05-19-2015 City Council Study Session Packet
City of Grand Island
Tuesday, May 19, 2015
Study Session Packet
City Council:
Linna Dee Donaldson
Michelle Fitzke
Chuck Haase
Julie Hehnke
Jeremy Jones
Vaughn Minton
Mitchell Nickerson
Mike Paulick
Roger Steele
Mark Stelk
Mayor:
Jeremy L. Jensen
City Administrator:
Marlan Ferguson
City Clerk:
RaNae Edwards
7:00 PM
Council Chamber - City Hall
100 East 1st Street
Grand Island Study Session - 5/19/2015 Page 1 / 20
City of Grand Island Tuesday, May 19, 2015
Call to Order
This is an open meeting of the Grand Island City Council. The City of Grand Island abides by the Open
Meetings Act in conducting business. A copy of the Open Meetings Act is displayed in the back of this room
as required by state law.
The City Council may vote to go into Closed Session on any agenda item as allowed by state law.
Invocation
Pledge of Allegiance
Roll Call
A - SUBMITTAL OF REQUESTS FOR FUTURE ITEMS
Individuals who have appropriate items for City Council consideration should complete the Request for
Future Agenda Items form located at the Information Booth. If the issue can be handled administratively
without Council action, notification will be provided. If the item is scheduled for a meeting or study
session, notification of the date will be given.
B - RESERVE TIME TO SPEAK ON AGENDA ITEMS
This is an opportunity for individuals wishing to provide input on any of tonight's agenda items to reserve
time to speak. Please come forward, state your name and address, and the Agenda topic on which you will
be speaking.
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City of Grand Island
Tuesday, May 19, 2015
Study Session
Item -1
Presentation on Tax Increment Financing (TIF)
Staff Contact: Chad Nabity
Grand Island Study Session - 5/19/2015 Page 3 / 20
Council Agenda Memo
From:Chad Nabity, AICP
Meeting:May 19, 2015
Subject:Tax Increment Financing (TIF)
Item #’s:1
Presenter(s):Michael Bacon and Chad Nabity
Background
Mike Bacon is an attorney with Bacon & Vinton Law Offices of Gothenburg Nebraska.
He has been advising the Grand Island Community Redevelopment Authority on Tax
Increment Financing Projects since 2008 and has been involved in hundreds of TIF
projects and Blight studies across the State of Nebraska.
Chad Nabity, AICP has been the Planning Director for Hall County and Grand Island
since 2000. In 2004 he was also named the Director of the Grand Island Commmunity
Redevelopment Authority. He has been involved as CRA Director in 31 of the 37 TIF
projects that have been approved and 34 of 37 TIF projects as Planning Director. These
projects have spanned a scope from the redevelopment of the Grand Island Mall Area
(several properties and millions of dollars of TIF) to replacing a worn out house with a
new duplex at less than $40,000 of total TIF.
Discussion
Topics to be covered during the presentation include:
How an area is declared Blighted and Substandard
How TIF is used to Provide Funding for a Project
Eligible Activities for the Funding Provided by TIF
The "But For" Clause
Areas of Grand Island that have been declared Blighted and Substandard
Grand Island Study Session - 5/19/2015 Page 4 / 20
Examples of TIF Projects that have been done in Grand Island
Question and Answer Session
Conclusion
This item is presented to the City Council in a Study Session to allow for any questions to
be answered and to create a greater understanding of the issue at hand.
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City of Grand Island
Tuesday, May 19, 2015
Study Session
Item -2
Presentation on Proposed Wind Energy Project
Staff Contact: Tim Luchsinger, Utilities Director
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Council Agenda Memo
From:Timothy Luchsinger, Utilities Director
Meeting:May 19, 2015
Subject:Proposed Wind Energy Project
Item #’s:2
Presenter(s):Timothy Luchsinger, Utilities Director
Background
State statute requires that public utilities in Nebraska provide its customers with adequate
electric service at as low of an overall cost as possible, consistent with sound business
practices. To do so, public utilities must look at long-term, in addition to immediate,
issues in an overall context. The Utilities Department has taken an approach in its energy
supply strategy to incorporate multiple facilities using a blend of fuel sources. This
allows flexibility in managing costs that can occur because of market conditions due to
industry issues or environmental concerns. Energy supply planning must also take into
account the long timeframes that are common in electric generation development,
therefore, utilities plan for conditions projected at least five to ten years in the future,
sometimes even longer.
Traditional energy sources in Nebraska have been based on coal because of the close
proximity of mines in Wyoming and a robust railroad system through this area. These
have been supplemented with hydro, natural gas and nuclear facilities, resulting in low
cost power to Nebraska customers.
Due to developing environmental concerns, the State’s utilities have been developing
facilities with renewable energy sources, primarily wind generation because of its
potential compared to solar or biofuels. Grand Island has participated in some of these
projects on a minor basis to learn more of the details of wind generation costs and
operational issues. At this time, wind supplies a little over one percent of the City’s
energy requirements and has resulted in a cost impact to electric rates of less than one
percent.
On May 8, 2012 Council approved a resolution to direct the Utilities Department to
evaluate potential renewable energy projects and provide to Council recommendations
for participation as needed to maintain a balanced energy portfolio.
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Discussion
On March 24, 2015 Council approved execution of a Non-Disclosure Agreement with
Invenergy to begin discussions regarding a wind energy project, and on April 28, 2015
approved execution of a Letter of Intent with Invenergy for a non-binding agreement to
purchase wind energy. Since that date, City Administration and Department staff has held
discussions with Invenergy regarding a Power Purchase Agreement (PPA) between the
City and Invenergy’s Prairie Breeze Wind Energy III Project. The discussions have
resulted in a proposed plan for the City to consider execution of a PPA with Invenergy
for the entire capacity of the Project with subsequent participation agreements between
the City and the Nebraska City Utilities and the City of Neligh for minority positions in
the Project.
Conclusion
This item is presented to the City Council in a Study Session to allow for any questions to
be answered and to create a greater understanding of the issue at hand. This information
is scheduled to be presented during a hearing of the Nebraska Power Review Board on
May 22, 2015 for the Project based on need and cost.
It is the intent of City Administration to bring consideration of approval of a Power
Purchase Agreement to a future council meeting for the proposed Wind Energy Project.
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UTILITIESProposed Wind Energy ProjectCity Council Study SessionMay 19, 2015Grand IslandStudy Session - 5/19/2015Page 9 / 20
UTILITIESClean Air Act Section 111(d)Clean Power PlanRule to be published later this yearEstablishes greenhouse gas emission goals by stateState plans to be submitted to EPA by June, 2016 for achieving emission targets for 2020-2029 and 2030+Grand IslandStudy Session - 5/19/2015Page 10 / 20
UTILITIESClean Power PlanReduce greenhouse gas emissions through the following “building blocks”Improve existing coal power plant efficienciesIncrease natural gas combined cycle generationIncrease use of renewable energy sources (Renewable Energy Credits)Implementation of demand-side energy reduction programsGrand IslandStudy Session - 5/19/2015Page 11 / 20
UTILITIESGrand Island Wind ParticipationNPPD Power Purchase Agreements with GIUD participation agreementsAinsworth – 1 megawatt (MW)Elkhorn Ridge – 1 MWLaredo Ridge – 1 MWBroken Bow – 1 MW Springview 2 – minimal output – access to dataGrand IslandStudy Session - 5/19/2015Page 12 / 20
UTILITIESCurrent Generation Source RatioGrand IslandStudy Session - 5/19/2015Page 13 / 20
UTILITIESPrairie Breeze IIIGrand IslandStudy Session - 5/19/2015Page 14 / 20
UTILITIESPrairie BreezeGrand IslandStudy Session - 5/19/2015Page 15 / 20
UTILITIESPrairie BreezeGrand IslandStudy Session - 5/19/2015Page 16 / 20
UTILITIESPower Purchase AgreementTotal project capacity agreement is 35.8 megawattsAgreement term is 25 yearsCommercial operation by 4thquarter 2016Firm energy cost with annual escalationCost paid on energy produced, no upfront costPower Purchase Agreement executed by GIUD and InvenergyGrand IslandStudy Session - 5/19/2015Page 17 / 20
UTILITIESParticipation AgreementsParticipation Agreements executed by GIUD and participantsNebraska City Utilities – 7 megawattsCity of Neligh – 2 megawattsEnergy allocation based on pro-rata share of actual generationScheduling and settlements by GIUD marketer (Tenaska) – costs shared on pro-rata basisGrand IslandStudy Session - 5/19/2015Page 18 / 20
UTILITIESGeneration Source RatioGrand IslandStudy Session - 5/19/2015Page 19 / 20
UTILITIESDiscussion / QuestionsGrand IslandStudy Session - 5/19/2015Page 20 / 20