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Show Federation States power Views 1989 when the contracts run out. It is my own idea that the Bureau is hard pressed to ignore new systems entirely en-tirely and the government is investigating in-vestigating other hydro generation projects which it might develop," said Fadel. "If Cedar City joins the Southwest Utah Cooperative Power Federation with the other communities in southern Utah savings will be realized by eliminating CPNational's 13-15 ' percent rate of return to stockholders, eliminating a lot of CPN's taxes, and eliminating the overhead of the San Francisco office. All. of these things are now paid for by area residents throught their electrical rates," stated Federation Attorney George Fadel. Leon Bowler, a federation board chairman, John Vaughn, Chairman of the Southwest Utah Power Agency, and Fadel spoke with city councilmen and candidates running for council positions last week at an information meeting which was arranged by mayor Jack Sawyers. The agency has been negotiating with CPN to purchase their electrical system in southern Utah and northern Arizona. The agency is the financial arm of the move for a home owned utility system and the federation would run and maintain the system. While Cedar City joined the agency last Feb., it has hedged on joining the federation. Fadel and Vaughn said that the agency's bonding company, Goldman and Sachs of New York City, had assured the group that Cedar City's support would not be necessary to provide the bonding support necessary for purchasing the system. "I would really like to have Cedar City come in with us and I don't want this to become politically polarized between Republicans or Democrats. My feeling is that this is for all of southern Utah. CPN is simply a broker, if they were producing ; power maybe the situation would be different but they have no future plans to develop the system and just pass increases on to consumers. Without Cedar City, the expected 20 percent savings might be cut off the front end of this deal but there will still be savings in the long run," said Vaughn. Vaughn and Fadel stated that in their opinions not having Cedar City as a member of the federation and being totally supportive of the move to a locally owned and controlled system had upped the price that CPN wanted the agency to pay for the utility's holdings in tiiis area. "If CPN had known that Cedar City had already voted to go municipal they might have been willing to forego some profit. Their figures are reasonable but some areas could have offered price cuts considering their accelerated depreciation and their investment tax credits which they don't want to pay back and received in other years... I think that they would have negotiated more if they thought that Cedar City was more definite in wanting to own their own system," said Fadel. Vaughn estimated that he thought that the system might have been purchased from CPN for $15.5 million if Cedar City had been "in" instead of the $17 million figure which is now being offered but which has not been accepted by the utility. The agency expects a reply from the CPN to its lastest offer some time in Nov. Cedar City's agency board member Jack Whiting objected to the opinions saying that Cedar City has been a member of the agency for some time and that in itself indicated its interest in going municipal. "All the time that I've been on the board, I've never hearo) a statement like that. At our last negotiations in ' Salt Lake City 'we agreed that the figures which CPN presented were justifiable and not padded," said Whiting. Fadel explained that the federation was necessary to keep the Rural Electric Associations a part of the southern Utah system. He said that the agency's role was limited to a financing role while the federation would be responsible for the power supply and transmission of power. He said that it would be possible for Cedar City to go municipal and contract with the federation to purchase pur-chase power but thought that it would be to the city's advantage to be a member of that organization. He thought that if the system is purchased pur-chased that most of CPN's employees would be hired by the cities and federation to run their systems. "Many of the unincorporated areas need someone to take care of their system and provide service and the federation would do this," said Bowler. Bowler stated that in his opinion there are no savings to be made from going municipal. "During the last five years Washington City has wanted me to help them go municipal. There is no way that it is economically feasible to put together a municipal system toddy. At Cedar City's last election, I thought the voters indicated a clear mandate to go minicipal but no one has. The federation's objective is to try to buy the entire system and run it economically for all of southern Utah... we have a mandate from 19 cities in southern Utah which have already adopted a resolution saying this is their intention," said Bowler. Bowler who also serves on the board of the Intermountain Consumers Power Agency also said that it would not be feasible for the city to join the ICPA for service because that organization is not in a position to run the CPN system. Bowler mentioned the need for a 345-kv line from the Intermountain Power Project to the Warner Valley Project. All of the federation and agency representatives supported the idea that costs for these lines would be shared and offset by the communal system with rate revenues paying such costs and thus not jeopardizing any of the individual cities' bonding capacity or financial position. "We'd probably take the line all the way down to the Glen Cayon system and then we'd be bringing power back to Cedar City as well as taking it down to the other communities through Cedar City," said Bowler. Fadel thought that Cedar City might be in line for some cheap federal power from the Bureau of Reclamation if it goes municipal. "The Bureau of Reclamation hasn't made any decision on whether old contracts will be renewed or not in |