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At that meeting, the scope of work for undergrounding the utilities was explained to the public. The improvements would be broken up into two phases, with the first phase being the undergrounding efforts and the second phase being the roadway improvements. Since the overhead utilities would most likely be placed underground below the roadway section, this would be the first order of work to be completed prior to the start of the roadway improvements. The work to be performed by a licensed electrical contractor would include the undergrounding of electrical, telephone, and cable TV wires in conduit. The location of conduit feeds from the public roadway to the adjacent private buildings would need to be coordinated with the adjacent property owners and would become the responsibility of the private property owners. The project would also require approval from the respective utility companies for those portions of the project that are public, and approval from the City's Building Department for the onsite private improvements in compliance with the local building and electrical codes. Cooperative agreements and right of entries would need to be obtained from all affected property owners to investigate existing conditions and prepare design plans for the utility conversions. Cooperative agreements to perform work on behalf of the private property owners on private property would also be needed. Upon completion of the electrical and cable system, PG&E would then energize the electrical system and remove the existing power poles. Once the power poles have been removed by PG&E, the City would then award a separate contract (Phase II) for the street improvement project for the remainder of the work. Since the completion of the underground utility work would be dependent on PG&E and its crews to complete, staff has decided to divide the work into two separate projects to avoid any potential delay claims from the contractor that could arise if the project were to incur delays. DISCUSSION Timeline Implications The undergrounding of public utilities would require the formation of an underground utility district, additional design work and permitting approvals from affected utility companies, and execution of a right-of-entry and cooperative agreements with affected property owners. As a consequence, the project completion would be extended out at least another two years and incur an increase in project costs for the construction portion of the project. The exact costs for the construction portion of undergrounding the overhead utilities will not be known until the final design is completed, advertised and bid. Based on the City's previous experience for the First Street Underground Utility District ($5 million cost to the City), the construction portion of the project is estimated to be between $2.5 and $3 million dollars or 50-60% of the First Street project. As part of the formation of the underground utility district, it is also recommended that City Council subsidize the potential costs up to $8000 per property to be consistent with past practices for previous districts, and these costs are included in the $2.5 to $3 million. By subsidizing the private property costs, the City will increase its span of Page 4 of 7