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Traer City Council receives update on gas franchise

August 5, 2009
Traer Star-Clipper

The Traer City Council received a written report from General Manager of Traer Municipal Utilities, Pat Stief, updating them on the progress of the gas franchise negotiations.

In the report Stief gives a time line of meetings that have occurred. On July 17 Mr Cmelik, attorney for TMU contacted Alliant and offered a date of July 30 to meet with them.

On July 30, Cmelik met with Alliant representatives, Randy Bauer and Jeff Rosencrants in Alliant offices in Cedar Rapids. Alliant reinterated comments they have made in the past, they don't think the appraisal amount is a fair amount. They focused on the cost per customer rather than the entire appraisal process and said it doesn't include the valuations for Alton and Mapleton; and said they would be happy to go to court and take their chances.

They wouldn't share information because when that was tried in other cases the information got leaked.

They offered to feed their information to a third party appraiser if we would agree to be bound by those results.

They agreed to meet again on August 27.

The report went on to say that the only comment that was seriously discussed was the data for Alton and Mapleton. The reason they weren't included in the appraisal report is because both of these systems went through the initial court process and were on their way to an appeals court hearing. In each case, prior to the appeals court date the investor owned utility, Mid American, owned by Warren Buffet, decided to settle out of court for the systems to be purchased. These cases were settled after the appraisal was written. Wanting to demonstrate good faith in arriving at a fair market value we agreed to have the appraisal report updated to include these two system transactions. The appraiser has been contacted and asked to update the report to reflect these two sales.



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