Willmar City Council schedules district heat decommission hearing
WILLMAR -- A public hearing will be conducted June 19, during the Willmar City Council meeting, to gather public comment regarding the decommissioning of the Willmar Municipal Utilities district heat program. The public hearing before the council...
WILLMAR - A public hearing will be conducted June 19, during the Willmar City Council meeting, to gather public comment regarding the decommissioning of the Willmar Municipal Utilities district heat program. The public hearing before the council is the next step in the decommission process. The council will also need to pass a resolution approving the end of the heating program.
A hearing will also be held on the financial assistance program the Municipal Utilities Commission created to help residents and commercial businesses having to install new heating systems. The council will need to pass a resolution on that issue as well.
"With the adoption of these two resolutions, the date would be determined for the decommission of district heat," Utilities general manager John Harren said Monday. A date of July 1, 2020, has been discussed at the utilities, which would give customers three years to update their properties. State law requires at least a two-year lead time.
Currently, the district heat system uses hot water, heated by the power plant's power generation, to provide heat to customers and businesses in downtown Willmar and in the residential area north of the railroad tracks. The city has provided district heat since 1913, first using steam and then changing to hot water in the 1980s.
The Willmar Municipal Utilities Commission held its own public hearings May 22. According to the meeting minutes, seven members of the public attended and two gave comment.
"Both spoke in favor of the decommission of district heat," Harren said.
The commission approved both the resolution for the decommissioning and for the financial assistance program. The financial assistance would provide loans to customers who are installing a 100 percent electric heating system in their property.
Harren also asked the council to consider waiving the mechanical permit fees for those same customers, retroactive to Feb. 1, when the utilities started the process to end district heat.
"On multiple occasions this request has been made by different customers and contractors," Harren said.
The city charges $31 for the residential permit and 1 percent of the total project cost for commercial. Harren said there are 133 residential customers still currently on district heat, so the city would lose $4,123 in permit fees if the council decided to waive them. On the commercial side, Harren said there was no way to know what the financial impact would be to the city, as businesses have not gotten final quotes for their projects.
"It will be sizeable. One percent of project costs will add up," Harren said.
The council has waived fees in the past, most recently following the flooding last August. However, some are not sure the circumstances are similar.
"This is a different situation, we are talking about something completely different. I would not be in favor of waiving those fees," Mayor Marv Calvin said.
Instead the idea of the utilities paying the fees for their customers was raised.
"You're the one that wants them to move on, so you should pay the fee to the city," Councilor Rick Fagerlie said.
According to Harren, Willmar Utilities could save nearly $2 million per year if district heat was discontinued, because the utilities would no longer have to produce the power to run the system or maintain it. If district heat stayed on, Harren said substantial improvements would be needed to the system, causing rates to nearly double.