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ORIGINAL
- BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
Idaho Public Utilities Commission
Office of the Secretary
RECEIVED
I DAHO POWER COMP AN~
Complainant,
SEP 2 7 2004
Boise, Idaho
vs.CASE NO. .IPC-04-
CITY OF EAGLE , IDAHO,
Re sponden t .
BEFORE
COMMISSIONER PAUL KJELLANDER (Presiding)
COMMISSIONER MARSHA H. SMITH
COMMISSIONER DENNIS HANSEN
PLACE:Commission Hearing Room
472 West WashingtonBoise, Idaho
DATE:September 9, 2004
VOLUME II - Pages 136 - 409
CSB: REpORTING
Constance S. Bucy, CSR No. 187
17688 Allendale Road * Wilder, Idaho 83676
(208) 890-5198 *(208) 337-4807
..
Email csb~spro.net
For the Staff:Donald Howell, Esq.Deputy At torney General
472 West Washington
Boise , Idaho 83720 - 0074
For Idaho Power:Monica B. Moen, Esq.
and Barton L. Kline, Esq.
Idaho Power Company
Post Office Box
Boise , Idaho 83707 - 0070
For Ci ty of Eagle:MOORE SMITH BUXTON & TURCKE
by Bruce M. Smith, Esq.
and Susan E. Buxton, Esq.
255 North 9th Street
Suite 420
Boise, Idaho 83702
For Eagle River , LLC:HOLLAND & HART LLP
by B. Newal Squyres, Esq.
Post Office Box 2527
Bo i s e , Idaho 83 7 0 1
CSB REPORTING
Wilder , Idaho
AP PEARANCE S83676
WITNESS EXAMINATION BY PAGE
Nancy C. Merrill
(City of Eagle)
Ms. Buxton (Direct)
Prefiled Direct Testimony
Ms. Moen (Cross)Mr. Squyres (Cross)Mr. Howell (Cross)Commissioner Kj ellander
Commissioner Hansen
Commissioner Smith
Commissioner Kj ellanderMs. Buxton (Redirect)
136
139
151
166
177
184
185
188
189
190
Don C. Reading
(Ci ty of Eagle)
Ms. Buxton (Direct)
Prefiled Direct Testimony
Prefiled Rebuttal Testimony
Mr. Howell (Cross)
Ms. Moen (Cross)
Commissioner Hansen
Commissioner Smith
Ms. Buxton (Redirect)
195
198
223
230
235
248
252
255
Pike Teinert
(City of Eagle)
Ms. Buxton (Direct)
Prefiled Direct Testimony
Prefiled Rebuttal TestimonyMr. Howell (Cross)Ms. Moen (Cross)
Ms. Buxton (Redirect)
258
261
286
305
309
329
Charles Carlise
(Eagle River)Mr. Squyres (Direct)
Prefiled Direct Testimony
Ms. Buxton (Cross)Ms. Moen (Cross)
Commissioner SmithMr. Squyres (Redirect)
333
336
361
367
372
373
Randy Lobb
(Staff)Mr. Howell (Direct
Prefiled Direct Testimony
Ms. Buxton (Cross)Mr. Squyres (Cross)
Commissioner Smith
374
376
397
404
406
CSB REPORTING
Wilder , Idaho 83676 INDEX
Admitted
Premarked
Admitted
Premarked
Admitted
Premarked
Admi t t ed
Premarked
Admitted
Premarked
Admitted
Identified
Admitted
Premarked
Admitted
Premarked
Admitted
Premarked
Admitted
Premarked
Admi t t ed
Premarked
Admi t t ed
PAGE
197
197
197
197
197
197
152
197
197
260
260
260
260
NUMBER DESCRIPTION
FOR THE CITY OF EAGLE:
100 -
101 - Eagle, Idaho , City Code
102 - Populations of Idaho Cities,1990-2000
103 - Profile of Selected Housing
Charactistics, 2000 Census
104 - Pat Summerall, Champions of
Industry, Best Managed Cities
in America
105 - Memo from Ken Harwood to Nancy
Merrill , June 11 , 2004 with
attached Architecture & Site
Design Book
106 - City of Eagle , The 2000Comprehensive Plan , Land Use Map,
November 9, 1999
107 - Development Agreement between
Eagle River Development & The
City of Eagle , January 25, 2000
108 - Idaho Power Company, 2002
Integrated Resource Plan
109 - Idaho Power Company, January
, 2003, Annual Demand Side
Management Report
110 - Demand-Side Management at Idaho
Power , A Business Plan 2003-2005
III - Idaho Power Company, ConservationPlan, April 15 , 2003
CSB REPORTING
Wilder , Idaho 83676 EXHIBITS
(Continued)
NUMBER DESCRIPTION
Premarked
Admitted
Premarked
Admi t t ed
Premarked
Admitted
Premarked
Admi t t ed
Premar ked
Admitted
Premarked
Admi t ted
Premarked
Admi t t ed
Premarked
Admi t t ed
Premar ked
Admitted
Premarked
Admitted
Premarked
Admitted
PAGE
260
260
260
260
260
260
138
138
138
138
138
FOR THE CITY OF EAGLE:(Continued)
112 - Idaho PUC Order No. 28583, Idaho
Power 2000 Electric Integrated
Resource Plan
113 - Response to Interrogatory No.
115 - City of Eagle, Underground Sub-
Transmission Line Alternative
Assessment , etc.
116 - Electric Transmission Week
April 7 , 2003 , etc.
11 7 - Innovations wi th EPRI Technology,
June 2001 , etc.
118 - ACSS/TW - An Improved Conductor
for Upgrading Existing Lines , etc.
119 - May 11 , 2004 , Eagle Findings of
Fact & Conclusions of Law , Case
No. CU - 0 - 02 , e t c .
120 - Development Agreement between
Albertson's and City of Eagle,
August 26 , 1997
121 - Development Agreement between
Eagle Gravel and Ci ty of EagleOctober 28, 1998
122 - April 11 , 2000 , Eagle "Findings of
Fact & Conclusions of Law, Case
No. CU - 8 - 9 9 , e t c .
123 - March 12, 2002, Eagle Findings of
Fact & Conclusions of Law , Case
No. CU - 11 - 01 , e t c .
CSB REPORTING
Wilder , Idaho 83676 EXHIBITS
E X H I B T S (Continued)
NUMBER DESCRIPTION
Premarked
Admitted
Premarked
Admi t t ed
Premarked
Admitted
Premar ked
Admitted
Premarked
Premarked
Premarked
Premarked
Premarked
Premarked
Premar ked
Premar ked
Premarked
PAGE
138
138
138
138
FOR THE CITY OF EAGLE:(Cant inued)
124 - September 12 , 2000, Eagle Findings
of Fact & Conclusions of Law , Case
No. CU - 3 - 00, e t c .
125 - August 28 , 2001 , Eagle Findings of
Fact & Conclusions of Law , Case
No. CU-10-96 MOD , etc.
126 - October 14 , 2003 , Eagle CityCouncil Minutes, etc.
127 - July 15 , 2003, Eagle Planning &
Zoning Minutes , etc.
128 - January 30 , 2004 , Idaho Power'
own depiction of the proposedpoles, etc.
129 - January 30, 2004 , Idaho Power'
own depiction of the proposedpoles, etc.
130 - Eagle Comprehensive Plan in effect
in 1995
131 - Eagle City Council Meeting
Minutes, January 9 , 1996
132 - Eagle Planning & Zoning Meeting
Minutes, August 11, 2003
133 - Kline letter dated Nov. 12?2002
134 - Whelan letter dated Nov. 15, 2002
135 - Applicable Sections of the Eagle
Ci ty Code
136 - Facilities map
CSB REPORTING
Wilder , Idaho 83676 EXHIBITS
E X H I B T S (Continued)
PAGE
236
236
335
335
NUMBER DESCRIPTION
FOR THE CITY OF EAGLE:(Cont inued)
137 - Eagle Planning & Zoning Meeting
Minutes, December 4, 1995
Premarked
138 - Correspondence with Black &
Veatch Premarked
139 - 2001-2003 Energy Efficiency &
Conserva t ion Programs
Premarked
140 Study prepared by Hamilton &Premarked
Schwann Admi t t ed
141 Study prepared by Haider &Premarked
Haroun Admi t t ed
FOR EAGLE RIVER , LLC:
201 - Eagle River , Idaho's Premier
Business Address
Premarked
Admitted
202 - Development Agreement Between
Ci ty of Eagle & Eagle River
LLC, January 25, 2000
Premarked
Admitted
CSB REPORTING
Wilder , Idaho 83676
EXHIBITS
BOISE , IDAHO, THURSDAY, SEPTEMBER 9, 2004 , 1: 15 P. M.
COMMISSIONER KJELLANDER:We'll go back on
the record and before we broke for lunch , we were ready
to begin with the witnesses for the City of Eagle.
MS. BUXTON:Mr. Chairman, Susan Buxton
for the Ci ty of Eagle.We would like to call to the
stand Mayor Nancy C. Merrill.
NANCY C. MERRILL
produced as a wi tness at the instance of the Ci ty of
Eagle, having been first duly sworn , was examined and
testified as follows:
DIRECT EXAMINATION
BY MS.BUXTON:
Mayor Merrill would you state your full
name,spelling your last name for the record?
Nancy C. Merrill , M-e-r-r-
And would you provide the record wi th your
business address, please?
310 East State Street , Eagle, Idaho.
CSB REPORTING
Wilder , Idaho
136 MERRILL (Di)
Ci ty of Eagle83676
And who do you represent in this
proceeding?
I represent the citizens of the City of
Eagle as their Mayor.
Have you previously filed written direct
testimony in this proceeding?
have.
Do you wish
your direct testimony?
to make any correct ions to
I do not.I do.On page - - I do.
page -- where is it , Susan?
I believe page 7 , line 15.
Line 15 on page 7.It states that I am
currently the president elect of the Association of Idaho
Cities.I won't beI am the second president elect.
president this year but the following year.
Is that the only amendment to your direct
testimony that you're suggesting today?
Yes.
If I asked you the same questions today,
would you answer them the same as you did in your direct
testimony?
Yes.
MS. BUXTON:Mr. Chairman, I request that
the direct testimony of Nancy Merrill , pages 1 through 7
CSB REPORTING
Wilder , Idaho
137 MERRILL (Di)
Ci ty of Eagle83676
be spread over the record as if read in its entirety and
that Exhibi ts 1 through 7 be marked for the record.
COMMISSIONER KJELLANDER:Without
obj ection , we would spread the testimony across the
record as if read and I believe it's Exhibits , what, 119,
120 --
MS. BUXTON:I apologize , 119 through 127.
I apologi ze , it's pages 1 through 7 of her direct
testimony and Exhibits 119 through 127.
COMMISSIONER KJELLANDER:Okay, and we
would mark those exhibits and also admit them at this
point as well wi thout obj ection.
(The City of Eagle Exhibit Nos. 119-127
were admi t ted into evidence.
(The following prefiled testimony of
Ms. Nancy Merrill is spread upon the record.
CSB REPORTING
Wilder , Idaho
138 MERRILL (Di)
City of Eagle83676
Would you please state your name and address?
Nancy C. Merrill , Mayor , City of Eagle. The
address is City Hall , 310 E. State Street , Eagle, Idaho
83616.
Does your testimony include any attachments?
Yes. Exhibits 119 through 127 are included
the end of my testimony.
What is the purpose of making your appearance
at this hearing?
As the Mayor of the Ci ty of Eagle, I am
testifying to explain the impact on Idaho Power
Company'(the Company, IPC) proposed 138 kV power line
through the Ci ty of Eagle , the Ci ty' s denial of their
request (Exhibit 119) and the efforts the City has made
over the years to establish and maintain a viable
residential and business community with the changing
expectations of the citizens of Eagle. I will also
testify that IPC failed to provide the City with
viable al ternati ves regarding the concerns raised about
the adverse impact of the high transmission lines.
How is your testimony organized?
I provide a brief description of my own
participation in Eagle City government , describe changes
made to Eagle's Ordinances and Policies to meet the
considerable growth and development Eagle has experienced
CSB REPORTING
Wilder , Idaho
139 MERRILL (Di)
City of Eagle83676
while maintaining its rural residential feel , and the
analysis undertaken by the City in denying IPC' s request
for the high transmission lines.
Can you describe your business prior to your
work in Eagle City government?
In 1988 I first became involved with the City
of Eagle as a citizen , business and property owner that
had recently been annexed into the Eagle City limits. Our
family business consisted of an egg farm consisting of
approximately 500,000 chickens. I also had my own
business teaching art classes, selling retail art
supplies , and traveling with a local designer around the
Pacific Northwest painting murals and faux finishes in
homes and commercial businesses.
What was Eagle like at that time?
CSB REPORTING
Wilder , Idaho
140 MERRILL (Di)
Ci ty of Eagle83676
Eagle had a population of approximately 3,000
but had been discovered and began to grow.
When and how did you get involved in Eagle City
government?
I was appointed to the Planning and Zoning
Commission in 1993 and served on the Downtown Task Force
as well as the Design Review Committee. I was appointed
to the City Council in 1994 , and was elected to that
position in 1995. Also , in 1995 while serving on the City
Council was given the job of the City Council's liaison
to the Design Review Commission. I was Council President
for four years before being appointed to the office of
Mayor in December 2002 and elected to that position in
2003.
What was Eagle's vision for its future
development?
In 1994 , Mayor Steve Guerber (he is presently a
member of the Eagle Ci ty Council) appointed me as the
City Council's liaison to the Design Review Committee.
was during my tenure with this committee that it became
evident that Eagle should focus on becoming a full-
service community, different from other cities close to
Boise. We needed to create a commercial area that could
support and balance residential taxes , provide jobs in
town instead of just being a bedroom communi ty to larger
CSB REPORTING
Wilder , Idaho
141 MERRILL (Di)
City of Eagle83676
business hubs like Boise, Meridian , and Garden City.
How did Eagle change its regulatory scheme to
meet its vision?
Eagle began the process by creating fairly
strict Design Criteria that included detached sidewalks
with planting strips for tree lined streets trees were
required to be of a three inch cal iper to provide for a
city that did not look like it was entirely new. We
created a tree ordinance that makes it difficult to
remove old growth trees and established a tree fund
replace these trees if they were removed or damaged.
We removed signs from poles and required them to be
replaced wi th non- illuminated monument signs. We required
lights to be shielded and directed downward to prohibit
light pollution at night.
CSB REPORTING
Wilder , Idaho
142 MERRILL (Di)
City of Eagle83676
We created scenlC corridors along Eagle Road and
State Street , as well as addi tional landscape
requirements at key entrances into our city. Those
entrances are the corner of Eagle Road and the Bypass
State 44 and Edgewood, State 44 and Highway 55 , State 44
and Old Hill Road , State 44 and Ballantyne, and Eagle
Road and Chinden.
We have required developers at these sites to
provide additional street corner landscaping along our
scenic corridors as identified in our Comprehensive Plan.
Exhibit 106, p. 48 and Land Use Planning Map indicating
the scenic corridors.This provides a beautiful entrance
into our city.We have also gone to great lengths to
ensure that development has adhered to Eagle's unique
rural/urban feel. Examples of the City's high standards
for design cri teria are contained in the numerous
development agreements. See, Exhibi ts 120 & 121.
We adopted a height limit of 35 feet to protect our
view corridor of the mountains. See, Exhibi t 101. We have
allowed additional height in only three locations of the
city: one was an uninhabited tower , a small part of an
archi tectural feature of the Two River Club House.
Exhibit 122 , pp. 5 & The other was a 5 foot addi tion
for the Hil ton Hotel that backs up to the Boise River.
Exhibit 123, pp. 1 , 5-7.This addition was allowed
CSB REPORTING
Wilder , Idaho
143 MERRILL (Di)
City of Eagle83676
because of gradient changes in the road that placed the
Hotel well below the regular grade for a building. The
same is true for the Con Agra building that is also
placed along the Boise River and was allowed an
addi tional 5 feet to conceal the mechanicals on the roof.
This building is in a setting that does not block the
view corridor of the mountains. Exhibi t 124 , pp. 5 - 6. St.
Alphonsus Medical Office Building recently requested
additional height at the new Eagle River site, but was
limited to the 35 foot standard. See , Exhibit 107 , Eagle
River Design Review Guidelines
p.
When did the City first become aware that pole
heights would adversely impact its vision?
I was serving on the Eagle Planning and Zoning
Commlssion that two new issues arose. One was
CSB REPORTING
Wilder , Idaho
144 MERRILL (Di)
City of Eagle83676
a cell tower that requested to be located at the back of
the Container and Packaging building located along State
Street and backing up to the Rocky Mountain Business
Park. The second issue was the CUP request from Idaho
Power to allow for additional pole height along State
Street from Edgewood to the existing substation across
from Ci ty Hall. The cell tower was denied because of the
requested height and because it was also too prominent an
intrusion into the view corridor.In contrast , in 1995
the Idaho Power poles were allowed , but the discussions
were long and lengthy, and because promises were made
that these would be the only completing circuit that
Eagle would ever need. The CUP also conditioned the
sub-station such that if upgrades were ever requested
the sub-station would be removed from the City center.
See , Exhibit 100.
In the mid 1990' s the Planning and Zoning Commission
was fairly new and the members and had never dealt with a
public utility. The desire of the Commission was not to
have ugly poles along State Street. I believe that if we
had had any idea that this was only the beginning of many
tall poles being requested within the city limits, we
would have recommended denial of the 1995 Condi tional Use
Permi t. See , Exhibi t 101.
A cell tower was later permitted at the Republic
CSB REPORTING
Wilder , Idaho
145 MERRILL (Di)
City of Eagle83676
Storage Site along Highway 55 however it was limited to
a 135 foot height and also allowed co-locations for
additional services on the same pole. See, Exhibit 125
pp. 1 , 4 - 7 .
In Eagle we strategically place cell towers away
from residences and provide for a fall zone as well as
limiting their height and prohibiting them along our
scenic corridor. See, Exhibi t 101.
Explain the history of IPC' s Conditional Use
Permit Application?
IPC received a CUP from the City in 1995 for
the upgrade of the public utility substation
primarily to update the transmission power lines from
69kV to 138kV.See , Exhibit 100.In its
CSB REPORTING
Wilder , Idaho
146 MERRILL (Di)
Ci ty of Eagle83676
Findings of Fact and Conclusions of Law , the Ci ty placed
condi t ions on the CUP which required future upgrades to
be made at a different location , outside of the City.
When IPC came to the City for a new CUP the Council was
gravely concerned about how this application would impact
property values , how it would fit into Eagle'
rural/urban set t ing, af f ect our tax base, revenues, job
opportunities and inhibit future development.Numerous
public hearings were held before both the Planning and
Zoning Comission and the City Council. See , Exhibit 126
pp. 3-9, Exhibit 127 , pp. 1-The public repeatedly
obj ected to the proposed pole heights and the impact they
would have on Eagle's skyl ine , the view corridor , and the
rural feel of the City.
As elected officials, we were frustrated with the
lack of options presented by IPC and felt powerless to
address the concerns of our citizenry.The City was
unfamiliar with available alternatives or any options
might have to alleviate these concerns. As a resul t, the
City hired Black and Veatch to evaluate the costs and
feasibility of constructing an underground 138kV line.
What Black and Veatch did not disclose to Eagle was the
fact that they had done significant work for IPC in the
past.We are concerned that this influenced the work
they did for us.Nevertheless the Black and Veatch
CSB REPORTING
Wilder , Idaho
147 MERRILL (Di)
Ci ty of Eagle83676
report is a narrow evaluation of overhead lines vs.
underground lines.The study contained no examination of
modern technologies and how they might be used to reach a
viable solution or any alternative routes suggested by
the City Council.Instead the Black and Veatch study
only examined IPC' s suggested alternatives.It did not
address innovations or al ternati ve technology.See
Teinert 's Direct Testimony.This may be due in part to
the City's unfamiliarity with the intricacies of public
utilities and utility planning.We were relying on IPC
to identify different options for us to consider.They
did not give us information on al ternati ve technologies.
Explain Eagle's goal in having such
development standards?
The City of Eagle has established high
design criteria for both the residential and
CSB REPORTING
Wilder , Idaho
148 MERRILL (Di)
City of Eagle83676
commercial developers. This has been a good partnership
and has given the citizens high property values while
keeping the property tax base one of the very lowest of
all the ci ties in Idaho.
Large overhead power lines through the scenlC
corridors of our City will absolutely destroy everything
we have tried so hard to create since we were
incorporated in 1972. We recently received the Pat
Summerall Champions of Industry Award for one of the Best
Small Managed Ci ties in America. See , Exhibi t 104. Much
of this was based on our planning and design cri teria
efforts.We also just received from the Association of
Idaho Cities two awards for being a Community of Promise.
See , Exhibi t 105.The Eagle Archi tecture and Design Book
was created for the purpose of ensuring that developments
follow these guidelines.
Our future could very well be defined by this very
important decision. With three state highways
intersecting our community - all with utility easements
we will be forever impacted if the PUC allows for this to
happen. There just simply must be a bet ter way.
As second President elect of the Association of
Idaho Cities (AIC) what concerns do you have for
the cities of Idaho?
I plan to educate growing cities like Eagle
CSB REPORTING
Wilder , Idaho
149 MERRILL (Di)
City of Eagle83676
about the dangers of how public utilities can affect
property values, result in adverse health perceptions,
has impacts on years of careful planning and zoning, and
stunt future development.Clearly, utility corridors
need to be planned well in advance.Since the cities are
given little or no help in this area I would like to see
the AIC take a more active role in helping to address
this problem. I am also the legislative chair for the AIC
and will encourage a review of relevant statutes
addressing large utility poles in the territorial limits
of Idaho Ci ties.
Does this conclude your direct testimony?
Yes.
CSB REPORTING
Wilder , Idaho
150 MERRILL (Di) 7 a
City of Eagle83676
open hearing.
(The following proceedings were had in
MS. BUXTON:Mr. Chairman , I'd present the
witness for cross.
Ms. Moen.
COMM IS S IONER KJELLANDER:Let's move to
BY MS. MOEN:
MS. MOEN:Thank you , Mr. Cha i rman .
CROSS - EXAMINATION
direct testimony in front of you?
Mayor Merrill , do you have a copy of your
and 5?
I do.
Could you please turn to page 7 , lines 4
Okay.
I believe you've testified that large
overhead power lines through the scenic corridors of our
CSB REPORTING
Wilder , Idaho
City will absolutely destroy everything we have tried so
hard to create Slnce we incorporated in 1972 is that
Tha t is correct.
Dr. Reading is sponsoring Exhibits 100 to
107 .m going to make reference to that.Mr. Cha i rman ,
correct?
151 MERRILL (X)
City of Eagle83676
I request that Exhibit 106 from the direct testimony of
Mr. Reading be marked.
plan?
Do you have a copy of the comprehensive
I don', of the comp plan , yes,
do.
COMM IS S IONER KJELLANDER:Without
objection , we will mark the exhibit.
(The City of Eagle Exhibit No. 106 was
marked for identification.
BY MS. MOEN:Could you please turn to
page 2 of 54 of the comprehensive plan?
CSB REPORTING
Wilder , Idaho
My comprehensive plan goes to 51 of 51 and
then it has maps.Are you referring to the maps?
Overview.
Page 2 of 54.It's the Chapter
Page 2 of 54?
MS. BUXTON:Mr. Chairman , may I approach
the wi tness?
obj ection.
COMMISSIONER KJELLANDER:Without
(Ms. Buxton approached the wi tness
. )
THE WITNESS:Okay.
BY MS. MOEN:As you can see under
Overview in Section 1., there are a list of statements
152 MERRILL (X)
Ci ty of Eagle83676
of purpose am I correct?
That is correct.
And if we go to Purpose B , that purpose
says that one of the purposes of the comprehensive plan
is to ensure that adequate public facilities and serVlces
are provided to the people at a reasonable cost.Am I
correct in reading that?
Tha t is correct.
Now , if the City could be assured of
having adequate public facilities provided to its
residents at a cost of $500 000, would it be reasonable
for the Ci ty to endorse a design that would provide an
identical level
million?
No.
Now when the comprehensive plan makes
of service at a cost of $5 to
reference to public facilities and services, that would
include Idaho Power I s electrical facilities, too,
wouldn't it?
Would you say that agaln , please?
When the comprehensive plan makes
reference to public facilities, as it does in Purpose B
public facilities includes reference to Idaho Power'
electrical facilities, wouldn't it?
It does.
CSB REPORTING
Wilder , Idaho
153 MERRILL (X)
City of Eagle83676
Therefore , consistent wi th the purpose of
the comprehensive plan , you'd agree, wouldn't you, that
Idaho Power's electrical facilities should be provided to
the City of Eagle at a reasonable cost?
I believe that the Idaho Power lines
should be provided to the citizens of Eagle at a
reasonable cost , but I also think that we have to look
all of the items in the comprehensive plan that deals
with that and there's other items besides just reasonable
cost that we have to look at.
Okay, but even taking all those other
costs into consideration , you've already testified that
if a cost were 500 000, it wouldn't be reasonable to have
an identical level of service and charge 10 to 18 times
that amount.
Yes, based on cost only.
Would you please refer to page 4 of your
testimony?On page 4 of your testimony, I'll give you
the specific lines , you on line 13 begin to make
reference to 35-foot height limitations is that
correct?
Tha t 's correct.
And I believe in Exhibit 2 to your direct
testimony, the last page, you make - - there's an excerpt
attached from the zoning ordinance that deals with
CSB REPORTING
Wilder , Idaho
154 MERRILL (X)
City of Eagle83676
archi tectural appurtenances.Have you found that?
, I don't have that document in front of
me.I just have my testimony and the comprehensive plan.
Do you recall in your testimony that
you've identified certain instances on page 4 where there
have been exceptions made to the Ci ty I S height
restrictions?
Limi ted exceptions , yes.
In particular , on page 4 you talk about an
uninhabi ted tower.You talk about an addition to the
Hil ton Hotel and I believe you refer to an entranceway
the Con Agra building?
Correct.
And these based on exhibits that you have
identified are appurtenances to a facility; is that
right?
They are appurtenances to a facility for
uninhabi ted occupation of which to hide mechanicals on
the roofs.
And it I s the same reference to
archi tectural appurtenances that you're applying the
35-foot height restriction in your testimony for Idaho
Power's power poles?
, we're not applying the same - - well
the same standard is 35 feet, but we also have that
CSB REPORTING
Wilder , Idaho
155 MERRILL (X)
City of Eagle83676
limitation with our cell towers, also, so towers , poles,
spirals and those kinds of things are what we look at.
For example, if a church has a spiral on it , it is
sometimes allowed and sometimes not.We just had one
removed because it was too tall and the adj acent or the
kitty-corner church , we made them take it off and put
down on the ground, so we've those kind of si tuations.
All right.Mayor Merrill , would you agree
that with the proposed extension of a 138 kV transmission
line from the Eagle substation , Idaho Power is not
requesting that alterations be made to the substation; is
tha t correct?
That is correct.
Now , on page 5 of your testimony, lines
to 9, you indicate that a condition of approval of the
1995 CUP for the substation was that if upgrades were
ever requested , the substation would be removed from the
Ci ty center.Am I reading that correctly?
Tha t 's correct.
Your counsel has already introduced into
evidence what I s been identified as Exhibit 100 , I think
to Dr. Reading I s testimony.It's the Findings of Fact
and Conclusions of Law.Do you happen to have a copy of
that in front of you?
I don 'You can read it to me, though.
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Among the recommendations I'm going to
read you and if you'd take this at face value
MS. BUXTON:Mr. Chairman, with
permission , I'll give a copy to the witness.
COMMISSIONER KJELLANDER:That's fine.
THE WITNESS:Thank you.Tell me where
you're at, please.
BY MS. MOEN:Please turn to the last page
of that exhibit.
Okay.
Now , in your testimony you said if
upgrades were ever requested, the substation would be
removed from the City center.Could you read , please
Recommendation No.
"No further expansion once they upgrade
this location , the next upgrade needed will require a
different location.
Okay, you'd agree, wouldn't you, that that
restriction or condition doesn't obligate the City to
abandon that substation , does it?
It doesn't require us to abandon it?
Yes.
, I don't think that was ever the
intent.I think the intent was that if it was going to
get bigger and have more stuff in it that it would need
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to be relocated outside of the Ci ty center.
Okay; so it's not that it has to be
removed and relocated?
At this time?
Yes.
, because it was our indication that
there wasn't golng to be additions or any upgrades to
that substation , that we were just going to be taking the
ines from there.
Okay.Hang on to that exhibit , but go to
page 6 of your testimony, lines 1 and 2.
Of my testimony?
Yes , please.
Okay.
You refer to the 1995 substation CUP and
you testify that, 1'm quoting, "the City placed
conditions on the CUP which required future upgrades to
be made at a different location , outside the City," and
then referring to that same exhibi t, can you tell me
among the four conditions placed upon the Company with
regard to their application for a rezonlng where
indicates that any new substation facility would have to
be located outside the City?
It doesn't say outside the Ci ty.
Different location would indicate because of the zoning
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that the City had that it would not be allowed within the
Ci ty limi ts.
So contrary to your testimony, it wouldn't
have to be located outside the City?There's nothing in
this --
There's nothing in this that says that.
Okay, thank you.If you refer , please , to
page 6 of your testimony, lines 2 to 5 , you indicate that
when IPC came to the City for a new CUP , the Council was
gravely concerned about how this application would impact
property values , how it would fit into Eagle'
urban/rural setting, affect our tax base, revenues , job
opportunities and inhibit future development.Did I read
that correctly?
Tha t is correct.
And I think when you're referring to that
particular CUP , in all fairness, you were referring to
the transmission route along either State Street or the
Bypass; correct?
Yes, I was.This whole thing had to do
wi th jus t the t ransmi s ion 1 ines , not wi th the
substation , so our focus has never been really on the
substation at this point but only on the transmission
ines
Okay, let's look at the comprehensive plan
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again please,
page 54.
Exhibit 106, and I'd like you to refer to
Okay.
And if you begin with the third paragraph
am I characterizing this right that the comprehensive
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plan that guides development in your community and
specifically with regard to electricity says that
appropriate placement of electrical utility facilities on
public rights of way is encouraged; is that right?
Tha t is correct.
And let's keep on going.Isn't it also
correct that the plan says that public streets and road
rights of way typically serve as corridors for electric
Tha t is correct.
And in the next paragraph it al so says
that additions and improvements to electric utility
facilities that enhance the capacity and reliability of
regional resources , particularly when
multi-jurisdictional benefits within the region can be
achieved, should be accommodated?
Well , that's not in that sentence.The
sentence you skipped was that the transmission lines are
usually located on easements that Idaho Power acquires
from private property owners and then it also goes down
facilities?
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to limitations as may be prescribed by applicable law
which is the Ci ty law , and then we go down to your next
sentence of additions and improvements.
And in all fairness, too, where you
stopped reading about prescriptions by applicable law , it
is also guided by prudent utility practice for existing
and proposed utility facilities; correct?
Correct.
So we have a lot of interests here to
juggle?
Yeah.
Based on your testimony that the City was
gravely concerned about how this application would impact
property values , why didn't the City go ahead and amend
its comprehensive plan to make reference to additional
requirements or why did it retain language that use of
public rights of way was appropriate or private easements
for transmission facilities?
Well , because all of the easements in the
City have public utilities in them and some of them are
owned by Idaho Transportation Department, so they'
allowed for that.We also were hoping and our law also
requires that most of the utilities be buried
underground , so the cable, the phones and those things go
into underground.A lot of the distribution lines , we
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were hoping in the future to get those buried
underground.Those underground corridors would be in
those easements.That's where they would most likely be,
so that's why that's recognized as those areas.
It al so says in general in our
comprehensi ve plan that these are the areas and not to be
specific in the area and so as the City grows, we were
looking at, we'll look at development and where those
things are occurring and then we will juggle the plan as
it occurs.
But in the section specifically
identifying and referring to electricity, there's no
language in your comprehensive plan that recommends that
Idaho Power's electrical transmission ines have to be
placed underground, is there?
Not in the comp plan.The comp plan is a
vlslon for the future.It's not the law.The law is in
our ordinances and our ordinances and our conditional use
permits is where those finer details and the law
applies.
But also it's a vision that public rights
of way can be used for utility facilities?
Correct.
It's a vision that rights of way serve as
corridors for electric facilities?
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Yes,that'for that.doesn'VlSlon
tell how those are to occur.doesn't say whether
they'above ground or below ground.
But on public rights of way rather than in
public rights of way maybe is a distinction with a
difference here.
Coul d be.
MS. BUXTON:I obj ect The question has
been asked and answered.
COMMISSIONER KJELLANDER:Well , it's just
been asked and answered again , so we I 11 move forward.
BY MS. MOEN:On page 6 of your testimony,
Mayor Merrill , you criticize the work that Black and
Veatch completed on the City's behalf; am I right?
We did.We very disappointed with it.
In lines 15 to 16 you say, "the Black and
Veatch report is a narrow evaluation of overhead lines
versus underground lines"; isn't that right?
Tha t 's correct.
And you admit, I think , in your testimony
that the Ci ty contacted Black and Veatch to conduct the
study on its behalf; correct?
Yes.
And so by contacting them , did you give
Black and Veatch any guidance as to what you wanted the
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company to evaluate on
We did.We gave them a scope of work and
when we got it back , we didn't believe that they had met
to the letter of what we were requesting them to do.
performed?
Did you pay them for the services they
We had entered into a contract,
But you think they breached the contract
because they didn't satisfy
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I wouldn't go that far, no.
So you've paid for their services?
We paid for their services.
So the constituents of the City of Eagle
have to surmise that because the City Council chose to
pay for those services that the City Council was happy
wi th those services?
I think we made it perfectly clear that
the City Council was not happy with those services, that
if we had to do it again, we would not have chosen that
company and that we were very disappointed wi th the
But you paid full price for services that
We certainly did.We didn't breach our
unfortunately.
resul ts.
you received?
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contract.
And you spent
- -
and the money belonged to
the constituents for those services?
We would have to say at this point we made
a mistake.
Okay.Would you please turn to page 5 of
54 of the comprehensive plan , and that page at the top
identifies section 2., Implementation Strategies.Would
you please read section
"Land use development regulations should
be designed to protect the heal th, safety and welfare of
the communi ty, avoiding unnecessary condi tions , delays
and costs.
Based on this implementation strategy
adopted by the Ci ty of Eagle, wouldn't you agree wi th me
that it's in the interests of the residents of the City
of Eagle that Idaho Power provide reliable electric
servlce to them?
I believe it I S important that Idaho Power
provide service to everyone.I think it's really
important for that , but I think we also have to look at
the health , safety and welfare of the community in that
and that's where our conflict has arisen.
Wouldn't you agree with me that it's in
the interests of the residents of the City of Eagle that
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reliable electric service be provided to the residents
the City without imposition of unnecessary conditions
delays and costs?
I would agree with that; however , we don '
believe that what's being asked by Idaho Power is for the
citizens of the City of Eagle and that's where a conflict
has arisen.
But in your comprehensive plan you also
indicate on page 10, I believe, that it's also important
that additions and improvements to electric facilities,
particularly when multi-jurisdictional benefits within
the region can be achieved, should be accommodated;
correct?
Correct.
MS. MOEN:I have no further questions.
COMMISSIONER KJELLANDER:Thank you, Ms.
Moen.Let I S move to Mr. Squyres.
MR. SQUYRES:Thank you.
CROSS - EXAMINATION
BY MR. SQUYRES:
Mayor Merrill , mention was made this
morning of the Citizens Advisory Committee, the CAC.
Correct.
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You're familiar with that , whatever it
is?
am.
Who put together that CAC?
Idaho Power.
Were any of the members of the CAC
selected or chosen by the City Council?
, that's an interesting process.What
usually happens with any kind of an advisory committee in
the City of Eagle is that the Mayor appoints a committee
and the Council confirms.They work under the direction
of the City Council.They go to whatever activity that
they're advising or researching out, bring that
information back to the City Council.We review it and
then we take action on that.That was not that process
here.This was solely isolated with Idaho Power doing
the selection , running the
- -
facilitating it and
directing it.We also had of the 14 people that were
there, seven of them were on the State Street route and
the rest of the seven were spread throughout the
community, including one from Star.There was no
representation from anyone on the Bypass route.
And there was no representation on the CAC
from the City's Planning and Zoning staff; is that
right?
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No.
Okay, and so the report or the conclusions
of the CAC don't represent the posi tion of the governing
elected body of the Ci ty of Eagle; is that correct?
Tha t 's correct.
You've been a member of the Planning and
Zoning Commission and the Design Review Commission and
the City Council and now the Mayor since, what, about
1973?
, thank you , but no.Since about ' 89.
About ' 89 , even longer than I thought and
during that time period you've been actively involved in
the activities of the Design Review Committee and the
development of the Ci ty' s design cri teria?
I have been.
And what was the purpose, the Ci ty' s
purpose, in having strict design cri teria?
Well , when we very first started to become
a city, we were between Boise and Meridian and just a
little farming town out there.In fact, our only
stoplight happened to be an old black lab that came from
the blacksmi th there and he'd come and lay in the street
and everybody would stop and slow to go around him and
that's how our traffic moved in our community and we had
a chicken farm there and had 500 000 birds in the middle
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of town , so Eagle started to grow and because of the way
it I s situated , it sits kind of in a valley along both
sides of the Boise River.It has some bluff areas and
some large farmland.
It became desirable for people to come out
there and move and it wasn't that far from Boise or from
Meridian , so at that point we decided gosh , if we'
going to grow , we better decide whether we want to be a
bedroom community or whether we want to be a full-service
communi ty and we started working towards can we provide
servlces , can we be a sustainable communi ty if we can
find jobs and commercial base here , do we send everybody
else on the roads to do their shopping and work outside
of our Ci ty, so if we were going to be a full- service
community, then we needed to also be different than Boise
or Meridian, why else would anybody want to come here
we weren't different, and we decided the way that we
could be different was to maybe have little higher
standards or different standards.I don't want to say
higher because we've never intended to be a city better
than anybody else.
We just wanted to have our own standards
and be different with our architecture and our
streetscapes and create an ambience and a feeling of a
place to be , a sense of communi ty and a place where
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people would want to live and shop and raise their
families and we wanted to be a community where people
could have a little more elbow room and the lots maybe
could be a little bit larger so they could throw a ball
instead of say please pass the butter to the guy next
door , so those are kind of the things that we tried to do
as we started creating our design criteria for our
communi ty .
We started out with some pretty extensive
landscaping.We increased our trees to three inch
cal ipers We had a beautiful vista of the mountains as
well as the river.We limited heights of our buildings
to 35 feet.We wrestled wi th the cell towers as to where
to place those outside of corridors and vistas so they
wouldn't be obstructive to the views.We worked hard on
the archi tecture and mechanicals , did a lot of things
wi th the outsides of our buildings in our comprehensive
plan.
We had a bypass coming through our
communi ty .We wanted to retain our downtown heri tage and
still allow for viability at the Bypass with those
businesses not to compete but to compliment , so we spent
a lot of years trying to create these areas.At that
bypass intersection we created what we called an entrance
corridor to the Ci ty and a scenic corridor up and down
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Eagle Road, up and down the bypass, as well as the
historic part of downtown Eagle which was State Street
which would be our main street or our Warm Springs
Avenue, if you will.
We wanted to protect those historic areas
and those scenic views and those corridors , so we put
some pretty strict criteria on those for people to come
in on how that was to be developed.We've had some
beautiful developments come into the communi ty and we'
embraced that and they've embraced what we have had.
It's been a win-win situation.The property values have
produced just from January to June of this year , we have
produced with 300 permits, which isn't very many for a
small ci ty, we've produced over $91 million of property
val ues in the Ci ty of Eagle of which goes to the state
coffers of the State of Idaho to help increase the
economy and also the tax bases for it, so we play a large
part, even though we're a small ci ty, of the economic
viability of the State of Idaho as well as the Treasure
Valley.
So let me ask you, there is an economic
relationship between the design cri teria that you've been
discussing, I mean , there was economic , the Ci ty was
trying to achieve economic goals through those design
cri teria?
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Yes.We also had a limitation in that we
are the third lowest taxed levy city in the State of
Idaho , so we have really low taxes and the only way that
we could offset that was to have great property values
and high property values , so economic viability
extremely important , part of our comprehensive plan and
part of our condi t ional use permi t
You mentioned design or entry corridors,
scenic corridors, one of those scenic corridors is at
Eagle Road and State Street; correct?
Tha t 's correct.
And another one is at Edgewood and the
Bypass?
Tha t 's correct.
So if the 138 kV line we're talking about
here were buil t along the Bypass route, it would have a
detrimental impact on two of the Ci ty' s scenic corridors;
correct?
Yes, it would and you see those beautiful
entrance signs out in those areas out there for that , so
it would conflict with that.
And that would have a detrimental impact
on the goal that the City had been working so hard to
achieve?
It would.
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And that was one of the reasons that Idaho
Power's conditional use permit for the Bypass route was
denied?
Tha t 's correct.
Let's talk about the State Street route
for just a minute and I think I understand that the Ci
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would prefer that this 138 kV line not be built anywhere,
either State Street or the Bypass; is that fair?
Ul timately, that would be wonderful.It I s
kind of like choosing between your favorite child.
Let's just assume hypothetically if we
need to that this line will be built either down State
Street or the Bypass , okay?
Okay.
The State Street route already has
existing structures and existing utilities currently in
use?
Tha t 's correct.
And they've been there a long time?
That's right.
And they're shielded in part and mitigated
by trees and buildings?
canopy?
Tha t 's correct.
I think it's called, what, a tree
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Yes.
There are poles already there that exceed
35 feet?
Yes.
So if this line were put down the State
Street route, what you would be doing is increasing the
height, perhaps , of already existing structures?
That I S correct.
As opposed to if the route down the Bypass
were put on there , you've got brand new poles in places
where there is nothing right now except some light poles
that had to be erected in accordance with the City'
comprehensive plan?
Correct.
And those light poles and everything that
was done on the Eagle River Development was done in
conformance wi th a very strict development agreement
entered into between the Ci ty and Eagle River?
Yes , and those poles are historic type of
poles.
And so , if you will , the lesser of two
evils , the Ci ty would prefer that , again assuming my
hypothetical , the lesser of two evils here would be for
the State Street route to be used for the proj ect that
Idaho Power is seeking; is that right?
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This is the question that the City Council
has wrestled with in which we almost had an agreement
with Idaho Power on it.It is obvious to us that that
probably the most feasible route to take.The manner in
which it happens is what we're concerned about.It is
we realize that we need to provide power.Everyone likes
to cook , bake a pan of cookies or turn on your electric
toothbrush in the morning.We understand what Idaho
Power is trying to do.It's the manner in which we can
make it happen and make it work.
We have explored everything out here wi
them.Undergrounding with transmission lines does not
seem to be in the cards at this point and this time.Our
citizens have asked us if not now , when.We can't answer
that.That is a question that the PUC has to answer or
Idaho Powe r .We don't have those answers, but they have
asked us to stand wi th them.They are very adamant about
this.As a Council , we have a lot of opportunities to
see more of the information than the citizens do and we
understand a lot more than the citizens do of the need
and what is trying to happen here , so we're trying really
hard to work with Idaho Power and to make something work
here wi th them.It's just the manner of how and where.
It's been a difficult process?
It's been a painful process for all of
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us.
But as we sit here today, from the City'
standpoint , the most feasible route would be down the
State Street?
The most feasible route is, like I said
having to choose between which child do I like the best
or least.It would have to be down State Street I would
imagine; however, the two reasons why it's so difficult
is because one is where the c i t i zens 1 i ve , the other is
where the businesses are.Both are important In our city
and both have desires and needs and both have concerns
about these poles and so for us to choose between our
businesses which we need for the economic viability or
the citizens which have a perceived economic impact on
their homes as well what they perceive is their health
really very real to us as a communi ty and we've been
elected by nearly 17 , 000 people to represent out here , to
try to choose and try to do the best , to follow our plan
is what they've asked us to do, follow our plan and yes,
there's some differences in our comprehensive plan.You
can always pick something out of any part of the law and
use it whether it's the law or the comprehensive plan
but in general , we know what our comprehensive plan says,
we know what our citizens expect from us and that's why
we're here today.
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And the application for a conditional use
permit which the City denied was along the Bypass
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Yes.
And the City has never issued a decision
on a conditional use permit along the State Street route;
No.
MR. SQUYRES:Thank you.That's all the
route?
questions I have , Mr. Chairman.
COMMISSIONER KJELLANDER:Thank you,
Mr. Howell.
CROS S - EXAMINA T I ON
Good afternoon , Mayor.
Good afternoon.
Let me follow up on just an issue that
Mr. Squyres was talking about.Do all condi tional use
permi ts have to be approved by the Council?
Yes , and Planning and Zoning most often.
And usually Planning and Zoning first and
then on to the Council?
is that right?
Mr. Squyres.
BY MR. HOWELL:
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Ci ty of Eagle83676
Uh-huh.
Okay, I'd ike to ask you one or two
quest ions about the comp plan.On page 3 of the comp
plan , it discusses Eagle's hopes to have a distinctive
downtown economic center.Could you explain to the
Commission where the Ci ty' s downtown economic center
is?
Our economic center runs from , gosh
probably Bosanka Village which is out by
- -
would be on
West State Street and that's about where our commercial
ends and residences start and it will go clear to
Edgewood , in that area , and then probably two blocks
north and south of State Street.
So we're generally talking about the
intersection of Eagle Road and State Street and off to
the east?
East and west, yes.
Okay, what would you say to those who
suggest that maybe the economic center of Eagle is now
the intersection of the Bypass and Eagle Road?
Well , I I d say that we have two economic
centers and they're both very viable.Like I said,
again , the whole idea of the comprehensive plan is not to
compete but to compliment and that's why the conditions
wi th the Development Agreement which is going out by the
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Bypass is very different from what is in the downtown
area, even the design criteria is different.
I'd next like to ask you also a few
questions about the Black and Veatch study.It's true,
isn't it , that Black and Veatch was not the only bidder
to perform the study for the City?
Tha t 's correct.
And isn't it true that the City solicited
bids and obtained bids from at least two other bidders?
Yes.
And isn't it true that the City whether
you retained or used Hol iday Engineering to perform an
analysis of the bids for you?
That's correct.
And then Hol iday or Hall iday recommended
the Black and Veatch over the other two bidders?
Tha t 's correct.
And isn't it true that the City called out
the subj ects that you wanted evaluated in that study?
We called out the subj ects, but I don't
believe that we gave them a big enough scope.I think
that it was too narrow in what we did.In fact , I'
sitting here telling you we didn't do due diligence on
this, on that Black and Veatch study.
Okay.Let me move on to something else.
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Has the Ci ty ever considered the use of an LID or local
improvement district to convert aerial lines or overhead
lines to underground construction?
We've briefly talked about it.
actually even talked about it with Idaho Power in some
the alternatives we tried to talk about.Our concern was
where do we put it and do we have enough time to
implement it to what they needed to do , so an LID is
something we have discussed briefly, not full bore.
And under the LID concept, doesn't a city
or a county typically go to the utility and ask the
utility to calculate the exact cost that it would expend
to do an underground conversion or an extension?
Gosh , I don't know.We've never done one
like that.The only LID that I know the City has ever
undertaken was at the very beginning of the City when we
did one for just a small area in the downtown improvement
That's the only LID we've ever done.area.ve never
personally been involved in one of those , but it sounds
like a good idea.
Assume for a moment that the Commission
would be inclined to order Idaho Power to construct
overhead aerial line down from the Eagle substation to
the alley in Jackson Square, back around Jackson Square,
onto State Street , onto Ballantyne Road, would the City
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still like to see the other two distribution lines, the
cable line and the telephone line , would you like to see
that buried?
We'd love to see it buried , yes.That'
been our whole issue.In fact , we were so close to our
agreement, I know that's not part of my testimony, but we
were so close and it just boiled down to dollars.
just couldn't figure out how we were going to pay for
that and make it work.
Was it the question of how to pay for
that was the stumbling block?
Yes.
I have one final question.Thi s morning
Mr. Smith was suggesting that once the Commission issues
its order in this proceeding that the Company take the
order , go to the City, file a conditional use permit and
then the City would review that new conditional use
permi t wi th the Commission's order in hand.Can you tell
the Commission what types of conditions you might or the
City might want to apply to that conditional use
permit?
Sure , I sure will.
MR. SMITH:Wai t, I want to obj ect
this.The question is calling for speculation.Until
the condi tional use application is filed and the scope
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that conditional use application is identified , it is
calling for speculation to assume what type of conditions
might be appl ied.
MR . HOWELL:I'll wi thdraw the question.
BY MR. HOWELL:As a former Planning and
Zoning Commissioner , Councilwoman and Mayor , does the
City have a set of boiler plate conditions?
For conditional use permits , standard
condi t ions?
Yes.
We always have our standard conditions and
then we have site specific conditions additional.
Can you tell us what your standard
condi t ions would be or are?
, goodness , it depends on the
application for sure.I don't have any of those before
me on that.It would just be the boiler plate regular
condi tions of approval.Site specific conditions of
approval would be additional requirements that are placed
on them.Sometimes those are even in the form of a
development agreement.
In the Planning and Zoning staff of the
work-up of the CUP that was denied by the City Council,
were there included recommended standard conditions?
m sure there are.They always put those
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standard condi tions in.There's usually a staff report
and in the findings and facts there's an overVlew
there's a recommendation from the Planning and Zoning and
then the recommendation from the City Council with the
site specific conditions as well as standard conditions
of approval.
Mr. Howell , I would also tell you that in
a conditional use permit that we have the opportunity as
well as with our permits to direct our staff to expedite
to sometimes enj oin the findings and facts and
conclusions of law together with the application.
have some ways that we can have some special meetings to
expedite these conditional use permits or any of the
applications that we can and we try real hard to work
with an applicant to get those things through , especially
if there's a time limit on something.
Would this be the kind of case that you
would consider expediting?
I would.
MR . HOWELL:All right, thank you.
further quest ions.
COMMISSIONER KJELLANDER:Thank you,
Mr. Howell.
I think we're ready now for questions from
the Commission and I'll lead off with one.
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EXAMINATION
BY COMMISSIONER KJELLANDER:
Good afternoon Mayor Merrill.
Good afternoon.
Sort following up on the two
assumptions that were similarly proposed by both
Mr. Squyres and Mr. Howell and also recognizing that this
is the best of the worst options in your Vlew , but State
Street was identified and assuming, then, that it's going
to be overhead and the Ci ty or the money doesn't show up
today or tomorrow to make it go underground, from your
testimony, you've already submitted that you don't like
the large overhead power lines and would like to really
bury all of them if you could.If that money should
materialize in four to five years after the transmission
lines are up down State Street , would you consider it to
be more cost effective if your goal is to try to
eliminate the overhead power lines to have it down one
corridor and then have that money and then bury them all
at once?
I think that's probably a better idea.
we'd had the money, if we I d thought that we needed to, we
maybe could have done ike Ketchum had done and increase
those franchise fees and had it in hand and been able to
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move that through.
So then a single corridor is your
preference?
Yes.
COMMISSIONER KJELLANDER:Thank you.
Are there other questions?Commissioner
Hansen.
EXAMINATION
BY COMMISSIONER HANSEN:
Mayor , just a couple of quest ions.Do you
believe there is an urgency to construct this proposed
transmission line between Eagle and the Star
substation?
m sure in the Idaho Power's view it is.
You know , for the Ci ty of Eagle there isn't an urgency,
of course, because we don't think that that's to serve
us.We know that that's to Star , but we are also part of
a regional group that we understand each other's needs
so we understand the needs that power needs to go and be
transmitted down the road.
Another question I had was , did you have
an opportunity as a city back in April of 2002 or since
that time when the CAC was formed and meeting to give
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your input and guidelines of what you as a city would
hope the guidelines would be in picking a route?
No.
One last question.ve got to ask you
this question , I guess , because I years ago served on the
ci ty council and I'm just kind of curious , in this case
m kind of surprised that you would rather have the PUC
make the decision on the route rather than the City
Council make that decision; am I correct in this case?
You know , it's really a chicken way out
the whole thing, on this whole thing, no doubt.Wha t has
happened is because of the extensive public comments and
unhappiness wi th our ci tizens, as well as the business
people out here and as we've tried to work wi th the Idaho
Power trying to come up wi th a route, a payment , an
underground distribution , myriads of different things out
here , size of poles to types of poles , it became very
clear to us and I have to tell you our Council has not
been unanimous on this and we have flip-flopped as we'
wrestled with this and wrestled with this and we came to
the conclusion at the last minute before we could sign
the agreement that we were in a no win situation.
If we signed the agreement with Idaho
Power , we would make the people that lived on the State
Street corridor very angry, that we had not allowed them
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to go through the public process of being able to express
to the Public Utilities Commission because they knew
that's where this was coming and be able to testify and
we would circumvent a public hearing process and that
would make them very angry.The second thing that would
make them very angry would be over the whole City that if
we had taken the agreement with the franchise fees and
spread them out over three years
- -
increase them to
three percent over a six-year period of time and ask all
the citizens to pay for that that would make everybody
else mad at us, so we said, you know , what the citizens
had asked us to do was please don't sell us out , stand
with us as citizens and let's go together to the PUC and
explain our plight and lay it at their feet and let them
make that decision for us, and as elected officials,
tha t 's what we were asked to do.Typically, we try to do
that.
I apologize for the pressure it puts you
under.We know that , but it's like I told the folks last
night , the PUC are good people, good hearts , they
understand a bigger , broader picture.They understand
power , they understand all the needs of the citizens for
all the State of Idaho.They are a bet ter board to make
this decision.We ul timately would have loved to have
had it go around the Ci ty and that was some of the routes
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that we looked at and we thought that that would better
serve up into the future wi th Star and some of those
developments that are going up into the foothills and
was just economically unfeasible, but we could never get
the real costs on it , so there were a lot of things out
there that we looked at, but as a Council member, you'
right, it was a very difficult decision on it and we will
stand by the PUC' s decision on that.We know that thi
decision is not easy for you, too, and we feel a little
bit like David and Goliath coming into the fight here,
but we've never done this and we hope that you make the
right decision for us.
COMMISSIONER HANSEN:Thank you very much,
Mayor.
THE WITNESS:Thank you.
COMMI S S IONER KJELLANDER:Commissioner
Smith.
COMMISSIONER SMITH:Thank you.
EXAMINATION
BY COMMISSIONER SMITH:
And thank you, Mayor, and I guess the
first thing you should have told your citizens is that
we're cheap and there won't be one more dime that goes
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into this, but I was glad you mentioned the citizens
coming to you and asking you , because I've recently
become aware of a statute that you've probably known
about for a long time and that is Chapter 25 of Title
of the Idaho Code and there's a whole section in here on
underground conversion of utilities and I guess my
question is when the citizens came to you
m not aware of it.
-- did you show them Title 50, Chapter 25
and say if our community wants to underground our
facilities, the legislature has told us the process by
which we can do that and here it is?
No, I did not even know that.We'
pretty much ingrained in our little City codes.
Well , and I was pretty much ingrained in
Title 61 and 62 , but now I've branched out into Title 50.
I will too now.
COMMISSIONER SMITH:Thank you.
EXAMINATION
BY COMMI S S IONER KJELLANDER:
Okay, I'll give it one shot.I'll just
ask , if the Commission were to issue an order to do the
overhead lines down State Street, you had mentioned
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earlier in your testimony that there had been an attempt
to deal with franchise fees to bury those lines.I f you
have a Commission order in hand, does that then
potentially go back to reopen that discussion to look
the franchise fee for burying a portion of this line?
I bel ieve so.
COMMISSIONER KJELLANDER:Okay, thank you.
redirect.
Anything else?Redirect.
BY MS. BUXTON:
MS. BUXTON:Mr. Chairman, just some minor
REDIRECT EXAMINATION
Mayor Merrill, would it surprise you to
know that Title 50, Chapter 25 is the LID statute to bury
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It would surprise me, yes.Thank you.
underground lines?
And you did ment ion that we had talked
LIDs for this purpose in the past; is
I just didn't know it fit under a Title
Mayor , when Ms. Moen was asking you
questions about the comp plan, she was asking you about
about potential
that correct?
law, sorry.
190 MERRILL (Di)
Ci ty of Eagle83676
the camp plan's provisions regarding accommodating other
areas, other areas in the region outside of the Ci
limits with regard to public utilities and other public
facilities.Does that also mean to you that the City
Eagle should have to pay for those benefits to those
areas outside of the Eagle City limits if they're going
to allow them to go through our town?
No, Ms. Buxton , that does not mean that we
should have to pay for that.What it means is that we
should cooperate with adj acent cities as well as the
Treasure Valley as we look at regionalization throughout
the Treasure Valley, whether it's sewer or water or power
or roads or however those as we connect to one another
that we should all be working cooperatively towards all
of these things for the betterment of all of the Treasure
Valley.
Mayor Merrill , wi th regard to the Black
and Veatch study, the engineers that were selected by the
Ci ty, you discussed that the Ci ty went through a bid
process and advertised for request for proposals; is that
correct?
Tha t 's correct.
I direct you to your testimony on page
ines 15 through 21.When you were saying that you
didn't do , the City didn't do, and I'll quote you, "your
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due diligence," were you really meaning, like you say on
lines 20 and 21 , that, and I quote , "this may be due in
part to the City's unfamiliarity with the intricacies of
public utilities and utility planning" with regard to
knowing how to set forth the scope of work that we asked
Black and Veatch to do?
Yes, I think I explained that.I do not
believe that we asked the right questions, that we got
the right answers that we needed.The report was just a
tiny little booklet of maybe 10 pages for the whole
thing, and for the dollars that we paid them, it just
blew our mind away that that's all that we got.
But do you believe the City acted in good
faith with regard to trying to get an outside consultant
to look at these questions on the Ci ty' s behalf?
We were trying to come up wi th an
al ternati ve or come up wi th some ideas.We were trying
to get some costs and find out what was being done around
the United States as well as around the rest of the world
for underground transmission lines.We just have heard,
we've read from other cities out there that it is being
done and we wanted to see how feasible it was and if we
could bring that information to Idaho Power that maybe we
could help in the process and that was our desire out
here was to say and here's some other ideas that we'
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come up wi th , al so.
So to summarize that, you wanted other
alternatives and you were looking for an expert to give
us some more ideas of al ternati ves; is that correct?
Exactly.
In response
Kj ellander you men t i oned we never got the real costs
to a question from Chairman
wi th regards to trying to work this out.Can you
elaborate on what the City requested from Idaho Power and
whether Idaho Power would or would not give us specific
costs that we were asking for?
Yeah , can I do just a little analogy?
would be something like if I went to a car lot and looked
at a car sticker on a car and said how much is this car
and they said
- -
had one item on it that said $25,000,
you're going to pay $25,000 for this car , and I'm saying
yes,but does have air condi t ioning,how much the
air condi t ioning going cost me?Does have an extra
sound system,what'that going cost me,and how did
get to the $25, OOO?I s there extra shipping and handl ing
and all the other things that go wi th a car, and when we
looked at these routes, all these different routes, the
six inc uding going on up Highway 55, we were given
will cost you the same to go down parallel to the Ci ty,
but it will cost you a million dollars a mile to go up
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and a million dollars a mile to go down, but there was
never any basis for it.
Break it down, what is it a linear foot to
What are the real costs on this , and the same thingme?
with the lines going down , burying the distribution lines
down State Street, we had a cost out here, a $340,000
cost , that was going to be spread and pushed on down and
they were going to bury that, but then the actual cost
where we came up with a million something dollars, we
couldn't get what is that paying for , what is the cost on
those, and when we budget, is this a real cost?Is this
a not-to-exceed cost?Is it a cost plus?Is it cost
plus labor?We couldn't get anything out of it as far as
what are the real costs on this thing, so if we were to
go for a franchise fee or an LID or that, we would have
to have some dollar amounts in our budget to say this is
what we have to budget for the next year or the next so
many years in order to do that.
MS. BUXTON:I have no further
questions.
COMMI S S IONER KJELLANDER:And thank you
Mayor Merrill.
(The wi tness left the stand.
COMMI S S IONER KJELLANDER:I believe we'
ready for your next wi tness
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MS. BUXTON:Mr. Chairman , we would next
call Mr. Don Reading.
DON C. READING,
produced as a witness at the instance of the City of
Eagle , having been first duly sworn , was examined and
testified as follows:
BY MS.BUXTON:
you?
DIRECT EXAMINATION
Good afternoon, Dr. Reading, how are
Fine.
State your full name, spelling your last
name for the record, please.
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Wilder , Idaho
Don C. Reading, R-e-a-i-n-
Could you provide us wi th your business
6070 Hill Road, Boise , Idaho.
Could you tell the Commission who you
represent in this matter?
City of Eagle.
And are you paid a consultant?
Yes.
address, please?
195 READING (Di)
Ci ty of Eagle83676
Have you previously filed written direct
testimony in this matter?
Yes.
Have you previously filed written rebuttal
and supplemental testimony in this matter?
Yes.
Do you wish to make any corrections to
ei ther your direct or your rebut tal and supplemental
testimony?
Not at this time.
I f I were to ask you the same quest ions
today for either your direct or your rebuttal and
supplemental testimony, would your answers be the same?
Yes.
MS. BUXTON:Mr. Chairman , I would request
that the direct testimony, pages 1 through 13, Exhibi
100 through 107 - - let's see, excuse me, I'm going to
back up - - be spread over the record as if read in its
entirety and that Exhibits 1 through 13 (sic) be marked
and admi t ted for the record.
COMMISSIONER KJELLANDER:Without
objection , without restating previous objections , we'll
spread the testimony of both direct and rebuttal as
read and also mark and admit Exhibits 1 through
(sic)
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MS. BUXTON:For the record, the rebuttal
testimony was pages 1 through 4.
COMMISSIONER KJELLANDER:That's fine.
We'll just call it rebuttal.
Is it 100 through 107?
MS. BUXTON:Exhibits 100 through 107.
COMMISSIONER KJELLANDER:Well , then I was
wrong and we'll just the say the associated exhibits.
(The City of Eagle Exhibit Nos. 100-107
were admi t ted into evidence.
(The following prefiled direct and
rebuttal testimony of Dr. Don Reading is spread upon the
record.
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Would you please state your name and address?
Don Reading, Ben Johnson Associates, Boise,
Idaho. The address is 6070 Hill Road, Boise,
Idaho.
Have you prepared an appendix that describes
your qualifications in regulatory and utility economics?
Yes. Appendix A , attached to my testimony,
serves this purpose.
Does your testimony include any attachments?
Yes. Exhibits 100 though 107 are included at a
the end of the testimony.
Wha t is your purpose in making your appearance
at this hearing?
Our firm has been retained by the Ci ty of Eagle
(the City, Eagle) to examine the impact on Idaho Power
Company'(the Company, IPC) proposed 138kV power line
through the Ci ty of Eagle.
How is your testimony organized?
First , I give a brief history of the conflict
between Idaho Power and the City of Eagle. Second,
is a presentation of census data that shows the City has
the highest median property value among non-recreation
based ci ties in the state. One of the reasons for these
high property values has is the development strategies
and development restrictions of the City over the past
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City of Eagle83676
15 years. The City has managed its growth with award
winning strategics that led to its rejection of Idaho
Power's proposal. Third I show , using econometric studies
of what common sense tells us, that high vol tage power
lines reduce property values and that IPC' s proposal will
devalue some of the City's most value real estate.
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Third, the 90 acre Eagle River Development at
the intersection of Eagle road and Highway 44 is used as
an example of the type of development that has been
occurring throughout the Ci ty. The developers have
expended significant sums to build an aesthetic
business park - including paYlng Idaho Power $100,000 to
bury it own electric lines. This development along with
other Eagle properties will see lower property values
should the line be build as proposed by Idaho Power. This
will not only hurt property owners but also the property
tax base of the City and it ability to attract the type
of businesses its planning efforts are aimed at. Fourth
lS a discussion of the fact that what is happening in
Eagle will occur throughout the state as cities attempt
of follow Eagles pattern and prepare their communities to
meet the economic development demands of Idaho's changing
economy.
Could you please briefly outline the dispute
between Idaho Power and the City of Eagle?
Idaho Power Company has ask the Idaho Public
Utilities Commission,(the Commission , IPUC) to issue an
Order directing it to construct a 138kV transmission line
through the Ci ty of Eagle. The Ci ty of Eagle's concern
over a maJor electric facility in the City began in 1995
when the IPC applied for a rezone and a conditional use
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permit (CUP) to upgrade its substation in Eagle from 69kV
to 138kV. The City approved IPC' s application with the
provisions that,
No further expansion once they
upgrade this location , the next upgrade
needed will require a different location.
Additional design review and landscape
review will be necessary. Additional
screening against the fence on State
Street is required. (Ci ty of Eagle,
Finding of Fact and Conclusions of Law
Recommendations, Oct. 1995., Exhibit 100)
2 .
3 .
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The restrictions indicated the City's concern about
maintaining aesthetics within the City of Eagle and
desire to keep unsightly power facilities at a minimum.
In late 2000 Idaho Power applied for a permit
to install a 138kV line that would run from the Eagle
substation through downtown along State Street to Highway
, then to Ballantyne Road. Since the time of the
original application the Company has withdrawn and
resubmitted its application. There have been numerous
meetings, public hearing, and discussions that have
invol ved the Ci ty, the Company and the I PUC Staf f in an
effort to resolve the issue. The City has rejected the
Company's latest request for a Conditional Use Permit and
an exemption to exceed the 35-foot building height
restriction , and negotiations have stalled. In essence
this application is the Company asking the IPUC to
override Eagle's rej ection of the CUP and order IPC to
construct the 138Kv line through the City in violation
the Ci ty 's own ordinances.(Eagle City Code 8-
General Standards for Condi tional Uses; Design
Requirements, Objectives and Considerations, 8-2A-
Exhibit 101)
Could you please provide a profile of the City
of Eagle?
Eagle has been one of Idaho's fastest growing
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City of Eagle83676
communities in one of the nations fastest growing states.
The City of Eagle was the 3rd fastest growing city in
Idaho between 1990 and 2000 increasing its population by
233%. This growth has continued since 2000 increasing by
nearly 2 200 residents or an additional 23%.(Population
of Idaho Cities , 1990-2000. Exhibit 102) The City also
has some of the highest property values in the state.
How do you know the City of Eagle has
relatively high property values?
According the 2000 Census the Ci ty of Eagle, as
measured by median house value, has the lOth highest
value among Idaho cities.
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Top 10 Idaho Cities
Median House Value 2000
Sun Valley
ernan Lake Village
$200 000 $400 000
Dollars
$600 000 $800 000
Note that all of the communities that rank above Eagle
are ei ther located on a lake or are resort based. This
means the Ci ty of Eagle has the highest property values
in the state among residential communi ties.(Profile of
Selected Housing Characteristics, 2000 Census. Exhibit
103)
Are you saying the population growth has driven
up property values?
, for a city like Eagle it is hard to
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City of Eagle83676
pinpoint cause and effect for increasing property values.
What is clear is that people want to move to Eagle and
are willing to pay premium prices to live there. When you
see both high property values and high growth for a city
it is an indication of its desirability and economic
prosperi ty. It is also an indication that the Ci ty ' s
growth has been well managed and that its development
strategies have been successful.
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If fact the City was named one of the "Best
Managed Small Ci ties in America" last year.(Pat
Summerall , Champions of Industry, "Best Managed Ci ty in
America", CD Exhibit 104.) The Association of Idaho
Cities (AIC) has picked Eagle as a 2004 recipient of the
City Achievement Award for creating an "Architectural &
Site Design Book" and establishing a "City Forester/Code
Enforcement Officer". The AIC praised Eagle for "paving
the way for other cities to follow suit"(Memo, Ken
Harwood, AIC to Nancy Merill , Mayor City of Eagle, June
, 2004. Book attached, Exhibit 105)
During the Planning and Zoning hearings dealing
with IPC' s application a number of protestants indicated
they felt property values in the city could be decreased
if Idaho Power were to build the line as proposed. Do you
agree?
According to Idaho Power,
On October 14, 2003, the Eagle City Council
took up the Company's application , including
the Planning and Zoning Commission'
recommended denial of the application. A public
hearing was held and testimony was received. A
number of citizens and commercial developers
testified that the Bypass route was
aesthetically unfavorable and, in their
opinion, could adversely affect commercial
property values in the area. (Idaho Power
Direct Testimony of David Sikes, pg. 11)
Econometric studies have shown that there is a direct
relationship between lower property values and the
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READING (Di)
City of Eagle
206
83676
proximity to high-voltage powerlines. For example a
University of Toronto study found,
This research offers conclusive evidence to the
claim that propinquity to high-voltage
powerlines capitalises into lower property
values. Results from OLS models estimated for
freehold properties within 1-km of the
power-lines suggest a loss of 4% to 6.2% in
value. Loss in value decreases with distance
from power-l ines. At an average proximity tohigh-vol tage power lines resul ted in a decline
of $11 000 to $27 000 in property values.
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(Impact of Power Lines on Freehold Residential
Property Values in the Greater Toronto Area,
Uni versi ty of Toronto, Haider, Murtaza and
Antoine, Haroun , Department of Civil;Engineering, 1992. (Canadian dollars))
Stanley Hamilton and Gregory Schwann in a 1995 Land
Economics article concluded,
High voltage electric transmission lines do
have an effect on property value. We find thatproperties adj acent to a line lose 6.3 percent
of their value due to proximity and the visualimpact. (Hamil ton , Stanley and Gregory Schwann
Land Economics, 71 (4): 436-44, November 1995.
These studies confirm common sense. Unsightly
structures on or near property will make the property
less desirable and thus reduce land value. What
important for land values is the perception of society.
There is a fear - rational or irrational - that high
voltage powerlines are a potential health hazards. This
is an additional factor in lowering the worth of a
property located near high vol tage power lines. There
of course many factors that influence property values
that make it difficult to sort out all the factors that
influence value. The econometric studies cited above have
attempted to do this and in my opinion are a reliable
indication of the impact of high voltage power lines on
the value of property.
The planned Bypass route proposed by Idaho
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Power runs along Highway 44 and through the intersection
on Eagle Road. In general what is the value of property
along this corridor?
As pointed out above the land along the
proposed powerline route would have some of the highest
non-resort values in the state. The fact that it is the
entry corridor to one fastest growing cities in the state
with some of the highest property values make this
property extremely valuable. The proposed line bisects
the land between Boise River frontage and
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developing downtown Eagle diminishing property values on
both sides of highway 44. The City has designated this
area its ' Scenic Corridor'(City of Eagle Land Use Map,
part of The City of Eagle 2000 Comprehensive Plan, as
amended. Exhibit 106). The City s 2000 Comprehensive Plan
states that, "The City of Eagle has the responsibility to
guide development and redevelopment that occurs along
these entryway corridors.(The 2000 Comprehensive Plan;
pg.
45. Exhibit 106) In rejecting IPC's proposal that
exactly what the City is doing.
As pointed out above resul ts indicate growth
management has been a success in Eagle. Placinghigh vol tage poles in the middle of the mostimportant land in the Ci ty would be a maj or
step backwards in that management process.
Has there been significant development effort
in property along the proposed route of the 138kV line?
Yes. One example is the Eagle River Development
located at the southeast corner of Eagle Road and State
Highway 44. The Eagle River Development is a 100-acre
planned mixed-use commercial development that
incorporates retail and office space with water
amenities, bike paths, open spaces and Boise River
frontage. The Eagle River Development was specifically
designed to be compatible with the City of Eagle'
comprehensive plan , which emphasizes the importance of
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preserving the rural elements of the communi ty and the
nature aesthetic of the area through pedestrian- friendly,
livable spaces, scenic views and open spaces. To create
its development in accordance wi th the Ci ty ' s development
goals and objectives, Eagle River and the City entered
into a Development Agreement.(Development Agreement
between Eagle River Development and the Ci ty of Eagle.
Exhibit 107)
In accordance wi th the Development Agreement
and consistent with the City's development goals, Eagle
River invested more than $3,000,000 in system
beautification efforts. Eagle River has developed an
integrated pathway
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throughout the development that connects wi th the River
Front Green Belt and Pathway. It has installed extensive
landscaping throughout the development with water
features, ponds and fountains. In addition , it installed
vintage-style street lighting along all on the internal
roads within the Development. Significantly, to protect
the thematic integrity and aesthetic of its development
Eagle River buried all of its utility lines and
additionally paid to Idaho Power more than $100,000 to
bury its own power lines along Eagle Road.
Is the Eagle River Development finished at this
time?
Presently, the Eagle River Development is not
fully developed. However, as of the date of this filing,
there is approximately $20 million in building
construction on site, and an additional $24 million of
planned construction to begin wi thin the next 12 months.
The construction of the 138 kV transmission
line along State Highway 44 as proposed by Idaho Power
will have a direct negative impact on the Eagle River
Development. Consistent with the power line studies
discussed above, Eagle River's land values will be
significantly diminished as a result of the transmission
line. With the diminished land values, the quality of the
development will decrease, and the market exposure time
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for its property listings will be extended. Instead of a
high-quality commercial development consisting of retail
and office space, the development will attract more
industrial and flex- space uses. Certainly, the Eagle
River developers would not have invested so heavily in
the property had they known an unsightly, high vol tage
transmission line would be placed adj acent to their land.
From the Ci ty of Eagle's perspective, the
devaluing of the Eagle River Development will impact the
City's development plans, and perhaps more importantly,
will affect it tax base and revenues. Not only will the
City have a
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more industrial-looking commercial center, with the lower
land values, it will lose tax revenues.
Are you saying only those who own property
along the proposed route will have their property values
diminished should the proposed powerline be buil
There certainly will be a significant impact on
adj acent property values. However because the proposed
line will impact the entry corridors to the City it may
well have an impact on potential development. Impressions
are important for potential business's and well as
prospecti ve home buyers and an unsightly entry corridor
will tend to dampen the desirability to locate there.
What is Idaho Power's rational for running this
high voltage line in the middle of such prime real
estate?
According to the Direct Testimony of Greg Said,
When a city, such as the City of Eagle,
determines that Idaho Power must meet standards
for aesthetics that are more stringent than the
standards in place throughout Idaho Power'
service territory and the result of the
application of the more stringent standard
higher cost, the question them becomes "who
should pay for the additional costs
attributable to the City of Eagle's morestringent aesthetics, the Ci ty of Eagle or
other Idaho Power customers begin served by
facilities build under different standards?"
Idaho Power believes it is inappropriate for
the City of Eagle to pass the costs of its
aesthetic standards onto other customers who
are willing to be served at lower costs underdifferent standards. (Idaho Power Direct
Testimony of Greg Said, pg. 11)
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The specific "more stringent" aesthetic standards that
Mr. Said refers to are the City's 35-foot building height
restriction and standards for a conditional use permit
(CUP)Among other things for the City to issue a CUP
needs to determine that the proposed proj ect,
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Wi 11 be harmonious with and in accordance
wi th the general obj ect i ves or wi th any
specific objective of the Comprehensive
Plan and/or this title;
Will be designed, constructed, operated and
maintained to be harmonious and appropriate
in appearance wi th the existing or intendedcharacter of the general vicini ty and that
such use will not change the essential
character of the same area;
Will not hazardous disturbingexistingfutureneighborhood use;
(Exhibi t 101)
Gi ven these conditions hard to see how the City
could approve Idaho Power's CUP and still maintain it own
standards. Nor are these restrictions unusual for cities
throughout Idaho. This is especially true when applied to
important entry corridors that lead to the city core.
The problem is that Eagle happens to be locate
between two of the maj or growth areas in the state and
Idaho Power has right - of -way through the Ci ty. The
Company has chosen to solve its load problems by put ting
a high vol tage line through Eagle's most expensive real
estate and scenic corridors rather than a different
route. Or for that matter obtaining generation to the
west of Eagle such as the failed Middleton plant. While
Boise City has high power voltage lines running through
it none are along important corridors such as Warm
Springs, Harrison Boulevard, and Capitol Boulevard.
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Mr. Said states that it is inappropriate for
the City of Eagle to pass the cost of its aesthetic
standards onto those who are willing to accept lower
aesthetic standards for power at a lower cost. Do you
agree?
No. In this case it is the citizens of Eagle
who are paying the cost of serving Idaho Power'
customers to the east through lower property values and
degraded visual entry corridors. It is customers to the
east of Eagle that will have the benefit of the electric
power wi thout having their views degraded or their
property values lowered.
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The Company suggests Eagle form a LID and/or
lncrease franchise fees to pay for rerouting or burying
the line. Is this a fair approach?
Who should pay is a key element in this
dispute. The Company's approach appears to be, "if
they (the City of Eagle) don't want these large power
ines through their Ci ty then let them pay for burying or
moving the line"Historically this has been business as
usual for the Company.However delivering electric power
in a growing state like Idaho should be borne by all
ratepayers in a case where a powerline will do as much
economic harm as the one proposed by Idaho Power in the
City of Eagle. As pointed out below Idaho is a state in
economic transition where aesthetics are an important
part of development plans. At a minimum , because the line
is to provide power in the rapidly growing "electric load
growth in the entire Eagle-Star-Meridian area"(Complaint
To Obtain Commission Order Directing Idaho Power to
Construct Improvements To Secure Adequate Services To Its
Customers , IPC-E- 04 - 04 , page 2.) ratepayers in this wider
area should share in the costs of either burying the line
or the extra costs of rerouting.
Dr. Reading, lets shift gears and look at the
bigger picture. Given Idaho Power's posi tion in this case
do you think Commission is likely to see other cases
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similar to this one?
Yes. Idaho is a state in economic transi tion.
The state is rapidly evolving from a agricul ture and
natural resource based economy to one of services, light
manufacturing, technology, and electronics. One economist
dubbed the change in Idaho's economy as evolving from
potato chips to computer chips. Governor Kempthorne I s
Task Force on Rural Development stated, "The new economy
is also resource-based. But this time the resource
knowledge. "(Governor's Task Force On Rural Development,
Findings and Recommendations,
http: / /www. idoc. state. ide us/idcomm/ruralinit/index. html)
In order for the state to prosper in the new economy
means attracting a knowledgeable labor force that is the
most important factor input for service and technological
firms. It is clear that the many of the rapidly growing
sectors of our economy are footloose" and can locate
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anywhere in or outside the state. These firms will
locate in places where there owners want to live and
where they can attract a quality workforce.
This means for communities to be competitive in
this new economy they will need to be places where people
want to life, work and raise their families. More and
more ci ties like Eagle will work to improve, as Greg Said
phased it , their aesthetic standards". As stated
earlier most other growing communities have development
restrictions like those of Eagle. As the AIC stated Eagle
is a City that is "paving the way for other cities". That
means, among other things, restricting unsightly power
lines through city cores and entry corridors. Innovative
solutions, like those suggested by City witness Teinart
need to be developed or this case will be only the start
of more filings at the Commission.
Are there economic benefits to the state in
general to build cities that are aesthetically
pleasing?
Yes. As indicated above the state is evolving
where quality of life issues are important for
economic development. Many "business as usual" approaches
- be they from the power company or elsewhere - need to
be modified. While one may want to make the argument that
the cost of burying or al tering the route of the power
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line should fall only on the City of Eagle the economlCS
of the state are not so easily segmented. Having
communities like Eagle is attempting to build benefit the
region and the state. Its higher property values generate
higher tax revenues. Its ambiance generates economic
vitality and attract businesses that will add jobs to the
state economy. These benefits extent to more than just
the people who own property or live within the City.
The state and individuals gain value through
improved aesthetic standards", but does this also help
the Company?
It is in Idaho Power's best interest to have a
growlng and economically viable service terri tory.
The more the Company can aid in the economic development
of the state and make it a place where firms want to
locate increase value for shareholders. Certainly low
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cost power is an important development tool and it is
incumbent on the Company to provide reliable power at a
reasonable price. However it also means providing that
power with that will satisfy the aesthetic and
development needs of the state along with the provision
of electric power.
Does this end your testimony as of July 2
2004 ?
Yes.
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Would you please state your name and address?
Don Reading, Ben Johnson Associates, Boise, Idaho.
The address is 6070 Hill Road, Boise, Idaho.
Are you the same Don Reading who filed direct
testimony and exhibits in this docket?
Yes.
What is the scope of your rebuttal testimony?
I have reviewed the direct testimony of Staff
Witness Randy Lobb and I have three observations in
relation to his positions.First, Mr. Lobb makes no
distinction between the potential loss between higher and
lower valued properties from the installation high
voltage transmission lines.He goes on to say the
utility should be able to put in its transmission lines
where it "deems appropriated"This approach leaves no
incentive for the power company to look at its impact on
property values and to weigh only its own benefits.
Second, by quoting the Idaho Land Use Planning Act, he
states that it is appropriate to place transmission lines
in existing utility easements.What he does not
recognlze is that utilities have easements along
virtually all roads in cities like Eagle.Third, he
agrees with Mayor Merrill and recommends city
comprehensive plans include designated transmission
corridors.I agree, and cities need to be informed about
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a utilities long-run transmission plans.Unless there
better coordination between city and utility planning the
Commission can expect more cases like this one.
Could you please discuss your first point dealing
with the economic impact of high voltage transmission
ines on high valued property?
On page 3 of his direct testimony Mr. Lobb states:
"While I do not necessary dispute the potential
economic impact such overhead ines may have on
adj acent property, I believe it is
inappropriate to require the general body of
Idaho Power customers to pay significantly
higher rates to provide underground facilities
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for the aesthetic benefit of local communities
and landowners.(Direct Testimony of Randy
Lobb, p. 3, lines 8-13.
He also states:
"I believe it likely that large overhead power
lines can negatively affect local propertyvalues wherever they are located.(Direct
Testimony of Randy Lobb, p .10, lines13 -15. )
As I stated in my direct testimony there are no high
voltage transmission lines along important corridors such
as Warm Springs, Harrison Boulevard, and Capitol
Boulevard in Boise.Property values in areas such as
this are too valuable to be spoiled by transmission
lines.A blanket policy that does not recognize this
will only lead to more confrontations between cities and
utilities and to more hearing like this one.
Does the power company have any incentive to
recognize this difference between higher and lower valued
properties?
According to Mr. Lobb Idaho Power should beNo.
able to:
"In my opinion , the Company should be allowed
in situations like these to reasonably extend
and upgrade its transmission/distribution
facilities, as it deems appropriate. (Direct
Testimony of Randy Lobb, p.9, lines 4-
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The problem is the Company's only incentive to meet its
obligations as a service provider is what it "deems
appropriate" This does not include the value of
adjacent property or a cities existing comprehensive
plan.Mr. Lobb also states:
"However , I believe overhead transmission
facilities are the standard of construction for
Idaho Power Company.(Direct Testimony of
Randy Lobb, p. 12, lines 2-
Wi th this standard of construction" the Company has only
the benefit to its system without considering the costs
it is imposing on property owners or the development
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opportunities of cities.Mr. Lobb appears to find this
appropriate without taking into account the degree of
potential harm done to the ci ty and its property owners.
What is missing is any attempt at a rational cost/benefit
analysis.The power company is looking only at the most
inexpensive way to meet its needs wi thout regard to any
level of costs imposed on the city and property owners.
Lets turn to your second point. What does Mr. Lobb
say about the Company's planned route along highway 44 or
bypass routes and the Idaho Land Use Planning Act?
On page 10 of his Direct Testimony Mr. Lobb states
that both State Street and the bypass routes are along
public roadways and thus are consistent with the Idaho
Land Use Planning Act.What he fails to recognize
that the Company has a utility right of way along almost
all roads within the City.This is to be expected and
true with other cities as well. This approach does not
deal wi th the essence of the dispute in this Docket.
What is important is that growing cities understand that
they need to understand utilities transmission plans and
establish utility corridors to route high voltage power
lines around their visual entry corridors and high value
downtown areas.
That leads us to your third point.Do you agree
with Mr. Lobb that cities need to include utility
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corridors in their comprehensive plans?
Yes.As Mayor Merrill stated in her role as
President of the Association of Idaho Cities:
"I plan to educate growing cities like Eagle
about the dangers of how public utilities can
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affect property values, resul t in adverse
heal th perceptions, has impacts on years of
careful planning and zoning, and stunt future
development. Clearly, utility corridors need to
be planned well in advance. Since the cities
are given little or no help in this area
would like to see the AIC take a more active
role in helping to address this problem. I am
also the legislative chair for the AIC and will
encourage a review of relevant statutes
addressing large utility poles in theterritorial limits of Idaho Cities. "(Direct
Testimony of Nancy Merrill
, p.
7, lines 17-23.
I recommend the Commission support this effort by
instructing the Staff and ordering the Company to
participate in this effort.I believe without a serlOUS
effort by all parties that the contested issues in this
case will continue to occur with cities throughout the
state.The Company and Staff are concern about any extra
costs from transmission construction be passed on to all
It should be remembered that all ratepayers
share in the cost of hearings like this and any
litigation that may follow.Resolving these issues in a
less contentions manner will be essential for the cost
expansion of transmission facilities.
this end your testimony as of September 1
ratepayers.
effecti ve
Does
2004?
Yes.
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open hearing.
(The following proceedings were had in
MS. BUXTON:We'd present Dr. Reading for
cross.
COMMISSIONER KJELLANDER:Thank you.
Mr. Howell.
Let's start wi th Mr. Squyres.
MR. SQUYRES:No questions.
BY MR. HOWELL:
COMMISSIONER KJELLANDER:Let's move to
CROS S - EXAMINA T I ON
Dr. Reading, on page 6 of your testimony,
you discuss the resul ts of a Stanley Hamil ton analysis in
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Wilder , Idaho
Yes.
Have you read that article?
Yes.
And isn't it true that the majority of
they were using to determine how
transmission lines affect property values had to do with
transmission towers?
Yes.
In 1 ieu of poles?
a 1995 article.
samples that
230 READ ING (X)
Ci ty of Eagle83676
Yes.
You note on page 10 of your testimony that
Eagle River paid more than $100,000 to bury its
distribution lines.Was that a requirement of the
Development Agreement?
I guess I can t answer that.It was
certainly a choice, I think, that they made.I would
have to look at the Development Agreement.I don't
believe it was.
Even if it wasn't included in the
Development Agreement, wouldn't the Company's Rule H
cover that?
You'losing me,m sorry.
Rule H deal ing wi the burial
distribution lines a customer'request.
At the customer's request and if it'
buried , they negotiate with the Power Company and
whatever it costs, then they pay the Power Company what
that cost is, and as I stated in my testimony, they would
do that because they felt it would make the property more
valuable, economic decision.
On page 10 on lines 25 through 28, you
were saying that Eagle ratepayers are paYlng the cost of
servlng Idaho Power customers to the east.
Yes.
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Wha t do you mean by that?
That my understanding the transmission
line is to get power into the Star substation and those
customers would be served in that area from that
transmission line.Did I say to the east?
Yes, you did.
, I should say to the west, so I have a
correction in my testimony.It should say west.
Turning to page 11, on lines 3 through 14
you re responding to a question about the Company
suggestion about forming an LID or using franchise fees
to reroute or bury.
Yes.
Are you suggesting that the ratepayers of
Eagle, Star and Meridian should share in the cost if the
Commission were to order this line to be buried?
m suggesting that as a potential option.
What I see occurring in the dispute in this case is a
bright line being drawn that if this particular power
line or facility goes here, these people pay for it.
it goes there, those people pay for it and so it's very
cut and dried.The development and economic viability of
a city like Eagle if it is successful, if it continues to
be successful as it has, it will economically help and
a development not only for the City of Eagle itself but
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for the whole surrounding area.
As part of that, what they re trying to
do, as I made statements, as I discussed in my testimony,
that the construction of the power lines would be an item
which could be a detriment to that development and so the
benefit is to the wider area and so in that sense, then
the economic engine for the region is being asked to pay
for something that will benefit a wider region , so the
bright lines here, at least in my looking at this, aren't
as I've heard discussed earlier today here.They are a
lot fuzzier in my mind, so to answer your question
directly, that would be an option.
You indicated in your testimony that the
overhead transmission lines along Highway 44 Bypass will
lower the property values for Eagle River.
I think they absolutely would.
Has the existing 138 kV transmission line
from Edgewood to the Eagle substation lowered Eagle
River's property values?
I haven't looked at that particularly.
know the Company's - - I think Mr. Sikes in his rebuttal
testimony at the very end makes a statement about they
haven't found that these power lines affect property
values.I looked at the econometric studies, whether
they be towers or poles or whatever.I think it's common
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sense that your property certainly isn't more valuable
with something ugly right in front something
ugly alongside it.For purposes of my testimony,
got some studies which showed that,
But in response - - I'm sorry, I didn'
mean to cut you off.
- -
the specific line you're talking about
m not sure where that is in relation to the Eagle
property and so I can't specifically state.Certainly,
power lines sure don't increase the value of property and
I can't imagine in most cases they wouldn't be a
detriment to the value.
MR . HOWELL:No further questions.
further questions, Mr. Chairman , I'm sorry.
COMMISSIONER KJELLANDER:I apologize.
saw Mr. Woodbury walk in with a blue back, so I think
this point , let's see , it is our turn , okay, let's go
through that.
MS. MOEN:May I have an opportunity to
cross-examlne, please?
COMMI S S IONER KJELLANDER:No, we're not
going to give you an opportunity.
THE WITNESS.Thank you, Mr. Cha i rman .
COMMISSIONER KJELLANDER:It can only get
worse from here, so we're going to stop.
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MS. MOEN:Is it to the Company'
betterment I don't cross?
COMMISSIONER KJELLANDER:m not quite
sure , but we'll find out.It is your turn.
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MS. MOEN:Thank you very much
Mr. Cha i rman .
CROSS - EXAMINATION
Dr. Reading, in your direct testimony, you
cite two studies concerning the relationship of property
values in proximi ty to high vol tage transmission towers;
Correct.
One was conducted by Hami ton and Schwann
Yes.
And the other one was conducted by Haider
and Haroun I believe in '99; is that right?
I would have to check the dates.I'll
BY MS. MOEN:
accept those dates.
Okay.Mr. Chair, in response to a
is that correct?
production request , the Ci ty of Eagle did produce copies
of both the Hamil ton and Schwann and the Haider and
in 2001?
235 READING (X)
City of Eagle83676
Haroun studies.They re identified as Exhibits 140 and
I request that those particular exhibits be141.
admi t ted to the record.
MS. BUXTON:No obj ect ion.
COMMISSIONER KJELLANDER:Thank you, and
they will be admitted.
(The City of Eagle Exhibit Nos. 140 & 141
were admi t ted into evidence.
BY MS. MOEN:Dr. Reading, you 'd agree
with me, wouldn't you, that Hamilton and Schwann in their
examination of literature that was conducted on this
subj ect matter , that is, the relationship between
property values and transmission towers, noted that in
all studies other neighborhood factors dominate the
explanation of variations in property values.Do you
recall that statement?
I can't remember which study, but I recall
a statement in one of them like that, yes.
In that same study, Hamil ton and Schwann
al so say that the general 1 i tera t ure on thi s subj ect ,
bearing in mind that the Hamilton and Schwann study was
done in 2001 , that they say that studies of transmission
line extensions report that impacts are initially
significant but quickly diminish over time; isn't that
correct?
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Yes.
And would you also agree with me that the
studies done by both Hamilton and Schwann and Haider and
Haroun analyze the impact of high vol tage transmission
towers on residential real estate?
I will accept that.I know the one was
residential.
And that the literature cited by both of
those groups of researchers determined that the extent of
impact could be anywhere from 4 to around 6 percent?
Yes, there was a several percentage
difference in the impact.
You're not testifying, then, are you, as
to the impact on commercial real estate, are you?
Yes, I am.
Are you suggesting that the impact on
commercial real estate would also then have potentially
an effect of 4 to 6 percent?
Not a particular percent.As I stated a
few minutes ago, when I taught statistics in the
uni versi ty was back when the tobacco companies were
claiming that smoking didn't harm your heal th and they
had statistical studies to show that.I look at whether
or not high vol tage transmission lines running in front
of or down the side of your property, be it residential
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or commercial, that that has no impact on the value
think doesn't pass common sense.m not testifying to
what that exact percent is, but to say that big, ugly
things don't make a property less valuable, to me, it
doesn't pass the laugh test.
Here it's kind of in the eye of the
beholder , wouldn't you say?
I assume there are certain individuals
who, I see Mr. Teinert an engineer back there who, may
look at a power pole and think how gorgeous it is.
would think that that wouldn't necessarily go to everyone
in society.There could be some electrical engineers who
would believe that, but I don't think society in general
does and society in general are the ones who look
property as desirable or not desirable and reflect a
market value on it.
Are you familiar with the transmission
lines that go down Eagle Road in the vicinity of the
Meridian Crossings Development, commercial development?
Oh, I'm trying to remember.I can't
remember specifically, but I'm sure they re there.
Do you go down Eagle Road?
Yes.
But you haven't really noticed them , have
you?
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I certainly have, especially since this
case started.I know there's - - is it Eagle Road
there's some as you head down towards the freeway, yes.
There also seems to be a pretty successful
commercial development, wouldn't you say, along either
side of Eagle Road in Meridian?
Sure, there's commercial development in
those areas.You have to look at - - again , commercial
development is in the eyes of the beholder.I see
commercial development down Capi tal Boulevard in Boise,
but I don't see any transmission lines there.The
commercial development I see on Eagle Road is Bed, Bath
and Beyond and some big box stores.The City of Eagle in
their comprehensive plan to the extent I understand
and the development agreements that they've entered into,
for instance, wi th the people from Eagle River restrict
that kind of development, so again, development is in the
eyes of the beholder, so the fact there's big stores and
commerc ial development along wi th power 1 ines, of course,
there is.
So there are fast food developments in
some of these suboptimal developments in Meridian, but
Wendy's in Eagle is, what, a higher level of
development?
It depends on where you are.When I look
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at some of that development that I see in Eagle, when
look at some of the development I see around Ketchum
when I look at some of the development I see around Park
Ci ty, Utah , there's an upscale kind of development and
most often you do not see a lot of commercial lines
there.Eagle River, for instance, paid to bury their
lines so they wouldn't have to look at them.That tells
me that they're the kind of development that finds
least more than $100, 000 worth of value or they wouldn't
have paid to do it.
And property taxes are less in the City
Eagle, too; right?
Yeah.
So people have more discretionary income
perhaps to use their funds for other improvements?
I obj ect MS. BUXTON:That calls for
speculation.
MS. MOEN:I'll wi thdraw that question.
BY MS. MOEN:Are you familiar also along
Front Street here in Boise we've got some transmission
lines, would you agree with me that the vicinity of where
the Ada County Administration building is that that is to
be an attractive development despite the presence of
transmission lines in that corridor?
I don't find it particularly attractive.
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Ci ty of Eagle83676
I don't find it bad and I certainly find the poles there
not attract i ve .
And you've indicated, I think , on page
of your rebuttal testimony that streets such as Warm
Springs, Harrison Boulevard and Capital Boulevard in
Boise don't have the presence of those lines; is that
correct?
Yes.
And are you saying that Warm Springs,
Harrison and Capital Boulevard are the same types of
corridors as the Eagle Bypass?
m not sure I would say they're the same
"types of corridors," but they're visual corridors.
Certainly, Capi tal Boulevard has been designated as a
visual corridor and it's of a value to a community to
have an attractive entry corridor that will then attract
development.The point I made in my testimony is, you
know , Eagle happens to be geographically situated between
two growing areas and so the Power Company says oh, we'
going to run big lines right through you and I think that
those power lines will detract from property values just
the way if they would happen to run down Capi tal
Boulevard, they would detract from those values.
Would you regard Warm Springs in the
vicinity of the golf course, for example, as an entryway
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READING (X)
City of Eagle
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83676
into Boise?
No, but I'd consider Warm Springs as one
of the
- -
between downtown and where you get to the gol f
course as one of the premiere streets.You have guests
come to town , you want to show them how nice Boise is,
you drive them down Warm Springs, you drive them down
Harrison and you drive them around town.
Would it surprise you if I told you that
along Warm Springs in the vicinity of the Mesa
subdivision that there are high power transmission lines,
overhead lines , in that area?
No.
Would it surprise you that within a
kilometer, which is less than a mile, of Warm Springs
Avenue in those residential subdivisions there are also
transmission lines?
There could be.
You haven't noticed them , have you?
You know, you asked me if I've noticed,
certainly since this case, but I've noticed power lines.
But based on your testimony that there are
no such high voltage transmission lines along Warm
Springs, obviously, you must not have noticed the
presence of those transmission lines either on Warm
Springs or near Warm Springs?
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83676
In that vicinity.You mentioned the
courthouse, I've noticed them there.
Okay.On page 6 of your testimony,
Dr. Reading, lines 16 to 18, I think your quote is,
"There is of course many factors that influence property
values that make it difficult to sort out all of the
factors that influence value.Am I describing that
correctly?
Perfectly.
Okay, and you also in Exhibit 141 that'
been admitted into testimony, you cite the Haider and
Haroun studies.Do you recall that Haider and Haroun
have noted that even in their study area, which was the
greater Toronto area , that the relationship between
proximity to power lines is not uniform throughout that
study area?
, sure.
Okay, and in fact, didn't Haider and
Haroun discover in their in analysis that, and I'
quot ing ,certain localities within the GTA, or the
greater Toronto area, where properties abutting the power
lines were of greater value than the rest of the sample
in the locality"?
That's what they said in their study.
Okay, and didn't they conclude that for
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municipalities where average price of properties
proximate to power lines is higher than the rest of the
sample, the adjacent units are of better quality and
larger in size than the rest?
I can remember that statement, sure.
So in other words, there could be a whole
host of factors that determine the value of property and
it's not just their proximity to a large power line?
That's what I said in my testimony, yes.
In fact, Haider and Haroun also observed
that for numerous indicators of social quality, Census
Tracts with power lines out-performed Census Tracts
wi thout power ines, didn't they say that?
Yes.
Okay.In your testimony on page 4, lines
22 to 23 , you say, and I'll quote, "for a ci ty like Eagle
it is hard to pinpoint cause and effect for increasing
property values"; so you 'd agree , wouldn't you, that
there are a host of variables that determine high
property values?
Certainly.
And would you agree that low cost
electrical power is a factor that's attractive to
potential commercial and residential development?
It's one of the factors, sure.
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Would you also agree that maybe low cost
electrical power can lead to the development of higher
end residential and commercial development?
Wow , in general, when you look at any
factor input, be it electric power or anything else, you
look at where that fits in the scale of production
inputs.I f you re an elemental phosphorus or aluminum
factory, electrici ty is certainly very, very important.
If you re another kind of an enterprise that produces
whatever it is and electricity is a very small input,
then it's not important, so I guess I couldn't answer.
Generally, it would depend on the kind of input it is.
I f you're a hospi tal, I don't think you would
particularly go where it would be low electric price, you
would go where you would perceive a need and where you
would have the ability to attract the kind of doctors,
nurses and those kinds of people to your hospital to
serve their needs, so electrici ty would have a very, very
low input and the kind of community around that hospital
would be a very high input.
Okay, thank you.On page 3 of your
rebuttal testimony, you indicate that cities need to
corridors in their comprehensive plans;include utility
that true?
Yes.
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Ci ty of Eagle83676
I think you also indicated that this
Commission should order Idaho Power to participate with
ci ties in establishing corridors; correct?
Yes.
What would you say Idaho Power has been
attempting to do since 1999 with the City of Eagle?
I wouldn't
- -
I am not familiar with that.
I am familiar with the fact that since this case has gone
forward that the Ci ty of Eagle is certainly now paying
attention to utility corridors.They had proposed a plan
for establishing a utility corridor and I can't remember
the names exactly, but it's running up Highway 55 up
north of Floating Feather somewhere and then straight
over to the Star substation, and the City of Eagle has
received a letter from Idaho Power saying gosh , we don't
like it, we don't think that's necessarily the most
economic, efficient place to put it and that's kind of
one of my problems with , as I explained in my testimony,
wi th thi s case.
Certainly, as Mr. Said indicated in his
testimony, what I see happening is Idaho Power in my mind
putting blinders on and saying our only responsibility
to put in the lines where they re the cheapest and
it's where there's high value property, so be it.
it's where there's low value property, so be it.Wha t
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246 READ ING (X)
Ci ty of Eagle83676
care about is doing it by our definition of the cheapest
and I don't think that that's necessarily in a
cost-benefit sense , as I said in my rebuttal, the proper
policy position or the best for the state or the region
or any city.
But by citing Hamilton and Schwann, you
have to agree with their statement, don t you, that the
impacts may be initially significant but diminish over
time?
That's certainly what their study had.
You're indicating I should - - I've got a couple of acres
on Hill Road, maybe I should ask the engineering
department to put a big pole in front of my property and
it wouldn't matter after 10 years.Well , I think it
would matter after 10 years.I understand the position
of the Company and I understand what they re saying.
just cannot accept that high voltage transmission lines
do anything but be a detriment, be it small, be it large,
be it the type of development.
Even though the experts that you cite
indicate that there are a host of variables that affect
property values?
There's a whole bunch of variables that
affect it, of course.
MS. MOEN:Okay, I have no further
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247 READING (X)
City of Eagle83676
questions.
COMMISSIONER KJELLANDER:Thank you, Ms.
Moen.
Let's now look to the Commission to see
there are questions from members of the Commission.
Commi s s i one r Hans en .
EXAMINATION
BY COMMISSIONER HANSEN:
Dr. Reading, just a couple.Do you think
that most people detest having poles running down their
street and think they are unsightly?
I guess I would say yes.I certainly
think poles around my house are unsightly.
So then do you think the maj ori ty
ratepayers would be willing to double or triple their
rates to have those poles removed so it would all be
underground?
Commissioner, it would depend, I think, on
obviously it's a cost-benefit, it would be where it would
be appropriate and where it wouldn't be appropriate.The
position I've tried to take in my testimony is that in
certain specific areas where there is development that
dependent on being attractive that in a cost-benefit
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248 READING (Com)
Ci ty of Eagle83676
sense not having big poles or having the smaller or most
visually pleasing poles would increase those values.
So you're saying in a development area as
being a factor , so would you think the Idaho Power
customers in Pocatello would be very supportive to having
their rates increase because the development Eagle,
over there and we'rates in thewe go lncreas lng
base and we say well,one the reasons in the rate
base we have this increased cost for the Ci ty of Eagle
and it's going to help the development in that area , do
you think the ratepayers in your mind , you've been
invol ved wi th rate cases, do you think the Pocatello
ratepayers of Idaho Power would embrace that?
Having lived in Pocatello, no, they
wouldn't, but let me answer a little further and it goes
to the same geographic bright line that I talked about
the potential economic development in a city like Eagle
helping southwest Idaho, not southeast , as I said in my
testimony, and that is my experience is the Commission
and intervenors often make decisions to raise rates and
have higher rates based on other factors and one of them
would be conservation and renewable.I think it's fairly
common for intervenors and the commissions to say okay,
all ratepayers in the whole area tend to benefit and
they're non-rate benefits that I can specifically place
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249 READING (Com)
City of Eagle83676
somewhere.
I think another example would be the
recent rate case that was just completed with Idaho Power
where the irrigation customer class did not pay its full
cost of service to help subsidize or help the farm
economy, which I can't remember what you said In your
most recent Order , I can remember orders that were
wri t ten when I was here that said due to the economic
farm condition and the best interests of the whole state,
we're not going to raise irrigation rates, so I think
that what I tried to say in my testimony and what I see
coming is as the economy transitions in Idaho and we
become more of a service footloose industry to attract
industry that what's happening in Eagle is going to
happen in other places , so if you ask me specifically do
the people in Pocatello embrace that , no.Certainly, the
intervenors in the rate case didn't embrace the
irrigators not receiving their full share , but it was
deemed as something that was important to the state and
something important to an important economlC sector
within the state to have rates that the rest of us pay to
help that particular sector out , so it's fuzzy to me.
So how would you give other ratepayers an
opportuni ty to have their opinions given in this and
evaluated so the Commission would know whether there'
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250 READING (Com)
Ci ty of Eagle83676
support for certain ci ty development?For the ratepayers
to participate , don't you think they should have an
opportunity to be heard?
Yes , I do and that's what went to the last
part of my supplemental/rebuttal testimony where I talked
about the fact that I think that there needs to be some
forum , some workshop, some kind of communication set up,
because what I see has happened
- -
and have it on either
a statewide basis or utility service area basis or
something.What I've seen in this case is a real clash
of cuI tures where the Ci ty of Eagle doesn't know the
utility game and at , least in my mind, the utilities
aren't being as sensitive as they should be to the needs
of the Ci ty of Eagle and so I look around the state,
Donnelly, we've got not West Rock, Tamarack , Tamarack
now , and I drive around Donnelly and I look at it and
can imagine something like this happening in Donnelly as
Tamarack develops , as those upscale people come in and
people around Donnelly say oh , we want to build some
local upscale developments so that we can take some of
their dollars and the area would grow and the Power
Company would say gosh , I've got to run a power line from
here to here and that would then be a conflict , so you
asked a very important question that's very hard to
answer and that's what I was attempting to get at at the
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251 READING (Com)
City of Eagle83676
end of my testimony is that there needs to be some real
communication set up so that things like utility
corridors can be established and set up, the Power
Company knows it , the city knows it, all the ratepayers
know it, the PUC has a feel for what these extra costs
may or may not be in the planning process so that
something like this doesn't happen again fairly soon
which I see a very high potential for.
COMMISSIONER HANSEN:Thank you.That'
very helpful.That's all I had.
COMMI S S IONER KJELLANDER:Commissioner
Smi th.
COMMI S S IONER SMI TH :Thank you.
EXAMINATION
BY COMMISSIONER SMITH:
So taking Commissioner Hansen'
hypothetical , I guess my solution would be we just put
all those charges on energy and run it through the PCA
how would that work?
I tend to represent to industrial
customers.
Maybe you shouldn't answer that.
m going to get on an airplane wi
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252 READING (Com)
Ci ty of Eagle83676
Mr. Hawk next week , I'll ask him that question.
You do , run that by him.
All right.
Looking at page 3 of your testimony where
you discuss how Eagle is fast growing and how it has high
CSB REPORTING
Wilder , Idaho
and median house value, it occurred to me that maybe
houses in Eagle are larger than the average house built
elsewhere in the Treasure Valley.
, I'm sure that's true.
And so probably they use more energy?
m sure that's true.
And could you have any of this growth
wi thout electrici ty?
Could you have any growth without
electrici ty?
Could you have this growth if there wasn '
adequate power available?
, of course not.
I noticed in the comprehensive plan
something I highly applaud and I think it's very forward
looking, the Ci ty of Eagle currently requires the
installation of pressurized irrigation systems for the
irrigation of landscaping when new development is within
an irrigation district and water rights are available.
m wi th you, that is very good.
253 READING (Com)
Ci ty of Eagle83676
Yes, and I was wondering, do you know
whether they've made similar progressive positions with
regard to the use of energy, for example, encouraging
energy efficiency in these large houses, encouraging the
use of maybe off -grid technologies like solar or wind?
I cannot answer that.
All right.
Without confusing the record , I see the
Mayor shaking her head no.
And I guess it occurs to me that this
ike so many other things I've seen happen where I Ii ve
because I live in an area that's transitioning from farm
land to large houses.
Yes.
Society seems to want to consume and they
want serVlces, like they want milk, but they don't want
flies or smells that comes with having a dairy.
Absolutely.
And they want meat, but they don't want to
step in a cowpie , so is this electrici ty like that, they
want big houses, they want to consume, they want their
hot tubs, their heated pools, their air conditioning, but
they don't want to see the power pole?
Sure.
COMMISSIONER SMITH:Okay.That's all
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254 READING (Com)
Ci ty of Eagle83676
have.
COMMISSIONER KJELLANDER:Let's move now
to redirect.
REDIRECT EXAMINATION
BY MS. BUXTON:
Dr. Reading, if increased property values
in Eagle help keep the overall taxes down for ratepayers
in Pocatello or other reaches of the state , do you think
they'd obj ect to that?
No.
Wouldn't it be reasonable to think that
big homes with fewer inhabitants who are gone all day may
use less electricity than small homes with more people in
it that are home all day?
That could be true , yes.
Is it your testimony that power lines have
impacts on the value of the land in which they are
adj acent?
Yes.
So did you misquote those studies in
Exhibi ts 140 and 141?They actually did agree that they
would have impacts; isn't that correct?
Yes , and as was pointed out, it's hard to
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255 READING (Di)
Ci ty of Eagle83676
get a clean study and there's lot of factors, but they
indicated that power poles, power towers, power lines
tended to impact property values.Mr. Lobb states that
in his testimony, also.
Is it your testimony that if there is an
al ternati ve to really high, obtrusive power lines wi
lower and less obtrusive power lines using different
technology that that would be something that would be
reasonable to look at with regard to whether it should be
placed in rate base or not?
Yes, and that's one of the things that
it's not my testimony, Mr. Teinert is coming up, but one
of the things that's been hard about this case is the
fact that there's kind of two al ternati ves, very high 138
poles or buried and I haven't seen until Mr. Teinert
filed his testimony a lot of effort to look at those
newer technologies that could provide the electricity in
a cost-effective , efficient, reliable manner without
those kind of power poles that are being proposed in this
case.
You discussed hospi tals, for instance, and
where they would be sited, do you know whether there's a
hospital or other medical facility that's going to be
sited somewhere along the route on Exhibit 10?
Saint Alphonsus has purchased land and has
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256 READING (Di)
Ci ty of Eagle83676
a proposed medical facility in Eagle River.
Do you know whether they feel ike they'
going to be impacted by these proposed high transmission
lines?
I obj ect to that question.MS. MOEN:
requlres speculation.
THE WITNESS:I was going to say I haven't
talked to them.
COMMISSIONER KJELLANDER:Excuse me, we
have an obj ect ion.
MS. BUXTON:I'll withdraw it.
COMMISSIONER KJELLANDER:It's been
wi thdrawn Okay, let's continue.
MS. BUXTON:I have no more questions.
COMMISSIONER KJELLANDER:And Mr. Reading,
we are going to allow you to leave the stand and we'
also going to take a ten-minute break.
THE WITNESS:Thank you.
MS. BUXTON:Could Mr. Reading be excused?
COMMISSIONER KJELLANDER:Before we
officially go off the record, does anyone obj ect?
MS. MOEN:No obj ect ions.
COMM IS S IONER KJELLANDER:That would be
fine.
THE WITNESS:Thank you.
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257 READING (Di)
Ci ty of Eagle83676
(The wi tness left the stand.
(Recess.
COMMI S S IONER KJELLANDER:We're back on
the record and we're ready now for the Ci ty of Eagle to
call its next witness.
MS. BUXTON:Mr. Chairman , the Ci ty of
Eagle would call Mr. Pike Teinert to the stand.
PIKE TEINERT
produced as a wi tness at the instance of the Ci ty of
Eagle , having been first duly sworn , was examined and
testified as follows:
DIRECT EXAMINATION
BY MS. BUXTON:
Mr. Teinert , can you state your full name,
spelling your last name for the record, please?
My full name is Herbert Pike Teinert.The
last name is spelled T-i-n-e-r-
Could you give your business address,
please?
My business address is 834 Harcourt Road,
Boise, Idaho, 83702.
And who are you representing in this
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258 TEINERT (Di)
Ci ty of Eagle83676
proceeding?
m representing the Ci ty of Eagle.
And what is your business address
- -
oh,
you already gave me that.Have you previously filed
written direct and written rebuttal testimony in this
matter?
Yes,have.
Do you wi sh make any corrections
either your direct written rebuttal testimony?
Yes , I have a couple of minor typos in my
direct that I would like to correct.In the direct on
page 12 , line 13 , the next to the last word on that line
is "that," t-h-a-t, it should be "than " t-h-a-n; and
then on page 14 , line 6, the second word in that sentence
was" should be stricken.
Are there any further amendments?
No, I do not have any.
If I asked you the same questions today
for either your direct or rebuttal testimony, would your
answers be the same?
Yes, they would.
MS. BUXTON:Mr. Chairman , I would request
that the direct and supplemental testimony, pages
through 19 for the direct and 1 through 14 of the
rebuttal testimony, be spread over the record as if read
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259 TEINERT (Di)
City of Eagle83676
in its entirety and that Exhibits 108 through 117 be
marked and admitted for the record.
COMMISSIONER KJELLANDER:Then without
obj ection , we'll spread the testimony, both direct and
rebuttal , across the record as if read and mark and admit
the associated exhibits.
(The City of Eagle Exhibit Nos. 108-118
were admi t ted into evidence.
(The following prefiled direct and
rebuttal testimony of Mr. Pike Teinert is spread upon the
record.
CSB REPORTING
Wilder , Idaho
260 TEINERT (Di)
Ci ty of Eagle83676
ADDRESS.
address 834
PLEASE STATE YOUR NAME AND BUS INESS
My name is Pike Teinert and my business
Harcourt Road Boise , Idaho 83702.
WHAT IS YOUR OCCUPATION?
I am a principal consultant for Energy
Strategies Group LLC, a consulting firm that provides
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Wilder , Idaho
servlces to clients in the utility industry.
ARE YOU SPONSORING ANY EXHIBITS WITH THI S
Yes. I am sponsoring Exhibit Nos. 108
PLEASE DESCRIBE YOUR QUALIFICATIONS TO
TESTIFY AS AN EXPERT IN THIS PROCEEDING.
I am an electrical engineer and I have
thirty- four years experience in the energy industry in
positions ranging from design engineer to Vice President.
As an engineer for Texas Power and Light Company, I
designed and managed the construction of 138KV and 345KV
swi tchyards. Over 20 years of my experience were in
customer relations positions that included responsibility
for negotiating customer service contracts including line
extension and system betterment provisions. From 1996
through January 2003 I was with the Electric Power
Research Institute , EPRI' s, client relations division and
was responsible for collaborative research
TESTIMONY?
through 118.
261 TEINERT (Di)
Ci ty of Eagle83676
and development coordination including transmission and
distribution R&D , for several of North America's largest
utilities. My complete resume, including educational
background and employment history, is presented as
Appendix A.
HAVE YOU PREVIOUSLY APPEARED AS AN EXPERT
WITNESS BEFORE THIS COMMISSION?
Yes. I have provided direct and rebut tal
testimony in the Idaho Public Utilities Commission Case
No. IPC-00-12 regarding an industrial class customer
and line extension policy within Schedule 19. I have also
provided direct and rebuttal testimony in the Idaho
Public Utilities Commission Case No. IPC-E- 03 -13, Idaho
Power Company's most recent general rate case.
WHY ARE YOU TESTIFYING IN THIS CASE
NO. IPC-E- 04 - 04?
I have been retained by the City of Eagle
as an expert witness to assist in the analysis of Idaho
Power's complaint filed in this case. The City of Eagle
and Idaho Power began discussing the Ci ty' s concerns
about upgrading the 69KV line to 138KV between the Eagle
substation and the new Star substation in 1999. Although
the Company has proposed several al ternati ve routes for
the 138KV sub-transmission upgrade, methods and
technologies other than a 138KV upgrade that can address
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262 TEINERT (Di)
Ci ty of Eagle83676
the City's concerns and could have been considered, were
not explored by Idaho Power and proposed to the City.
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TEINERT (Di)
City of Eagle
263
83676
testimony will outline technology that Idaho Power could
have proposed that can offer the Ci ty an acceptable
option to those currently offered by the Company.
silence on other lssues in this case does not necessarily
imply acceptance of the Company's posi tion.
PLEASE DESCRIBE HOW YOUR TESTIMONY
ORGAN I ZED.
My testimony and exhibits will address
demand side al ternati ves that coul d impact the proposed
upgrade to the 69KV line from Eagle substation to the new
Star substation and also delivery technologies that were
not included as alternatives by the Company to the City
of Eagle.
YOU SAY THAT DEMAND S IDE ALTERNATIVES WERE
NOT INCLUDED IN THE COMPANY'S PLANS TO UPGRADE THE 69KV
LINE FROM THE EAGLE SUBSTATION TO THE STAR SUBSTATION.
CAN YOU GIVE EXAMPLES?
Yes. Al though Idaho Power Company's 2002
Integrated Resource Plan , 2002 Demand Side Management
Report, DSM 2003-2005 Business Plan and 2003 Conservation
Plan , Exhibit Nos. 108 , 109, 110 and III respectively all
include discussions of load reduction benefits gained
from demand side resources , the benefits of these
resources were not explained and identified to the City
by Idaho Power as alternatives that could help diminish
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264 TEINERT (Di)
Ci ty of Eagle83676
the rate of load growth in the Eagle and Star servlce
areas.Examples of programs included in these documents
that could have
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265 TEINERT (Di)
Ci ty of Eagle83676
been discussed to slow load growth in Eagle and Star are
found on page 18 of the Company's DSM 2003-2005 Business
Plan , Exhibit No. 110. They include residential and
commercial programs, important in this case, such as the
Lighting Coupon Program , Residential new Construction
Program , AC Direct Load Control Program and the
Residential Air Conditioning Cycling Pilot Program.
Additionally, Idaho Power's 2002 Demand Side Management
Report, Exhibit No. 109, that includes Idaho Power'
September 12 , 2002 , Residential Time-of Use Study
quantifies significant load reduction potential from
AMR/TOU. When the Company was ordered by the Commission
in its Order No. 29196, in March, 2003 to submit a
plan to replace the current meters of Idaho Power wi
advanced meters , the Company subsequently proposed its
Emmett service area as an area for AMR technology
deployment. Given the substation and 69KV constraints in
Eagle and Star , the Company should have proposed Eagle
and Star as locations to initiate AMR that would
demonstrate both the load reduction and delivery asset
management benefits of AMR/TOU in the Eagle and Star area
and help resolve the 69KV sub-transmission issues in this
complaint.
HAD THE COMPANY CONSIDERED DEMAND SIDE
INITIATIVES AS POSSIBLE SOLUTIONS TO ADDRESS DELIVERY
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TEINERT (Di)
Ci ty of Eagle
266
83676
CONSTRAINTS PRIOR TO THE DEVELOPMENT OF THE DOCUMENTS
YOU'VE CITED?
Yes. In the Company's 2002 IRP filing, the
IPUC's Order No. 28583 , dated December 18, 2000, Exhibit
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Wilder, Idaho
No. 112 , page 5, the
267 TEINERT (Di)
City of Eagle83676
Company indicates it will "Perform and present a
feasibility study on the near-term application of mobile
generators to provide not only additional power and
energy but also to provide reinforcement to the delivery
system and potentially defer or avoid capacity upgrades
to delivery facilities-November 2000 (emphasis added)"
It is clear that the Company is and was aware of the
potential of demand side initiatives to defer or avoid
capacity upgrades to delivery facilities like the 69KV
line from the Eagle substation to the new Star
substation. Yet , the Company did not offer demand side
initiatives to the City as alternatives to upgrading the
69KV line between Eagle and Star.
IF THE CITY HAD BEEN INFORMED IN 1999 OF
THE POTENTIAL TO AVOID OR DEFER THE UPGRADE OF THE 69KV
EAGLE/STAR LINE USING DEMAND SIDE INITIATIVES , COULD THE
CITY AND THE COMPANY HAVE COOPERATED TO DEVELOPED AND
EXECUTE THE PROGRAMS.
Yes. Clearly there was time to develop and
initiate demand side programs. In his testimony Idaho
Power's David Sikes' Exhibit No., estimates the cost of
the 69KV to 138KV upgrade to range from $2 500 000 to
$2,840,000 with no additional cost to the City. Clearly
if that level of funding had been budgeted for demand
side programs they would yield significant long-term load
CSB REPORTING
Wilder , Idaho
268 TEINERT (Di)
Ci ty of Eagle83676
reduction benefits and avoid or defer capacity upgrades
to the del i very system.Based on the Expendi t ure Chart
of the Company's DSM 2003-2005 Business Plan, Page 6
Exhibi t No. 110 , the
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Wilder , Idaho
269 TEINERT (Di)
City of Eagle83676
estimated cost of the sub-transmission upgrade in this
case would exceed the total system DSM program
expenditures for Idaho Power in each year from 1999
through 2002.
Also , the general public was certainly
sensitive to the exceptionally high and volatile energy
prices at that point in the 2000-2001 energy crisis and
would have been very receptive to demand side programs
that would not only have avoided or deferred delivery
upgrades but would also have helped mitigate large future
PCA increases necessi tated by record high prices in the
wholesale market.
WOULD DEMAND SIDE PROGRAMS HELP DIMINISH
THE RATE OF LOAD GROWTH IN EAGLE AND STAR?
Yes. The Company would have had almost
four and one hal f years to plan and execute DSM programs
that would have deferred or avoided the need for the
Eagle to Star 69KV to 138KV upgrade.
MR. TEINERT, HAVE YOU REVIEWED IDAHO POWER
COMPANY DOCUMENTS THAT PROVIDE SUBSTATION CAPACITY AND
LOADING FOR THE EAGLE SUBSTATION?
Yes. The document is identified as Exhibit
No. 113 provided by the Company in the IPUC Commission
Case No. IPC-00-12.
CSB REPORTING
Wilder , Idaho
TEINERT (Di)
City of Eagle
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83676
BASED ON THE COMPANY'S INFORMATION
PROVIDED IN EXHIBIT NO. 113 WHAT IS YOUR ASSESSMENT OF
THE LOADING ON THE EAGLE SUBSTATION?
As shown in Exhibit No. 113, the Eagle
substation 2000 summer peak demand was 33.3 MW. The
substation capacity was 65 MVA and therefore was loaded
to about 60% of its capacity at a load factor of 85%.
SINCE THE EAGLE SUBSTATION WAS ONLY 60%
LOADED IN THE SUMMER OF 2000, COULD IDAHO POWER HAVE
MANAGED THE GROWTH AT THIS SUBSTATION WITH DEMAND SIDE
PROGRAMS AND DEFFERED OR AVOIDED THE CAPACITY UPGRADE TO
THE EAGLE/ STAR 69KV LINE.
Yes. In the summer of 2000 given the
heightened awareness of the soaring price of wholesale
electricity, demand side programs would have been
especially effective and would have been a huge public
relations opportunity for the Company to demonstrate its
support for sustainable energy DSM practices specifically
in Eagle and Star and would also have been a model for
the remainder of Idaho Power's system.
SINCE THE STAR SUBSTATION WAS NOT BUILT
UNTIL 2004 , COULD IDAHO POWER HAVE MANAGED THE GROWTH IN
STAR USING DEMAND SIDE PROGRAMS AND DEFFERED OR AVOIDED
THE CAPACITY UPGRADE TO THE EAGLE/ STAR 69KV LINE.
CSB REPORTING
Wilder , Idaho
271 TEINERT (Di)
Ci ty of Eagle83676
Yes. As I've stated previously in my
testimony, in the summer of 2000 given the heightened
awareness of the soaring price of wholesale electrici ty,
demand side programs would have been especially effective
and would have been a huge public relations opportunity
for the Company to demonstrate its support for
sustainable energy practices.
FOCUSING ON THE COMPANY'S ASSERTION THAT
THE STAR SUBSTATION MUST BE BUILT BY THE SUMMER 2005 TO
AVOID SERVICE DEGRATION IN THE EAGLE STAR AREA, HOW DOES
IDAHO POWER'S DAVID SIKES CHARACTERIZE THE GROWTH IN
STAR?
Mr. Sikes in his direct testimony, page
beginning at line 9 , states that:
"While the load growth in Star is materializing
at a slightly slower rate due to the smaller size of the
community and the additional commute distances from Star
to Boise and Meridian commercial hubs, wi th increasing
housing costs in Ada County and, specifically in Boise
and Meridian, development in Star is accelerating.
Q .DOES MR. SIKES INDICATE WHY THE COMPANY
DECIDED TO BUILD THE STAR SUBSTATION EVEN THOUGH THE
GROWTH IN STAR WAS MATERALIZING AT A SLOWER RATE THAN
EXPECTED?
CSB REPORTING
Wilder, Idaho
272 TEINERT (Di)
Ci ty of Eagle83676
No. Mr. Sikes simply says on page, 4
beginning at line 23:
"In 1999 the Company decided to construct the
Star substation by the summer of 2004 in order to
maintain adequate service in the area.
There is no explanation of the need to complete
the Star substation in the summer of 2004 regardless of
the slower growth.
Q .DID THE COMPANY CONTINUE WITH ITS PLAN TO
BUILD THE 138KV STAR SUBSTATION EVEN THOUGH THERE WERE
DELAYS IN PERMITTING THE 138KV LINE TO SERVE THE STAR
SUBSTATION?
Yes.
MR. TEINERT , WAS BUILDING THE STAR
SUBSTATION IN THE SUMMER OF 2004 PRUDENT SINCE THERE WAS
NOT A 138KV SOURCE AVAILABLE FOR THE NEW 138KV STAR
SUBSTATION?
No. Normally, the source for a
distribution substation , like the 138KV Star substation,
would have a confirmed 138KV source before the decision
to build the sub is finalized.In this case the decision
to build the sub and construction both took place even
though the 138KV source was not secure. Mr. Sikes'
testimony clearly states the decision to build the sub
was made in 1999. The Company applied for a CUP in
CSB REPORTING
Wilder , Idaho
273 TEINERT (Di)
Ci ty of Eagle83676
December 2000 to upgrade the Eagle sub to Star 69KV to
138KV and in February 2001
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Wilder , Idaho
TEINERT (Di) lOa
City of Eagle
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83676
the Eagle Planning and Zoning Commission formally
recommended that the City Council deny the application.
AFTER THE CITY P&Z COMMISSION'S DENIAL
RECOMMENDATION , OF IDAHO POWER'S FIRST CUP APPLICATION,
DID THE COMPANY OFFER THE CITY ANY ALTERNATIVES OTHER
THAN 138KV ALTERNATIVES?
No.
DID THE COMPANY SUBMIT ANOTHER APPLICATION
FOR A CUP TO UPGRADE THE 69KV LINE FROM EAGLE TO STAR TO
138KV?
Yes.In September 2002 the Company
submitted another CUP application for a 138KV alternative
route along Highway 44 through Eagle.In September 2003,
the City of Eagle P&Z Commission recommended denial of
Idaho Power's second application for a CUP to build a new
138KV line through Eagle.
AFTER THE DENIAL RECOMMENDATION, OF ITS
SECOND CUP APPLICATION , DID THE COMPANY, OFFER THE CITY
ALTERNATIVES OTHER THAN 138KV ALTERNATIVES?
No.
GIVEN THI S HI STROY OF SLOWER LOAD GROWTH
IN THE STAR AREA AND THE P&Z' S TWO DENIAL
RECOMMENDATIONS, WHAT WAS DRIVING THE COMPANY'S RUSH TO
BUILD THE STAR SUBSTATION AND THE 138KV EAGLE TO STAR
UPGRADE?
CSB REPORTING
Wilder , Idaho
275 TEINERT (Di)
City of Eagle83676
It is reasonable to conclude that the
Company's 10 Year Transmission Plan for the Treasure
Valley, Exhibi t No. 114 , page 17 documenting the timing
of the Company's 138KV Transmission plan , rather than the
load in Star , was driving force behind the Company's push
to complete the Star substation and 138KV source from
Eagle in summer 2004. Upon completion of the 138KV
substation in Star , the Company asserts they would then
need a 138KV source from Eagle to serve it.However , the
Company offers no data or analysis concluding that the
existing 69KV feed to the Star substation is not adequate
or that it could be upgraded to provide a permanent 69KV
feed. The Company's silence on any solution other than a
138KV solution provides further support that the
Company's 10 Year Transmission Plan , rather than the load
in Star and Eagle is driving the plan and timetable for
this proj ect.
MOVING TO ALTERNATIVES OTHER THAN THE
COMPANY'S 138KV OPTIONS, DID OR HAS THE COMPANY EVER
OFFERED THE CITY ALTERNATIVES OTHER THAN THE 138KV
ALTERNATIVES OUTLINED IN MR. SIKES' TESTIMONY?
There is no documentation in the testimony
or exhibi ts in this case that indicates the Ci ty was ever
offered any al ternati ves other that the 138KV
al ternati ves in Mr. Sikes' testimony.
CSB REPORTING
Wilder , Idaho
276 TEINERT (Di)
Ci ty of Eagle83676
states:
Also , Mr. Said's testimony on page 2, line 21
CSB REPORTING
Wilder , Idaho
277 TEINERT (Di) 12a
Ci ty of Eagle83676
" . .
the Company has attempted to identify a
route and al ternati ve acceptable to all interested
parties"
There has clearly been no option other than
138KV alternatives identified by Idaho Power and the City
has repeatedly found the 138KV alternative unacceptable.
Therefore, the Company has failed completely to identify
acceptable al ternati ves for the Ci ty.
Mr. Sikes , in his testimony, states on page
line 3 that:
"Idaho power has been diligent and prudent in
its effort to site new transmission facilities.
Again , neither Mr. Said nor Mr. Sikes has
identified any alternative other than new 138kV
alternatives regardless of the City's strong objection to
new 138KV transmission facilities.There fore, the
diligence and prudence of the Company's search for a
solution acceptable to the City is questionable and
clearly inadequate.
IS IT PRUDENT PLANNING AND DESIGN STRATEGY
TO EXCLUDE ALL ALTERNATIVES OTHER THAN 138KV
ALTERENATIVES IF THE CITY IS FIRMLY IN OPPOSITION TO THE
138KV ALTERNATIVES?
CSB REPORTING
Wilder , Idaho
278 TEINERT (Di)
Ci ty of Eagle83676
No. The Company's rush to adhere to
building the 138KV Star substation and 138KV line from
Eagle to the Star substation as outlined in its 10 Year
Transmission Plan is unreasonable given the Ci ty ' s
concerns. It is reasonable to conclude that the Company
was totally committed to its 10 Year Transmission Plan
and did not seek alternatives other than 138KV options.
MR TEINERT HAVE YOU REVIEWED THE BLACK AND
VEATCH STUDY IDENTIFIED AS EXHIBIT NO.115?
Yes.
BASED ON YOUR REVIEW OF THE BLACK AND
VEATCH STUDY WERE THERE ALTERNATIVES OTHER THAT THE 138KV
OVERHEAD AND UNDERGROUND LINE ALTERNATIVES ANALYZED AND
REPORTED TO THE CITY IN THE BLACK AND VEATCH STUDY?
No.
THEREFORE, BASED ON THE DOCUMENTATION IN
THI S CASE DO YOU FIND THAT BOTH THE COMPANY AND BLACK AND
VEATCH PRESENTED ONLY 138KV OVERHEAD AND UNDERGROUND
ALTERNATIVES?
Yes. The only alternatives analyzed in the
B&V study were the 138KV overhead and underground
solutions previously identified by Idaho Power. Certainly
the City had hoped that the B&V study would explore other
reasonable alternatives to 138KV
CSB REPORTING
Wilder , Idaho
TEINERT (Di)
City of Eagle
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83676
given the City's objection to the height of 138KV
overhead and the expense of 138KV underground.
HASN'T RECENT RESEACH AND DEVELOPMENT
PROVIDED THE ELECTRIC UTILITY INDUSTRY WITH SEVERAL
TECHNOLOGY ADVANCEMENTS LIKE SUPERCONDUCTING CONDUCTOR
CAPABLE OF SIGNIFICANTLY INCREASING THE CAPACITY OF
TRANSMISSION SYSTEMS?
Yes.My seven years experlence at EPRI
through early 2003 provided an inside look at several
advances in transmission technology that will
significantly improve the capacity of the existing
transmission grid. Transmission superconductors,
FACTS (Flexible AC Transmission Systems) and Dynamic Line
Rating technology are examples of technologies that have
been developed , tested and introduced to the industry by
EPRI in the 1 as t few years.
ARE THESE TECHNOLOGIES THAT IDAHO POWER
SHOULD HAVE REVIEWED AND CONSIDERED AS ALTERNATIVES TO
THE 138KV SOLUTIONS THEY IDENTIFIED?
Yes.Some of them are potential
solutions. However, the latest developments in these
technologies have been developed by EPRI and its members
and Idaho Power has not been a member of EPRI since 2001
and therefore, may not be aware of them.
CSB REPORTING
Wilder , Idaho
280 TEINERT (Di)
City of Eagle83676
MOVING TO THE I SSUE OF DELIVERY SYSTEM
CAPACITY AND UPGRADES TO THE STAR SUBSTATION, DOES MR.
SIKES EXPLAIN WHY SERVICE TO THE STAR SUBSTATION FROM THE
CALDWELL-LANSING 69KV LINE IS ONLY TEMPORARY?
Yes , Mr. Sikes explains in his direct
testimony that the 69KV line from Caldwell cannot provide
ampaci ty and vol tage support to the Star substation
beyond the load levels expected at the Star substation in
early 2005.
DOES MR. SIKES OFFER ANY SOLUTIONS FOR THE
VOLTAGE SUPPORT AND AMPACITY PROBLEM ON THE 69KV LINE
SERVING THE STAR SUBSTATION FROM CALDWELL-LANSING OTHER
THAN THE 138KV EAGLE TO STAR UPGRADE?
No. Mr. Sikes simply says in his testimony
beginning on page 16 , line 10 that:
"This line is limited by both conditions and
will require a capacity upgrade in the future.
Q .ARE THERE TECHNOLOGIES AVAILABLE TO
RESOLVE THE CALDWELL-LANSING 69KV LINE VOLTAGE SUPPORT
AND AMPACITY PROBLEMS GIVEN THE CITY OF EAGLE'S CONCERNS
ABOUT CONSTRUCTING A 138KV LINE THORUGH EAGLE?
Yes. The Caldwell 69KV line could be
reconductored to mitigate the voltage support problem.
Many electric utilities have been faced with transmission
capacity problems and have
CSB REPORTING
Wilder , Idaho
TEINERT (Di)
Ci ty of Eagle
281
83676
addressed them by using high temperature, low sag,
al uminum conductor steel supported (ACSS) cable that is
capable of operating at approximately twice the operating
temperature of conventional conductors. As stated in
Exhibit No. 116, title
"ACSS/TW conductor operates at higher temperatures,
delivers more power over existing transmission corridors"
ACSS cable would reduce vol tage drop and
significantly increase the capacity of the Caldwell-
Lansing 69kv line to adequately serve the Star
substation. This solution would not require the proposed
upgrade of the existing 69KV line through Eagle to a
138KV line.
IF THE ACSS 69KV ALTERNATIVE IS USED TO
RESOLVE THE VOLTAGE SUPPORT AND AMPACITY PROBLEMS ON THE
CALDWELL-LANSING LINE TO SERVE THE STAR SUBSTATION, WOULD
IT BE NECESSARY TO BUILD THE 138KV LINE THROUGH EAGLE AS
PROPOSED BY THE COMPANY?
No. If ACSS were used to reconductor the
Caldwell-Lansing line then the Star substation could be
served from that source instead of the Eagle source.
MR TE I NER T , WHAT OTHER AL TERNA T I VE , NOT
OFFERED BY THE IDAHO POWER COMPANY , WOULD ELIMNATE THE
NEED FOR UPGRADING THE 69KV LINE TO 138KV FROM EAGLE TO
THE STAR SUBSTATION?
CSB REPORTING
Wilder , Idaho
TEINERT (Di) 1 7
Ci ty of Eagle
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83676
ACSS cable could also be used to
reconductor the 69KV ine from Eagle to the new Star
substation. Height requirements would not need to exceed
the existing 69KV line through Eagle especially if the
Company undergrounds the distribution currently existing
on the 69KV line as they have expressed a willingness to
do. Therefore , it would not be necessary to erect large
steel poles through Eagle for 138KV service to the Star
substation. Facilities in the Eagle substation to step
down 138KV to 69KV would be required.
CAN EITHER OF THESE TWO SOLUTIONS BE
IMPLEMENTED WITHIN THE TIME FRAME PROPOSED FOR THIS
PROJECT?
Yes. ACSS cable has been "widely available
for more than a decade" as stated in Exhibit No. 116 and
is available imposed deadline of May, 2005.
IS ACSS TECHNOLOGY RELIABLE?
Yes.Examples of research , studies and
case histories as provided in Exhibit Nos. 116 and 117
that include studies by EPRI , the Electric Power Research
Institute on ACSS cable, have verified ACSS technology as
a reliable and efficient technology that effectively
manages capacity problems on existing delivery
infrastructure. As stated in Exhibit No. 116,
CSB REPORTING
Wilder, Idaho
283 TEINERT (Di)
Ci ty of Eagle83676
" . .
ACSS cable . has been used successfully by
several utilities to improve power flows in existing
transmission corridors.
ACSS adds delivery capacity as deregulation has
burdened electric utilities' transmission systems with
non-native generation from unregulated companies.
I S THE COST OF ACSS CABLE MORE EXPENS IVE
THAN ACSR , A MORE FREQUENTLY USED CONDUCTOR?
Yes. ACSS normally costs 15%-25% more than
ACSR conductor.However, as shown in figure 3 of Exhibi
No. upgrading capacity with ACSS can save the total cost
of new structures and reduce overall conductor cost by
20% .The increased capacity of ACSS can eliminate the
need for extensive and expensive upgrading to higher
vol tages and is a much more economical al ternati ve than
building a new 138KV steel pole line through Eagle.
DOES THE INSTALLATION OF ACSS REQUIRE
NON - STANDARD EQUI PMENT OR REQUIRE NON-STANDARD
INSTALLATION TECHNIQUES OR TRAINING?
As stated in Exhibit No. 116, ACSSNo.
can be installed using "good stringing practices". Some
additional care needs to be taken to protect the soft
aluminum conductor during installation such as using
lined stringing blocks.
CSB REPORTING
Wilder, Idaho
284 TEINERT (Di)
Ci ty of Eagle83676
IN SUMMARY DOES YOUR TESTIMONY SUPPORT
USING ACSS AT 69KV AS THE BASIS FOR SERVING THE STAR
CSB REPORTING
Wilder , Idaho
SUBSTATION FROM EITHER OR BOTH THE CALDWELL-LANSING LINE
OR THE EAGLE SOURCE?
Yes.
DOES THIS CONCLUDE YOUR DIRECT TESTIMONY?
Yes.
285 TEINERT (Di)
Ci ty of Eagle83676
ADDRESS.
addre s s 834
PLEASE STATE YOUR NAME AND BUS INESS
My name is Pike Teinert and my business
Harcourt Road Boise, Idaho 83702.
ARE YOU THE SAME PIKE TEINERT WHO FILED
DIRECT TESTIMONY AND EXHIBITS IN THIS MATTER?
I am.
WHAT IS
SUPPLEMENTAL TESTIMONY?
CSB REPORTING
Wilder, Idaho
THE SCOPE OF YOUR REBUTTAL AND
I will address the proposed overhead
transmission line from Eagle substation to the new Star
Substation along the route just North of and adjacent to
State Street through the City of Eagle to the new Star
HAVE YOU REVIEWED THE DIRECT TESTIMONY OF
THE COMMISSION STAFF, IN THIS MATTER?
Yes.
DO YOU HAVE ANY OVERALL OBSERVATIONS
REGARDING THAT TESTIMONY?
Yes.Staff addressed many issues in its
testimony, but it does not recommend an acceptable
solution that can both satisfy the City's objections and
meet the Company s goal of serving the new Star
Substation.
Substation.
286 TEINERT (Di-Reb)
City of Eagle83676
...
WHAT WOULD BE AN ACCEPTABLE SOLUTION FOR
BOTH PARTIES IN THIS CASE?
The Company has stated that it wants to
provide service to the new Star Substation from the
existing Eagle Substation and the City's position is to
minimize the impact of sub-transmission service to the
new Star Substation on its residential and commercial
property owners at no cost to the City or its citizens.
If both the City and Company's positions could be
realized with the same sub-transmission line and route,
an acceptable solution could be reached.
BEGINNING WITH THE PURPOSE AND ROUTE OF
THE PROPOSED LINE DOESN'T THE STAFF IN SEVERAL PLACES IN
ITS TESTIMONY STATE THAT THE PURPOSE OF THE PROPOSED LINE
IS TO SERVE THE NEW STAR SUBSTATION?
Yes.On page 2, line 7-11, the Staff
states that:
"Simply stated, Idaho Power Company needs to extend
its sub transmission facilities from the existing
substation through the City of Eagle to the new Star
Substation.
Additionally, on page 4, line 2-6, the Staff states:
CSB REPORTING
Wilder, Idaho
287 TEINERT (Di-Reb)
City of Eagle83676
"The City of Eagle has denied Idaho Power's request
to extend its overhead transmission facilities from the
Eagle substation westward through the City to the Star
substation.
Based on these statements in the Staff's Testimony
and the Ci ty' s response to the Company's complaint in
this case, it is clear that both the Ci ty and the Staff
understand the Company's request to build a
sub-transmission line to serve the new Star Substation.
WHY IS IT IMPORTANT TO EMPHASIZE THE
STAFF'S AND THE CITY'S UNDERSTANDINHG OF THE COMPANY'S
REQUEST FOR AN OVERHEAD TRANSMISSION LINE THROUGH THE
CITY OF EAGLE?
Because the Company in its CUP
applications, its subsequent meetings with City staff and
ul timately in this complaint did not reveal the real
reason for the proposed 138kV line to the City or the
Commission Staff.
WHAT I S THE COMPANY'S REAL REASON FOR THE
PROPOSED HIGH CAPACITY 138KV TRANSMISSION LINE?
The City's Exhibit No. 114, Idaho Power
Company'10 Year Transmission Plan for the Treasure
Valley, Buildout proj ection Distribution Planning
2002-2012 , Page 11 under "Locust Loop No.2 states:
CSB REPORTING
Wilder , Idaho
288 TEINERT (Di-Reb)
Ci ty of Eagle83676
The Locust-Eagle 138 will be built when the
reliability of service is at risk or when the Gary tap
opened because of the State 138kV conversion. The Star
tap is a tap in the Locust-Eagle line for temporary
service to Star. The Locust No.2 is completed wi th the
Locust -Eagle 138kV construction and will serve H. P. ,
Joplin , Eagle loads and loads north of the Beacon Light
area. The Eagle-Ustick 138kV line serves as a tie to the
Cloverdale source. A source in the north Star area will
serve the Star Substation.
Clearly the need to serve the Star Substation
only temporary. "The Star tap is a tap in the
Locust-Eagle line for temporary service to Star." "A
source in the north Star area will serve the Star
Substation." The Company did not disclose that the
proposed Eagle Substation service to the new Star
Substation was only temporary.
Also and more importantly, the Company did not
disclose the real reason for the high capacity 138kV line
as stated in the third sentence of the quote. "The Locust
Loop No.2 is completed with the Locust-Eagle 138kV
construction and will serve H. P., Joplin , Eagle loads and
loads north of the Beacon Light area." Clearly this high
capacity 138kV line , which is the same line being
contested in this case, must have the capaci ty to carry
CSB REPORTING
Wilder , Idaho
289 TEINERT (Di - Reb)
City of Eagle83676
the load for the Joplin and Hewlett-Packard Substations
as well as the Eagle Substation load and benefits
customers served from the Joplin and Hewlett-Packard
substations too.
CSB REPORTING
Wilder , Idaho
290 TEINERT (Di-Reb)
City of Eagle83676
The Company did not disclose this information in its
CCUP application to the City, in meetings with the City
Staff or Council , or in its complaint in this case. And
the City of Eagle has been unfairly compelled to use its
limited time and financial resources to respond to Idaho
Power's claim in this dispute although customers served
by the Joplin and Hewlett-Packard Substation clearly
benefit from the high capacity 138kV line.
Pages 47 and 48 of Exhibit 114 confirm that in the
Company's loop model , the first line sections from the
source substation , such as the Locust-Eagle 138kV line,
must have enough capacity to carry all of the substations
on the loop. Therefore , the Locust-Eagle 138kV line must
have the capaci ty to carry all of the load on the Eagle,
Joplin and Hewlett-Packard Substations at the same time.
Additionally, the Company's request for a high
capacity 138kV line from the Eagle Substation to the new
Star Substation is not the Star Substation's permanent
source , but instead , the first phase of the Locust-Eagle
138kV line to complete the Locust Loop No.
If the City and the Commission Staff had known that
the new Star Substation feed from Eagle Substation was
only temporary and that the real reason for the high
capacity 138kV ine was to complete the Locust Loop No.
, the search for acceptable solutions would have been
CSB REPORTING
Wilder , Idaho
291 TEINERT (Di-Reb)
Ci ty of Eagle83676
much more focused, easier to analyze, less contentious
and significantly less time consuming.
CSB REPORTING
Wilder , Idaho
292 TEINERT (Di-Reb)
City of Eagle83676
WHY WOULD THE CITY AND THE STAFF HAVE BEEN ABLE
TO PURSUE MORE ACCEPTABLE SOLUTIONS?
The City and Staff both believed that the
Company's request for a high capacity 138kV line was
needed to serve the existing and future loads in the Star
and Eagle area as stated by the Company in its Testimony.
The real reason for the high capacity 138kV line is to
serve Eagle, Joplin and H. P. Substations, is to complete
the Locust Loop No., a much larger load than the
capaci ty of the new Star Substation. Based on the
Company's 10 Year Transmission Plan, City Exhibit No.
114 , page No. 48, first paragraph, the first line
section , the Eagle-Locust 138kV line, in the 138kV Locust
Loop No., is rated as a getaway section at 277 MVA. In
contrast , the new Star Substation transformer is rated
from 20-30 MVA , about one tenth of the capacity the
Company plans for the high capacity Eagle-Locust 138kV
line.
Therefore, al though the City and Staf f have been led
to believe that the proposed high capacity 138kV line was
needed to serve the Star Substation , the Company's 10
Year Transmission Plan contradicts the Company'
testimony and explains that it's real purpose is the
completion of the Locust Loop No.Therefore, the Ci
and Commission Staff have been developing alternatives
without the benefit of valid data and information.
CSB REPORTING
Wilder , Idaho
293 TEINERT (Di -Reb)
Ci ty of Eagle83676
The City and Commission Staff could have more
thoroughly analyzed smaller capacity solutions, like 69kV
transmission to serve the new Star Substation capacity,
had the Company disclosed the size of the Star Substation
load, and that the Eagle feed to new Star Substation was
only temporary.
The Company's failure to disclose the real reason
for the high capacity 138kV line created an extremely
complex and contentious environment in which a solution
to this dispute has not been found after more than four
years since the Company first approached the City in late
1999 with its request to serve the proposed Star
Substation.
HAS THE STAFF INDICATED IN ITS TESTIMONY
THAT THEY MADE AN ANALYSIS OF THE 69KV OPTION YOU
RECOMMENDED IN YOUR TESTIMONY?
No. The Staff however, did state in its
testimony on page 8 , line 20, in reference to the 69kV
option using ACSS conductor, that they believed it had
potential to provide additional transmission capacity at
reasonable cost.
The Staff further says, beginning on line 23 of page
8, that they would look to the Company to explain why
ACSS would not be a viable alternative to expand the
capacity of existing facilities.
CSB REPORTING
Wilder, Idaho
294 TEINERT (Di-Reb)
Ci ty of Eagle83676
Q. HAS THE COMPANY PRODUCED ANY DOCUMENTS
DETAILING ITS ANALYSIS AND DECISION NOT TO USE ACSS?
CSB REPORTING
Wilder , Idaho
295 TEINERT (Di-Reb)
Ci ty of Eagle83676
, it has not.
SINCE THE COMMISSION STAFF HAS NOT OFFERED
A 69KV ALTERNATIVE TO SERVING THE NEW STAR SUBSTATION AND
A 69KV SOLUTION WOULD REQUIRE CAPACITY THAT IS MUCH LESS
THAT THE CAPACITY NEEDED FOR THE LOCUST LOOP NO., IS
THERE A 69KV SOLUTION THAT WILL MEET THE CITY'S
REQUIREMENTS AND PROVIDE CAPACITY TO SERVE THE NEW STAR
SUBSTATION?
Yes , the new Star Substation transformer
capacity is about 20-30 MVA. A 69kV line using ACSR , all
al uminum or ACSS conductor can provide the needed
transmission capacity to serve the transformer load
the new Star Substation. In addition to the 69kV
transmission line , an autotransformer would be required
at or near the Eagle substation. These step-down
138kV/69kV autotransformers are available on the
after-market, are excellent equipment for temporary
applications and can be ordered and delivered in time to
meet the Company's proposed May 2005 completion date.
ON PAGE 2 , BEGINNING AT LINE 24 THE STAFF
LISTS ALTERNATIVES AVAILABLE TO THE COMMISSION IN ITS
DECISION. DOES THIS 69KV LINE ALIGN WITH THE
ALTERNATIVES?
Yes , the 69kV line aligns with the recommended
Commission al ternati ves Nos. 1 , 4) and 5) respectively,
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directs the Company to extend its overhead facilities
through Eagle and directs the
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Company to pursue a lower cost overhead al ignment or a
combination of these al ternati ves.
THE STAFF'S DIRECT TESTIMONY FURTHER
RECOMMENDS , BEGINNING ON PAGE 3, LINE 1 , THAT THE
COMMISSION SHOULD DIRECT THE COMPANY TO INSTALL OVERHEAD
FACILITIES. WOULD THE 69KV LINE ALIGN WITH THIS
RECOMMENDATION BY THE STAFF?
Yes , the 69kV overhead line would comply
wi th this recommendation also.
ON PAGE 5, BEGINNING ON LINE 19 THE STAFF
SAYS THAT " IT IS UNLIKELY THAT A PREVIOUSLY PROPOSED
OVERHEAD ALIGNMENT ADJACENT TO STATE STREET THROUGH THE
CITY WOULD BE ANY MORE ACCEPTABLE." DO YOU AGREE THAT
THIS ALIGNMENT IS UNACCEPTABLE TO THE CITY?
, because the Staff was referring to the
high capacity 138kV line previously proposed to the City
and not the 69kV line that could provide the temporary
feed to the new Star Substation and would be much less
obtrusive. A 69kV line from the Eagle Substation , along
the alignment referenced by the staff , west along State
Street , has previously used this route on existing poles
before the Company reconfigured the line as a
distribution feeder from the Eagle Substation. The City
would not obj ect to the re-conversion of the line to 69kV
service to feed the new Star Substation.
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ON PAGE 9, BEGINNING ON LINE 13, THE STAFF
SAYS THAT THE STATE STREET ALIGHNMENT MAKES THE MOST
ECONOMICAL SENSE FOR THE GENERAL BODY OF IDAHO POWER
CUS TOMERS. DO YOU AGREE?
Yes , I believe that if the Company
completes a detailed design and cost analysis of the 69kV
alternative, it will illustrate that the 69kV alternative
will cost less than the 138kV high capacity alternative
to temporarily serve the new Star Substation. This
solution will therefore have less impact on the general
body of Idaho Power customers, as well as the Ci ty of
Eagle.
ARE THERE ADDITIONAL ISSUES RAISED BY THE
STAFF IN ITS DIRECT TESTIMONY THAT ARE PROBLEMATIC FOR
THE CITY?
Yes the Staff says on page 3, beginning on
line 5 and again on page 9, beginning on line 4 that the
Company should be allowed to reasonably extend and
upgrade its overhead transmission/distribution facilities
as it deems appropriate. However , the Staff does not
include in this part of its testimony any recommendation
for tests or checks and balances that will ensure that
the Company's planning and design for such facilities
include both the customer's and the Company's best
interests.Especially in contested extension of
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facilities , as in this case, such a system of checks and
balances would have quickly identified the Company's real
reason for the proposed high
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capacity 138kV line. A mandatory system of planning and
design test sand checks and balances would have
identified the separate functions of the Company'
proposed line, one, a high capacity 138kV line designed
to complete the Locust loop No.2 and two , to provide
temporary service to the new Star Substation.The City
and the Company could have focused their discussions
clearly on the temporary service of a low capaci
sub-transmission line to serve the Star Substation.
In this case , an excessive amount of time has been
required to extract the details of the Company's plan for
the high capacity 138kV line. Therefore, if the
Commission establishes a policy that allows the Company
to reasonably extend its overhead facilities , then the
Commission at the same time must also establish a system
of tests , checks and balances for the Commission Staff to
analyze the Company's plans and designs for those
extensions in disputed instances.
As examples , in this dispute, the Ci ty and the Staff
were not given essential design data including, but not
limited to: the proposed sub-transmission line electrical
loads, the temporary load requirements for the new Star
Substation feed from Eagle , the electrical load
requirements of the 138kV high capacity line to complete
the Locust Loop No., the timing associated wi th the
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completion of the Locust Loop No., the routing of the
proposed Locust Loop No.2 through the city of Eagle , and
the Company's standard design specifications for 138kV
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and 69kV sub-transmission lines. Al though the Staff may
not be comfortable with analyzing data at this level of
detail , it is essential information necessary to analyze
plans and design for contested Company proj ects.
If the Commission required and the Staff reviewed
this type of essential information as part of its test
for reasonableness , the Ci ty, the Company and the
Commission Staff would have been able to quickly identify
potential solutions in this dispute.
IN CONCLUSION , WILL YOU PLEASE SUMMARIZE
YOUR REBUTTAL AND SUPPLEMENTAL TESTIMONY?
Yes , in summary the Staff has been unable
to provide an acceptable solution for this dispute
primarily because the Company did not disclose the real
reason for the proposed high capacity 138kV line.
An overhead 69kV line solution routed on the old
69kV line right-of-way going West from the Eagle
Substation is acceptable to the City as temporary service
to the new Star Substation and agrees wi th the
alternatives the Staff recommends to the Commission in
its testimony.
Also, the Staff's recommendation to the Commission
that it should allow the Company to reasonably extend its
overhead delivery facilities must be accompanied by a
requirement for detailed planning and design data to
enable the Staff to ensure
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equitable solutions for all parties. Had the Company
disclosed its real reason for the high capacity 38kv line
and provided this detail in the initial request to the
City, all parties could have agreed on a solution very
early in the process.
DOES THI S CONCLUDE YOUR TESTIMONY.
Yes.
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open hearing.
(The following proceedings were had
MS. BUXTON:Mr. Chairman , we present Mr.
Teinert for cross-examination.
Mr. Howell.
COMMISSIONER KJELLANDER:Let's start with
BY MR. HOWELL:
MR . HOWELL:Thank you, Mr. Cha i rman .
CROS S - EXAMINA T I ON
Mr. Teinert, on page 14 you indicate that
you have read and reviewed the Black and Veatch study?
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Wilder , Idaho
Tha t 's correct.
Isn't it true that less than one percent
of transmission line circuit miles in the United States
are installed underground?
That would be a reasonable assumption.
don't know the exact number.
And doesn't the Black and Veatch report
also say that on page 2 subtransmission lines such as the
Eagle/Star 138 kV line proposed by Idaho Power are most
always constructed using air insulated overhead bare
conductors such as proposed by Idaho Power?
Without looking at that specific part of
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City of Eagle83676
the study, I'd accept that.
Okay.On page 18 you talk about one of
the al ternati ves, technology al ternati ves, such as using
ACSS , which is aluminum conductor steel supported cable.
Do you know if ACSS is typically the type of conductor
used by Idaho Power?
Idaho Power has stated in its discussions,
I think, with myself and others off the record that it is
not their typical standard construction conductor.
If Idaho Power were to install ACSS as
you're suggesting on a reroute or a replacement of the
well , what used to be the 69 kV line, wouldn't it need
additional instruments and software to monitor these
types of conductors?
Not that I'm aware of.A conductor is a
conductor.It wouldn't take any additional electronic
equipment to monitor that particular type of cable more
so than it would an ACSR or all aluminum conductor which
is their standard.
Under your suggestion to reconductor the
existing State Street 69 kV line, isn't it true that a
transformer that would be used for that 69 kV line would
have to be placed in the substation in Eagle?
In response to that question , let me start
at the Star substation and work back to the Eagle
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substation and I will address that particular issue.The
Star substation currently has a 69 kV transformer
installed.The ine between Star and the Eagle
substation as you heard Mr. Sikes testify this morning
a 69 kV line, conducted for 69, insulated for 69 , so if
we work backward from Star , we arrive at the Eagle
substation with 69 facilities in place and when we get to
the Eagle substation , we then from that point have a
mismatch , if you will , of transmission voltages or in
this case subtransmission as is stated by the Company,
and at that point you would require an auto transformer
and an auto transformer is basically a device that would
take the 138 kV subtransmission voltage and drop it down
to a 69 kV subtransmission voltage and allow you to serve
the Star substation , one auto transformer available on
the after market.
I think that's what your testimony does
say, available on the after market.What would the price
of that transformer be?
On the after market they run between 6 to
$8.00 per kVa and that would get you a price in the
neighborhood of 4 to $500,000.
But under your configuration that auto
transformer would need to be placed in the substation
wouldn't it?
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In or near the substation, that's correct,
and I've taken the liberty of looking at the availability
of properties in or near the substation.There are
properties contiguous to and adj acent to the substation
footprint that would allow at least the investigation of
purchasing that property for an auto transformer
installation.
Have you been present pretty much all
morning?
Yes, I have.
Haven't several witnesses said that it'
their belief that Exhibit 100 which is the conditional
use permit granting the substation rezone that no more
upgrades could occur in that location and that the
substation would have to be moved?
ve heard those discussions , that'
correct.
So doesn't that seem to rule out the
availability of putting the auto transformer in the
substation?
I believe my testimony was in or near and
near is not in and splitting hairs, but again, I'm not
the individual who makes the judgment on what the
conditional use permitting process is and the rules that
go wi th that.
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I f the Company were to reconductor the
existing 69 kV line route on State Street, wouldn't they
have to use taller poles?
If you reconductor for 69, the answer
no and I believe that my testimony indicates that
reconductored wi th ACSS trap wire which is a
configuration of ACSS could manage the required power to
serve the Star substation, so no taller posts would be
required if it were 69.
MR . HOWELL:No further quest ions.
COMMISSIONER KJELLANDER:Mr. Squyres.
MR. SQUYRES:No questions.
COMM IS S IONER KJELLANDER:Ms. Moen.
MS. MOEN:Thank you, Mr. Cha i rman .
CROSS - EXAMINATION
BY MS. MOEN:
Mr. Teinert, in your direct testimony on
page 2 , lines 14 to 15, you acknowledge that you'
testifying in this case as an expert wi tness; is that
right?
Yes, that's correct.
Mr. Teinert, can you tell me what
professional experience that you have conducting
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transmission line studies?
My experience , as indicated in the
testimony beginning on page 2 , indicates that I have
substation and/ or, if you will, swi tchyard, and they'
equally the same , 138/345 kV experience.That experience
requires that you understand transmission line design
particularly the loading and weighting of dead-end
structures and those would be basically large angle
structures similar to those that we're talking about here
in this particular case at 138 kV.
Well , my question was what professional
experience do you have actually conducting transmission
line studies?
Transmission line studies?
Yes.
To what degree?Studies can come as
models or they can come as driving the line to observe
what the right of way looks like.
Planning for transmission lines on a
systemwide basis.
Planning for transmission lines on a
systemwide basis in several capacities at Texas Utilities
and Texas Power & Light Company, I was responsible for
negotiating line extension agreements which included not
just line extension agreements for distribution but also
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transmission facilities.In the process of those
negotiations, we performed transmission line studies for
the clients who needed those facilities, whether they
were 345, 138 kV or perhaps 69 kV, so there's an
extensive amount of experience there in that particular
field.
If we to go Appendix A, would you identify
in your vi tae here where it says you have experlence
conducting transmission line studies?
If you will go to
- -
unfortunately, these
pages aren't numbered , but bear with me
- -
it would be
the fourth page , Manager of Industrial Services and read
with me or let me read to you, if you don't mind.Under
Manager of Industrial Services, "Developed policies,
practices and procedures for new service , marketing,
sales strategy and tactics for 108 000 commercial and
industrial customers with annual revenue" and so forth.
The policies , practices and procedures for new service,
new service entails in many cases for industrial and, in
fact , commercial customers similar to Eagle River perhaps
in this particular case that required transmission line
studies to determine the contractual obligations of both
the company and the customer , and embodied in that,
although it does not specifically say, that exactly is
what is entailed.
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City of Eagle83676
Okay, and during that time period,
December 1980 to July 1985, you were not a registered
professional engineer , were you?
Let me take a look at this.That is
correct.
Okay; so any work you would have
participated in in conducting any transmission line
studies would have had to have been reviewed and approved
and signed off by someone with those qualifications
correct, before those could be implemented?
I don't believe that's the case.Studies,
it is not required that you have a professional
engineer's 1 icense to conduct studies.It does require a
professional engineer's license to design and, if you
will , supervise the construction of those types of
facilities , but the studies themselves don't require a PE
license , at least in my experience in the State of
Texas.
What professional experience do you have
developing long-range electrical infrastructure plans?
Long-range electrical infrastructure
plans, can you clarify for me a bit, production?
Deli very?Global?Distribution?
Tell me any experience that you might
have.
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Any experience?Okay, once again , if you
look at my experience, it's rather vast both at Texas
Utilities , Texas Power & Light as well as Orlando
Utilities and in particular with respect to industrial
and technical serVlces, those management posi tions at
Texas Power & Light, we clearly had to si t down wi th our
large industrial customers and discuss our long-range
plans for transmission facilities and those facilities
basically were the facilities that they would attach to,
whether it was a cogen proj ect that required large
transmission capability.I will give you a quick
example.Mini mills , those are basically steel mills
that use scrap to produce rebar or sheet metal, require
several thousand vol ts of delivery, 138 in these cases
and we negotiated two of those.It required an
understanding of the long-range electrical and
infrastructure to provide service to those facilities.
I understand.I too in this business have
to learn a lot about electrici ty and understand those
long-range electrical infrastructure plans, but I don't
develop them and that's why I was asking if you developed
those plans.
We didn't in the industrial services and
technical services actually develop those plans, that'
correct.
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Are you a registered professional engineer
in Idaho?
, I am not.
Because you aren't a registered
professional engineer in Idaho, isn't it fair to
characterize most of your testimony concerning
engineering matters to be an opinion only, rather than an
expert opinion?
I wouldn't characterize it that way, no.
In your testimony are you asking the
Commission to substitute your opinions regarding a
subj ect matter on which you don't have an extensive
amount of professional expertise for the decisions of
Idaho Power's registered engineers that work wi th the
system on a regular basis?
My testimony does not specifically address
detailed engineering design simply because we were not
given that kind of information in either the testimony or
the exhibi ts that Idaho Power or because based on my
knowledge any other party to this proceedings has
provided.My testimony essentially addresses somewhat
broad issues about transmission vol tages, about
corridors, about the capability, if you will , of certain
equipment to provide the capaci ty necessary based on
long-range, broad, not engineering specific plans
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provided by the Company in some of its long-range
planning.
But you're suggesting to the Commission
there's a bet ter way; right?
And that is the case, in fact, and when we
talk about a better way, we're not necessarily talking
about connectors and, if you will , the particular
technology embodied in that equipment, we're talking
simply about the capacity of those types of delivery
designs, if you will , those delivery types of lines to
provide the capacity required to serve Star.
Okay, let's take the example that
Mr. Howell spoke with you about where you've suggested
that a solution could be to place a transformer to
basically bring down the voltage from 138 to 69 at the
Eagle substation and that then we would have service to
the Star substation that way.In your estimation, would
that be a long-range solution to the system issues facing
Idaho Power?
The issue in this particular case
providing service to the Star substation on a temporary
basis.It is not a long-range issue.
Do you recall that Mr. Sikes said in
testimony this morning that even if it's a temporary
solution , that particular 138 line would never become
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obsolete?
I don't recall that, but I'll accept
that.
Are you also aware that the 69 kV solution
that you recommend would not in the long range serve the
voltage requirements of the Lansing-Star substations?
Well , we're not talking about the Lansing
substation here.We are talking about the Star
substation.
Mr. Teinert, I think that's the problem
we've got here is we can't look at the substations in
isolation.We have to look at the system , so you can't
just look at what's happening between Eagle and Star.
Mr. SMITH:We are going to obj ect
this.If you just askShe is being argumentative.
questions , that's fine , but don't testify.
MS. MOEN:m sorry, and I'll retract
that question.
BY MS. MOEN:Are you aware that we'
looking at a systemwide system here?
Basically I'm responding to the testimony
and exhibi ts of the Company and the testimony and the
exhibits of the Company indicate that this case is about
serving the Star substation which seems to be an urgent
mat ter.
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And would you also agree that serving the
Star substation is a component of Idaho Power's overall
electrical system?
The Star substation is a distribution
system - - excuse me , a distribution substation and in
that regard it's a pretty localized , if you will
application.If it were a source substation or , if you
will , a transmission substation , then I think you could
make that statement, but in this particular case , the
Star substation is for a very localized, if you will
what we refer to as a distribution substation.I think
that's the way it's referred to by Idaho Power in its
system plan.It's not essential to the system other than
the , if you will , those customers served from that
particular substation since it is a 60 megawatt
substation, as I understand it.By definition , that's a
distribution substation , not a source substation.
m going to swi tch gears here.You make
references to the benefits of demand side management or
DSM programs; is that right?
Yes , I do.
Have you ever managed a DSM program?
Yes.Once again , you can refer to
Appendix A.If you look at my title at Orlando
Utilities , I was vice president of conservation , and
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customer service and conservation for a municipal utility
the size of Orlando included not only energy savings but
demand reduction programs and they were demand side
programs as well as a 1 000 point AC , load control AC,
program at Texas Utilities and Texas Power & Light
Company.
You were proj ect manager; lS that right?
For Orlando Utilities?
Yes.
I was a vice president of customer service
and conservation , 200 employees if you'll read it.
But did you actually implement and manage
a demand side management program personally?
I was responsible for all of Orlando
Utilities' conservation which included demand side
programs.The buck stopped at my desk and I had
employees, 200 employees , in the division that did in
fact design and implement the programs.
Okay, in your testimony you provide very
general recommendations or observations regarding the
Company's abili ty to maybe serve the loads wi thin the
Star service area with demand side incorporated into the
system; isn't that correct?
I don't think I limi ted it to just Star.
I think I maybe said Eagle and Star, but if I said Star,
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even Star would be appropriate as an example.
Okay, have you ever done an analysis as to
the amount of demand side management programs that would
be required in order to achieve a deferral or avoidance
of building the Eagle to Star transmission line?
ve not done an analysis that would give
you a specific number.ve used the Company's materials
and they're in the exhibi ts to provides examples of the
kinds of demand reduct ions, and I think if those programs
had been discussed with the City, as I mentioned in my
testimony, back in '99 given the five years that the
Company had based on its 10-year transmission plan to
build a substation and serve it that there could have
been significant impact.
Your experience as a manager in overseeing
demand side management programs, what do you suppose
would have cost to design, implement and manage systems
to either defer or avoid construction of a 138 kV line?
In my testimony, I basically say that
given the $2.5 million budget that we somewhat have to
work wi th here, we could have made some significant
reductions in the demand in the Star and Eagle area had
those programs been focused on those particular
customers, so I don't know the amount because we haven't
established which programs we might use.I can give you
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a quick example.There is a program in your most recent
DSM report , if I'm not mistaken , that indicates in new
construction , and there is a lot of new residential by
the way, that the Energy Star new construction
residential program can reduce energy consumption in
residential properties as much as 30 percent, so we could
make some calculations.
And in the last five years that you said
Idaho Power could have done something here , did the Ci
of Eagle adopt any ordinances requiring new construction
to utilize Energy Star appliances in order to achieve the
reductions you're referring to?
I really haven't looked at the City'
activities over the last five years with respect to
DSM.
Okay, do you think DSM programs could
relieve significantly the expected load of 140 megawatts
at build-out for the Star and Lansing substations?
Well once again, I wasn't aware that
Lansing was part of these proceedings, but for Star , the
60 megawatts at Star , that's build-out and as Mr. Sikes
testified earlier today,the temporary StarserVlce
would last as much as years and may,he had an
exhibi his rebuttal,Exhibi t No.that indicated
that in the first six years of the life of the Star
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substation , the load on that substation will not exceed
14 megawatts, so if we go back to the initial , if you
will, 1999 date and go through the year 2010 and we have
10, 11 years to work wi th , then I think we could make a
significant impact on the 14 megawatt load , 15, I think,
maybe if we round up, we could have had a significant
impact on that load , yes, I do.
Let's talk about the ACSS conductor , the
aluminum conductor steel supported conductor , that you
referred to in comparison to the ACSR conductor
conventionally used by the Company.You indicate on page
1 7 of your testimony that ACSS conductor can increase the
line capacity and reduce voltage drop; am
characterizing your testimony correctly?
I believe that's what it says, yes.
Couldn't standard ACSR conductor of a
larger size do the very same thing?
It could , but once again, what we were
concerned about here was not only capacity and voltage
support, but also the issue of , if you will, the
requirement for larger, bigger structures to support the
ACSR - - excuse me , well , in your case ACSR and
proposed, if you will , technological solution , perhaps,
ACSS.ACSS has much less sag.ACSS can carry qui te a
bi t more current at higher temperatures and therefore,
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require a much smaller conductor, smaller poles , shorter
poles, whichever you choose , and also lower
- -
let me go
back because I said smaller poles, but fewer poles as
well , so that comparison was basically to draw your
attention to the fact that ACSS could provide the same
capacity, somewhat improved voltage support and require
smaller and fewer of the structures which was an issue
here in this particular case.
There are a couple of terms I want to
clarify.You said somewhat increased voltage support,
but you also indicated that ACSS can basically run
hotter , can carry more electrical current at a higher
temperature.
That's right.
That's ampacity, isn't it?
More current is ampacity, that'
correct.
It isn't voltage support , is it?
Well, no, but those are two different
lssues as you are aware, I think , but ACSS and ampacity
were the central issues when we looked at serving the
Star substation from the Eagle substation.I think
you're particularly referring to the current, if you
will , configuration to serve Star from the
Caldwell-Lansing line and in that particular case, the
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Company indicates that there is a voltage support problem
and that is the reason that that particular line could
not be used for permanent or service beyond much where we
are today in fact.
Okay; so you would agree that the limi ting
factor facing Idaho Power today is not an ampacity issue
that could be corrected by ACSS, but it's a vol tage
support issue?
No, I couldn't agree wi th that , because
once again you're making a general statement about the
entire issue at hand here.That is one particular
portion of this issue and that was the Caldwell-Lansing
service to the Star substation that we have today, so if
we make that statement about the service from Eagle to
Star where there is no vol tage support problem , at least
that I'm aware of , certainly the Company has not
indicated that's the case, then that's a statement that
has no meaning to that particular application.
But as an electrical engineer , wouldn'
you say it would be very short-sighted of Idaho Power to
restrict a solution to a small part of its system?Don'
you think it needs to evaluate the solutions and the
problems from a systemwide basis?
Well , if we go back once more to the fact
that these are distribution substations within a loop and
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that loop would be essentially the loop that they'
described in their long-range plan and that long-range
plan, by the way, was not discussed with the CAC, was not
discussed with the City, was not discussed with the
Commission Staff, the only point made in its case, in its
complaint that the Company made was the service to the
Star substation and as we found out by looking at the
10-year plan , it is only a temporary service of a 10-year
link, or at least that was Mr. Sikes' testimony this
morning, so if we look at that, which is in fact the
issue at case here , temporary service to the Star
substation for that 10-year period would easily be
accommodated by the 69 kV solution ACSS or even ACSR or
perhaps all aluminum on existing structures and existing
right of way with the application of the auto
transformer.
And then in 10 years from now Idaho Power
would need to come forward requesting a conditional use
permit to perhaps increase the voltage or ampacity or
change conductors on that ine?
, 10 years from now you would have the
substation , whatever it is unnamed today, up north of
Star and you could serve Star as you were saying in your
10 -year plan from that substation, so in this particular
case, there would be no need for the 69 kV service to
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Star once you get the permanent , if you will , and those
are my words, not yours , but the source substation for
the 10-year Star substation after temporary service which
would be, as Mr. Sikes says, approximately 10 years.
You also heard Mr. Sikes say that the
temporary line as it has been classified as would not
become obsolete.Won't you agree wi th me it wi 11 become
part of the entire system?
MS. BUXTON:Obj ect , it's been asked and
answered.
BY MS. MOEN:The application of ACSS
technology wouldn't preclude the eventual construction of
another line through the City of Eagle , would it?
Would the application of ACSS preclude the
eventual construction of another line?
Yes.
That's a very general question.I suppose
that eventually there's going to have to be some more
ines in the Ci ty of Eagle somewhere , but ACSS would
preclude the construction of this many lines because
has more current carrying capacity with smaller
conductors and that was the point of my testimony.Now
again, we're making very general statements here , so it'
very difficult to say without more specific
information.
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Okay, on page 17 of your testimony, lines
15 to 21 you say,If ACSS were used to reconductor the
Caldwell-Lansing line , then the Star substation could be
served from that source instead of the Eagle source"
right?
Yes, that's correct.
And that assumes that there's sufficient
transformer capacity at Caldwell , doesn't it?
I would assume that you would have
sufficient transformer capacity at Caldwell.That was
not part of the Company's testimony or exhibits.
, but it's a recommendation or
suggestion that you've made as an alternative solution to
the Eagle-Star line; correct?
I think it's an assumption that the
Company makes because the Company says the problem of
servlng the Star substation beyond emergency, if you
will , or very temporary nature that it currently serves
it at was one of vol tage support and capaci ty, not one of
transformer size at the Caldwell substation.
Well , would it surprise you if I told you
that Idaho Power had considered expanding the
Caldwell-Lansing line?
I don't think it would surprise me , but
don't know that that's the case.
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Would it surprise you that there'
insufficient capacity at Caldwell or it's limited, so
that's not a solution?
MR. SMITH:Obj ection, Mr. Chairman.
she wants to ask a question , that's fine, but she can't
testify to things that aren't in the record.That
information is not in their direct testimony and it'
never shown up and she can't ask questions in that
fashion.
COMMISSIONER KJELLANDER:Ms. Moen.
MS. MOEN:Yes, Mr. Chairman , Mr. Teinert
makes the statement that a solution to the issue before
the Commission is to have the Company look at an
al ternati ve source.I think it's clear that Mr. Teinert
is making that recommendation without sufficient
substantiation or background.
COMM IS S IONER KJELLANDER:I'll allow the
question.
THE WITNESS:Would you repeat the
question for me, please?
BY MS. MOEN:The question is are you
aware that the 69 kV transformer capacity at Caldwell
limited?
I have no knowledge of that.
And would you be surprised to know that
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providing additional transformer capacity at Caldwell and
reconductoring over 13 miles of kV line from Caldwell
would be much more expensive to the Company's ratepayers
than the Eagle alternative proposed by the Company?
MR. SMITH:Before you answer , for the
record , I obj ect to this.
COMMI S S IONER KJELLANDER:Perhaps maybe we
have gone pretty far out in relation to the testimony
that has been submitted here today.
MS. MOEN:Just one other question.
BY MS. MOEN:Looking at the system as a
whole, are you aware that your Caldwell-Lansing line
solution wouldn't provide a source of electricity for the
proposed substation at Beacon Light and Linder Road which
are illustrated on the City's comprehensive plan maps?
Once again , you're making pretty broad
statements.The system as a whole , is that in reference
to all of Idaho Power's loop system?
No, I'm referring to the Caldwell,
Lansing, Star , Eagle, eventually Beacon Light loop.
m not aware that there is a pI an to
serve Beacon Light/Linder from the Caldwell-Lansing sub
and therefore, I haven't studied that particular
application , if you will , so I can't answer that
question.
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MS. MOEN:I have no further questions.
COMMI S S IONER KJELLANDER:I believe
Mr. Squyres , we've given you an opportuni ty, haven't we?
MR. SQUYRES:Yes.
COMMI S S IONER KJELLANDER:So I think it'
our turn if we have any questions from members of the
Commission.
No questions, we're ready for redirect.
MS. BUXTON:Thank you, Mr. Cha i rman .
REDIRECT EXAMINATION
BY MS. BUXTON:
Mr. Teinert , is it your testimony that
Idaho Power doesn't have to do what it's proposing for
the need that it says it's trying to meet right now; is
that correct?
Yes.
So in other words , Idaho Power does not
have to build a 138 kV line to provide reliable service
to Eagle or Star , but can do it with a 69 kV line using
modern technology; correct?
Yes.
Wouldn'that give Idaho Powe time
place the line in a new transmission corridor that the
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Ci ty is trying to establish and as has been suggested by
Mr. Lobb' s testimony?
Yes.
Mr.Teinert
114 front you?
do you have a copy of Exhibit
Yes.
Could you describe briefly to the
Commission the basis for your discussion of the fact that
you believe that this is a temporary line and that the
real purpose of this line is to close Locust Loop No.
which is on page 11 , and then describe how the loop model
with the two sources on page 47 and 48 would work?
Based on this particular document which
at this particular point in time approximately two to
three years old , if we look under Locust Loop No., we
discover that the Locust-Eagle 138 kV -- excuse me, 138
which I think is kV
- -
will be built when the reliability
of service is at risk or when the Gary tap is opened
because of the State 138 kV conversion , so simply what
we I re saying here is down the road at some point based on
those particular conditions there would be an additional
t ransmi s s ion 1 ine in thi s case, once again , thi s
subtransmission because it is part of a loop, it is not a
transmission line in the sense that the transmission grid
in Idaho Power's service area is significantly impacted
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by this, but if we go to the next sentence, then it
states very clearly that the Star tap is a tap in the
Locust-Eagle line for temporary service to Star.
That particular statement really gets
ahead of itself in terms of time, because really what
we're talking about is the loop would be complete at that
point and in fact , Mr. Sikes stated this morning that
once the loop was complete and another source north of
Star was available, we would in fact serve Star from that
particular source , so the sequence of events here aren't
necessarily clear , but we clearly know that the
Locust-Eagle line only provides a temporary service to
Star , so what we have is some triggers that would require
the completion of the 138 kV loop from the source
substation at Locust to Hewlett-Packard , and I'll read
that part in just a moment, and to Joplin on around to
Eagle and then back around to Locust, and if you'll look
on page 47 of that document, you'll see that loop
depicted in Figure No. 49b and so you see that the Star
tap, the temporary serVlce is not included in that
particular diagram, so what we really see here is that
the, I think I refer to it in my rebuttal as the, real
reason for the 138 kV line is not to serve Star on a
temporary basis but to complete this loop a~d none of
that was information was provided by the Company in its
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meetings with the CAC and its exhibits or the testimony
to the Commission Staff or the City, so once again
we're --
Let me interrupt you, then.
Yes, ma' am.
So in other words, what you're saying is
that this 138 kV line that's being proposed in this
matter will also benefit customers served from the Joplin
and Hewlet t - Packard substations which are not wi thin the
limits of the City of Eagle's jurisdiction; is that
correct?
Clearly that's the case.
MS. BUXTON:I have no further
questions.
COMMISSIONER KJELLANDER:Thank you, and
believe that Mr. Teinert, you're excused.We thank you
for your test imony .
(The wi tness left the stand.
COMMI S S IONER KJELLANDER:And that then, I
believe, takes us now to Mr. Squyres.
MR. SQUYRES:Thank you, Mr. Cha i rman .
would call Chuck Carlise to the stand, please.
COMMISSIONER KJELLANDER:Mr. Squyre s , I'
having just a little bit of difficulty hearing you.
you mic on?
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MR. SQUYRES:I didn't get the mic on
until I was about halfway through.Usually I don't need
a microphone to be heard, but I think I was mumbling as
well , Mr. Chairman , so I apologize.
COMMISSIONER KJELLANDER:You're fine,
thanks.
CHARLES CARLISE
produced as a wi tness at the instance of Eagle River
LLC, having been first duly sworn , was examined and
testified as follows:
DIRECT EXAMINATION
BY MR. SQUYRES:
Mr. Carlise , would you please state your
name and spell your last name for the record , please
sir?
Charles Carlise, spelled C-a-r-s-e.
What is your business address?
485 East Riverside Drive in Eagle,
Idaho.
And you are the same Charles Carlise that
provided written direct testimony on behalf of Eagle
River that was filed in these proceedings on July the
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8th , 2004?
I am.
I believe that testimony consisted of
pages and two exhibits, Nos. 201 and 202; is that
correct?
Yes.
Do you have any changes to that
testimony?
None.
And if I asked you the questions that are
set forth in that wri t ten test imony, would your answers
be the same?
Yes, they would.
MR. SQUYRES:Mr. Chairman , I move for
Mr. Carlise' s direct testimony to be spread on the record
as if he had read it and for the exhibits , 201 and 202
to be marked for identification.
COMMISSIONER KJELLANDER:Thank you , and
without obj ection , we'll admit the direct testimony and
also the associated exhibi ts.
MR. SQUYRES:Thank you.I would al
just state for the record that Exhibit 202 is the
Development Agreement between Eagle River , LLC and the
City that has also been marked as Exhibit 107 in Dr.
Reading's testimony.
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COMMISSIONER KJELLANDER:Mr. Squyres
just as a point of clarification , I think you meant 301
and 302 and not 201 and 202.
MR. SQUYRES:I don t think so, but that
doesn't mean that I'm not wrong.If they should have
been the 300 series , then I made a mi stake because
don't think they are.
COMMISSIONER KJELLANDER:The tabs that
are in our books , it could well be that there's an error
on our numbering system as well , but since we said the
associated exhibits , I think we can find them and life
good.
MR . SQUYRES:Your Staff was probably
making sure things were done right when I didn'
(Eagle River , LLC Exhibit Nos. 201 & 202
were admi t ted into evidence.
(The following prefiled testimony of
Mr. Charles Carlise is spread upon the record.
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335 CARLISE (Di)Eagle River , LLC83676
Please state your name and address.
My name is Charles Carlise.I am the
Managing Partner for the Eagle River Development located
in Eagle, Idaho.The address is 485 East Riverside
Drive, Eagle, Idaho 83616.
What is the purpose of your testimony
in these proceedings?
Eagle River is a premier mixed-use
commercial development located at the intersection of
Eagle Road and State Highway 44.If Idaho Power Company
is permitted to construct the 138 kV transmission line
along State Highway 44 (the Eagle Bypass), the
transmission line will be directly adj acent to Eagle
River's property and will cause substantial and
irreparable economic injury to our Development.
I am testifying to describe the impacts
and detrimental effects that Idaho Power Company'
proposed transmission line will cause to Eagle River , the
Ci ty of Eagle, and the surrounding area.I am also
testifying to explain how Eagle River was developed in
strict accordance with the City of Eagle's Comprehensive
Plan and the Development Agreement between the Ci ty and
Eagle River , and how , if Idaho Power Company'
transmission line is constructed as proposed, Eagle
River's reliance upon the City of Eagle's development
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plan and the considerable costs incurred to satisfy the
City of Eagle's requirements will have been utterly
wasted.Finally, I am testifying to explain how Idaho
Power Company failed to notify Eagle River of its plan to
construct the 138 kV transmission line and how Idaho
Power Company acted in bad faith when it agreed to bury
one of its power lines along Eagle Road to protect the
aesthetic of our Development, while at the same time
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was planning to construct a larger transmission line
along the entire mile of our frontage along the Eagle
Bypass.In sum, I am testifying to voice our obj ection
to the construction of the transmission line as proposed
by Idaho Power Company.
Would you describe the Eagle River
Deve 1 opmen t .
The Eagle River Development is a
unique high-end commercial development located on the
southeast corner of Eagle Road and the Eagle Bypass.The
Development, which is also known as Eagle River, consists
of approximately 90 acres of land that is bounded on the
south side by the North Channel of the Boise River and on
the north by the Eagle Bypass.
The Eagle River Development began wi th a
vision of creating a premier mixed-use community that
would take advantage of the natural environment of its
river front set t ing and tie in wi th the Ci ty of Eagle'
development plan for a distinctive rural town setting.
The Eagle River site was specifically chosen for several
reasons, including its river frontage and natural
aesthetics and its prime location within the City of
Eagle, which in and of itself is one of the most
desirable locations within the Treasure Valley.The site
was also chosen because the property is located at the
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gateway to Meridian , Emmett, Star, Horseshoe Bend and
McCall.
In addition to the prime physical location
of the property, we also favored locating our development
wi thin the Ci ty of Eagle because of the Ci ty' s high
standards for development.It has been our experience
that communities with high standards for development are
better able to attract quality businesses and a high-end
demographic of customers and visi tors,
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which in turn results in higher land values and a more
profitable development.The City of Eagle recognizes the
important connection between the enforcement of exacting
development standards and resulting heightened quality
development within a community, and it is one of the
reasons why Eagle River and its parent company tend to
purchase and develop in areas like Eagle.
Once we decided on the location for the
Development, we then began an extensive planning and
design phase.That phase took years of planning and
thousands of hours of work and coordination with the City
of Eagle to ensure that the Eagle River Development would
promote the development objectives of the City.In order
to create the caliber of development that Eagle River has
now become, more than $7.8 million dollars has been
spent.By way of illustration, Eagle River has invested
the following amounts in site improvements for the
Deve 1 opmen
Engineering / Archi tect ural / Permi t s 878 326.
388,631.
178,664.
844 402.
859,699.
438,178.
Electric
Water /Gas Systems
Irrigation System/Canal Relocation
Roads
Storm Drainage/ Sani tary Sewer
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340 CARLISE (Di) Eagle River , LLC83676
Ponds /Fountains /Waterfall s 801 936.
506 685.
119,322.
211,176.
Landscaping/Trees /Light ing
Sidewalks/Bike Paths
Traffic Signal Lighting
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341 CARLISE (Di)
Eagle River , LLC
Taxes/Construction Management/Legal/Misc.622,617.
TOTAL $ 7,847 651.
At its full build out, the Development
will consist of approximately 1 000 000 square feet of
mixed-use commercial space , wi th the commercial uses
being distributed between an Office Building Component of
approximately 600 000 square feet , an Ambulatory Care
Facility with Medical Offices of approximately 90,000
square feet, a 144-room Hotel with related meeting
facilities totaling 135,000 square feet, and a Retail
Component of approximately 200,000 square feet.
The Retail Component is being developed
along the western and northern part of the property to
take advantage of its exposure to Eagle Road and the
Eagle Bypass.This portion of the Development
designed as a "Lifestyle Retail Center" that will focus
on up-scale tenants in a pleasing setting in order to
focus upon the high-end demographic market of Eagle.
currently planned , the Retail Component will have at
least ten restaurants with indoor and outdoor dining and
at least twenty-five stores.
The Office Building Component when
completed will consist of approximately 600,000 square
feet of a mix of one- and two-story, first class
professional and medical offices.The offices will be
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situated in a garden setting with exposure to the Boise
River, pond frontage, walking paths, bike paths
beautiful roads, all which are landscaped wi th planted
medians , mature trees and flowers.
The remaining building area consists of
the river front Hilton Garden Inn.The Hilton currently
has 99 rooms and is in the process of completing the
final building plans that will expand its capacity to a
total of
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144 rooms.The expansion will also include a convention
meeting area that will accommodate more than 600 people.
The development as a whole has a variety
of ameni ties such as over 2 , 500 feet of Boise River
frontage, a river front greenbel t, integrated pathways
and bike paths, six large ponds , three waterfall entry
features, fountains and water features, mature
landscaping, vintage street lighting along all roads, and
approximately 25% of its property dedicated to open
And significant to this case, all utilities havespace.
been buried, including Eagle River's payment of more than
$100,000 to Idaho Power Company to bury its power line
along Eagle Road.
All of this effort was made to make Eagle
River an attractive, up-scale commercial center within
the Ci ty of Eagle, and I believe our efforts have been a
success.I have attached a copy of materials about Eagle
River as Exhibi t 201.
What are some of the businesses
currently located at Eagle River?
Eagle River is still in the early
stages of its development, with the full build out to be
completed within the next ten years.To date, several
si tes have been sold and businesses constructed.Among
the businesses that are currently located in Eagle River
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include, Hilton Garden Inn , Land Group, Wendy's, Westmark
Credi t Union , Eagle River I, Bardenay Restaurant , and the
Riverside Office Building I.
The Eagle River Development is continuing
to grow.We completed five sales transactions in 2003
and have fifteen scheduled for 2004.Several businesses
will begin building construction within the next
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year , including St. Alphonsus Regional Medical Center
Home Federal Savings, Eagle River I I , and Riverside
Office Building II.
In addi tion to the actual development
of property wi thin the Ci ty of Eagle , does Eagle River
bring any other benefits to the City and the surrounding
area?
Yes, in several regards.First , the
Eagle River Development is designed to be an employment
center that will bring several thousand jobs to the City
of Eagle and the surrounding community.As noted above,
at completion Eagle River will encompass approximately
million square feet of commercial development space.The
Development will employ one person for every 100 square
feet of space , which translates to approximately 10,000
jobs.The creation of employment opportunities and a
solid job-base is important for the City of Eagle and the
surrounding areas , and it is one of the many goal s of the
Eagle River Development.
Additionally, the type of jobs that the
Development will bring to the area are solid, quality
jobs that will benefit the community.Because Eagle
River is creating opportunities for office and retail
businesses, it has been able to, and will continue to,
attract medical personnel and staff , as well as other
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professional jobs such as banking, mortgage business, and
other office jobs.In addition , the Retai 1 Component of
the Development will offer retail and restaurant jobs.
Next, because of the qual i ty of the Eagle
River Development, the property values wi thin the
Development have increased.Presently the land values at
Eagle River range between $9.50 to $17.00 per square
foot.These high land values translate into a higher tax
base for the Ci ty of Eagle, which
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in turn resul ts in higher property tax revenues.
Finally, the Eagle River Development will
benefit the community by providing opportunities for
additional tax revenues in the form of retail sales.The
Retail Component of the Development is designed to
accommodate at least twenty-five retail stores.At a
standard rate of $300 of gross sales per square foot for
the approximately 200,000 square feet of retail space
the Retail Component of the Development will produce
approximately $60,000 000 in retail sales, which at a
sale tax rate of 6% totals approximately $3.6 million in
additional sales tax revenue.
The benefits that will result from a
successful development at Eagle River will be felt beyond
the borders of our Development.It will extend to the
Ci ty, the surrounding areas and to the state as a whole.
Did the Ci ty of Eagle impose any
requirements on the Eagle River Development?
Yes.The City of Eagle has very
exacting development standards, and it was very strict in
enforcing those standards for the Eagle River
Development.Consistent with its Comprehensive Plan and
its designation of the Eagle Bypass corridor as a scenlC
area , the Ci ty required that Eagle River enter into a
Development Agreement, which set forth the standards for
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our development.I have attached a copy of the
Development Agreement as Exhibit 202.
Under that Agreement, the Eagle River
Development was required to be constructed in harmony
with the existing community.(Exhibit 202 , Development
Agreement, p. 1) .The Agreement further required Eagle
River to:
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* Provide a public easement for a
greenbel t pathway;(Exhibit 202, Development Agreement,
p. 7)
* Provide on-site, tree-lined landscaped
strip along State Highway 44 and Riverside Driver (Id.
* Provide a ten-foot wide bicycle/
pedestrian pathway within the landscaped strip (Id.
* Provide a minimum 28,000 square foot
on-site landscaped area at the corner of State Highway
and Eagle Road (Id.
* Provide public art, water features, or
other features of interest (Id., p. 8)
* Provide pedestrian amenities which
encourage pedestrian use (i. e ., outdoor drinking
fountains, benches, tables, etc.(Id.
) .
And the list goes on and on.The purpose
for these development requirements is perhaps best stated
in the Development Agreement itself:
"The Purpose of the Design Guidelines
lS to provide an aesthetic roadmap for the development of
the Eagle River proj ect wi thin the highly visible and
scenic ci ty of Eagle/Boise River context.(Id., Design
Guidelines, p. 1)
The Development Agreement further provides
that:
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"The intent of the Design Guidelines
is to provide a harmonious and integrated development of
commercial and residential buildings sharing common
streets, trails, wetlands, and open spaces.The general
theme of the City of Eagle is to emphasize Northwest
turn of the 19th Century, architectural styles and
appropriate materials.(Id.
) .
Eagle River is committed to meet, if not
exceed these goal s, for the
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purpose of creating a pleasing, premium quality
development that enhances the Eagle community and for
economic benefits that will result from such a
deve 1 opmen
Could the Eagle River Development
have been constructed without meeting those requirements?
No.The Development Agreement was a
requirement for the Eagle River Development, as it is for
other developments within the City of Eagle.One of the
important considerations for Eagle River in creating its
development was the fact that the City of Eagle was
serious about its development requirements, its
development ordinances and its Comprehensive Plan.What
that meant to us was that not only would Eagle River be
subj ect to the Ci ty' s high standards for development, but
other developers would be as well.Eagle River relied
upon the City of Eagle's strict enforcement of its
development standards so that all developments would have
the same themes, aesthetic and meet the same design goals
as Eagle River.
How did Eagle River learn about Idaho
Power Company's proposal to construct a 138 kV
transmission line along the Eagle Bypass corridor?
We found out about the proposal
almost by accident.One of our employees was at the Ci
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of Eagle Sewer Office when he saw a copy of a notice of a
Planning & Zoning Commission meeting where the Idaho
Power Company's proposed line was to be discussed.The
news was surprising to us, since Eagle River had been
working closely wi th Idaho Power Company to have the
company bury one of its power lines-at Eagle
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353 CARLISE (Di) Eagle River , LLC83676
River's expense - in order to protect our Development from
these unsightly overhead lines.It seemed incredible
that we had paid Idaho Power Company to bury these lines,
when at the same time the company was planning and movlng
forward wi th a proposal to construct a much larger
transmission line along the entire length of Eagle
River's property on the north.All of thi s occurred
without any communication to us by Idaho Power.
Upon discovering the information about the
hearing, we contacted Layne Dodson at Idaho Power Company
and met wi th him to discover why Eagle River was not
informed about the transmission line.Through that
meeting, we learned that we were not notified of the
meetings-despite our prior interactions with Idaho Power
Company and despi te our owning property right next to the
proposed line-because Idaho Power Company only mailed
notices to owners who had an Eagle zip code.
How will the transmission line affect
Eagle River?
The construction of an overhead 138
kV transmission line along the entire mile-long northern
boundary of the Eagle River property will have
significant detrimental effects to our development.
Because so much of our Development focuses on the
aesthetic, natural environs, the transmission line will
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severely impact that aspect of what we have created with
Eagle River.In concrete terms, what this means is that
with the 70-90 foot towers that are proposed for the
transmission line, along with the tangle of overhead
wires, the Eagle River Development will be degraded to
the point that land values will fall and building
standards will be forced down.
Instead of a premium , high quality
development, the Eagle River Development will be reduced
to a more average qual i ty development, wi th
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much less desirability and appeal to the high-end
businesses and customers Eagle River is seeking to
attract.Eagle River would then have more
industrial-type uses, rather than general office/medical
office uses.Additionally, the Retail Component of the
Development would be diminished because high-end retail
will not locate in the proj ect as a resul t of its more
industrial appearance.
As a resul t, the Eagle River Development
will suffer lower land values with a lesser quality of
development.The Development build-out period will be
delayed, there will be a loss of leverage for Eagle River
to realize its plan for the development, and we will have
lost the investment of the cost and expense of the
high-end amenities which we incorporated into our
Development.And Eagle River will have lost out on our
reI iance upon the Ci ty of Eagle's development plan
Comprehensive Plan, and Development Agreement, as well
our future plans for the Eagle River Development.
Will the impacts to the Eagle River
Development that you described above have affects beyond
your property?
Yes.As a resul t of the lower land
values that will be realized from a more industrial-type
development, the City will loose a portion of its
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property tax base.In addition, the Development will not
attract the same type or quantity of employment
opportunities, and therefore the City will lose out on
these benefits as well.And finally, because the
Development will be unable to support the Retail
Component, the Ci ty and State will lose the sales tax
revenues that it would have otherwise enj oyed.
As noted above, the detrimental effects of
Idaho Power Company's transmission line will not only be
substantial , they will reach far beyond the
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borders of our Development.
Are you aware that Idaho Power
Company previously requested approval from the City of
Eagle to construct the 138 kV transmission line?
Yes.Before filing its complaint
with the Idaho Public Utilities Commission, Idaho Power
Company first sought permission from the City of Eagle to
construct is transmission line through the City.Eagle
River was involved in that process as a landowner
affected by the proposed transmission line.Eagle River
obj ected the proposed line at every stage the
process and explained how it would be adversely impacted
by the line.Ul timately,the City of Eagle rej ected
Idaho Power Company's request.
Is there anything else that you would
like to add to your testimony?
Just that, Eagle River is adamantly
opposed to the proposed 138 kV transmission line.
will drastically al ter the Eagle Bypass corridor and will
have substantial adverse impacts on the Eagle River
Development and other developments along its path.
In addition , it is our understanding that
there exists reliable technology that would not require
Idaho Power Company to construct the massive 138 kV poles
and lines and that would not cost any more than Idaho
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Power Company's current proposal to construct the ines
along the Eagle Bypass.It is also our understanding
that this technology is currently in use in a number of
other communities and that Idaho Power Company failed to
consider any similar alternatives in its analysis of its
current proposal.In fact, Eagle River in conj unct ion
with the City of Eagle specifically asked
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Idaho Power Company whether there were any al ternati ves
that would mitigate the injury that would be caused as a
resul t of the construction of the 138 kV transmission
line.And to my knowledge, Idaho Power Company did not
consider al ternati ve technologies as a means of
mitigating the impacts of its transmission line.
Eagle River respectfully requests that the
Commission deny Idaho Power Company's request to
construct an overhead 138 kV transmission line within the
right of way for the Eagle Bypass as proposed.Eagle
River also requests that if al ternati ve technologies that
were not considered by Idaho Power Company are available,
those alternatives should be considered as a reasonable
resolution and accommodation to all landowners who will
be affected by the proposed transmission line, the City
of Eagle and Idaho Power Company.
Does this conclude your direct
testimony?
Yes, it does.
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open hearing.
(The following proceedings were had in
MR. SQUYRES:I have nothing further and
would tender Mr. Carlise for cross-examination.
COMMI S S IONER KJELLANDER:Okay, and we'
ready, then , and why don't we begin with Mr. Howell.
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MR . HOWELL:No questions.
COMMISSIONER KJELLANDER:And I'm not
pretending to ignore you , I did hear what you said.
We'll move to the Ci ty of Eagle.
MS. BUXTON:Thank you, Mr. Cha i rman .
BY MS. BUXTON:
CROSS - EXAMINATION
Mr. Carlise, you heard Ms. Moen'
questions and discussion that power lines as proposed by
Idaho Power do not negatively impact property values; do
No.
Why not?
After 37 years of experience in the
development business, I can assure you that this kind of
an encumbrance, if you will , on the land will definitely
be a detriment to selling it and leasing it.People
you agree?
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Eagle River , LLC83676
simply see it and judge it as something that is not
desirable and therefore, it diminishes the value and
diminishes the desirability.
You were here in the room when there was
earlier testimony and questions about exactly where you
have buried your distribution lines on Exhibit 10.Could
you describe that in more particularity for the record,
please?
Would you ike me to just walk over to
that map or should I attempt to do it verbally?I have a
copy of it.
If you can just try and do it verbally,
Mr. Carlise, that will be helpful , because it's hard to
put pointing on the record.
All right.We made contract wi th Idaho
Power to bury the line that starts right at the
intersection of Eagle Road and the Bypass goes all the
way to the river which is our entire west boundary.
left remaining one pole at the northwest corner of our
property with a down guy and one in our southwest
property or the corner of our southwest property with a
down guy.
Have you participated within all of the
public testimony of opportunities with regard to these
power ines in the Ci ty of Eagle, you or your
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representati ves?
I believe so.
As many as you have been aware of; is that
correct?
As many as I have been aware of, right.
I sn 't it true you were not aware of some
of those because you were not receiving proper notice; is
that correct?
Coincidentally during the period of time
when we were negotiating with and paying Idaho Power to
bury that line along our west line, Idaho Power was
conducting studies with the Citizens Committee to
determine where the location of this 138 kV line would
Purely by accident one of our employees was at thego.
Eagle Sewer Department and saw a P&Z memorandum about
and came back and told us about it.We then contacted
Layne Dodson and his group and had a meet ing with him and
that time we were told about the fact that the study
not only was underway but was about concluded.
When we obj ected to the fact that we had
not been notified given the fact that we had a mile of
frontage on where this line was supposed to go or at
least one of the options as to where it was going to go,
we were told that they sent out a mailer to invi te the
residents of the area and since we didn't have an Eagle
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zip code, we weren't included in the list.
During your participation in the public
meetings that you have attended with regard to this
topic, were you aware of the temporary nature of the
proposed line to serve Star , that it was really to close
the Locust Loop No.
No.
Do you believe there was any testimony or
any information like that given to the City by Idaho
Power?
Never heard that.
Could you identify the development that
you've been so fortunate to get in Eagle River since its
inception , people that have already purchased property
that you can disclose that has been developed and then
things you can disclose that has not been developed yet
that's coming on that they have relied upon, the
documentation that's on the record, like the Development
Agreement?
I '11 try.
Okay.
We have starting from the northwest corner
of our property, we have Westmark Credi t Union that is in
and up and operating.There's a Wendy's operation due
south of Westmark.Washington Trust Bank owns a parcel
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right at the intersection of our signalized entry and
Eag 1 e Road.To the south of that we have the Hilton
Garden Inn and just to the east of the Hil ton Garden Inn
is a Bardenay Restaurant.In addition to that , we have
sold approximately seven acres to Saint Alphonsus
Regional Medical Center for the installation of one of
their ambulatory care centers and medical office proj ect,
as well as a second parcel to Saint Alphonsus for a
10,000 square foot future office building.
In addition , we have built on our own
Eagle River No. I.We are under construction with a
000 square foot Eagle River No. II.We built
Riverside Office Building No. I and we're under
construction with Riverside Office Building No. II.
have sold at least five or six other parcels that will be
developed over the course of the next year,
year-and-a-half.All in all , there are, I believe it'
44 parcels and approximately 22 or 23 are either sold
under development or spoken for ei ther in escrow or under
contract.
Every one of those purchasers have reI ied
upon the Development Agreement, the standards that the
City of Eagle has set out, the overall atmosphere that
has been created by the Ci ty' s fathers and mothers in
Eagle and it is a very important ingredient in our
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overall package.
Are there other cities that you're working
in in southern Idaho that also have development standards
that are stringent besides Eagle?
We are not working in any other city yet
in Idaho.
m sorry, I think I'm thinking of one of
your representatives , so I apologize to you.You were in
the Hearing Room today when we were talking about Wendy
and can you describe the Wendy's as it looks in Eagle
River versus as it looks at let's pick Meridian
Crossroads?
They re not in Meridian Crossroads.Oh,
yes, they are, but there I s another one in Meridian, per
se, which is a better comparison.The one in Meridian
an absolute box with no embellishments whatsoever and
it's really in my opinion hard to look at.The Wendy'
that we've developed in Eagle River with our direction
and the direction of the City and their Design Review
Committee is something that I think is one of the best
looking Wendy's that I've seen across the country, not
just in Idaho but across the country, so I think there'
a vast different interest.It certainly cost more to do
it, but that's the kind of standards we've employed and
the standards that have been employed by the City.
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Are you aware of whether that Wendy'
franchise has been upset by the potential degradation of
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their property by this potential line?
I personally have not spoken to the
individual that is the owner of Wendy's to find out
whether or not he is upset specifically.I have spoken
to others, of course, out there and wi thout fail , they'
very, very worried about what can happen to their
property and their property values.Bardenay, Saint
Alphonsus, I mean, they're all very, very concerned.
MS. BUXTON:I have no further questions,
Thank you.
COMMISSIONER KJELLANDER:Thank you.
Mr. Carlise.
Let's see , Ms. Moen, have we given you a
MS. MOEN:No, you have not.
chance yet?
COMMISSIONER KJELLANDER:Let's do that
then.
MS. MOEN:Thank you.
BY MS. MOEN:
CROSS - EXAMINATION
Mr. Carlise, as you state in your direct
testimony, you're the managing partner for Eagle River
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Eagle River , LLC83676
LLC; is that correct?
That's correct.
And I think on page 1 of your direct
testimony, you indicate that your development was
developed in strict accordance with the City of Eagle'
comprehensive plan and the Development Agreement between
the City of Eagle; is that right?
I believe.
On page 11 of your testimony at lines
to 14 , you indicate that should Idaho Power's proposed
transmission line be constructed on Eagle Road, your
development will have lost out on its reliance upon the
City of Eagle's comprehensive plan , among other
documents; isn't that right?
Yes.
Have you had an opportunity to , I presume
you have, but have you had an opportunity to review the
City of Eagle's comprehensive plan?
Not recently,. but, of course, I have.
And you know that for sometime, then, as
noted in my cross-examination of the Mayor that there are
provisions in the comprehensive plan that permi
placement of electric utility facilities on public rights
of way; is that right?
I heard you say that earlier.
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And that public streets and corridors can
serve as avenues or routes for electric facilities;
correct?
I heard you say that as well.
Okay, and also on the comprehensive plan
it makes reference to the Eagle area Idaho Power
facilities map that was provided by Idaho Power to the
City of Eagle and which is referenced in the
comprehensive plan.Are you aware of that?
Not really, but I accept what you say.
Okay, and are you aware that that
particular map specifically identifies both the Eagle
Bypass and the State Street routes as potential corridors
for Idaho Power's facilities?
I accept that, but I would like to make
the qualification that power lines are one thing, 80-foot
poles and multi-laced lines are certainly another.The
comprehensive plan or , I should say, the Development
Agreement of the City of Eagle required that we do
everything underground and literally on our property,
other than the entry points that I mentioned earlier,
everything is underground.Not only is it underground in
the new construction that we perform, but also we paid
Idaho Power to underground that portion that was already
in existence when we began to develop the property, so a
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power line is one thing, but it's certainly not what
we're describing here.
But again , that map that's identified in
the comprehensive plan upon which you've testified you
relied does illustrate the Bypass and State Street as
corridors for Idaho Power's facilities?
MR. SQUYRES:m going to obj ect to the
question because it misconstrues his testimony.His
testimony is that he relied on the comprehensive plan and
the Development Agreement, not just the comprehensive
plan standing alone.I think in both places that's used
the phrase is used in the conj unct i ve and so I think you
take them together.
MS. MOEN:I'd 1 ike to rephrase the
question --
COMMISSIONER KJELLANDER:Please do.
MS. MOEN:
- -
or approach it a di f f erent
way, i f I ma y I'll withdraw that particular question.
BY MS. MOEN:Isn't it true, Mr. Carlise,
that the development plan only addresses development
within the boundaries of your 90- to 93-acre development?
Yes.
So it does not look to any improvements
outside the boundaries of your property?
I believe that's the case, yes.
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So you wouldn't look to your development
plan to determine whether or not there are electric
corridors designated on the Bypass; correct?
What we would look at, however , is the
ti tIe to the land that is adj acent to us.The corridor
that you're referring to is owned by ITD.It's owned by
the state from the standpoint of road purposes.It's not
a public utility easement.It's a roadway and that'
what we're looking at.We weren't looking at a public
utility corridor, per see We were looking at a state
road.
But relying upon the comprehensive plan
and your development plan in the conj uncti ve, you would
have been aware that the Bypass was an al ternati ve route
for Idaho Power's facilities; correct?
Maybe you're suggesting I should have been
aware, but I was not aware.
MS. MOEN:All right, I have no further
quest ions.
COMMISSIONER KJELLANDER:Thank you.
Mr.Howell , have we given you a chance
We have.yet?
Okay, I bel ieve we're ready now for the
Commission.Commi s s i one rAre there any questions?
Smi th.
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COMMISSIONER SMITH:Jus t one.
EXAMINATION
BY COMMISSIONER SMITH:
I was looking on page 1 of your testimony
where you give your address as 485 East Riverside Drive
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Wilder , Idaho
Eagle, Idaho, 83616, is this a new address?
Yes, it is.This building was just
recently built and we recently occupied it as of the
first of January of this year.
So in 2002 your business had no presence
in Eagle?
We had a presence, but we didn't accept
It came to my home office.
Which is?
1002 Harrison Boulevard.
mai 1 there.
In Boise?
In Boise , yes.
COMMISSIONER SMITH:Thank you.
COMMISSIONER KJELLANDER:Are there any
further questions from members of the Commission?
not, we are ready for redirect.
372 CARLI SE (Com)
Eagle River, LLC83676
BY MR.SQUYRES:
Eagle River to
right?
REDIRECT EXAMINATION
The Development Agreement required you at
landscape to the edge of the roadway;
Tha t 's correct.
I mean, you've landscaped, you ve put sod
, there's a bike and walking path right in the right of
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Wilder , Idaho
Tha t is correct.As a matter of fact, we
way; right?
were required to go to the state and get their consent to
do in that a portion of the right of way or a portion of
that area is, of course, still in the title of the state,
so yes, we landscaped right up to the pavement.
And that was pursuant to the Development
Agreement with the City of Eagle and you were complying
with their requirements?
That is correct.
MR. SQUYRES:No further questions.
COMM IS S IONER KJELLANDER:Thank you , and
believe that brings us to the end of your testimony.
appreciate it and thank you for being here today.
THE WITNESS:Thank you.
(The wi tness left the stand.
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COMMI S S IONER KJELLANDER:Let's move now
to Mr. Howell and your witness.
RANDY LOBB
produced as a wi tness at the instance of the Staff,
having been first duly sworn, was examined and testified
as follows:
DIRECT EXAMINATION
BY MR. HOWELL:
Would you state your name and spell your
last name for the record, please?
My name is Randy Lobb, L-o-
And Mr. Lobb, who are you employed by and
in what capaci ty?
m employed by the Idaho Public Utilities
Commission as the administrator of the utilities
division.
And are you the same Mr. Lobb that has
caused to be prepared prefiled direct testimony in this
case?
am.
Do you have
your prefiled testimony?
any changes or corrections to
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374 LOBB (Di)Staff83676
No, I do not.
If I were to ask you the questions set out
on that prefiled testimony, would your answers be the
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Yes, they would.
MR . HOWELL:Mr. Lobb has no exhibits, but
with that, I would move that his testimony be spread upon
the record as if read and I would make Mr. Lobb available
COMM IS S IONER KJELLANDER:Without
same today?
obj ection, we'll spread the testimony across the record
and he wi 11 be subj ect now to cros s - examina t ion.
(The following prefiled testimony of
Mr. Randy Lobb is spread upon the record.
for cross.
375 LOBB (Di)Staff83676
Please state your name and business address for
the record.
My name is Randy Lobb and my business address
is 472 West Washington Street, Boise, Idaho.
By whom are you employed?
I am employed by the Idaho Public Utilities
Commission as Utilities Division Administrator.
What is your educational and professional
background?
I received a Bachelor of Science Degree in
Agricultural Engineering from the University of Idaho in
1980 and worked for the Idaho Department of Water
Resources from June of 1980 to November of 1987.
received my Idaho license as a registered professional
Civil Engineer in 1985 and began work at the Idaho Public
Utilities Commission in December of 1987.My duties at
the Commission currently include case management and
oversight of all technical staff assigned to Commission
filings.I have conducted analysis of utility rate
applications, rate design , tariff analysis and customer
petitions.I have testified in numerous proceedings
before the Commission including cases dealing with rate
structure , cost of service, power supply, line
extensions, regulatory policy and facility acquisitions.
What is the purpose of your testimony in this
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case?
The purpose of my testimony is to provide a
policy recommendation to the Commission regarding how
Idaho Power's complaint should be resolved in this case
and how similar situations should be addressed in the
future.
Please summarize your testimony.
Simply stated, Idaho Power Company needs to
extend its sub transmission facilities from the existing
substation through the Ci ty of Eagle to the new Star
substation.These new facilities will serve west Eagle
and the Star serVlce areas.The City has twice denied
the Company's application to construct overhead
facilities through the City that exceed 35 feet in
height.The al ternati ve would require underground
facilities or alternative overhead alignments at
significantly higher cost.
The al ternati ves available to the Commission
include: 1) directing the Company to extend its overhead
facilities through Eagle; 2) directing the Company to
install underground facilities provided the incremental
additional cost is contributed by the City and/or its
residents; 3) directing the Company to install
underground facilities and spread all costs over the
general body of ratepayers; 4) directing the Company to
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pursue a lower cost overhead alignment; 5) or a
combination of the above.
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378 LOBB (Di)
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I recommend that the Commission direct the
Company to install overhead facilities unless or until
the City of Eagle provides the incremental difference in
cost required to place those facilities underground.
addition , I recommend that the Commission establish a
policy that allows the Company to reasonably extend its
overhead facilities through existing utility corridors.
While I do not necessary dispute the potential economic
impact such overhead lines may have on adj acent property,
I believe it is inappropriate to require the general body
of Idaho Power customers to pay significantly higher
rates to provide underground facilities for the aesthetic
benefit of local communities and landowners.
The Complaint
Would you please briefly provide your
understanding of the situation between Idaho Power
Company and the City of Eagle that has lead to the
Company's complaint in this case?
Yes.My understanding of the situation
based on discussions wi th the various parties to this
case and a review of production requests and previously
filed testimony.Both Company witness Sikes and City of
Eagle wi tness Merrill have described the detailed history
leading to Idaho Power's complaint so I will not repeat
it here.Simply stated, Idaho Power has an existing
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379 LOBB (Di) Staff83676
substation within the City limits of Eagle served from
the east along State Street by an overhead 138 -
transmission line.The City of Eagle has denied Idaho
Power's request to extend its overhead transmission
facilities from the Eagle substation westward through the
City to the Star substation.The first request made by
Idaho Power for a conditional use permit (CUP) to exceed
the 35 foot height limitation was opposed by the Eagle
Planning and Zoning Commission and was wi thdrawn by the
Company. The Ci ty Council unanimously rej ected the second
request made by the Company stating:
The proposed conditional use for the
construction of overhead sub-transmissionline...is not in accordance with the general
obj ecti ves of the Comprehensive Plan nor
Eagle City Code Title 8. ...the design and
construction of an overhead sub-transmission
line conflicts with the City's goal "to protect
important views, vistas, and panoramas of the
community's natural setting and environment"
...
The council went on to say "the overhead line also
conflicts with the city's goal to 'Strive to create an
aesthetically pleasing community and protect the unique
natural beauty and small town character of the City.
Exhibit No. 119 page 12 of 13 Section Eagle Findings
of Fact and Conclusions of Law, Case No. CU-02.
What do you believe the Commission must
determine in order to resolve this complaint?
I believe the Commission must determine whether
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380 LOBB (Di) Staff83676
facilities are needed , what facilities are necessary, the
appropriate alignment and who should pay for any
facilities constructed.
Do any of the parties dispute that additional
facilities are needed to meet load in the Eagle/Star
Area?
Not really.While City of Eagle witness
Teinert questions the urgency for upgraded facilities and
points to a lack of demand side management (DSM)
implemented by the Company in prior years, he too seems
to recognize that some new facilities are needed.
Typically, DSM can dampen demand caused by load growth.
However , it cannot el iminate construction necessary to
promote system reliability.
Al ternatives
What are the al ternati ves available to Idaho
Power to provide service to the Star substation given the
City's opposition to the proposed overhead alignment?
The overhead proposal rej ected by the Ci ty was
to be located along the State Highway 44 bypass beginning
at Edgewood Street.Al though not specifically rej ected
by the City Council, it is unlikely that a previously
proposed overhead alignment adj acent to State Street
through the City would be any more acceptable.
Consequently, the only 138 -kV al ternati ves from the Eagle
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substation to the Star substation would seem to be ei ther
underground or consist of an overhead alignment that
proceeds north from the
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382 LOBB (Di)
83676 Staff
substation and then west around the City along either
Floating Feather or Beacon Light.
What is the estimated incremental increase in
cost associated with these alternatives?
Exhibit No.4 of Company witness Sike' s
testimony shows that alternative overhead options 5 and
would cost $1.42 million and $2.37 million more
respectively than the proposed overhead option rejected
by the Ci ty.The additional cost of underground options
with alignments through the City and along the Highway
bypass are estimated to range from $5.25 to $7 million.
Are there other problems associated wi th these
alternatives besides additional cost?
Yes , there certainly could be.It is likely
that any alternative overhead alignment chosen will
encounter similar opposi tion from adj acent landowners.
The Community Advisory Committee (CAC) established by the
Company to assist in transmission siting recommended that
overhead facilities not be placed" through residential
The Company indicates that even wi thout landownerareas.
opposition, it is unlikely that alternative overhead
facilities could be completed by the time they are needed
to serve the Star substation.
Other problems with underground facilities are
ci ted on pages 3 through 5 of the Black and Veatch study
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383 LOBB (Di) Staff83676
conducted for the Ci ty of Eagle and on pages 18 and 19 of
an Idaho Power Routing Study attached as Appendix A to
the Black and Veatch study (Exhibit No. 115)These
problems include difficulty in identifying and repairing
ine problems and the need to obtain highly trained
technicians to maintain such facilities.It is my
understanding that Idaho Power currently has no
underground transmission facilities.
Are there other al ternati ves described by the
parties?
Yes, City of Eagle witness Teinert maintains
there are other methods and technologies such as demand
side management (DSM) , mobile generators and Aluminum
Conductor Steel Supported (ACSS) cable that the Company
should have explored as alternatives to the 138-
options.
What is your opinion of the al ternati ves
proposed by Mr. Teinert?
I don't believe pointing out DSM activities
that the Company could have undertaken in the past
helpful in solving the transmission constraints
experienced in the Eagle area today.Mr. Te inert
speculates that a number of demand side management
programs described by Idaho Power in 2002/2003 could have
been put in place in the Eagle area as early as 1999.
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also speculates that these programs, many of which are
untried or in the pilot stage, could have reliably
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reduced transmission loadings and eliminated the need for
transmission upgrades at issue in this case.
He would seem to imply that Idaho Power was
imprudent in its implementation of DSM and therefore , it
is the shareholders and not the general body of customers
or the citizens of Eagle that should pay for costly
transmission upgrades.I do not believe that is an
appropriate conclusion in this case nor do I believe that
is the posi tion of Mr. Teinert.
I also believe that placement of mobile
generators in the Eagle/Star area as suggested by Mr.
Teinert as an alternative to the transmission upgrade
not a reasonable long-term solution.The Company'
experience wi th the location or placement of mobile
generators during the 2000/2001 energy crisis
demonstrated significant customer opposition and a high
cost of operation.
What is your opinion of Mr. Teinert' s ACSS
al terna t i ve?
I am not an expert in ACSS.However , I believe
this alternative has considerably more potential to
provide additional transmission capacity at reasonable
cost than the other al ternati ves described by Mr.
Teinert. I would look to the Company to explain why ACSS
would not be a viable al ternati ve to expand the capaci
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of existing facilities.
What facilities do you believe should be
installed to meet the growing load in the Eagle/Star
area?
In my opinion , the Company should be allowed in
situations like these to reasonably extend and upgrade
its transmission/distribution facilities, as it deems
appropriate.In this case, an existing 138-kV overhead
transmission line enters the City of Eagle from the east
to serve the Eagle substation.The most logical and
economical alternative is to upgrade existing overhead
facilities to the west in established utility right of
ways using structures that meet the lowest allowable
clearances under the National Electric Safety Code.
Consequently, the State Street alignment makes the most
economic sense from the standpoint of the general body of
Idaho Power customers.
Is this alternative consistent with Idaho Code
and the City's Comprehensive Plan?
Yes. The Idaho Land Use Planning Act at section
67-6508 (h) requires local comprehensive plans to contain
an analysis for "utility transmission corridors"The
City's Comprehensive Plan Exhibit 106, section 4.
page 10 of 54 states that:
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Appropriate placement of electric utility
facilities on public right of ways is
encouraged. Public streets and road rights-
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of -ways typically serve as corridors for
electric facilities. Transmission lines
are usually located on easements that IPC
acquires from private property owners. The
joint use of utility corridors is alsoencouraged, provided that such j oint use
is consistent with limitations as may be
prescribed by applicable law and prudent
utility practice for existing and proposed
utility facilities.
Both the State Street and bypass routes are along public
roadways.
Both Eagle River LLC witness Carlise and City
of Eagle wi tness Reading point to the economic inj ury
that adjacent land owners will experience if 138-
transmission lines are placed overhead.Do you dispute
their claim?
Not necessarily.I believe it likely that
large overhead power lines can negatively affect local
property values wherever they are located.If the
standard for constructing overhead transmission lines
were that they couldn't negatively impact local property
values then overhead lines would rarely be constructed.
Even the alternative overhead alignments suggested by the
City would not be viable on that basis.
If overhead alternatives are eliminated due to
property value impact, doesn't that leave just
underground transmission as the only viable alternatives?
A. wi th the possible exception of ACSS, it appears
so based on the testimony of Mr. Teinert, Mr. Calise,
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Dr. Reading and Ms. Merrill.
Has the Ci ty offered to pay the higher
incremental cost of underground transmission facilities
in order to protect its vistas and property values?
No, it has not.
Who would pay the higher incremental cost of
underground facilities if the City and its citizens did
not?
These costs would almost certainly be passed on
and paid for by the general body of Idaho Power
ra tepayers
Is that reasonable?
No, I don't believe it is.Ci ty of Eagle
wi tness Reading in describing the Eagle Communi ty in
testimony states: "The City of Eagle was the 3rd fastest
growing city in Idaho between 1990 and 2000 increasing
its population 233%.He also indicates that population
has increased another 23% since 2000.He goes on to
state "the City of Eagle has the highest property values
in the state among residential communities.Finally,
Dr. Reading states, "What is clear is that people want to
move to Eagle and are willing to pay a premium to live
there.
The Ci ty of Eagle has experienced rapid growth
that has required substantial electrical facilities
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including 138-kV overhead transmission to provide cost
effective reliable service.It is commendable that the
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City and its citizens have created a community that
prosperous and desirable.However , I believe overhead
transmission facilities are the standard of construction
for Idaho Power Company.Underground transmission
facilities exceed this standard and are more expensive to
The residents of Eagle should be willing toconstruct.
pay a premium that reflects the increased cost of meeting
local concerns of the City.When the standard of
construction is overhead, the incremental cost of these
facilities should not be passed on to other Idaho Power
customers that receive no aesthetic benefit of placing
the facilities underground.
Wouldn't you agree that the rate impact is very
small when the incremental additional cost of placing
transmission facilities underground through the City
Eagle is spread over energy consumed by all Idaho Power
customers?
I would agree if this were the only such
special request that could be expected.Howeve r ,
believe that other cities and counties would make similar
requests if the Commission allows the additional costs
described in this case to be spread among all Idaho Power
customers.
How would you recommend the City and its
residents pay the increased incremental cost of
underground transmission facilities?
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I bel ieve the Ci ty should provide a
Contribution In Aid of Construction (CIAC) that reflects
the additional incremental cost of underground facilities
prior to commencing construction.The City rather than
the utility should be responsible for assessing its
citizens for the additional cost.
Why do you recommend an up front CIAC paid for
and collected from City residents by the City rather than
an energy surcharge assessed and collected by Idaho Power
Company?
From a policy standpoint, I believe it is more
efficient to require cities, counties or other
governmental entities requesting special facilities to
assume responsibility for CIAC payment and collection.
Requiring an energy surcharge on local residents whenever
special facilities are requested could lead to a
hodgepodge of pancaked surcharges and rate structures
across Idaho Power Company's entire service terri tory.
The resul t would be administratively burdensome and
confusing to electric customers.
How might the City generate funds for the CIAC?
Idaho Power Company wi tness Said describes in
testimony ways in which the City could fund the
additional costs associated with underground facilities.
These options include creation of a Local Improvement
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District (LID) and short-term financing through the
Company paid for through franchise fees assessed by the
Ci ty on local residents.
Would the franchise fees assessed by the City
be sufficient to cover the incremental additional cost of
placing transmission facilities underground in this case?
No.Even if franchise fees are set at the
maximum rate of 3 % of electric revenues, the Ci ty could
only generate $140,000 of the estimated $1.8 million
needed each year.
Then based on your recommendation , the City
must either accept an overhead alignment or create an LID
to pay the incremental addi tional cost of underground
facilities?
Yes, unless ACSS is shown to be a viable
alternative to 138-kV facilities.
Is it also your recommendation that the
Commission establish a similar CIAC policy when
underground or special utility facilities are requested
by other municipal or county governments?
Yes.First, ci ties and counties should
recognize that electric transmission structures typically
exceed 35 feet and local comprehensive plans should
reflect that fact.Comprehensive plans should designate
transmission corridors wi th the understanding that tall
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electric transmission structures will be located there.
Second,
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these enti ties should be put on notice that the general
body of ratepayers will not be responsible for
incremental addi tional costs associated wi th special
utility facilities requested for the benefit of local
residents.Such notice will incent planning for overhead
utility corridors or funding methods to provide CIAC to
cover the higher cost of special facilities.
Does this conclude your testimony?
Yes it does.
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open hearing.
(The following proceedings were had in
COMMISSIONER KJELLANDER:Let's begin wi
the Ci ty of Eagle.
BY MS. BUXTON:
CROSS - EXAMINATION
Good afternoon.
Good afternoon.
I can't hardly talk anymore, so I'll make
Mr. Lobb, do you see any difference between an
economic impact for a high vol tage line on property
CSB REPORTING
Wilder, Idaho
values between a line along a potato field and a high-end
I suppose that it could be perceived to
have different economic impacts.
Perceived or it would?
I don't know.
Do you think it's reasonable to think that
a different economic impact or not?
On a percentage basis or I mean , it
depends on your perspective, I suppose.If you re the
potato farmer , I suppose that a 10 percent reduction in
your land value would be just as crucial as a 10 percent
it quick.
commerc ial area?
it would have
397 LOBB (X)Staff83676
reduction in commercial value.
impact.My testimony says that.
So it would have an economic impact?
I would say it would have an economic
On page 9 of your testimony
- -
do you have
that in front of you?
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Yes , I do.
Okay, looking at lines 4 through
Page
Page 9, sir.
Okay, I'm there.
You say that in situations like this, the
Company should build facilities that it deems
With a policy like that , what incentive
does Idaho Power have to respect property values or city
I think they certainly have to comply with
appropriate.
those land use plans as best they can.Hopefully, those
land use plans accommodate transmission corridors.
this particular instance, you have 138 kV line all the
way down State Street from Gary Lane and perhaps even
further to the east that goes into the City of Eagle to a
It would seem to me that a reasonable
extension of those facilities would be to continue down
land use plans?
substation.
State Street.
398 LOBB (X)Staff83676
Okay, you were present when Dr. Reading
testified that the City of Eagle since this proceeding
has started in the process of amending its comprehensive
plan , do you remember his testimony?
I understand that he said that.
And that he also said that the City of
Eagle received a letter recently from Idaho Power telling
them that they don't like where the City of Eagle
trying to actually establish a utility transmission
corridor and so again , even if the Ci ty is trying to
establish it and Idaho Power doesn't like it , from your
testimony, if they don't deem it appropriate , then why
would anyone ever try?
Well , I think that's one of the reasons
that we're here is because the City has required an
al ternati ve to what the Company deems appropriate and the
Company deems it to be higher cost, so they've come to
the Commission to determine if in fact the City
ordinances and the alternatives that the City has
proposed are reasonable al ternati ves.
Is it the job of the Commission to take a
look at whether the City has enacted unlawful ordinances
or not or is that something that should come under the
Administrative Procedure Act?
I don't know what the Administrative
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Procedure Act
Perhaps that wasn't a fair question , but
don't think that we're here to determine the validity of
the City's ordinances.
Well , I think we're here to determine
the extension of the Company's facilities under the City
ordinances makes sense in terms of the impact on
ratepayers, the addi tional cost and that sort of thing.
Is there a single dollar amount that can
be deemed reasonable and prudent for costs for what'
reasonable and deemed appropriate?What number
that?
I don't think it's a fixed number.
think it's a range of reasonableness.
How do we establ i sh the range of
reasonableness if , like you say, the Company builds
facili ties as they deem appropriate?
Well , I think you need to give the Company
the leeway to extend its facilities in a manner that
within a reasonable range provides the reliability
they're looking for and meets the growth and the loads
that they expect.
So is the reasonable and prudent standard
or the appropriate standard, is it a solely a matter of
the cheapest alternative?
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I don't necessarily believe that it has to
be the cheapest.Certainly my interest here is what does
it cost, what are the al ternati ves, why would you pay
more, what do you get if you pay more.
You've heard testimony today that the
City's frustration is that they can't get an actual cost
number from Idaho Power and are they being unreasonable
to try and get an actual cost amount?
Well, I'm not sure there's a fixed
alternative that has been acceptable to the City.
seems to me in my participation that it's been somewhat
of a moving target.
I'll direct you to page 10 of your direct
testimony, please.At lines 24 and 25 you say, "With the
possible exception of ACSS, it appears so based on the
testimony of Mr. Teinert, Mr. Carlise, Dr. Reading and
Ms. Merrill.Wi th that, when you say "wi th the possible
exception of ACSS, " you think underground is the only
viable alternative to eliminate impact on property
values?
If the impact on property values
determines whether or not you can put in overhead ines,
then that is correct.
Have you or the Staff investigated the
viability of ACSS or other technology that would lessen
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the impact on property value?
No.
Do you know if Idaho Power has ever
investigated whether the viability of ACSS or other
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technology could lessen the economic impact on property
I don't know.
They haven't provided it to you in this
, they haven't provided the Staff wi
any studies like that.
Next to page 11 , 1 ines 2 through 4 , you
indicate that overhead is a standard of construction for
Who determines what is or what isn't the
standard of construction?Is it the PUC or is it Idaho
The standard of construction in my view
what Idaho Power has traditionally used in terms of
facilities when they extend those facilities.
So when the Company establishes its
values?
standard of construction, do they take into account the
impact on property values or is only the efficient method
You'll need to ask Idaho Power that.
As far as you know , there hasn't been
case, have they?
Idaho Power.
Power?
considered?
402 LOBB (X)Staff83676
anything that you've ever seen that would indicate that
their standard construction would take into account
impact on property values; correct?
Tha t 's correct.I haven't seen any
analysis like that.
Mr. Lobb, did the Company clearly identify
to you in its testimony that the proposed 138 kV line in
this matter to the Star substation was only temporary
service?
Had they indicated that to me?
Correct.
I think in discussions that was indicated.
Certainly in response to Production Request No.3 that
the City had that it was clear to me -- it wasn't clear
to me that it was temporary, but certainly there was
additional future feeders planned.
MS. BUXTON:I have no further questions.
Thank you , Mr. Lobb.
COMMISSIONER KJELLANDER:Thank you.
Let's move to Mr. Squyres.
Thank you.MR. SQUYRES:Mr. Lobb --
COMMI S S IONER KJELLANDER:Is your mic on?
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CROSS - EXAMINATION
BY MR. SQUYRES:
Mr. Lobb, it's like marking exhibits and
forgetting to get them admitted every time until somebody
reminds you.As I understand - - well , whatExcuse me.
is your job?
My job is to set policy positions of the
Commission Staff , review Commission Staff work products
and generally oversight acti vi ties of the Staff.
You're the top guy in your position?
m the administrator of the Staff, that'
correct.
In other words, to go higher than you
would ei ther have to go to Mr. Howell or go to - - I'
looking at your testimony on page 9, beginning on line
and I want to make sure that I understand your position.
You said, "In my opinion, the Company should be allowed
in si tuations like these to reasonably extend and upgrade
its transmission/distribution facilities , as it deems
appropriate. And then you go on to say, "In this case
an existing 138 kV overhead transmission line enters the
City of Eagle from the east to serve the Eagle
substation"; so what you're - - the policy that you
believe the Commission should adopt is if you have an
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404 LOBB (X)Staff83676
existing utility transmission corridor then in use and
Idaho Power wants to upgrade or extend that route, if you
will , then they should be able to do it as they deem
appropriate; is that correct?
Sure, I think the keyword there in that
sentence is reasonably extend and it makes sense that the
Company should be allowed to reasonably extend these
facilities.
But the qualifier there is because you
talking about an existing, an expansion within an
existing, corridor, because you go on to say, The most
logical and economical al ternati ve is to upgrade existing
overhead facilities to the west in established utility
right of ways using structures that meet the lowest
allowable clearances under the National Electric Safety
Code?
In this particular case, that's correct.
Okay, and then you conclude,
"Consequently, the State Street alignment makes the most
economic sense from the standpoint of the general body of
Idaho Power customers," that's your opinion?
Tha t 's my opinion.
MR. SQUYRES:Thank you, sir.No further
questions.
COMMISSIONER KJELLANDER:Thank you,
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405 LOBB (X)Staff83676
Mr. Squyres.
Let's go to Ms. Moen.
MS. MOEN:I have no questions.
COMMI S S IONER KJELLANDER:Any questions
from members of the Commission?Commissioner Smith.
EXAMINATION
BY COMMISSIONER SMITH:
I guess, Mr. Lobb, were you present
earlier today when it was suggested that perhaps
utilities should come to the Commission first and get
certificates or approval before doing these kinds of
extensions?
Yes, I was here.
Is that the ordinary practice of utilities
in our state?
No.In fact, this is the first time, to
my knowledge, that a company has actually come to the
Commission in conjunction with a request for permit
through a city.
In fact, doesn't Idaho Code 61-526 say
that if you have a certificate and you're providing
service in a ci ty or county, you don't need to come to
the Commission to extend that service in that city or
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406 LOBB ( Com)Staff83676
county?
That's my understanding.
And do you think that probably the other
thing that's going on here and why Idaho Power came to
the Commission is because it sees the potential of
finding itself in the position of having spent money
cannot recover if it expends monies perhaps to comply
with rules that the Commission says we're not going to
pay for that?
Certainly, if the Company had just
extended underground facilities at very high costs
through the City of Eagle at the City of Eagle's request
that would be something that I'm sure the Staff would
look very closely at in terms of cost recovery.
I don't know , I'm struggl ing wi th the word
temporary in this case when it's testified that the
facilities would be used 10 years in one way and then in
perpetuity another way, so is 10 years in your mind
temporary?
Well, I don't think that it is.The
question in my mind, is there a need , does the 138 kV
line at least to Linder serve some purpose to the City
Eagle and it seems to me that it does and if you look
the Response to Production Request No.3, it seems to
indicate that their grid is upgraded, is being upgraded
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to 138 kV , there's no new 69 kV ines proposed.
provides looping into the Ci ty so you can have service
from the east and service from the west.
And does that increase the reliability to
the customers in that area?
Yes, it does.
COMMISSIONER SMITH:That's all I have.
Thanks.
COMMISSIONER KJELLANDER:Ready for
redirect?
MR . HOWELL:None.
COMMISSIONER KJELLANDER:Thank you.
Before Mr. Lobb leaves , did you want to address the issue
of the live rebuttal or would you like to wait until the
end of the hearing?
MR . HOWELL:We'll wai
COMMISSIONER KJELLANDER:Okay, thank you.
Mr. Lobb , you are temporarily excused.
(The wi tness left the stand.
MR . HOWELL:Mr. Chairman, if we could go
off the record, I might confer with my witness.
COMMISSIONER KJELLANDER:We'll go off the
record.
(Off the record discussion.
COMMISSIONER KJELLANDER:We'll go back on
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the record and Mr. Howell , you asked for an opportunity
to confer with your witness and what have you come to a
conclusion on?
MR . HOWELL:Thank you, Mr. Cha i rman .
appreciate your indulgence.The Staff has determined
that we do not see a need for live rebuttal.
COMMISSIONER KJELLANDER:Okay.Well
thank you , Mr. Howell.I think at this point it would be
the Commission's pleasure to go ahead and adj ourn for the
day and to head out to the public hearing in Eagle which
will begin at 7: 00 and then tomorrow , at the crack of
dawn , somewhere around noon , not knowing how late we'
golng to go tonight, I think I'd like to get just a
little later start since we only have one witness left
how about if we shoot for 10: 30 or is that too late?
10:00 o'clock it is.10:00 o'clock will
be our intended start date and I think that if we'
fortunate, we may be able to run through that rather
quickly, so we are adj ourned for the day.
(The Hearing recessed at 4 :40 p.
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