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Recap of the Oct. 4 Citizens For Traer's Future meeting

October 13, 2017
Traer Star-Clipper

At a town hall meeting hosted by Citizens For Traer's Future there were five individuals that gave short presentations in person as well as a presentation made over Skype. Nick Podhajsky presided over the meeting. Nick opened by comparing ownership of the gas system to owning or renting a house. With Alliant it is similar to renting, you just keep sending payments with Alliant receiving a return on investment while you build no equity. With community control of the franchise those payments are investments in the ownership of the system. Once the system is paid for there will be profits that can be used for community support and stable competitive, possibly lower rates.

Nick introduced Karla Uhl, City Clerk from Mapleton, Iowa who presented her information via Skype. Mapleton acquired their system in 2009. Karla talked about revenues and said the system is exceeding expectations and will be paid off in 2022, just 13 years after acquiring it. She also talked about the benefit of being able to share existing three employees to operate the gas system with the gas system fully supporting the salary of one employee. They are doing this by charging the same rates as the incumbent utility was charging. Karla gave high praise to the gas qualification training and mutual aid programs offered by IAMU (Iowa Association of Municipal Utilities) in Ankeny, Iowa. Mapleton was hit by a tornado two years after getting the gas system. A 2-inch gas main was damaged and the whole town had to be shut down. There was also damage to the city's electrical system. By mid-day the following day there were over 30 operators from other municipals responding through the IAMU mutual aid program and in less than 48 hours gas and power was restored throughout town to every building that wasn't damaged and was able to receive service.

Dale Oltmans from Alton, Iowa was the next speaker. Mr. Oltmans spoke about Alton obtaining their system at about the same time as Mapleton. He too, said that income from the system is allowing them to make payments towards the bond retirement, pay employees and have money left for other purposes. Alton is using an existing workforce and existing equipment just as Mapleton to operate their system. Mr. Oltmans said that they relied on the IAMU training program to qualify their two operators and after operating the system for 10 years they have not experienced any problems and they don't expect to.

Then two men from IAMU spoke about the training programs that IAMU provides to its members. IAMU also has a training field that is used for hands on, real life situation training. Nick Vandegriff was introduced. Mr. Vandegriff previously was a safety inspectors for the Iowa Utilities Board and now is with IAMU. He pointed out that training for gas operators is the same whether they work for a big corporation or a city utility. The training standards and regulations are set forth by the Pipeline and Hazardous Materials Safety Administration (PHMSA). He talked about the Operator Qualification Training program offered by IAMU with class room and hands on training conducted at their 11 -cre training field and complex. Mr. Oltmans reiterated Ms. Uhl's previous comments about the mutual aid program and the fact that there are 51 municipal gas utilities ready and able to provide help in case of any type of emergency. Mr. Oltmans was asked about the age of this system. Both Vandegriff and Oltmans responded that if the cathodic protection system that is required to be in place to provide protection is properly maintained that age is not a factor. Vandegriff said that the protection system has to be inspected annually, not to exceed 15 months and the results of the inspection have to be documented and recorded. If any deficiencies are discovered there is a specified period of time in which corrections have to be made. Mr. Oltmans said they have exposed pipes in Alton that were installed in 1954 and they look the same today as when they were installed.

Clayton Energy was represented by Bill Lindley who runs the company. Clayton Energy today provides natural gas to 43 municipal gas systems. Clayton purchases gas from the same suppliers and as competitively priced as Alliant. They have contracts in place for gas supplies for the next six years. Mr. Lindley reviewed the history of gas supplies and costs since 2000. In 2008 with the discovery of shale fields and the use of horizontal drilling with multiple inputs feeding a single wellhead the supply of gas has exceeded the demand which has caused a drop in gas prices to the levels we are seeing today. Clayton Energy also has procured capacity on the Northern Natural Pipeline and will be able to provide natural gas on that pipeline to the town.

Pat Stief, General Manager of TMU was the final speaker. He talked about what caused the price spikes in electricity in 2008. He indicated that the cause has been alleviated and wholesale prices are competitive and stable today. Stief then stated that even after prices subsided the TMU board was determined to assert some local control over their energy costs and moved ahead and partnered to have a wind turbine installed. TMU then installed solar energy and offered ownership of solar panels to the TMU customers. Today TMU receives 40% of the total energy consumed from renewable resources, the highest of any municipal in the state. And TMU was the first municipal in the state to utilize both wind and solar energy. Stief went on to point out that for years TMU has offered rebates for energy efficiency and offers budget billing to their customers. But the best news shared by Stief was that TMU will have the wind turbine paid for at the end of the year and is REDUCING RATES for all of its customers. For an average residential customer this means a rate reduction of 10% to 12% on the bill they will receive in January 2018. Stief pointed out that with the recent rate increase enacted by Alliant that Traer's residential rates will be 30% below Alliant's residential rates.

A few of the question from the audience are noted here:

How many properties in municipal systems have been blown up due to gas accidents? Nick Vandegriff and Dale Oltmans both responded - ZERO.

How much additional equipment will be required to operate a gas system? The equipment that TMU already owns was discussed and Dale Oltmans said the only thing they might need is a gas detector or locator with a total expense of under $500.00.

How much of the pipe line will we own and where do we get gas from? The pipe all the way out to the town border station by the sports complex will be owned and gas is delivered to the town system at the border station.

How about these old pipes that have been buried since 1960? The speakers that addressed the system protection devices and required testing referred to this again and said there should not be any problems due to the age of the system.

Nick Podhajsky wrapped the meeting by saying the single most important reason to vote YES is to allow us to discover what it would cost to obtain the gas system. Once a price is determined the same analysis used to consider purchase of the turbine will be applied to this situation. If the numbers do not work we will not move forward. But we need YES votes to allow us to move forward and make that determination. He stated that Traer's attitude over the years has always been a positive can-do with words like CAN'T and NO not included in our vocabulary. Vote YES so we can move forward and make an informed decision.

 
 

 

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