Background:
Florida Gas Transmission (FGT) is the only interstate natural gas pipeline company serving Southeast Florida. The City of Sunrise contracts with FGT for space (capacity) on this pipeline. The current Service Agreement for Contract No. 5761 is for the lowest cost rate (FTS-1) for capacity on the FGT pipeline system.
A Service Agreement Contract No. 5761 was approved by Resolution 98-4 and subsequent amendments were administratively approved by a prior Gas Department Director.
On December 13, 2016, the City Commission approved Amendment 11 to Contract No. 5761 extending the Contract through January 31, 2027, via the rollover provision. Subsequently, on January 10, 2017, the City Commission approved a revised Amendment 11 to include the Federal Energy Regulatory Commission (FERC) Docket RP15-101 approved changes to FGT’s FTS-1 pro forma service agreement.
The current Service Agreement Contract No. 5761 is set to expire on January 31, 2027. The contract contains a rollover provision to extend the contract for an additional ten (10) years. Amendment 12 exercises the rollover option and extends the contract through January 31, 2037.
FGT and its customers, including Florida municipalities, are not authorized to make any changes to the Service Agreement after it is approved by FERC. The FERC-approved Service Agreement contains terms and conditions not typically approved by the City, including application of Texas law and FGT’s right to make changes to the terms unilaterally upon approval of appropriate regulatory authorities. In addition, state statutory provisions typically required in service contracts by Florida law are not included in the FERC-approved Service Agreement.
FGT agreed to include an Appendix to Amendment 12 to Contract No. 5761 including Affidavit of Compliance with Human Trafficking Laws and Affidavit of Compliance with Foreign Entity Laws.
City staff reviewed Amendment 12 to Contract No. 5761 and requests permission of the City Commission to allow the Mayor to execute Amendment 12.