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A. For any license granted pursuant to this chapter, the licensee shall pay to the licensor an annual amount of two percent of the licensee’s gross annual revenues. The licensee shall pay the license fee because, among other things, the public rights-of-way which are used by the licensee in the operation of its industrial gas pipeline within the boundaries of the City are valuable public properties acquired and maintained by the City at great expense to its taxpayers, and that the grant to the licensee to use said public right-of-way is a valuable property right without which the licensee would be required to invest substantial capital in right-of-way costs and acquisitions.

B. In the event licensee’s industrial gas pipeline should perpendicularly cross only a single public right-of-way, then the licensee’s annual amount shall be capped at $125,000.00 regardless of the number of pipes crossing the single public right-of-way. The $125,000.00 cap in this section shall increase every five years, starting in 2027, by the increase in the cumulative consumer price index for the Phoenix metropolitan area during the previous five-year period. At no time shall the cap amount be less than the cap for the previous five-year period. The Street Transportation Director shall provide written notice to all current licensees of any increase in the annual cap, and the increase shall go into effect in the calendar year following the notice. For purposes of this subsection, “perpendicular crossing” shall mean not greater than 160 linear feet across the public right-of-way from the licensee’s owned or leased property to a private property. For instances where the licensee’s crossing includes multiple pipelines, no individual pipeline crossing shall exceed 160 feet through the single public right-of-way. Upon written notice and approval by the City, the licensee may cross additional public rights-of-way, then licensee shall be subject to the two percent of gross revenues derived from these additional crossings. The additional right-of-way crossing shall not be subject to any cap of the annual fee.

C. Payments due the licensor under this provision shall be computed annually, for the preceding year, as of December 31. Each annual payment shall be due and payable no later than 30 calendar days after the date listed in the previous sentence. If such payment is not made by the date due, the City shall impose interest at a rate of one and one-half percent per month commencing from the date payment should have been made and continuing until the payment is made. Fractions of a month shall be considered to constitute a full month for the purpose of computing interest. Each payment shall be accompanied by a brief report showing the basis for the computation and such other relevant facts as may be required by the licensor. The amount due shall be reported and remitted to the City Treasurer on forms prescribed by the City Treasurer.

D. No acceptance of any payment shall be construed as an accord that the amount paid is in fact the correct amount, nor shall such acceptance of payment be construed as a release of any claim the licensor may have for further or additional sums payable under the provisions of this permit. All amounts paid shall be subject to audit and recomputation by the licensor.

E. In no event will the licensee pay the City pursuant to this section an amount less than $2,000.00 per calendar year, or portion thereof, for the term of this license and initial payment of said sum shall be paid to the City upon acceptance of its license for the first calendar year and a $2,000.00 payment shall be made each year in advance for each additional calendar year or portion thereof for the term of the license.

F. If the license is terminated or revoked prior to the time specified in the license, the licensee shall immediately submit to the licensor a detailed financial statement showing the gross annual revenues of the licensee for the time elapsed since the last period for which the licensee has paid to the licensor the required fee, and the licensee shall pay to the licensor, not later than 30 calendar days following the termination, the appropriate percentage of the gross annual revenue due. The licensor’s duly authorized agent is empowered to audit, examine, and verify all such financial statements and financial records of the licensee and to that end shall be entitled to a full inspection of the licensee’s books, records and documents. (Ord. No. G-2199, § 1; Ord. No. G-3961, § 1, 1996; Ord. No. G-7028, § 8, 2022)