20040706Reading Direct.pdf

Idaho Public Utnnt.. Commission
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION'tfl ~ ~fd~'1 ~.8tary
JUL - 2 2004
BoIse, Idaho
IDAHO POWER COMPANY
COMPLAINANT VS. CITY OF EAGIE
IDAHO, RESPONDENT CASE NO. IPC-04-
Direct Testimony of
Don C. Reading, Ph
Ben Johnson Associates , Inc.
on behalf of
The City of Eagle
July 2 , 2004
Direct Testimony of Don Reading, Ph.
On Behalf of the City of Eagle, Idaho, Case No. IPC-O4-04.
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.
What is your purpose in making your appearance at this hearing?
Our finn has been retained by the City of Eagle (the City, Eagle) to examine the impact on
Idaho Power Company s (the Company, IPC) proposed 138kV power line through the City 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 cities 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
15 years. The City has managed its growth with award winning strategies that led to its
rejection of Idaho Power s proposal. Third I show, using econometric studies of what
common sense tells us, that high voltage power lines reduce property values and that IPC'
proposal will devalue some of the City's most value real estate.
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
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 City. The developers have expended significant sums to build an aesthetic
business park - including paying 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, is 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
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
City of Eagle. The City 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 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. (City of Eagle, Finding of
Fact and Conclusions of Law, Recommendations, Oct. 1995., Exhibit 100)
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-Q4-04.
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 44, 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 involved the City, the Company and the IPUC Staff 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 rejection of the CUP and order IPC to construct the
138Kv line through the City in violation of the City's own ordinances. (Eagle City Code 8-
, General Standards for Conditional Uses; Design Requirements, Objectives and
Considerations, 8-2A-6. Exhibit 101)
Could you please provide a prof"Ile of the City of Eagle?
Eagle has been one of Idaho s fastest growing communities in roe 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 City of Eagle, as measured by median house value, has
the 10th highest value among Idaho cities.
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
If fact the City was named one of the "Best Managed Small Cities in America
last year. (Pat Summerall, Champions of Industty, "Best Managed City 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 11 2004. Book attached, Exhibit 105)
During the Planning and Zoning hearings dealing with !PC'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 Cotq)any s application
including the Planning and Zoning Commission s recomnended denial of the application.
A public hearing was held and testimmy 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 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-kmofthe power-lines suggest a loss of 4% to 6.2% in value.
Loss in value decreases with distance from power-lines. At an average proximity to high-
voltage power lines resulted in a decline of $11 000 to $27 000 in property values.
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
(Impact of Power Lines on Freehold Residential Property Values in the Greater Toronto
Area, University 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 fmd that
properties adjacent to a line lose 6.3 percent of their value due to proximity and the visual
impact. (Hamilton, 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 is 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 voltage power lines. There is 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 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
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
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'
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 is exactly what
the City is do ing.
As pointed out above results indicate growth management has been a success in
Eagle. Placing high voltage poles in the middle of the most important land in the City
would be a major 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 s comprehensive plan, which emphasizes the importance of preserving
the rural elements of the community and the nature aesthetic of the area through
pedestrian-friendly, livable spaces, scenic views and open spaces. To create its
development in accordance with the City s development goals and objectives
Eagle River and the City entered into a Development Agreement. (Development
Agreement between Eagle River Development and the City of Eagle. Exhibit
107).
In accordance with 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
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
throughout the development that connects with 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 within 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 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 voltage transmission line would be placed adjacent
to their land.
From the City 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
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
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 built?
There certainly will be a significant impact on adjacent 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
prospective 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 1hat are more stringent than the standards in place throughout Idaho Power
service territory and the result of the application of the more stringent standard is higher
cost, the question them becomes "who should pay fur the additional costs attributable to
the City of Eagle s more stringent aesthetics, the City 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 under different
standards. (Idaho Power Direct Testimony of Greg Said, pg. 11)
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 it needs to determine that the proposed project
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
Top 10 Idaho Cities
Median House Value 2000
Sun Valley
$400 000
Dollal"8
$800 000$600 000$200 000
Note that all of the communities that rank above Eagle are either located on a lake or are
resort based. This means the City of Eagle has the highest property values in the state
among residential communities. (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 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 prosperity. It is also an
indication that the City's growth has been well managed and that its development
strategies have been successful.
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
If fact the City was named one of the "Best Managed Small Cities in America
last year. (Pat Summerall, Champions of Industry, "Best Managed City 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 11 , 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 Cotq)any s application
including the Planning and Zoning Commission s reconmended denial of the application.
A public hearing was held and testimmy was received. A nu.nDer 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 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 I-Ian of the power-lines suggest a loss of 4% to 6.2% in value.
Loss in value decreases with distance from power-lines. At an average proximity to high-
voltage power lines resulted in a decline of $11 000 to $27 000 in property values.
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
(Impact of Power Lines on Freehold Residential Property Values in the Greater Toroo.to
Area, University 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 fmd that
properties adjacent to a line lose 6.3 percent of their value due to proximity and the visual
impact. (Hamilton, Stanley and Gregory Schwann, Land Economics, 71 (4): 43644
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 is 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 voltage power lines. There is 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 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 fustest
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
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
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'
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 is exactly what
the City is do ing.
As pointed out above results indicate growth management has been a success in
Eagle. Placing high voltage poles in the middle of the most important land in the City
would be a major 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 s comprehensive plan, which emphasizes the importance of preserving
the rural elements of the community and the nature aesthetic of the area through
pedestrian-friendly, livable spaces, scenic views and open spaces. To create its
development in accordance with the City s development goals and objectives
Eagle River and the City entered into a Development Agreement. (Development
Agreement between Eagle River Development and the City of Eagle. Exhibit
107).
In accordance with 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
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
throughout the development that connects with 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 within 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 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 voltage transmission line would be placed adjacent
to their land.
From the City 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
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
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 built?
There certainly will be a significant impact on adjacent 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
prospective 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 is higher
cost, the question them becomes "who should pay fur the additional costs attributable to
the City of Eagle s more stringent aesthetics, the City 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 under different
standards. (Idaho Power Direct Testimony of Greg Said, pg. 11)
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 it needs to determine that the proposed project
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
Will be harmoo.ious with and in accordance with the general objectives or with
any specific objective of the Comprehensive Plan and/or this title;
Will be designed, constructed, operated and rmintained to be harmonious and
appropriate in appearance with the existing or intended character of the general
vicinity and that such use will not change the essential character of the same area;
Will not be hazardous or disturbing to existing or future neighborhood use;
(Exhibit 101)
Given these conditions it is 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 major growth
areas in the state and Idaho Power has right-of-way through the City. The Company has
chosen to solve its load problems by putting a high voltage 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.
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 without
having their views degraded or their property values lowered.
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho~ Case No. IPC-O4-04.
The Company suggests Eagle form a LID and/or increase 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 lines through their City 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
minim , 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-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
position in this case do you think Commission is likely to see other cases similar to
this one?
Yes. Idaho is a state in economic transition. The state is rapidly evolving from a
agriculture 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 s Task Force on
Rural Development stated
, "
The new economy is also resource-based. But this time the
resource is knowledge." (Governor s Task Force On Rural Development, Findings and
Recommendations, http://www.idoc.state.id.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 fmns. It is clear that the
many of the tapidly growing sectors of our economy are "footloose" and can locate
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
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 cities
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 bmying or alrering the route of the power line should fall only on the City
of Eagle the economics 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 growing and economically viable service
territory. 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
Direct Testimony of Don Reading, Ph.
On Behalf of the Oty of Eagle, Idaho, Case No. IPC-O4-04.
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.
Present position
Education
Honors and
awards
Professional
and business
history
Firm experience
AnPendix A
Don C. Reading
Vice President and Consulting Economist
, Econcmics - Utah State University
, Economics University of Oregon
Ph., Economics Utah State University
Omicron Delta Epsilon, NSF Fellowship
Ben Johnson Associates, Inc.
1989 ---- Vice President
1986 ---- Consulting Economist
Idaho Public Utilities Commission:
1981-86 EconomistIDirector of Policy and Administration
Teaching:
1980-
1970-
1968-
Associate Professor, University ofHawaii-Hilo
Associate and Assistant Professor, IdalD State University
Assistant Professor, Middle Tennessee State University
Dr. Reading provides expert testimony concerning economic and regulatory
issues. He has testified on IOOre than 35 occasions before utility regulatory
commissicns in Alaska, California, Colorado, the District of Columbia, Hawaii
Idaho, Nevada, North Dikota, Texas, Utah, Wyoming, and Washington.
Dr. Reading has more than 30 years experience in the field of economics. He has
participated in the development of indi ces reflecting economic trends, GNP
growth rates, foreign exchange markets, the money supply, stock market levels
and inflation. He has analyzed such public policy issues as the minimnm wage
federal spending and taxation, and in1Jort/export balances. Dr. Reading is one of
four economists providing yearly forecasts of statewide personal incorre to the
State of Idaho for purposes of establishing state personal income tax rates.
In the field oftelecommmications, Dr. Reading has provided expert testimony
on the issues of marginal cost, price el~ticity, and measured selVice. Dr.
Reading prepared a state-specific study of the price elasticity of demaro for local
telephone service in Idaho and recently conducted research for, and directed tre
preparation of, a report to the Idaho legislature regarding the status of
telecommunications competition in that state.
Dr. Reading s areas of expertise in the field of electric power include demand
forecasting, long-range planning, price elasticity, marginal and average cost
pricing, pnxluction-simIlation modeling, and econometric trodeling. Ammg his
recent cases was an electric rate design analysis for the Industrial Customers of
Idaho Power. Dr. Reading is currently a consultant to the Idaho Legislature
Committee on Electric Restructuring.
Among Dr. Reading's recent projects are a FERC hydropower relicensing study
(for the Skokomish Indian Tribe) and an analysis of Northern States Power
North Dakota rate design proposals affecting large industrial customers (for l.
Simplot Company). Dr. Reading has also performed amlysis for the Idaho
Governor's Office of the impact on t~ Northwest Power Grid of various plans to
increase salmon runs in the Columbia River Basin.
Dr. Reading has prepared econometric fOrecasts for t~ Southeast Idaho Council
of Govermrents and the Revenue Projection Committee of the Idaho State
Legislature. He has also been a member of several Northwest Power Planning
Council Statistical Advisory Committees and was vice chairman of the
Governor s Economic Research Council in Idaho
While at Idaho State University, Dr. Reading performed detrographic studies
using a cohort/survival mooel and several economic ~act studies using
input/output analysis. He has also provided expert testimony in cases concerning
loss of income resulting from wrongful death, injury, or employment
discriminatioo. He is currmtly a adjunct professor of economics at Boise State
University (Idaho economic history, urban/regional economics and labor
economic.
Dr. Reading has recently co:D1Jleted a public interest water rights transfer case
and is currently involved in litigatioo for the Minidoka Irrigation District.
Publications The Economic Impact of a Restored Salmon Fishery in Idaho, Idaho Fish and
Wildlife Foundation, April, 1999.
The Economic Impact of Steelhead Fiming and the Return of Sahnon Fishing in
Idaho, Idaho Fish and Wildlife Foundation, September, 1997.
Cost Savings from Nuclear Resources Reform: An Econometric Model" (with
E. Ray Canterbery and Ben Johnson) Southern Economic Journal Spring 1996.
A Visitor Analysis for a Birds of Prey Public Attraction, Peregrine Fund, Inc.
November, 1988.
Investigation of a Capitalization Rate for Idaho Hydroelectric Projects, Idaho
State Tax Commission, June, 1988.
Post-PURPA Views " In Proceedings of the NARUC Biennial Regulatory
Conference, 1983.
An Input-Output Analysis of the lIqJact from Proposed Mining in the Challis
Area (with R. Davies). Public Policy Research Center, Idaho State University,
February 1980.
Phosphate and Southeast: A Socio Economic Analysis (with J. Eyre, et al).
Government Research Institute of Idaho State University and the Southeast Idaho
Council of Governments, August 1975.
Estimating General Fund Revenues of the State of Idaho (with S. Ghazanfar and
D. Holley). Center for Business and Economic Research, Boise State University,
June 1975.
A Note on the Distribution of Federal Expenditures: An Interstate Comparison
1933-1939 and 1961-1965." In The American Economist
Vol. xvllI, No.2 (Fall 1974), pp. 125-128.
New Deal Activity and the States, 1933-1939.InJournal of Economic History,
Vol. xxxIll, December 1973 , pp. 792-810.
Case No. IPC-04-
Exhibit 100
City of Eagle
Findings of Fact and Conclusions of Law
October 30, 1995
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CITY OF EAGLE
IN THE MATTER OF
I DARO POWER
AN APPLICATION
FOR A REZONE AND
CONDITIONAL USE PERMIT
FINDINGS OF FACT
AND CONCLUSIONS
0 F LAW
On October 16, 1995, pursuant to public notice and hearingprocedures set forth in Section 67~6509, Idaho State Code, andSection 8-7-3-5, Eagle City Code, Idaho Power the applicant, camebefore the Eagle Planning and Zoning Commission for the Ci ty ofEagle, Idaho, requesting approval of a conditional use permit and
a rezone from CBD Central Business District to M2 Industrial forthe purpose of updating a public utility sub station, and upgradeof a power line from 69kV to 138kV. Susan Gray, Tish Yerrington,Blaine Johnston and Thomas Prang, Idaho Power representativesoutlined this proj ect to the Conunission. The location of theproperty is: Rezone-substation 315 State street, Eagle Idaho andCUP-power lines along north side of state street from Glenwood todowntown Eagle Substation and from the north channel of the BoiseRiver to Edgewood Lane (approximately), Eagle, Idaho.
Based on the application, testimony from the applicant and allinterested parties and, together wi th all documentary evidencesubmi tted concerning the application, the Eagle Planning and ZoningConunission finds the following:
FINDINGS OF FACT AND CONCLUS IONS OF LAW
1 .The records in this matter indicate all notices, andpublications have occurred as required by law. The recordsfurther reflect notice of the public hearing was sent relevant public enti ties, including Central District Heal th,Eagle Sewer District, Eagle Water ' Co., Eagle Fire Dept., ITD,and Ada Highway District.
2 .There was no wri tten or oral public testimony.3. Eagle City Code and Comprehensive Plan as it pertains to thisapplication:
Section 6-6-1 through 6-6-9 UTILITY OPERATION FRANCHISES.read thi s chapter.Please
EXHIBIT 100
CASE NO. IPC-04~04
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6-6-5: RIGHTS OF CITY: The grant of every franchise shall besubj ect to the right of the City, whether reserved or not, to makeall regulations which shall be necessary to secure, in the mostample manner, the safety, welfare and accommodations of the public,including among other things, the right to pass ans enforceordinances to protect the public from danger and inconvenience inthe operation of any work or business authorized by the grant ofthe franchise, and the right to make and enforce all suchregulations as shall be reasonably necessary to secure adequate,sufficient and proper service and accommodations for the people andensure their comfort and convenience.
8-5-1 through 8-5-6 NONCONFORMING USES.Please read this chapter.
8-5-3: Extension or enlargement of nonconforming use: Nonconforminguses are declared by this Title to be incompatible with permitteduses in the districts in which such use is located. Anonconforming use shall not be extended or enlarged after theeffective date hereof by attachment of a building or premises ofadditional signs intended to be seen from off the premises, of bythe addi tion of other uses of a nature which would be generallyprohibited in the district in which such use is located.
8-5-4: Repairs and Maintenance: On any nonconforming structure, ofportion of a structure containing a nonconforming use, work may bedone on ordinary repairs or on repair or replacement of nonbearingwalls, fixtures, wiring or plumbing, provided, that the cubiccontent existing when it became nonconforming shall not increased. Nothing in the Section shall be deemed to prevent thestrengthening or restoring to a safe condi tion of any building orpart thereof declared to be unsafe by any official charged wi protecting the public safety upon order of such official.
OUTLINE OF CONDITIONS THAT MAY BE ATTACHED TO SPECIAL USE PERMIT
A. Uses allowable with conditions and subject to ability ofpoli tical subdivisions to provide services.B. Notice procedures apply (ISC 67-6509)C. Can be tied to ability of political subdivisions to provideservices. Sequence, timing, duration, maintenance; can requiresi te-specific condi tions.
D. May require that studies be conductedE. Transferable from owner but not from parcel.
PRACTICAL POINTERS
The special use permi t procedure allows a zoning ordinance toaddress uses which are conditionally acceptable in the midst of a
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land use zone. The special use procedure allows the application of
special conditions to development of uses which would allow them tointegrate suitably with their surroundings By including thecondi tions which are susceptible to special use approval, a permi applicant is put on notice of what design features should beconsidered and might be applied as conditions.
Some of those considerations might be restrictions on lighting,landscaping requirements, limits on building height or placement,design considerations.
It may be appropriate to require applicants for a special usepermi t to conduct special studies and to provide addi tionalanalysis beyond that normally required of a permit applicant beforea permi t can be favorably considered. Special use permi ts do notcreate binding precedent are very site specific in that certainuses can be integrated suitably into certain sites better thanothers. Accordingly, special use permits are not transferable fromone site to another, but do continue from one owner to another.Special use permits can b implemented to time certain, or wi thin acertain time frame.
EAGLE CITY CODE:
8-7-3-2: GENERAL STANDARDS FOR CONDITIONAL USES: TheCommission/Council shall review the particular facts andcircumstances of each proposed conditional use in terms of thefollowing standards and shall find adequate evidence showing
that such use at the proposed location:
A. Will, in fact, constitute a conditional use as established inSection 8-2-3 of this Ti tIe for the zoning district involped;B. Will be harmonious wi th and in accordance wi th the: generalobjectives or with any specific objective of the Comprehensive Planand/or this Title;
C. Will be designed constructed, operated and maintained to beharmonious and appropriate in appearance with the existing orintended character of the general vicini ty and that such use willnot change the essential character of the same area;D. Will not be hazardous or disturbing to existent or futureneighboring uses;
E. Will be served adequately by essential public facilities andservices such as highways, streets, police and fire protection,drainage structures, refuse disposal, water and sewer an schools;or that the persons or agencies responsible for the establishmentof the proposed use shall be able to provide adequately any suchservices;
F. will not create excessive additional requirements at public costfor public facilities and services and will not b detrimental to
the economic welfare of the community;
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G. Will not involve uses, activities, processes, materials,equipment and conditions of operation that will be detrimental toany persons, property or the general welfare by reason of excessiveproduction of traffic, noise, smoke fumes, glare or odors;H. Will have vehicular approaches to the property which shall be sodesigned as not to create an interference wi th traffic surrounding public thoroughfares; and
I. Will not result in the destruction, loss or damage of a natural,scenic or historic feature of major importance.
8-7-3-3 Public Si tesfollowing:and open spaces:shall conform to the
A. Public UsesB. Natural Features
C. Special Developments
8-7-3-4: Supplementary condi tions and safeguards: In granting andCUP the Council may prescribe appropriate conditions, bonds andsafeguards in conformity wi th this Ti tIe. Violations of suchconditions, bonds or safeguards, when made a part of the termsunder which the CUP is granted, shall be deemed a violation of thisTi tIe.
8-7-3-5: CONDITIONAL USE PERMITS
8-7-3-5-C-2: Upon granting or denying a CUP specify:a. the ordinance and standards used in evaluating theapplication;
b. the reasons for approval or denial; andc. the actions, if any, that the applicant could take toobtain a permi t .
8-7-3-5-D: Conditions of permit: Upon granting of a CUP conditionsmay be attached to said permit including, but not limited to,those:
1. Minimizing adverse impact on other development;2. Controlling the sequence and timing of development;3. Controlling the duration of development;4. Assuring that development is maintained properly;5. Designating the exact location and nature of development;
6. Requiring the provision for on si te or off si te publicfacilities or service; and
7. Requiring more restrictive standards than those generallyrequired in this Ti tIe
8-7-3-5-E: TRANSFER OF PERMIT: A CUP is not transferrable from oneparcel to another. . (D) CUP shall not be considered establishing a binding precedent to grant other CUP.
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ZONING DISTRICTS
8-2-1: Districts established
Residential Districts: to provide regulations anddistricts for various residential neighborhoods. Densi tyin an R District shall be determined according to thenumeral following the R. The number designates themaximum number of dwelling units per acre. Centralizedwater and sewer facilities are required in all districtsexceeding one dwelling unit per acre.
8-2-3: Schedule of District Use Regulations: district regulationsshall be as set forth in the Official Schedule of DistrictRegula tibns and in the performance standards.
8-7-2 Zoning Permits and certificates of occupancy
A. Zoning Permit
1. Application
2. Plan
3. Approval
4. Expiration
5. Occupancy
of permit
EAGLE COMPREHENS IVE PLAN
LAND USE: Residential uses- 1. The residential densities in theCi ty limits shall not exceed the land use designations as reflectedon the Land Use Designation Map, adopted with the 1993 EagleComprehensive Plan on May 11, 1993.
COMMUNITY DESIGN: (#4) Floodways shall be reserved as a naturalstate such as greenbelt, wildlife habitat, open spacerecreational area and for agricul tural uses
COMMUNITY DESIGN: (#7) New residential, commercial, and industrialdevelopment shall be required to meet minimum design standards asspeci fied by City ordinances.
COMMUNITY DESIGN:Comply wi th the Eagle Tree Plan
CONCLUSIONS OF LAW
1. granting of a Rezone and a Conditional Use Permit, wi th therecommended conditions, for the purpose of upgrading an IdahoPower substation 'and upgrading the power lines leading intothat substation will not violate the Idaho State Codes, EagleCi ty Codes or Eagle Comprehensive Plan.
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2. the approval of the application will have no adverse
impact on those property owners in the area;3. the application submitted by Idaho Power for a Condi tionalUse Permit and Rezone serves the welfare and electrical power
needs of the general public and is in the best interest of thepublic.
RECOMMENDAT ION
Based upon the foregoing FINDINGS OF FACTS AND CONCLUSIONS
LAW, the Eagle Planning and Zoning Commission recommends tothe Council the application be approved for a ,zoning of C3,not the requested M2, wi th the following condi tions:
1 .An additional CUP must be applied for, for thesubs ta tion.
No further expansion once they upgrade this location, thenext upgrade needed will require a different location.Addi tional design review and landscape review will benecessary. Addi tional screening against the fence onState Street is required.
To grant the CUP for the lines only.necessary to comply wi th Ti tIe
3 .
4 .Additional CUP
ADOPTED by the Eagle Planning and Zoning Commission
of the City Eagle, Idaho this day of October , 1995.
APPROVED:ATTEST:
Bert Bradley, Chairman
Planning and Zoning Commission Barbara Montgomery, City Clerk
City of Eagle
THE FINDINGS OF FACT AND CONCLUSIONS OF LAW and recommendationregarding the Rezone presented for adopted by the Eagle Planningand Zoning on October 30, 1995, are hereby adopted by the EagleCi ty Council:
DATED THIS 12th day of December , 1995
~:"""'
Attes.
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Steve Guerber, Mayor
City of Eagle 1fff)~ra Mont gC) "
d!t~,of ~agle
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Case No. IPC-04-
Exhibit 101
Eagle, Idaho
City Code
This code was last updated by Ordinance 464 passed January 27 2004.
Case No. IPC-04-
Exhibit 101
page 1 of 2
8- 7 -2: GENERAL STANDARDS FOR CONDITIONAL USES:
The commission/council shall review the particular facts and circumstances of each proposed
conditional use in terms of the following standards and shall fmd adequate evidence showing that
such use at the proposed location:
A. Will, in fact, constitute a conditional use as established in section 8-3 of this title for the
zoning district involved;
B. Will be harmonious with and in acconlance with the general objectives or with any specific
objective of the comprehensive plan and/or this title;
C. Will be designed, constructed, operated and maintained to be harmonious and appropriate in
appearance with the existing or intended character of the general vicinity and that such use will
not change the essential character of the same area;
D. Will not be hazardous or disturbing to existing or future neighboring u~s;
E. Will be served adequately by essential public mcilities and selVices such as highways, streets
police and fire protection, drainage structures, refuse disposal, water and sewer and schools; or
that the persons or agencies responsible for the establishment of the proposed use shall be able to
provide adequately any such services;
F. Will not create excessive additional requirements at public cost for public facilities and
services and will not be detrimental to the economic welfare of the community;
G. Will not involve uses, activities, processes, materials, equipment and conditions of operation
that will be detrimental to any persons, property or the general welfare by reason of excessive
production of traffic, noise, smoke, fumes, glare or odors;
H. Will have vehicular approaches to the property which shall be so designed as not to create an
interference with traffic on surrounding public thoroughfares; and
I. Will not result in the destruction, loss or damage of a natural, scenic or historic feature of
major importance. (Ord. 40, 10-1978, rev. 9-1980)
. EXHIBIT 101
CASE NO. IPC-04-
Case No. IPC-04-
Exhibit 101
page 2 of 2
2A-6: DESIGN REQUIREMENTS , OBJECTIVES AND CONSIDERATIONS:
6. Architectural appurtenance height restrictions:
a. All spires, poles, antennas, steeples, towers, and any other such structures shall be limited to a
maximum of forty feet (40') within the DDA and TDA and thirty five feet (35') in all other
locations. Additional height may be permitted if a conditional use pennit is approved by the city
council.
Populations of Idaho Cities
1990-2000
Case No. IPC-04-
Exhibit 102
Populations of Idaho Cities,Case No. IPC-E-O4-
Exhibit 1021990-2000 page 1 of
Source: US Bureau of the Census, April I , 2000
Release March 2001
Percent
Chng.Chng Chng.
Rank City 4/111990 4/112000 1990-2000 1990-2000
Placerville 328.
Mendlan 596 91Y 323 263.
Eagle 32/ms~7, 7 5~Z33.
VIctor 292 84U 548 187.
:star"""648 , 7~5 14'177.
Kuna ~55 382 421 175.
iKathdrwn UUU 8 H:14U.
!'post ,Falls 34Y 241 89~134.
Crouch 7'j 15./1 IU5.
Spencer II.J I ~lUU.U'7o
Athol 346 67fJ 330 ~5.
MlmGOlCa Ll~~2.)'70
Hayden 888 15~271 87.4%
letoma 132 24'1I5 81.1'70
INampa 5UL 82.
Hauser 38l bb8 2S~
').
Hazelton 3~./I b8/2~3 74.4%
Melba 25~43~IS'14.
I :splnt Lake 7~(j/t 58(14.L'7~
Halley 57~2u(62~73.4'70
Varden CIty 3b~I U b2./1 25~bb.8'7~
.t10 111 ster 144 64.
MIGmeton 12'bU.
fUltJand 4Ul 8U:1 ,4U~)8.)'7~
MoYle :spnngs 41-b)(241 )8.1'7~
EXHIBIT 102
CASE NO. IPC-04-
Case No. IPC-04-
Exhibit 103
Profile of Selected Housing Characteristics, 2000 Census
Case No. IPC-04-
Exhibit 103
page 1 of
June
2002
Profile of Selected Housing Characteristics, 2000
Census
Source:US Census Bureau, Internet Release
Sun Valley 339
...1!!L Tota Houslng Unl ts
Ketchum 947
Hayden Lake
Parkllne
Hailey
Fernan Lake Vlllage
493
141East Hope
Dal ton Gar ens
Hope
Crouc
Garden Clty
Bellevue
McCall
Mountaln Home AFB
Irwln
Moscow
Dover
Bolse Cl ty
Bolse MSA
lctor
798,400
503,300
212,500
200,300
176,800
EXHIBIT 103
CASE NO. IPC-04-
Case No. IPC-04-
Exhibit 104
page 1 of
Pat Summerall, Champions of Industry
Best Managed Cities in America
CD attached
Case No. IPC-04-
Exhibit 105
page 1 of
Memo, Ken Harwood, AIC to
Nancy Merill, Mayor City of Eagle
June 11, 2004
Book attached
Page 1 of
Tracy Osborn
-,,--,,--~,._-".."_._..._.".._"..,"""--""""-~~-~~,---,,,-,,,,,,-~---"--~-- -'----~~'~",-,-
From: Sharon Bergmann (sharon~cityofeagle.org1
Sent: Monday, June 14, 20048:56 AMTo: Steve Guerber; Lynne Sedlacek; Nancy Home; Scott Nordstrom; Stan BastianCc: Tracy Osborn; Sheri Horton
Subject: FW: City Achievement Award
-----
Original Message-----
From: Amy Norton (mailto:anorton(gHdahoCities.org) On Behalf Of Harward, KenSent: Friday, June 11, 2004 8:22 AM
To: Merrill, Nancy
Cc: Bergmann, Sharon
Subject: City Achievement Award
Dear Mayor Nancy Menill:
We are pleased to congratulate you as a 2004 recipient of the City Achievement A ward for creating an Architectural &
Site Design Book and establishing a City Forester/Cod Enforcement Officer Contract Positions in the City of Eagle.
We were impressed with your ingenuity and your innovative way of solving problems/issues within your city. Not only
are these new developments improving your community and increasing communication between Eagle and other cities
but also you are paving the way for other cities to follow suit. We thank you for all your hard work. We encourage the
continuation of new efforts to make Idaho cities great. We hope to have you in attendance along with the person(s)
receiving the award in behalf of your city on Wednesday, June 16 2004 at the Wednesday Night Extravaganza.
We understand not every delegate and award acceptor is registered for the conference. To accommodate those who want
to be present for the award presentation, the option of purchasing a $24 dinner ticket for June 16 is available.
Please contact Amy at AIC at [phone] or email at anorton (g)idahocities.org to inform us who will be accepting
your City Achievement Award. Once again, congratulations on this great achievement!
Sincerel y
Ken Harward
Executi ve Director
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EXHIBIT 105
CASE NO. IPC-04-6/14/2004
ARCHITECTURE & SITE DESIGN BOOK
EAGLE, ID
EXHIBIT 105
SEE CASE FILE
Case No. IPC-04-
Exhibit 106
City of Eagle
The 2000 Comprehensive Plan
Land Use Map
November 9, 1999
SEE CASE FILE
Case No. IPC-04-
Exhibit 107
Development Agreement between
Eagle River Development and
The City of Eagle
January 25, 2000
SEE CASE FILE