RESOLUTION NO. 16-153, SERIES 2016

RESOLUTION APPROVING THE JOINT EXERCISE OF POWERS AGREEMENT
ESTABLISHING THE VALLEY CLEAN ENERGY ALLIANCE, AUTHORIZING THE
MAYOR TO EXECUTE THE AGREEMENT ON BEHALF OF THE CITY OF DAVIS,

AND APPOINTING TWO CITY COUNCILMEMBERS TO SERVE AS THE
DIRECTORS ON THE BOARD

WHEREAS, the City Council of the City of Davis has investigated options to provide electrical
services to customers within the City of Davis and unincorporated areas of the County; and

WHEREAS, the City of Davis has prepared, in consultation of the County, a Technical Feasibility
Study for a community choice aggregation program, otherwise known as a Community
Choice Energy program in the City of Davis and Yolo County under the provisions of the
Public Utilities Code section 366.2. The Technical Feasibility Study shows that implementing a
CCE program has the potential to provide multiple bene?ts, including:
a. Increasing local control and involvement in and collaboration on energy rates and other
energy-related matters;
b. Providing cost-competitive clean electricity;
0. Providing customers a choice of power providers and electricity power products;
d. Providing more stable long-term electric rates that are competitive with those provided by
the incumbent utility;
e. Reducing greenhouse gas emissions arising from electricity use within Yolo County and the
City of Davis;
f. Increasing local renewable generation capacity;
g. Increasing energy conservation and ef?ciency projects and programs; and

WHEREAS, the City wishes to be a community choice aggregator and has introduced the
Ordinance required by Public Utilities Code Section 366.2 in order to do so; and

WHEREAS, Yolo County also wishes to be a community choice aggregator and has also introduced
the Ordinance required by Public Utilities Code Section 366.2 in order to do so; and

WHEREAS, pursuant to Section 366.2 two or more entities authorized to be a community choice
aggregator, may participate as a group in a community choice aggregation program through a joint
powers agency established pursuant to Chapter 5 (commencing with Section 6500) of Division 7 of
Title 1 of the Government Code, if each entity adopts the aforementioned ordinance; and

WHEREAS, the City Council has considered the proposed Joint Exercise of Powers Agreement,
attached hereto as Exhibit A, under which the City of Davis and Yolo County will form the Valley
Clean Energy Alliance and both agencies will become the initial members of 
and

WHEREAS, the Joint Exercise of Powers Agreement will create and establish VCEA, and Yolo
County, the City of Davis, and other cities or counties that later choose to participate in VCEA and
the CCE program will have membership on the Board of Directors of VCEA as provided in the
Joint Exercise of Powers Agreement if they execute the Agreement and adopt the ordinance
required by the Public Utilities Code; and

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Resolution No. 16-153

WHEREAS, VCEA will enter into agreements with electric power suppliers and other service
providers, and based upon those agreements VCEA will be able to provide power to residents and
business. Once the California Public Utilities Commission approves the implementation plan
created by VCEA, VCEA will provide service to customers within Yolo County and within the
jurisdiction of the City of Davis and those other cities and counties that choose to join VCEA and to
participate in the CCA program; and

WHEREAS, under Public Utilities Code section 366.2, customers have the right to opt-out of the
CCE program and continue to receive service from the incumbent utility. Customers who wish to
continue to receive service from the incumbent utility will be able to do so.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Davis does hereby
approve the Joint Exercise of Powers Agreement with Yolo County to form the Valley Clean
Energy Alliance and

BE IT FURTHER RESOLVED that the Mayor is hereby authorized and directed to execute the
Joint Exercise of Powers Agreement on behalf of the City of Davis, which will establish VCEA
with Yolo County as an initial member; and

BE IT FURTHER RESOLVED that Lucas Frerichs and Robb Davis are hereby appointed as the
initial Directors on the VCEA Board representing the City of Davis; and

BE IT FURTHER RESOLVED that the Mayor is hereby authorized to execute any and all other
necessary documents to enter into the Joint Exercise of Powers Agreement to form VCEA.

PASSED AND ADOPTED by the City Council of the City of Davis on this 25th day of October,
2016, by the following vote:

AYES: Arnold, Frerichs, Lee, Swanson, Davis
NOES: None
Robb Davi
Mayor
ATTEST:

 

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Resolution No. 16-153
Exhibit A

JOINT EXERCISE OF POWERS AGREEMENT RELATING TO AND CREATING
THE VALLEY CLEAN ENERGY ALLIANCE
This Joint Exercise of Powers Agreement, effective on the date determined by Section 2.1, is
made and entered into pursuant to the provisions of Title 1, Division 7, Chapter 5, Article 1
(Sections 6500 et seq.) of the California Government Code relating to the joint exercise of
powers and establishes the Valley Clean Energy Alliance (“VCEA”), is by and between the
County of Yolo (“County”), the City of Davis (“City”) and those other cities and counties who
become signatories to this Agreement as provided herein, who agree as follows:
RECITALS
A.

The Parties share various powers under California law, including but not limited
to the power to purchase, supply, and aggregate electricity for themselves and
customers within their jurisdictions.

B.

In 2006, the State Legislature adopted AB 32, the Global Warming Solutions Act,
which mandates a reduction in greenhouse gas emissions in 2020 to 1990 levels.
The California Air Resources Board is promulgating regulations to implement
AB 32 which will require local governments to develop programs to reduce
greenhouse gas emissions.

C.

The purposes for entering into this Agreement include:
a.

Reducing greenhouse gas emissions related to the use of power in Yolo
County and neighboring regions;

b.

Providing electric power and other forms of energy to customers at a
competitive cost;

c.

Carrying out programs to reduce energy consumption;

d.

Stimulating and sustaining the local economy by developing local jobs in
renewable energy; and

e.

Promoting long-term electric rate stability and energy security and
reliability for residents through local control of electric generation
resources.

D.

It is the mission and purpose of this Agreement to build a strong Community
Choice Energy program that is locally controlled and delivers cost-competitive
clean electricity, product choice, price stability, energy efficiency and greenhouse
gas emission reductions.

E.

It is the intent of this Agreement to promote the development and use of a wide
range of renewable energy sources and energy efficiency programs, including but
not limited to solar, wind, and biomass energy production. The purchase of
renewable power and greenhouse gas-free energy sources will be the desired
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 Resolution No. 16-153
Exhibit A

approach to decrease regional greenhouse gas emissions and accelerate the State’s
transition to clean power resources to the extent feasible. The Agency will also
add increasing levels of locally generated renewable resources as these projects
are developed and customer energy needs expand.
F.

The Parties desire to establish a separate public agency, known as the Valley
Clean Energy Alliance or VCEA, under the provisions of the Joint Exercise of
Powers Act of the State of California (Government Code Section 6500 et seq.)
(“Act”) in order to collectively study, promote, develop, conduct, operate, and
manage energy programs.

G.

The Parties anticipate adopting an ordinance electing to implement through the
VCEA a common Community Choice Energy (CCE) program (also known as a
community choice aggregation (CCA) program) hereinafter called a CCE
Program, an electric service enterprise available to cities and counties pursuant to
California Public Utilities Code Sections 331.1(b) and 366.2. The first priority of
the VCEA will be the consideration of those actions necessary to implement the
CCE Program.
AGREEMENT

NOW, THEREFORE, in consideration of the mutual promises, covenants, and conditions
hereinafter set forth, it is agreed by and among the Parties as follows:
ARTICLE 1: DEFINITIONS AND EXHIBITS
1.1

Definitions. Capitalized terms used in the Agreement shall have the meanings
specified in Exhibit A, unless the context requires otherwise.

1.2

Documents Included. This Agreement consists of this document and the
following exhibits, all of which are hereby incorporated into this Agreement.
Exhibit A: Definitions
Exhibit B: List of the Parties
Exhibit C: Annual Energy Use
Exhibit D: Voting Shares
Exhibit E: Signatures

ARTICLE 2: FORMATION OF VALLEY CLEAN ENERGY ALLIANCE
2.1

Effective Date and Term. This Agreement shall become effective and VCEA
shall exist as a separate public agency on October 25, 2016, or when the County
and the City execute this Agreement, whichever occurs later. The VCEA shall
provide notice to the Parties of the Effective Date. VCEA shall continue to exist,
and this Agreement shall be effective, until this Agreement is terminated in
accordance with Section 6.4, subject to the rights of the Parties to withdraw from
VCEA.

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 Resolution No. 16-153
Exhibit A

2.2

Formation. There is formed as of the Effective Date a public agency named
Valley Clean Energy Authority. Pursuant to Sections 6506 and 6507 of the Act,
VCEA is a public agency separate from the Parties. Pursuant to Sections 6508.1
of the Act, the debts, liabilities or obligations of VCEA shall not be debts,
liabilities or obligations of the individual Parties unless the governing board of a
Party agrees in writing to assume any of the debts, liabilities or obligations of
VCEA. A Party who has not agreed to assume an Authority debt, liability or
obligation shall not be responsible in any way for such debt, liability or obligation
even if a majority of the Parties agree to assume the debt, liability or obligation of
VCEA. Notwithstanding Section 7.4 of this Agreement, this Section 2.2 may not
be amended unless such amendment is approved by the governing board of each
Party.
2.2.1

Name. VCEA may change its name at any time through adoption of a
resolution of the Board of Directors.

2.3

Purpose. The purpose of this Agreement is to establish an independent public
agency in order to exercise powers common to each Party to build a strong CCE
program that achieves deep, long-term GHG emission reductions by offering
clean, cost effective and price stable electricity to residents, businesses, and
agricultural producers while carrying out innovative programs to reduce customer
energy use, substantially increase local renewable energy production, and power
the local transportation system. To that end, VCEA will study, promote, develop,
conduct, operate, and manage energy, energy efficiency and conservation, and
other energy-related programs, and to exercise all other powers necessary and
incidental to accomplishing this purpose. Without limiting the generality of the
foregoing, the Parties intend for this Agreement to be used as a contractual
mechanism by which the Parties are authorized to participate in the CCE
Program, as further described in Section 4.1. The Parties intend that other
agreements shall define the terms and conditions associated with the
implementation of the CCE Program and any other energy programs approved by
VCEA.

2.4

Membership in VCEA.
2.4.1

The initial members of VCEA are the County of Yolo and the City of
Davis. The Cities of Woodland, West Sacramento and Winters may also
become initial members of VCEA by resolution of the city’s city council
adopted prior to the Effective Date.

2.4.2

Any city or county, that is not an initial member, may request to become a
member of VCEA by submitting a resolution adopted by its City Council
or Board of Supervisors to the Board of VCEA. The Board shall review
the request and shall vote to approve or disapprove the request. The Board
may establish conditions, including but not limited to financial conditions,
under which the city or county may become a member of VCEA. The
Board shall notify the then members of VCEA of this request and the date
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 Resolution No. 16-153
Exhibit A

that the request will be on the Board’s meeting agenda for action. The
date set for Board action shall be at least forty-five (45) days from the date
the notice is mailed to the members. If the request is approved by the
Board, the city or county shall become a member of VCEA under the
terms and conditions set forth by the Board and upon approval and
execution of this Agreement by the city or county.
2.5

Powers. VCEA shall have all powers common to the Parties and such additional
powers accorded to it by law. VCEA is authorized, in its own name, to exercise
all powers and do all acts necessary and proper to carry out the provisions of this
Agreement and fulfill its purposes, including, but not limited to, each of the
following powers, subject to the voting requirements set forth in Section 3.7
through 3.7.5:
2.5.1 to make and enter into contracts;
2.5.2

to employ agents and employees, including but not limited to an Executive
Officer;

2.5.3

to acquire, contract, manage, maintain, and operate any buildings,
infrastructure, works, or improvements;

2.5.4

to acquire property by eminent domain, or otherwise, except as limited
under Section 6508 of the Act, and to hold or dispose of any property;
however, VCEA shall not exercise the power of eminent domain within
the jurisdiction of a Party over its objection without first meeting and
conferring in good faith.

2.5.5 to lease any property;
2.5.6 to sue and be sued in its own name;
2.5.7

to incur debts, liabilities, and obligations, including but not limited to
loans from private lending sources pursuant to its temporary borrowing
powers such as Government Code Sections 53850 et seq. and authority
under the Act;

2.5.8

to form subsidiary or independent corporations or entities if necessary, to
carry out energy supply and energy conservation programs at the lowest
possible cost or to take advantage of legislative or regulatory changes;

2.5.9 to issue revenue bonds and other forms of indebtedness;
2.5.10 to apply for, accept, and receive all licenses, permits, grants, loans or other
aids from any federal, state, or local public agency;

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 Resolution No. 16-153
Exhibit A

2.5.11 to submit documentation and notices, register, and comply with orders,
tariffs and agreements for the establishment and implementation of the
CCE Program and other energy programs;
2.5.12 to adopt Operating Rules and Regulations;
2.5.13 to make and enter into service agreements relating to the provision of
services necessary to plan, implement, operate and administer the CCE
Program and other energy programs, including the acquisition of electric
power supply and the provision of retail and regulatory support services;
and
2.5.14 to permit additional Parties to enter into this Agreement after the Effective
Date and to permit another entity authorized to be a community choice
aggregator to designate VCEA to act as the community choice energy
aggregator on its behalf.
2.6

Limitation on Powers. As required by Government Code Section 6509, the power
of VCEA is subject to the restrictions upon the manner of exercising power
possessed by City of Davis.
ARTICLE 3: GOVERNANCE AND INTERNAL ORGANIZATION

3.1

Board of Directors. VCEA shall be governed by a legislative body known as the
a Board of Directors (“Board”). The Initial Board shall consist of two (2)
directors appointed by each of the initial members; for example, if the initial
members are the County of Yolo and the City of Davis, the board shall be four (4)
directors with two (2) directors appointed by the Yolo County Board of
Supervisors and two (2) directors appointed by the City Council of Davis. Each
Director shall serve at the pleasure of the governing board of the Party who
appointed such Director, and may be removed as Director by such governing
board at any time. If at any time a vacancy occurs on the Board, a replacement
shall be appointed to fill the position of the previous Director within 60 days of
the date that such position becomes vacant. Directors must be members of the
Board of Supervisors or members of the City Council of the appointing City that
is the signatory to this Agreement. Each Party may appoint an alternate(s) to
serve in the absence of its Director(s). Alternates may be either (1) members of
the Board of Supervisors or (2) members of the governing board of the
municipality that is the signatory to this Agreement.
If additional cities or counties join VCEA, as set forth in section 2.4, each city or
county that becomes a member of VCEA shall be entitled to two (2) directors who
shall be appointed as set forth above. When the fifth member joins VCEA, the
number of directors per member agency of all current member agencies shall be
reduced to one (1) director per member agency.
3.1.1

Ex officio Directors. The Board may appoint ex officio members of the
Board. Ex officio directors shall receive all meeting notices, shall have
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 Resolution No. 16-153
Exhibit A

the right to participate in Board discussions and the right to place items on
the agenda but shall not be counted towards a quorum and shall have no
vote.
3.2

Quorum. A majority of the appointed Directors shall constitute a quorum, except
that less than a quorum may adjourn from time to time in accordance with law.

3.3

Powers and Functions of the Board. The Board shall exercise general governance
and oversight over the business and activities of VCEA, consistent with this
Agreement and applicable law. The Board shall provide general policy guidance
to the CCE Program. Board approval shall be required for any of the following
actions:
3.3.1

The issuance of bonds or any other financing even if program revenues are
expected to pay for such financing.

3.3.2 The appointment or termination of the Executive Officer and General
Counsel.
3.3.3

The appointment or removal of officers described in Section 3.9, subject
to Section 3.9.3.

3.3.4 Any decision to provide retirement or post-retirement benefits that are
defined benefit programs, subject to the requirements of section 5.3.4,
below.
3.3.5 The adoption of the Annual Budget.
3.3.6 The adoption of an ordinance.
3.3.7 The approval of agreements, except as provided by Section 3.4.
3.3.8

The initiation or resolution of claims and litigation where VCEA will be
the defendant, plaintiff, petitioner, respondent, cross complainant or cross
petitioner, or intervenor; provided, however, that the Executive Officer or
General Counsel, on behalf of VCEA, may intervene in, become a party
to, or file comments with respect to any proceeding pending at the
California Public Utilities Commission, the Federal Energy Regulatory
Commission, or any other administrative agency, without approval of the
Board as long as such action is consistent with any adopted Board
policies.

3.3.9

The setting of rates for power sold by VCEA and the setting of charges for
any other category of service provided by VCEA.

3.3.10 Termination of the CCE Program.

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 Resolution No. 16-153
Exhibit A

3.4

Executive Officer. The Board of Directors shall appoint an Executive Officer for
VCEA, who shall be responsible for the day-to-day operation and management of
VCEA and the CCE Program. The Executive Officer may be retained under
contract with VCEA, be an employee of VCEA, or be an employee of one of the
Parties. The Executive Officer shall report directly to the Board and serve as staff
to VCEA. Except as otherwise set forth in this Agreement, the Executive Officer
may exercise all powers of VCEA, including the power to hire, discipline and
terminate employees as well as the power to approve any agreement if the total
amount payable under the agreement is less than $100,000 in any fiscal year, or
such higher amount as established by the Board from time to time, by resolution
of the Board, except the powers specifically set forth in Section 3.3 or those
powers which by law must be exercised by the Board of Directors. The Executive
Officer shall serve at the pleasure of the Board.

3.5

Commissions, Boards, and Committees. The Board may establish commissions,
boards or committees, including but not limited to a standing executive
committee of the Board, as the Board deems appropriate, to assist the Board in
carrying out its authority and functions under this Agreement and may delegate
authority to such commission, board or commission as set forth in a Board
resolution. Such delegation may be modified, amended or revoked as any time as
the Board may deem appropriate. Any decision delegated pursuant to this
subsection may be appealed to the Board, as the Board so determines.
3.5.1

The Board may also establish any advisory commissions, boards, and
committees as the Board deems appropriate to assist the Board in carrying
out its functions and implementing the CCE Program, other energy
programs and the provisions of this Agreement.

3.5.2

Any board, commission or committee formed under this section shall
comply with the requirements of the Ralph M. Brown Act. The Board
may establish rules, regulations, policies, bylaws or procedures to govern
any such commissions, boards, or committees, and shall determine
whether members shall be compensated or entitled to reimbursement for
expenses.

3.6

Director Compensation. Directors shall serve without compensation from VCEA.
However, Directors may be compensated by their respective appointing
authorities. The Board, however, may adopt by resolution a policy relating to the
reimbursement by VCEA of expenses incurred by Directors.

3.7

Voting. In general, as described below in Section 3.7.3, action by VCEA Board
will be taken solely by a majority vote of the total number of Directors present;
provided, however, that so long as VCEA consists of three or less members, all
actions of the Board shall require the affirmative vote of at least one director
appointed by each member. In addition, as described below in Section 3.7.4,
upon request of two (2) Directors each from a different member agency, a
weighted vote by shares will also be conducted. When such a request is made, an
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 Resolution No. 16-153
Exhibit A

action must be approved by both a majority vote of Directors present and a
majority of the weighted vote by shares present. No action may be approved
solely by a vote by shares. The voting shares of Directors and approval
requirements for actions of the Board shall be as follows:
3.7.1 Voting Shares.
Each member agency shall have a voting share as determined by the
following formula: (Annual Energy Use/Total Annual Energy) multiplied
by 100, where
(a)

“Annual Energy Use” means, (i) with respect to the first two (2)
years following the Effective Date, the annual electricity usage,
expressed in kilowatt hours (“kWh”), within the Party’s respective
jurisdiction and (ii) with respect to the period after the second
anniversary of the Effective Date, the annual electricity usage
during the prior Fiscal Year, expressed in kWh, of accounts within
a Party’s respective jurisdiction that are served by VCEA; and

(b)

“Total Annual Energy” means the sum of all Parties’ Annual
Energy Use. The initial values for Annual Energy Use will be
designated in Exhibit C, and shall be adjusted annually as soon as
reasonably practicable after January 1, but no later than March 1 of
each year. These adjustments shall be approved by the Board.

(c)

The combined voting share of all Directors representing a member
agency shall be based upon the annual electricity usage within the
member agency’s jurisdiction; the combined voting share of a
county shall be based upon the annual electricity usage within the
unincorporated area of the county.

For the purposes of Weighted Voting, if a member agency has more than
one director present and voting, then the voting shares allocated to the
entity shall be equally divided amongst its Directors that are present and
voting.
3.7.2

Exhibit Showing Voting Shares. The initial voting shares will be set forth
in Exhibit D. Exhibit D shall be revised no less than annually as necessary
to account for changes in the number of Parties and changes in the Parties’
Annual Energy Use. Exhibit D and adjustments shall be approved by the
Board.

3.7.3

Approval Requirements Relating to CCE Program. Except as provided in
Sections 3.7 above and 3.7.4 and 3.7.5 below, action of the Board shall
require the affirmative vote of a majority of Directors present at the
meeting.

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 Resolution No. 16-153
Exhibit A

3.7.4

Option for Approval by Voting Shares. Notwithstanding Section 3.7.3,
any two (2) Directors, each appointed from a different member agency,
present at a meeting may demand that approval of any matter related to the
CCE Program be determined on the basis of both voting shares and by the
affirmative vote of a majority of Directors present at the meeting. If two
Directors makes such a demand with respect to approval of any such
matter, then approval of such matter shall require the affirmative vote of a
majority of Directors present at the meeting and the affirmative vote of
Directors having a majority of voting shares present, as determined by
Section 3.7.1 except as provided in Section 3.7.5.

3.7.5 Special Voting Requirements for Certain Matters.
(a)

Two-Thirds and Weighted Voting Approval Requirements
Relating to Sections 6.2 and 7.4. Action of the Board on the
matters set forth in Section 6.2 (involuntary termination of a
Party), or Section 7.4 (amendment of this Agreement) shall require
the affirmative vote of at least two-thirds of Directors present;
provided, however, that (i) notwithstanding the foregoing, any
two (2) Directors present at the meeting, each appointed from a
different member agency,
may demand that the vote be
determined on the basis of both voting shares and by the
affirmative vote of Directors, and if any two (2) Directors makes
such a demand, then approval shall require the affirmative vote of
both at least two-thirds of Directors present and the affirmative
vote of Directors having at least two-thirds of the voting shares
present, as determined by Section 3.7.1; (ii) but, Directors from at
least two (2) Parties must vote against a matter for the vote to fail;
and (iii) for votes to involuntarily terminate a Party under Section
6.2, the Director(s) for the Party subject to involuntary termination
may not vote, and the number of Directors constituting two-thirds
of all Directors, and the weighted vote of each Party shall be
recalculated as if the Party subject to possible termination were not
a Party.

(b)

Seventy-Five Percent Special Voting Requirements for Eminent
Domain and Contributions or Pledge of Assets.
(i)

A decision to exercise the power of eminent domain on
behalf of VCEA to acquire any property interest other than
an easement, right-of-way, or temporary construction
easement shall require a vote of at least 75% of all
Directors present and voting and a vote of at least twothirds of all the members of the Board of Directors .

(ii)

The imposition on any Party of any obligation to make
contributions or pledge assets as a condition of continued
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 Resolution No. 16-153
Exhibit A

participation in the CCE Program shall require a vote of at
least 75% of all Directors present and voting and the
approval of the governing boards of the Parties who are
being asked to make such contribution or pledge.
(iii)

Notwithstanding the foregoing, any two (2) Directors
present at the meeting, each appointed by a different
member agency, may demand that a vote under subsections
(i) or (ii) be determined on the basis of voting shares and by
the affirmative vote of Directors, and if any two (2)
Directors makes such a demand, then approval shall require
both the affirmative vote of at least 75% of Directors
present and the affirmative vote of Directors having at least
75% of the voting shares present, as determined by Section
3.7.1, but Directors from at least two (2) Parties must vote
against a matter for the vote to fail. For purposes of this
section, “imposition on any Party of any obligation to make
contributions or pledge assets as a condition of continued
participation in the CCE Program” does not include any
obligations of a withdrawing or terminated party imposed
under Section 6.3.

3.8

Meetings and Special Meetings of the Board. The Board shall hold at least six (6)
regular meetings per year, but the Board may provide for the holding of regular
meetings at more frequent intervals. The date, hour and place of each regular
meeting shall be fixed by resolution or ordinance of the Board. Regular meetings
may be adjourned to another meeting time. Special and Emergency Meetings of
the Board may be called in accordance with the provisions of California
Government Code Sections 54956 and 54956.5. Directors may participate in
meetings telephonically, with full voting rights, only to the extent permitted by
law. All meetings shall be conducted in accordance with the provisions of the
Ralph M. Brown Act (California Government Code Sections 54950 et seq.).

3.9

Selection of Board Officers.
3.9.1

Chair and Vice Chair. The Directors shall select, from among themselves,
a Chair, who shall be the presiding officer of all Board meetings, and a
Vice Chair, who shall serve in the absence of the Chair. The Chair and
vice Chair shall serve at the pleasure of the Board. There shall be no limit
on the number of terms held by either the Chair or Vice Chair. The office
of either the Chair or Vice Chair shall be declared vacant and a new
selection shall be made if:
(a)

the person serving dies, resigns, or the Party that the person
represents removes the person as its representative on the Board or

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 Resolution No. 16-153
Exhibit A

(b)

3.10

the Party that he or she represents withdraws from VCEA pursuant
to the provisions of this Agreement.

3.9.2

Secretary. The Board shall appoint a Secretary, who need not be a
member of the Board, who shall be responsible for keeping the minutes of
all meetings of the Board and all other official records of VCEA.

3.9.3

Treasurer and Auditor. The Treasurer shall function as the combined
offices of Treasurer and Auditor pursuant to Government code section
6505.6 and shall strictly comply with the statutes related to the duties and
responsibilities specified in Section 65.5 of the Act. The Treasurer for
VCEA shall be the depository and have custody of all money of VCEA
from whatever source and shall draw all warrants and pay demands
against VCEA as approved by the Board. The Treasurer shall cause an
independent audit(s) of the finances of VCEA to be made by a certified
public accountant, or public accountant, in compliance with Section 6505
of the Act. The Treasurer shall report directly to the Board and shall
comply with the requirements of treasurers of incorporated municipalities.
The Board may transfer the responsibilities of Treasurer to any person or
entity as the law may provide at the time. The duties and obligations of
the Treasurer are further specified in Article 5. The Treasurer shall serve
at the pleasure of the Board.

Administrative Services Provider. The Board may appoint one or more
administrative services providers to serve as VCEA’s agent for planning,
implementing, operating and administering the CCE Program, and any other
program approved by the Board, in accordance with the provisions of an
Administrative Services Agreement. The appointed administrative services
provider may be one of the Parties. One or more of the Parties may agree to
provide all or a portion of the services in the manner set forth in an
Administrative Services Agreement. Employees of the member agencies utilized
to perform such services shall remain employees of the member agency and
subject to the employing member agency’s control and supervision. An
Administrative Services Agreement shall set forth the terms and conditions by
which the appointed administrative services provider shall perform or cause to be
performed all or enumerated tasks necessary for planning, implementing,
operating and administering the CCE Program and other approved programs. The
Administrative Services Agreement shall set forth the term of the Agreement, the
services to be provided, and the circumstances under which the Administrative
Services Agreement may be terminated by VCEA. This section shall not in any
way be construed to limit the discretion of VCEA to hire its own employees to
administer the CCE Program or any other program.

ARTICLE 4: IMPLEMENTATION ACTION AND AUTHORITY DOCUMENTS
4.1

Preliminary Implementation of the CCE Program.

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Exhibit A

4.2

4.1.1

Enabling Ordinance. To be eligible to participate in the CCE Program,
each Party must adopt an ordinance in accordance with Public Utilities
Code Section 366.2(c)(12) for the purpose of specifying that the Party
intends to implement a CCE Program by and through its participation in
VCEA.

4.1.2

Implementation Plan.
VCEA shall cause to be prepared an
Implementation Plan meeting the requirements of Public Utilities Code
Section 366.2 and any applicable Public Utilities Commission regulations
as soon after the Effective Date as reasonably practicable. The
Implementation Plan shall not be filed with the Public Utilities
Commission until it is approved by the Board in the manner provided by
Section 3.7.3.

4.1.3

Termination of CCE Program. Nothing contained in this Article or this
Agreement shall be construed to limit the discretion of VCEA to terminate
the implementation or operation of the CCE Program at any time in
accordance with any applicable requirements of state law.

Authority Documents. The Parties acknowledge and agree that the affairs of
VCEA will be implemented through various documents duly adopted by the
Board through Board resolution. The Parties agree to abide by and comply with
the terms and conditions of all such documents that may be adopted by the Board,
subject to the Parties’ right to withdraw from VCEA as described in Article 6.
ARTICLE 5: FINANCIAL PROVISIONS

5.1

Fiscal Year. VCEA’s fiscal year shall be 12 months commencing July 1 and
ending June 30. The fiscal year may be changed by Board resolution.

5.2

Depository.
5.2.1

All funds of VCEA shall be held in separate accounts in the name of
VCEA and not commingled with funds of any Party or any other person or
entity.

5.2.2

All funds of VCEA shall be strictly and separately accounted for, and
regular reports shall be rendered of all receipts and disbursements, at least
quarterly during the fiscal year. The books and records of VCEA shall be
open to inspection by the Parties at all reasonable times. The Board shall
contract with a certified public accountant or public accountant to make an
annual audit of the accounts and records of VCEA, which shall be
conducted in accordance with the requirements of Section 6505 of the Act.

5.2.3

All expenditures shall be made in accordance with the approved budget
and upon the approval of any officer so authorized by the Board in
accordance with its Operating Rules and Regulations. The Treasurer shall
draw checks or warrants or make payments by other means for claims or
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Exhibit A

disbursements not within an applicable budget only upon the prior
approval of the Board.
5.3

Budget and Recovery of Costs.
5.3.1

Budget. The initial budget shall be approved by the Board. The Board
may revise the budget from time to time as may be reasonably necessary
to address contingencies and unexpected expenses. All subsequent
budgets of VCEA shall be approved by the Board in accordance with the
Operating Rules and Regulations.

5.3.2 Funding of Initial Costs. The County of Yolo and the City of Davis have
funded certain activities necessary to implement the CCE Program. If the
CCE Program becomes operational, these Initial Costs paid by the County
and the City shall be included in the customer charges for electric services
as provided by Section 5.3.3 to the extent recovery of such costs is
permitted by law, and the County and the City shall be reimbursed from
the payment of such charges by customers of VCEA. Prior to such
reimbursement, the County and the City shall provide such documentation
of costs paid as the Board may request. VCEA may establish a reasonable
time period over which such costs are recovered. In the event that the
CCE Program does not become operational, Yolo and Davis shall not be
entitled to any reimbursement of the Initial Costs that have paid from
VCEA or any Party. If any of the initial member agency assists in funding
initial costs, that initial member shall also be entitled to reimbursement
pursuant to this section.
5.3.3

CCE Program Costs. The Parties desire that all costs incurred by VCEA
that are directly or indirectly attributable to the provision of electric,
conservation, efficiency, incentives, financing, or other services provided
under the CCE Program, including but not limited to the establishment and
maintenance of various reserves and performance funds and
administrative, accounting, legal, consulting, and other similar costs, shall
be recovered through charges to CCE customers receiving such electric
services, or from revenues from grants or other third-party sources.

5.3.4

Employee Retirement and Post-retirement benefits. Should the Board
determine to provide a defined benefits retirement benefit to VCEA
employees (such as PERS) or other post-retirements benefits that would be
within an Other Post-Retirement Benefits (OPEB) obligation to VCEA
employees, prior to providing such benefit(s) to any employee, the Board
shall (1) obtain a third party independent actuarial report on the long term
costs of the benefit or benefits, (2) adopt a funding plan for the payment of
both current and long-term costs that provides for the payment of all such
costs on a current, pay-as-you-go, basis and eliminates any known or
reasonably anticipated unfunded liability associated with the benefit(s) and
(3) notice all member agencies of the pending consideration of the
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 Resolution No. 16-153
Exhibit A

benefit(s) together with the actuarial report and funding plan, for at least
sixty (60) days and obtain the unanimous consent, by resolution, of all the
Directors present and voting on the resolution. .
ARTICLE 6: WITHDRAWAL AND TERMINATION
6.1

Withdrawal.
6.1.1

Right to Withdraw. A Party may withdraw its participation in the CCE
Program, effective as of the beginning of VCEA’s fiscal year, by giving
no less than 6 months advance written notice of its election to do so,
which notice shall be given to VCEA and each Party. Withdrawal of a
Party shall require an affirmative vote of the Party’s governing board.

6.1.2

Right to Withdraw After Amendment. Notwithstanding Section 6.1.1, a
Party may withdraw its membership in VCEA following an amendment to
this Agreement adopted by the Board which the Party’s Director(s) voted
against provided such notice is given in writing within thirty (30) days
following the date of the vote. Withdrawal of a Party shall require an
affirmative vote of the Party’s governing board and shall not be subject to
the six month advance notice provided in Section 6.1.1. In the event of
such withdrawal, the Party shall be subject to the provisions of Section
6.3.

6.1.3

The Right to Withdraw Prior to Program Launch. After receiving bids
from power suppliers, VCEA shall provide to the Parties the report from
the electrical utility consultant retained by VCEA that compares the total
estimated electrical rates that VCEA will be charging to customers as well
as the estimated greenhouse gas emissions rate and the amount of
estimated renewable energy used with that of the incumbent utility. If the
report provides that VCEA is unable to provide total electrical rates, as
part of its baseline offering, to the customers that are equal to or lower
than the incumbent utility or to provide power in a manner that has a lower
greenhouse gas emissions rate or uses less renewable energy than the
incumbent utility, a Party may immediately withdraw its membership in
VCEA without any financial obligation, as long as the Party provides
written notice of its intent to withdraw to VCEA Board no more than
fifteen (15) days after receiving the report. Any withdrawing Party shall
not be entitled to any return of funds provided to VCEA, provided,
however, that if, after the program is launched there an unobligated and
unused funds, the withdrawing member shall be refunded its pro rata
share of the unobligated and unused funds.

6.1.4

Continuing Financial Obligation; Further Assurances. Except as provided
by Section 6.1.3, a Party that withdraws its participation in the CCE
Program may be subject to certain continuing financial obligations, as
described in Section 6.3. Each withdrawing Party and VCEA shall
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 Resolution No. 16-153
Exhibit A

execute and deliver all further instruments and documents, and take any
further action that may be reasonably necessary, as determined by the
Board, to effectuate the orderly withdrawal of such Party from
participation in the CCE Program.
6.2

Involuntary Termination of a Party. Participation of a Party in the CCE Program
may be terminated for material non-compliance with provisions of this Agreement
or any other agreement relating to the Party’s participation in the CCE Program
upon a vote of Board members as provided in Section 3.7.5. Prior to any vote to
terminate participation with respect to a Party, written notice of the proposed
termination and the reason(s) for such termination shall be delivered to the Party
whose termination is proposed at least thirty (30) days prior to the regular Board
meeting at which such matter shall first be discussed as an agenda item. The
written notice of proposed termination shall specify the particular provisions of
this Agreement or other agreement that the Party has allegedly violated. The
Party subject to possible termination shall have the opportunity at the next regular
Board meeting to respond to any reasons and allegations that may be cited as a
basis for termination prior to a vote regarding termination. A Party that has had
its participation in the CCE Program terminated may be subject to certain
continuing liabilities, as described in Section 6.3.

6.3

Continuing Financial Obligations; Refund. Except as provided by Section 6.1.3,
upon a withdrawal or involuntary termination of a Party, the Party shall remain
responsible for any claims, demands, damages, or other financial obligations
arising from the Party membership or participation in the CCE Program through
the date of its withdrawal or involuntary termination, it being agreed that the Party
shall not be responsible for any financial obligations arising after the date of the
Party’s withdrawal or involuntary termination. Claims, demands, damages, or
other financial obligations for which a withdrawing or terminated Party may
remain liable include, but are not limited to, losses from the resale of power
contracted for by VCEA to serve the Party’s load and any unfunded liabilities
such as unfunded retirement contributions or costs and any unfunded postretirement benefits. With respect to such financial obligations, upon notice by a
Party that it wishes to withdraw from the CCE Program, VCEA shall notify the
Party of the minimum waiting period under which the Party would have no costs
for withdrawal if the Party agrees to stay in the CCE Program for such period.
The waiting period will be set to the minimum duration such that there are no
costs transferred to remaining ratepayers. If the Party elects to withdraw before
the end of the minimum waiting period, the charge forwithdrawal shall be set at a
dollar amount that would offset actual costs to the remaining ratepayers, and may
not include punitive charges that exceed actual costs. In addition, such Party shall
also be responsible for any costs or obligations associated with the Party’s
participation in any program in accordance with the provisions of any agreements
relating to such program provided such costs or obligations were incurred prior to
the withdrawal of the Party. VCEA may withhold funds otherwise owing to the
Party or may require the Party to deposit sufficient funds with VCEA, as
reasonably determined by VCEA and approved by a vote of the Board of
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Exhibit A

Directors, to cover the Party’s financial obligations for the costs described above.
Any amount of the Party’s funds held on deposit with VCEA above that which is
required to pay any financial obligations shall be returned to the Party. If there is
a disagreement related to the charge(s) for withdrawal or exiting, the Parties shall
attempt to settle the amount through mediation or other dispute resolution process
as authorized by section 7.1. If the dispute is not resolved, the Parties may agree
in writing to proceed to arbitration, or any party may seek judicial review. The
liability of any Party under this section 6.3 is subject and subordinate to the
provisions of Section 2.2, and nothing in this section 6.3 shall reduce, impair, or
eliminate any immunity from liability provided by Section 2.2.
6.4

Mutual Termination. This Agreement may be terminated by mutual agreement of
all the Parties; provided, however, the foregoing shall not be construed as limiting
the rights of a Party to withdraw its participation in the CCE Program, as
described in Section 6.1.

6.5

Disposition of Property upon Termination of Authority. Upon termination of this
Agreement, any surplus money or assets in possession of VCEA for use under this
Agreement, after payment of all liabilities, costs, expenses, and charges incurred
under this Agreement and under any program documents, shall be returned to the
then-existing Parties in proportion to the contributions made by each.
ARTICLE 7: MISCELLANEOUS PROVISIONS

7.1

Dispute Resolution. The Parties and VCEA shall make reasonable efforts to
informally settle all disputes arising out of or in connection with this Agreement.
Should such informal efforts to settle a dispute, after reasonable efforts, fail, the
dispute shall be mediated in accordance with policies and procedures established
by the Board.

7.2

Liability of Directors, Officers, and Employees. The Directors, officers, and
employees of VCEA shall use ordinary care and reasonable diligence in the
exercise of their powers and in the performance of their duties pursuant to this
Agreement. No current or former Director, officer, or employee will be
responsible for any act or omission by another Director, officer, or employee.
VCEA shall defend, indemnify and hold harmless the individual current and
former Directors, officers, and employees for any acts or omissions in the scope
of their employment or duties in the manner provided by Government Code
Sections 995 et seq. Nothing in this section shall be construed to limit the
defenses and immunities available under the law, to the Parties, VCEA, or its
Directors, officers, or employees.

7.3

Indemnification of Parties. VCEA shall acquire such insurance coverage as is
necessary to protect the interests of VCEA, the Parties, and the public. VCEA
shall defend, indemnify, and hold harmless the Parties and each of their respective
Board or Council members, officers, agents and employees, from any and all
claims, losses, damages, costs, injuries, and liabilities of every kind arising
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 Resolution No. 16-153
Exhibit A

directly or indirectly from the conduct, activities, operations, acts, and omissions
of VCEA under this Agreement.
7.4

Amendment of this Agreement. This Agreement may not be amended except by a
written amendment approved by a vote of Board members as provided in Section
3.7.5. VCEA shall provide written notice to all Parties of amendments to this
Agreement, including the effective date of such amendments, at least 30 days
prior to the date upon which the Board votes on such amendments.

7.5

Assignment. Except as otherwise expressly provided in this Agreement, the
rights and duties of the Parties may not be assigned or delegated without the
advance written consent of all of the other Parties, and any attempt to assign or
delegate such rights or duties in contravention of this Section 7.5 shall be null and
void. This Agreement shall inure to the benefit of, and be binding upon, the
successors and assigns of the Parties. This Section 7.5 does not prohibit a Party
from entering into an independent agreement with another agency, person, or
entity regarding the financing of that Party’s contributions to VCEA, or the
disposition of proceeds which that Party receives under this Agreement, so long
as such independent agreement does not affect, or purport to affect, the rights and
duties of VCEA or the Parties under this Agreement.

7.6

Severability. If one or more clauses, sentences, paragraphs or provisions of this
Agreement shall be held to be unlawful, invalid or unenforceable, it is hereby
agreed by the Parties, that the remainder of the Agreement shall not be affected
thereby. Such clauses, sentences, paragraphs or provision shall be deemed
reformed so as to be lawful, valid and enforced to the maximum extent possible.

7.7

Further Assurances. Each Party agrees to execute and deliver all further
instruments and documents, and take any further action that may be reasonably
necessary, to effectuate the purposes and intent of this Agreement.

7.8

Execution by Counterparts. This Agreement may be executed in any number of
counterparts, and upon execution by all Parties, each executed counterpart shall
have the same force and effect as an original instrument and as if all Parties had
signed the same instrument. Any signature page of this Agreement may be
detached from any counterpart of this Agreement without impairing the legal
effect of any signatures thereon, and may be attached to another counterpart of
this Agreement identical in form hereto but having attached to it one or more
signature pages.

7.9

Parties to be Served Notice. Any notice authorized or required to be given
pursuant to this Agreement shall be validly given if served in writing either
personally, by deposit in the United States mail, first class postage prepaid with
return receipt requested, or by a recognized courier service. Notices given (a)
personally or by courier service shall be conclusively deemed received at the time
of delivery and receipt and (b) by mail shall be conclusively deemed given 48
hours after the deposit thereof (excluding Saturdays, Sundays and holidays) if the
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 Resolution No. 16-153
Exhibit A

sender receives the return receipt. All notices shall be addressed to the office of
the clerk or secretary of VCEA or Party, as the case may be, or such other person
designated in writing by VCEA or Party. Notices given to one Party shall be
copied to all other Parties. Notices given to VCEA shall be copied to all Parties.
CITY:
CITY OF DAVIS, a California municipal
corporation

By:
Rob Davis, Mayor
ATTEST:

By:
Zoe Mirabile, City Clerk

APPROVED AS TO FORM:

By:
Harriet A. Steiner, City Attorney

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Exhibit A

EXHIBIT A
DEFINITIONS
“Act” means the Joint Exercise of Powers Act of the State of California (Government Code
Section 6500 et seq.)
“Administrative Services Agreement” means an agreement or agreements entered into after the
Effective Date by VCEA with an entity that will perform tasks necessary for planning,
implementing, operating and/or administering the CCE Program, or any portion of the CCE
Program or any other energy programs adopted by VCEA.
“Agreement” means this Joint Powers Agreement.
“Alliance” or “Authority” or “VCEA” means the Valley Clean Energy Alliance.
“Annual Energy Use” has the meaning given in Section 3.7.1.
“Authority Document(s)” means document(s) duly adopted by the Board by resolution or motion
implementing the powers, functions, and activities of VCEA, including but not limited to the
Operating Rules and Regulations, the annual budget, and plans and policies.
“Board” means the Board of Directors of VCEA.
“CCE” or “Community Choice Energy” or “CCA” or “Community Choice Aggregation” means
an electric service option available to cities and counties pursuant to Public Utilities Code
Section 366.2.
“CCE Program” or “CCA Program” means VCEA’s program relating to CCE that is principally
described in Sections 2.3, 2.4, and 4.1.
“Director” means a member of the Board of Directors representing a Party.
“Effective Date” means October 25, 2016 or when initial members of VCEA, including but not
limited to the County of Yolo and the City of Davis execute this Agreement, whichever occurs
later, as further described in Section 2.1.
“Implementation Plan” means the plan generally described in Section 4.1.2 of this Agreement
that is required under Public Utilities Code Section 366.2 to be filed with the California Public
Utilities Commission for the purpose of describing a proposed CCE Program.
“Initial Costs” means all costs incurred by the County, the City and/or Authority relating to the
establishment and initial operation of VCEA, such as the hiring of an Executive Officer and any
administrative staff, and any required accounting, administrative, technical, or legal services in
support of VCEA’s initial activities or in support of the negotiation, preparation, and approval of
one or more Administrative Services Agreements.
“Operating Rules and Regulations” means the rules, regulations, policies, bylaws and procedures
governing the operation of VCEA.

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Exhibit A

“Parties” or “Members” means, collectively, the County, the City of Davis and any city or
county which executes this Agreement.
“Party”, “Member” or “Member Agency” means a signatory to this Agreement.
“Total Annual Energy” has the meaning given in Section 3.7.1.

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 Resolution No. 16-153
Exhibit A

EXHIBIT B
LIST OF PARTIES
Parties:

County of Yolo
City of Davis

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Exhibit A

EXHIBIT C
ANNUAL ENERGY USE / VOTING SHARES

Unincorporated Yolo County

318,300,165 KWh

Davis

284,129,391 KWh

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