shall have had an opportunity to be heard and to correct or justify the alleged breach. Upon failure of the Company to exercise reasonable diligence to correct such condition, the Town may declare this franchise forfeited and notify the Company in writing. In the event that this franchise is forfeited, then the Company agrees to continue to render service as theretofore provided until the Town makes alternative arrangements for such services. Neither the Town nor the Company shall be in breach or forfeiture of this franchise if failure to perform is due to uncontrollable forces, which shall include but not be limited to accidents, acts of God, floods, storms, fires, sabotage, terrorist attack, labor disputes, riots, war, forces of nature and other causes or contingencies of whatever nature beyond the reasonable control of the parties affected, which could not reasonably have been anticipated and avoided.


Sec. 5-3-290.  Reserved Rights.


The right is hereby reserved by the Town to adopt, from time to time, in addition to the provisions herein contained, such ordinances as may be deemed necessary in the exercise of its police power to protect the health, safety and welfare of the public, including but not limited to ordinances to control and regulate the use of the Streets and Other Public Places and the space above and beneath the Streets and Other Public Places. Neither the Town nor the Company waives any rights under this franchise or the statutes and constitution of the State of Colorado or of the United States, except as otherwise specifically set forth herein.


Sec. 5-3-300.  Regulation.


This Ordinance and the respective rights and obligations of the parties hereunder are subject to all present and future valid governmental legislation or regulation, whether federal or state, of duly constituted authorities which have jurisdiction over this Ordinance, one or both of the parties, or any transaction hereunder.


Sec. 5-3-310.  No Third-Party Beneficiaries.


Nothing contained in this franchise shall be construed to provide rights to third parties.


Section 2.       Declaration of Emergency. The Board of Trustees herewith finds, determines, and declares that this ordinance is necessary to the immediate preservation of public property, health, welfare, peace, or safety. Pursuant to C.R.S. § 31-16-105 this ordinance shall be effective upon adoption.









By: _______________________________

                     Danny Kipp, Mayor





Debra L. Chumley, Town Clerk



DATE OF FINAL PUBLICATION: ____________________, 20___.




                                                                                   ATMOS ENERGY CORPORATION



                                                                                    By: _______________________________

                                                                                             Gary W. Gregory

                                                                                             President (Colorado-Kansas Division)




Town’s Mailing Address and Phone Number:

Town of Keenesburg

ATTN: Town Clerk

Box 312

Keenesburg, CO 80643

(303) 732-4281