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BACKGROUND The Stanley Boulevard improvement project has been in the works since 2002 when the Downtown Specific Plan was adopted. As originally planned, the project included street surface improvements consisting of concrete curb, gutter, sidewalks, asphalt pavement, street lighting and landscaping. The project was estimated to cost $2.5 million. Much of the funding to construct the street improvement project is currently available in the CIP, of which approximately half is restricted for use on the street improvements only. In 2008 the scope of the project was expanded by City Council to include the undergrounding of overhead utilities. At that time, staff was directed to design the plans and specifications and provide a construction cost estimate for the Stanley Boulevard Undergrounding Utility project. Staff received further direction to establish Underground Utility District 09-01 under the PG&E Rule 20B program. The Undergrounding Utility project design was completed in 2010, but the source of the estimated $3.25 million of additional City funding needed to construct the undergrounding project was not identified. In 2012, as an alternative to waiting for additional City funding, staff recommended the conversion of the project to the PG&E Rule 20A program, which uses Rule 20A dollars to fund the construction of the underground utility improvements. The City conducted a public hearing and created a Rule 20A Underground Utility District No 12-01 on Stanley Boulevard from Santa Rita Road to First Street. In addition, City Council approved the use of Rule 20A work credits to cover the service lateral trenching costs onto private property up to 100 feet from the street (100 Foot Rule) and to cover the electrical panel conversion costs up to $1500 per panel, as permitted under Rule 20A regulations. In 2012 the project was entered into PG&E's Rule 20A queue for funding, electrical design, and scheduling of constructing in 2016. In January 2015, staff met with PG&E to review the final electrical design and coordinated their design into the final plans and specifications. The remaining utility companies (AT&T and Comcast) were notified to prepare their respective utility designs which will also be incorporated into the final plans and specifications. DISCUSSION The CPUC Tariff Regulations require the utility companies to fund their portion of the utility undergrounding. PG&E sets aside an annual conversion allocation, which is apportioned to cities and counties in their service areas based upon the number of electrical meters for overhead electrical services within the City's boundaries. These funds are commonly referred to as Rule 20A work credits. Currently, the City receives a yearly allocation work credit of $145,000 and has accumulated $1.5 million in work credits. PG&E's program allows the City to borrow against up to five future years of Rule 20A work credits. The total work credits should be sufficient to fund PG&E's share of the undergrounding portion of the project. The other participating utility companies (AT&T and Comcast) will reimburse their pro rata share of constructing the underground utilities based upon the actual construction bids. Page 2 of 4