2005 Minnesota Statutes

     451.04 Franchise for city heating system. 

    Subdivision 1.    Right to build, run.  A home rule 
 charter city of the fourth class may give a person, company, or 
 corporation the right to use the streets, alleys, and other 
 public grounds of the city to construct, operate, and maintain a 
 system to furnish heat to city residents. 

    Subd. 2.    Council sets terms, condition.  The city 
 council must decide what terms and conditions apply to the use 
 of the right given under subdivision 1. 

    Subd. 3.    City sale of steam, hot water.  If the city 
 owns and operates a plant that heats water or generates steam, 
 the city may sell the steam or hot water to the user of the 
 right given under subdivision 1 at a profit to the city. 

    Subd. 4.    Arrangements for heat, control of system.  
 The city may make contracts and arrangements for furnishing 
 heat, using the city's steam or hot water, to city residents.  
 The city may also make arrangements for the regulation and 
 control of the heating system. 

    Subd. 5.    May install system equipment.  The city may 
 give a person, company, or corporation the right to use the 
 streets, alleys, and other public grounds of the city to 
 install, at no expense to the city, necessary and incidental 
 equipment to construct, operate, and maintain the heating 
 system.  The city council must decide what terms and conditions 
 apply to the use of the plant. 

    Subd. 6.    Heat from city steam, hot water.  If the 
 city owns and operates a plant that heats water or generates 
 steam, the city may make the necessary and incidental contracts 
 and arrangements to furnish, at a profit to the city, heat from 
 the steam or hot water, to the city's residents. 

    Subd. 7.    City may buy system.  The city may acquire, 
 own, operate, and enlarge the heating system after it is 
 installed. 

    Subd. 8.    City debt payable in future heat.  The city 
 may issue its certificates of indebtedness payable in heat to be 
 sold by the city. 

    Subd. 9.    City's steam, hot water to service company.  
 If the city operates a municipal electric light or water plant, 
 the city may agree with a service company that furnishes steam 
 or hot water heat to its residents to supply from the municipal 
 plant to the service company, the necessary steam or hot water 
 for the company's customers. 

    Subd. 10.    Terms of agreement.  The supply agreement 
 between the city and the service company may include terms on 
 the subjects in this subdivision. 

    (a) The agreement may provide for joint approval of the 
 plans and joint supervision of the construction and the definite 
 determination at the time of completion, of the cost of the 
 company's plant. 

    (b) The agreement may:  

    (1) fix the rates to be charged to the company's customers 
 for the heat supplied; 

    (2) fix the charges to be billed to and collected from the 
 customer either by the city or the service company; and 

    (3) divide the revenue received from the collections 
 between the city and the service company. 

    (c) The agreement may provide for the purchase of the 
 company's plant by the city at cost, plus reasonable interest on 
 the cost, and for payment for the plant from the money saved by 
 the city from its share of the collections.  

    Subd. 11.    City may buy private system.  If there is a 
 heating system in the city that is not owned by the city, the 
 city may buy the heating system for not more than its fair value.
 The city and the owner of the system must agree on the terms of 
 the sale. 

    Subd. 12.    Pay with bonds.  The city council may issue 
 and sell as many bonds of the city as it judges are necessary to 
 buy the heating system from its owners. 

    Subd. 13.    Bond formalities.  (a) The city council 
 must decide:  

    (1) the bonds' form and denomination; 

    (2) the rate of interest on the bonds, not more than six 
 percent per year, payable semiannually; and 

    (3) the time, not more than 20 years from their date, when 
 the bonds are due and payable. 

    (b) If the city issues the bonds, the bonds must be signed 
 by the mayor and countersigned by the clerk. 

    (c) The bonds must be sold for not less than par and 
 accrued interest. 

    Subd. 14.    Add to other powers.  The powers granted in 
 this section are to be added to other powers granted by law. 

    HIST: (1768) 1917 c 122 s 1; Ex1919 c 25 s 1; 1921 c 108 s 1; 
 1949 c 119 s 111; 1988 c 469 art 6 s 1