January 20, 2023 at 3:30 p.m.
North Branch Council not ready to sever ties with power agency
On their agenda was an action enacting an agreement severing the city’s energy contract with the Southern MN Municipal Power Association or SMMPA.
The pending sale of the municipal electric assets to the East Central Energy cooperative, which is a member of Great River Energy, calls for GRE to takeover the North Branch obligations to SMMPA.
The ECE sale however, means approximately $30,000 monthly that the North Branch Water & Light utility received, to provide on-demand power to SMMPA, goes away.
Both newly-incoming and incumbent officials at the council meeting questioned where North Branch will get revenue to continue to operate several diesel generators, which are not part of the assets being bought by ECE (or GRE.)
New Council member Peter Schaps, who recently chaired the Water & Light utility commission, said he lacked information on this.
He argued the city won’t be able to float “revenue bonds” after any utility-held savings are spent, to support the city costs associated with the generators, “...because we’ll have no revenue” to pay off the loan. To sever the SMMPA relationship is “a pretty big risk” at this time, he added. Schaps argued for “more study” to be done.
Council member Kelly Neider, who also formerly served on the utility commission, said she wants to see “numbers on a paper.” There’s been discussion about expected proceeds from the sale of the electric distribution assets, but no final projections have been made public for what will actually be available after the utility debt is paid off and expenses are accomodated.
Many questions remain about long range costs and plans to pay for them that were to have been investigated by the Water & Light utility sale transitions team.
City Administrator Renae Fry observed for council, that the Water & Light Commission had “no conversation” when the budget for the utility was approved, either the pre-sale budget or the post-sale budget.
The monthly Water & Light meetings have a regular item on the agenda for Nathan Keech to give reports from transitions team meetings. Keech, who is the current Chair of Water & Light, assured council last week the transitions team determined it was “feasible” to keep the generators.
A Capital Plan will need to be created, he agreed, adding, “I have full confidence we can get this figured out.”
Newly elected Mayor Scheiber stated there’s too many unresolved questions to take action on the formal release from SMMPA, and he made a motion to table the vote until the Jan 24 council session. It passed 5-0. (Later it was announced on the city website there may be three or more council members attending the regularly scheduled Water & Light Commission meeting yesterday, Jan. 18. As usual the Press will report on that session.)
Mayor Scheiber explained to the council that he viewed a number of past meeting videos, especially the joint session last May where the independent appraisal of the electric assets was presented, and he is now concerned to see the discussion going from “enthusiasm” months ago to apprehension being vocalized now.
Editor’s note: The Chisago County Press requested a transitions team meeting schedule and the reporter was advised the meetings were not public. The disagreement is, having been organized as a subcommittee of a public body (Water & Light) the transitions team must adhere to Minnesota Open Meeting Law rules, which would have included a regular published schedule of meetings, taking minutes and maintaining a record of attendance for later collecting of per diems.
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