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Show Power Board works to solve Cedar's electrical dilemma CEDAR CITY Cedar City's Power Board is beginning to make the pieces fit on its profit and loss statement for Cedar's power system. The statement, when completed, will hopefully reveal how economical it would be for Cedar to purchase it's own system. During a regular Power Board meeting Sept. 1, Chairman Neil Boyter presented to board members newly found data for the board's profit and loss statement. Figures have been arrived at in a number of areas including an estimated $5,663,626.69 for gross income on power sales one year. This was figured by taking eight months of UP&L sales and pro-rating that to come up with a one year cost. UP&L also reported that power purchased wholesale would cost $3,103,460.85 and franchise tax lost would be $56,562.63. These figures would need to be substracted from the over $5.6 million income figure, as well as other costs that have not been arrived at, to compute the total profit or loss. There are still quite a few areas-including areas-including operation and maintenance, debt service and capital equipment outlay where the Power Board must locate figures before completing the statement. Yet according to Power Board officials they've got a good start on it. "Our main objective now is to begin work in the area of operation and maintenance costs," stated Boyter. The Power Board also decided to begin research in determining the cost of the capital equipment outlay for the project. Chairman Boyter also requested that City Manager Joe Melling write a letter to the State Tax Commission asking for a breakdown on power sales tax. Melling agreed to write the letter. During another part of the meeting, City Councilman Conrad Hatch, who si also a member of the power board and president of the Southwest Utah Cooperative Power Federation, announced an-nounced the results of a recent meeting in Salt Lake City with bonding companies com-panies and an engineering company currently working with the city to solve the ongoing power dilemma. According to Hatch, Boettcher Company and Burrows, Smith, Bache Company were selected by the Federation for the purpose of considering con-sidering the feasibility of the city purchasing their own system. R.W. Beck Company, an engineering company also selected by the Federation, proposed that it consider conducting a phase I and phase II study. Phase I basically consists of a study of the current distribution system that UP&L is offering for sale, along with what the cost would be to replace the power system rather than purchase it. Phase I would cost the 11 communities com-munities making up the Federation $35,000. If the cost were broken up on a population basis, Cedar City would have 56 percent of the total population, according to Hatch's report. "We would be paying about $19,000 to $20,000 for phase I alone if we go on a population basis," he explained. Hatch went on to say that the cost to Cedar may decrease if it considers working on a customer basis rather than a population basis. However, at the present time no definite facts are known. Hatch went on to explain to the board see POWER on p. A3 PoWBT continued from page A 1 that phase II would be a feasibility study looking at sources of power and costs. It would also include whether or not it would be economical for the Federation to go into the power business. Hatch stated that the cost of this study would be another $25,000. He explained that it may cost Cedar around $30,000 or more to complete both studies. "I think it is very important that we have the city's response in the matter on whether or not they would be interested in seeking the funding for the project," said Hatch. Boyter brought up the concern that this study may be a duplication of a study conducted by Ford, Bacon and Davis some time ago. Hatch assured Boyter that even though the studies were similar a new study should be conducted because the earlier study by Ford, Bacon and Davis is outdated. Hatch added that it is imperative that the hoard decide on some type of action soon. "We've got to come to a decision on something so that we don't keep coming back with the same thing over and over again. We've got to get some answers to present to the public," he said. Power Board member Eldon Sch-mutz Sch-mutz expressed his concern that the study of all 11 communities may not result in what Cedar needs. "We are the only city in the Federation that has a good amount of commercial users. The other cities are primarily residential. It's like comparing pears to apples. The other cities just don't fit the mold of Cedar City any way you look at it," said Schmutz. Hatch stated that if Cedar were to conduct a study on it's own it would cost the city $23,000 for phase I alone. The board took no action in deciding what recommendations to make to the city council concerning this issue. |