Tuesday, July 27, 2021


Supervisors authorize purchase of Rule 20 funds from Butte County

The Colusa County Board of Supervisors unanimously voted to authorize County Administrative Officer Wendy Tyler to purchase $2 million in Rule 20 Credits from Butte County, if necessary, to complete the undergrounding of electric utilities as a part of the California Department of Transportation’s Bridge Street Reconstruction Project – and it would only cost the County $500,000 in unrestricted funds.

The California Department of Transportation is preparing to make significant improvements to Highway 20 (Bridge Street) within the City of Colusa and unincorporated Colusa County, between Butte Vista Drive and Market Street, which will include reconstruction of the roadway; installation of curb, gutter and sidewalk; landscaping; and undergrounding of overhead utilities. The county and city collectively created underground utility districts for the purpose of facilitating the undergrounding of overhead utilities for the project, and agreed to provide their current Rule 20 Credits, up to and including the maximum available balances, to facilitate undergrounding. The only problem was that the bids for the undergrounding came in about $2 million over the estimate, for a total of $6.2 million. The city and county had two options: Move forward with overhead utilities and dissolve the underground utility districts they had created (because overhead utilities are not allowable in underground utility districts), or look into other funding options. During the May 15 meeting of the Board of Supervisors, direction was given to staff to reach out to other agencies who may have been interested in entering into a funds exchange agreement to address the $2 million deficit. Ultimately, Butte County expressed interest in entering into such an agreement with Colusa County.

Rule 20 Funds – part of a state-wide program established in 1967, which was created to eliminate the concentration of overhead electric and telecommunication lines and wooden utility poles along major arterial streets, public areas of scenic value, or a downtown or civic center core – can only be used for the purpose of undergrounding utilities. The program also allows for an agency to obtain an advance, up to five years, from their annual allocation, and to acquire additional Rule 20 funds from another agency – the latter of which is what the board authorized on June 12. Public Works Director Scott Lanphier previously said that $1.00 in Rule 20 Credits could be purchased for about $0.25 in unrestricted funds, and that’s the rate that Colusa County could end up paying Butte County for their credits, if all goes according to plan.

Nothing will be finalized until the Butte County Board of Supervisors vote to approve the contract, but Lanphier said that they are expected to vote on it at their July 24 meeting. Should they approve the exchange, it would be at that point that the two agencies can move forward with a contract.

As for $500,000 in unrestricted funds necessary to purchase the credits from Butte County, it remains to be seen how the cost will be divided between the City and County of Colusa. City and county officials are still working that out, Lanphier said, noting that the county was aware of the fact that the city was operating on a very tight budget.

“We are going to enter into some kind of an agreement to reimburse the county some how, whether that’s giving them our future Rule 20 allocation to them until we’ve met our financial allocation for the shared part,” Colusa City Manager Jesse Cain confirmed. “The agreement will likely also state that, when the City of Colusa becomes financially sound, we would have the option to purchase them back.”n

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