“I’m glad to see all of you here…this decision is something that’s going to effect our community for the next 30 years,” said Ophir Town Manager Randy Barnes, to start the meeting.
He was referring to SMPA’s new surcharge, the result of years of negotiations and lawsuits initiated by property owners on Wilson and Specie Mesas who wanted to see the new, upgraded Tri-State Generation and Transmission Association line installed underground. To pay for the multi-million dollar project, SMPA (a member system of Tri-State) recently imposed a 7.47 percent surcharge on San Miguel County power users, including those living in Ophir.
But Ophir residents already pay a 10 percent surcharge, related to a 1988 agreement with the power association in which they agreed to pay the cost of moving a transmission line originally planned to run through the middle of the town to its outskirts.
It’s a surcharge only Ophir residents pay, and according to Barnes on Tuesday, and they’re about eight years away from paying off the original balance.
“That’s why the line is where it is, and it’s why we have the surcharge. Nobody loves surcharges or looking at that line, but that was the deal we made,” Barnes said, going onto explain that the 1988 agreement is why the town has threatened to pursue legal action to fight the new surcharge.
Barnes said that SMPA officials did come to town officials in 2008 to discuss the 7.47 percent surcharge, offering to reduce Ophir’s original 10 percent relocation surcharge to 2.5 percent – but, the terms of the reduced surcharge would be extended by another 30 years.
“We discussed that offer openly at that time, and ultimately said no thank you,” Barnes said. “Our sentiment hasn’t changed, so when I received the [SMPA] newsletter in May and saw that Ophir was included [as one of the communities affected by the new 7.47 percent [surcharge,] I was surprised. SMPA never told us, and I feel they trumped us.”
On their most recent power bill, Ophir residents saw that SMPA had reduced the original surcharge to 2.5 percent, and had added the new surcharge (making their overall surcharge rate remain at 10 percent, but with new terms.)
According to town attorney Steve Johnson, Ophir would like to see that arrangement rescinded, on the basis that it is in violation of the town’s earlier agreements with their power provider.
As Johnson explained on Tuesday, Ophir’s franchise agreement with SMPA includes an “equivalency cause,” which states that rates paid by its town’s residents should be equivalent to the rates paid by residents in other towns SMPA services. The new surcharge would thus violate the original franchise agreement, Johnson told the meeting on Tuesday, while modifying the 10 percent surcharge without amending the earlier agreement could also provide cause for legal action.
One Ophir resident at the Tuesday meeting expressed concern that the transmission line upgrade triggering the new 7.47 percent surcharge for San Miguel County residents could actually benefit Tri-State power users further east, who haven’t been required to pay the new surcharge.
“I haven’t seen any consideration for the fact that Tri-State uses lines that service energy grids to areas east of us. I feel they’ve hidden that fact,” he said, adding that he understands that that issue may not be applicable to Ophir’s current situation.
Johnson responded that that was one of the issues raised at a meeting between Ophir and SMPA on August 24.
In an attempt to circumvent legal action, SMPA met with Ophir’s Barnes and Johnson on August 24. “We asked them if they had a better offer, and they did,” Johnson told the Assembly Tuesday night.
The details of that offer were discussed in Executive Session. After a lengthy executive session, the General Assembly moved to continue negotiations with SMPA in order to reach an agreeable settlement.
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