Background
Earlier this year Commonwealth Edison advised the Village that they were making infrastructure improvements in the area of Hickory, Kensington, as well as, other neighborhoods. Specifically, Commonwealth Edison is proposing to upgrade the electrical capacity from 4KV to 12KV lines. As a result of this notice, Village staff and Attorney Hart Passman reviewed the existing franchise agreement and had conversations with Commonwealth Edison representatives and their attorney’s regarding requirements for undergrounding overhead facilities. While the legal requirements are not completely clear, it does appear as a result of some litigation and administrative hearings, Commonwealth Edison is a public utility operating under what is known as Rider 19. Rider 19 does permit undergrounding of power lines that specifies the cost of such undergrounding should be paid for by the municipality requesting the undergrounding. These costs can either be paid directly or through an increased cost to every Commonwealth Edison customer within the municipality’s jurisdiction.
Request for Underground Cost Estimate
While not relinquishing any future rights or interpretation of the underground provisions of the franchise agreement the Village requested preliminary cost estimates to underground the overhead utilities in the Hickory/Kensington area.
Along Kensington Rd. only between Hickory Ave. & South Beverly Lane
- Preliminary cost estimate $670K+
- First Phase Preliminary Engineering $67K
The cost estimates are preliminary and some additional costs may be necessary. The cost to bury all of the overhead Commonwealth Edison lines in the Hickory/Kensington area is cost prohibitive. The cost of burying the overhead Commonwealth Edison lines just along Kensington Road between Hickory and Beverly, which would result in removal of approximately seven poles with some pole mounted transformers and require two ground mounted transformers/switch gear to be placed within the Kensington Road right of away could be funded from the Hickory/Kensington TIF district. Two poles on the south side if Kensington would need to be installed to maintain service to buildings in the Kensington/Northwest Highway triangle. When redevelopment of the triangle occurs overhead lines in this area could be buried as part of that redevelopment. Staff has prepared the attached photo illustrating the ground mounted equipment that would be needed in the approximate locations. Before proceeding with this, Commonwealth Edison would require the Village to enter into a contract committing to pay for the undergrounding of these utilities. Additional overhead undergrounding south of Kensington Road could occur if and when properties between Kensington and Northwest Highway west of Mariano’s redevelop.
Funding
Staff would not recommend funding the undergrounding of the Commonwealth Edison lines be paid by all of the customers and tax payers in the Village of Arlington Heights, however, this area is within the Hickory/Kensington TIF district. The Hickory/Kensington TIF district runs until 2037. At the end of 2022, the TIF district had a positive fund balance of approximately $4M. The Village has committed to project costs for the Campbell Street extension and 4 N. Hickory public private partnerships in the amount approximately $1.5M plus $120,000 per year maximum commitment for 8 years for 4 N. Hickory. It is further anticipated that the 4 N. Douglas development will request public private partnership. However, projections indicate that the Village could pay for the Commonwealth Edison undergrounding, as well as, facilitate additional development while still maintaining a positive TIF fund balance to facilitate future redevelopment.
Recommendation
It is recommended that the Village Board authorize the Village Manager to enter into an underground relocation agreement with Commonwealth Edison to relocate the above ground utility lines along the north side of Kensington Road between Hickory Avenue and South Beverly Lane. The cost estimate is $670,000 to be funded from the Hickory/Kensington TIF District – Account # 266-4001-550250