08/19/2003 Minutes
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OFFICIAL PROCEEDINGS
CITY OF GRAND ISLAND, NEBRASKA
MINUTES OF CITY COUNCIL STUDY SESSION
August 19,2003
Pursuant to due call and notice thereof, a Study Session of the City Council of the City of Grand
Island, Nebraska was conducted in the Council Chambers of City Hall, 100 East First Street, on
August 19, 2003. Notice of the meeting was given in the Grand Island Independent on August
13,2003.
Mayor Jay Vavricek called the meeting to order at 7:00 p.m. The following members were
present: Councilmembers Meyer, Pielstick, Gilbert, Nickerson, Seifert, Pauly, Hornady, and
Walker. Councilmembers Whitesides and Haase were absent. The following City Officials were
present: City Clerk RaNae Edwards, Public Works Director Steve Riehle, City Attorney Doug
Walker and Finance Director David Springer.
RESERVE TIME TO SPEAK ON AGENDA ITEMS: One individual reserved time to speak on
agenda items.
Discussion Concerning Interlocal Agreement with Hall County Regarding SWAT Team. Police
Chief Kyle Hetrick reported that earlier this year discussions took place between the City
Attorney, County Attorney, Chief of Police and County Sheriff regarding the need for an
interlocal agreement between the City of Grand Island and Hall County to define the relationship
between the two governmental entities who were involved with the SWAT team. The agreement
was a draft prepared by the Hall County Attorney for discussion purposes. Presented were
various issues regarding the formation and use of a SWAT team.
Councilmember Pielstick commented on the types of service the SW A T team performed. Chief
Hetrick stated the SWAT team responds to high risk cases. Training was discussed.
Councilmember Walker questioned the jurisdiction and if a Grand Island Police Officer would
go into another town. Chief Hetrick stated that Police Officer's currently do that now if there is a
need outside the city limits and the interlocal agreement would cover that. Councilmember
Nickerson questioned the procedures of serving papers. Chief Hetrick commented on proactive
responses, training, and procedures. Councilmember Pauly questioned why we couldn't use the
State Patrol SWAT Team. Chief Hetrick stated the State Patrol has a larger area to cover, time
restraints were an issue, and some cases would not apply to the State Patrol guidelines.
Councilmember Gilbert questioned the interlocal agreement and number of people on the team.
Chief Hetrick stated the Police Department had 8 officers and the county had 4 officers with each
being equipped by their respective departments. Costs were discussed with the majority being
used for training. Councilmember Meyer questioned what the team would not respond to. Chief
Hetrick stated they did not have a sniper team or a negotiating team. Also stated was there was
no overtime to the officers for training.
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Page 2, City Council Study Session, August 19,2003
City Attorney Doug Walker discussed the interlocal agreement. Mark McCue representing
Ryder, Rosacker, McCue, and Houston commented on the insurance coverage carried by the
City.
Discussion Regarding Future Power Supply. Gary Mader, Utilities Department Director reported
that differing fuel costs created a substantial difference in the cost of generation. Platte
Generating Station produced electricity with a fuel cost of about $10/MWh; Burdick Station was
fired by natural gas and produces power for a volatile $80/MWh. In 2002, Grand Island's retail
electric rate averaged $47 .30/MWh.
Mr. Mader commented that to maintain the present rate structure, production from Burdick
Station must be limited to peaking service only. For the past two summers, peak demand had
exceeded 150 MW. Platte Generating Station could supply only 100 MW of the demand. The
recently completed Combustion Turbine installation would help to control fuel costs. Unlike the
Burdick Station stearn generation, which must run for extended periods, combustion turbine
operation could be restricted to peak load periods only.
Peak demand was growing at a projected rate of 2.29%. Grand Island had generating resources to
satisfy peak demands for an extended period of time; this would require extensive operation of
the Burdick Station stearn generation. The price of energy was determined by our generation
mix, which would grow more uneconomical as energy needs grow.
Energy sales were increasing 3.2% per year. By 2007 it was expected that the natural gas fired
Burdick Station would be needed for every month of the year. To remain competitive, Grand
Island needed additional base load capacity in the 2010 to 2012 time frame. Therefore, the
Utilities Department continued to explore a number of options to add low cost, base load, coal
fired resources to the current power generation mix.
At present, there were three coal plant projects being evaluated in Nebraska; 1) Omaha Public
Power (OPPD), a 600 MW plant at Nebraska City. 2) Hastings Utilities and Nebraska Municipal
Power Pool (HU/NMPP), a 220 MW plant at Hastings and: 3) Nebraska Public Power District
(NPPD), a 400 MW plant at the CHAAP or at a site in the northeast part of the state.
In order to put these options, and associated costs, in perspective, the following information was
provided. It was stressed that the tabulated figures were rough, round, order of magnitude
numbers intended for only general comparison of the capital costs of the various options. The
table also shows a hypothetical addition to Grand Islands Platte Generating Station. A PGS
addition would be half the size of the HUINMPP plant and have higher capital cost.
Additionally, higher than average coal costs decrease the competitive viability of the potential
addition to Platte Generating Station.
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Page 3, City Council Study Session, August 19,2003
1. Option Comparisons:
Project Date of Cost GI GI Annual %of
Sponsor Operation Per KW Share Total Cost* Revenue**
OPPD 2009 $1400 30MW $42,000,000 $2,500,000 8.3%
HUINMPP 2009+ $1600 15MW $24,000,000 $1,400,000 4.7%
NPPD 2012+ $1400 40MW $56,000,000 $3,300,00 11.0%
GI 2011 $1700 100MW $170,000,000 $9,900,000 33.0%
* Assumes bonded debt at 5% interest.
**Compares the annual capital debt service obligation to the Electric Department annual
revenue.
2. Power Cost Risk:
PGS fuel cost @ $10 per MWH.
Non-firm purchase power markets in 2003:
May: $40 per MWh:
June: $44 per MWh:
July: $70 per MWh
Cost difference at 1500MWh per day.
May: $45,000/day, $1,350,000/month:
June: $51,000/day, $1,530,000/month:
July: $90,000/day, $2,700,000/month
3. Fuel Cost; Coal 2002, FERC Report 423
1) NPPD: $8.49 per ton,
2) OPPD: $10.48 per ton,
3) HU: $11.80 per ton,
4) GI: $12.79 per ton
State Weighted Average $10.00 per ton. GI fuel cost was 28% higher than the State Average at
400,000 tons per year/ $1,000,000 per year.
4. Miscellaneous Items to consider: Transmission Service, Debt Structure - a) Capitalize interest
during construction, b) Issuance costs, c) Gas Turbine debt paid in 2016.
Dispatching Ancillary - Voltage, Imbalance, Spinning Reserves, etc.
Discussion was held concerning rail lines to transport coal and coal costs. Councilmember
Nickerson questioned the time frame of each of the project sponsors, excess power, and
memorandum of understandings with OPPD and HUINMPP.
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Page 4, City Council Study Session, August 19, 2003
Discussion Concerning License Agreements. Steve Riehle, Public Works Director reported that
License Agreements could be approved administratively (by Staff) or encroachments in
easements, streets or alleys. Staff were reluctant to approve license agreements for fences. If a
request for a license agreement was denied by staff, the applicant could request that the license
agreement be considered by council.
Mr. Riehle stated staff had a pending request for a fence to be built in the right-of-way (ROW) in
front of 229 North Carey. Also mentioned was a request for a license agreement for a fence that
was replaced where the old fence was and for a new playground, both of which encroach on the
street ROW at 2103 West Koenig Street. If council directs, staff would come back with an item
for approval of license agreements for these encroachments at the August 26th Council Meeting.
Staff recommended the following:
Administrative License Agreements:
Private Sanitary Sewer Services
Paving in alleys or Easements
Other Minor Encroachments
Council Approved License Agreements:
Structures in ROW
Fences
Sheds
Garages
Jarrod Spilger, 229 North Carey spoke with regards to his request for a fence in his front yard.
ADJOURNMENT: The meeting was adjourned at 9:00 p.m.
Respectfully submitted,
QD~m~
RaNae Edwards
City Clerk