Great Falls Tribune
June 2, 2009
City looking into hiring consultant for utility By RICHARD ECKE Tribune Staff Writer
City government may hire an energy consultant as quickly as July and receive a report well before the snow flies.
"It's probably going to be a two- to three-month project," Great Falls City Manager Greg Doyon told the Electric City Power Board Monday night.
City officials want a consultant to look at whether it's wise for the city to stay in the energy business, selling electricity to area businesses, public agencies and nonprofit groups.
For the city, it's been a money-losing proposition, although city Fiscal Officer Coleen Balzarini said the picture is improving.
"We're still at a deficit but the trend is positive," she said at the meeting. Customers are paying higher rates, the city's costs for wholesale power have moderated, and the city by the end of its fiscal year June 30 could end up with "a very small plus or a much lower negative" on its balance sheets, Balzarini said.
Critics have urged the city to leave the electric power business, but supporters say the city has helped customers save money.
A consultant could weigh the pros and cons and recommend to the city whether to stay the course or abandon ship.
Finding a consultant will cost the city at least tens of thousands of dollars.
City government received eight proposals from consultants to provide that advice, with price tags anywhere from "$30,000 to $180,000-plus," Doyon said last week at a city agenda-setting meeting.
A committee will consider the proposals. Doyon recommended Commissioner Mary Jolley sit on the committee; Mayor Dona Stebbins nominated Commissioner Bill Bronson as another member of the committee. Doyon, other city staff members and members of the Electric City Power board also are expected to serve on the committee.
Doyon said after Monday night's meeting it's hard to say exactly how long the entire process will take. His estimate to the board would mean the City Commission could receive a final report from a consultant by late summer or early fall.
Board members debated whether the City Commission should even fill one empty position on the board, vacated for health reasons by member John Gilbert.
Member Bob Pancich moved to recommend to the commission that no replacement be named, because the consultant will study "if we should exist" at all. That motion failed by a 3-1 vote. Chairman George Golie said board members "shouldn't assume we're going to go out of business."
Doyon said he thinks the position should be filled because the city needs to have a fully functioning board.
Ron Gessaman of Great Falls said he thinks the board should have placed the consultant issue on its agenda, rather than discuss it briefly and off-handedly.
"I think the public needs to know something about this," Gessaman said.
Electric City Power, the city's electric utility arm, had lost a total of about $1.8 million through December on its energy venture. The city also has invested about $2.3 million in a proposed power plant project east of Great Falls. In March, Balzarini estimated the city would lose $4.75 million if the city immediately liquidated its energy assets.