December 27, 2007
Who Will Pay for Power to the Alamo Industrial Park

Photo by Dave Maxwell Alamo Industrial Park Land

By Dave Maxwell

Getting electricity to the Alamo Industrial Park, so businesses can start building there, is the next important question on the table. However, two forces in the County are in opposing corners on how this should be done.

In the one corner is the Lincoln County Commissioners, who feel that the Alamo Power District, as provider of the power, should pay the $4.5 million cost of having power lines brought from the Crystal Springs substation, down the west side of the valley, then across the valley and U.S. 93 to the Park. In the other corner is Alamo Power, who feels that the County, as initial owner of the land, is the developer responsible for paying the cost of getting power lines into the park.

The County Commission has sought to apply for a $2.3 million Economic Development Authority grant for on-site infrastructure for the Park. However, County Manager John Lovelady said, “One requirement of the grant is that utilities must be installed first and be ‘available to hook up to and turn on the switch’ in order to receive the money from the grant. But, as Grant Administrator Phyllis Robistow reported at the meeting, the EDA grant can only be used for “electricity and other infrastructure inside the Park.” The money cannot be used, she said, to help the Power District get power to the Park. County Commissioners have said they feel that it is the responsibility of the Alamo Power District as power provider, to get electricity to the Park.

In the other corner, Doug Miller, manager of Alamo Power, said he felt that, “the County is the developer of the Industrial Park because they are buying it and then selling pieces of it off, so they are the developers.” He said discussions have gone “round and round about this” between the County and the Lincoln County Rural Development Authority.

Miller said the written policy of both the Alamo Power Board and Lincoln County Power, “is that the developer pays the cost of any new construction and bringing in power lines. Any homeowner that wants to put a new power line somewhere on his property has to pay the cost of it. That’s just existing policy. We’re not going to put our existing ratepayers at risk if a power line is put in and then the (Industrial Park) development does not happen as expected. Who’s going to pay?” Miller asked. “It’s the industry norm that the developer is the one that pays, not put it on the backs of your existing customers. If everything filled up right away and used lots of power, it wouldn’t be a big issue,” he said. “But, currently I don’t see the whole place filling right up and using a ton of power right off the bat.” He said the original figures Alamo Power was given by Steel Tech of how much power they would need, “is that they would use about as much as the grocery store up here on the corner.” Although it’s a fair amount, Miller noted, “It certainly would not fund a $4 million project.”

Miller said Alamo Power does have enough in their current system to feed the Steel Tech plant (if it is built), but nothing else. “It seems pointless when you have this whole development, to just build one little line up there instead of trying to plan for the whole thing,” he said. Bringing power to just the 24 acres that Steel Tech plans to buy from the County in Parcel A, Miller said, will be about $500,000. “But that’s just a band-aid. They really need to figure out how to finance the development as a whole.”

Putting in the “whole development,” Miller said, “would be to run the 69,000 kilovolt line from the Crystal Springs substation to another substation built at the Industrial Park to plan for future growth in the area….It’s obvious to me,” he said, “that that’s not all that is going to happen there. We’re trying to be real careful and not put any of the burden on the existing ratepayers.”

One solution that has been suggested is to create a Special Improvement District in the Industrial Park and residential areas in the other Parcels that would assess fees to all property owners in the SID to fund the building of the power lines.

With things as they stand right now, Commissioners expressed a sense of frustration at the regular meeting December 17 because they want to be able to guarantee prospective builders that power lines are installed and ready to work. They fear longer delays will cause interested developers to turn away.

Another meeting to seek a solution between Lincoln County Power District, Alamo Power, the County Commission, and the Lincoln County Regional Development Authority is tentatively set for 10 a.m. January 3, 2008 in the Commission Chambers.