20070629Sale of Transmission Easements.pdf

~ ~~;~
~OUNT AIN
(j, \ q
,j l 'J' ,-'
J",' L
201 South Main, Suite 2300
Salt Lake City, Utah 84111
June 28, 2007
, . ":,: j,\
1..1 'i \\"
\\\ .:.,)
VIA EXPRESS MAIL
Idaho Public Utilities Commission
472 W. Washington
Boise, ill 83702-5983
Attn: Jean D. Jewell
Commission Secretary
Re:Sale of Transmission Easements
The purpose of this letter is to provide notice from Rocky Mountain Power (Company) to the
Idaho Public Utilities Commission (Commission) of the planned sale of four transmission
corridor easements in Utah. The underlying property in the proposed transaction is currently
accounted for as a transmission property investment and a portion of that investment has been
allocated to Idaho and included in Idaho rate base.
Woodside Homes
Woodside Homes has requested an easement to be located within the Company s Ben Lomond-
Terminal 345 kV transmission corridor. The proposed easement is necessary for the development
of the Woodside Homes Sunset Farms Equestrian Estates subdivision in Davis County, Utah.
The easement will include a sixty-six foot wide roadway easement as well as a ten foot public
utility easement on each side, for a total of 0.63 acres. Kaysville City has approved the
subdivision plat for the Sunset Farms Equestrian Estates subdivision, pending final approval
from Rocky Mountain Power.
Through a market analysis, CRG Commercial determined the property value to be $117 830 per
acre. As such, the Company has determined the value of the combined roadway and public
utility easement to be $45 776.96 ($39 590.88 + $6 186.08). This represents 70 percent of the
fair market value for the .48 acres of roadway easement ($117 830 x .48 acres = $56 558.40 x .
= $39 590.88) and 35 percent of the fair market value of .15 acres for the public utility easement
($117 830 x .15 acres = $17 674.50 x .70 = $6 186.08). The Company targets 70 percent as the
factor for easement transactions involving a roadway, with lower factors used in extenuating
circumstances or considerations that might impact negotiations between the parties, such as the
particular location of the subject property, the potential future use of the property and its
surrounding area, and the counterparty s ability to obtain an easement through condemnation.
The reduced factor of 35 percent on the public utility easement is based on the perceived limited
development opportunity beyond this particular parcel.
Galena Parkway
Draper City (Draper), Utah, is the owner of a public road known as the Galena Parkway. The
Galena Parkway is part of Draper s master plan, and the road previously terminated at the west
boundary of the Company s Ninetieth South - Camp Williams 345 kV transmission line
corridor. It is Draper s intent to extend the Galena Parkway via an easement through the
Company s transmission corridor in an effort to provide additional access to local businesses.
Roadway drawings were submitted by Draper in April 2006 and have been reviewed and
approved by Rocky Mountain Power, subject to the negotiation of an easement agreement.
Draper commenced construction of the roadway while the parties were finalizing the terms and
conditions of the easement agreement and has since completed construction. Draper
construction of that portion of Galena Parkway that extends through the transmission corridor is
in compliance with the National Electrical Safety Code and the Company s clearance standards
and there are no outstanding issues that would preclude the Company from completing its grant
of the easement to Draper.
The Company relied upon the opinion of a local broker for determining the market value of the
underlying property. The market data :from the broker suggests that the land value is $3.50 per
square foot, or $152 460 per acre, for a total easement price of$79 081 ($152,460 x .741 acres =
$112 972.86 x .7 = $79 081).
Public Trails
Rocky Mountain Power has historically permitted local governments to develop public parks and
trail systems within portions of the Ninetieth South - Camp Williams transmission corridor
(Corridor), provided the use will not interfere with the Corridor s current and/or future use.
Public trails have minimal impact; in most cases, the corridor stays the same with the exception
of a walking path constructed of asphalt or gravel. Rather than base the value of an easement of
this type on property value, the Company has charged an administrative fee of $1 500 per acre as
the fair and reasonable compensation to cover the Company s administrative expenses.
Draper has requested an easement to allow it to complete a portion of its public trail system that
will be located within the Corridor. The proposed trail begins on the south side of 12950 South
(Golden Harvest Road) at structure No. 55 and ends at structure No. 60 at approximately 13400
South. The proposed trail is 20 feet in width and runs along the eastern boundary of the
Corridor. The transaction amount of this easement as determined by the Company is $2 085
($1 500 x 1.39 acres = $2 085).
In December 2003 , the Company granted Taylorsville City (Taylorsville), Utah, a public
recreation easement that allowed for the construction of a public trail system and a trail head
parking lot located at 4800 South 900 West in Taylorsville. The public trail runs south along the
eastern boundary of the Corridor, crosses over the Jordan River, and then connects with the
Jordan River Parkway trail system. Taylorsville is now seeking approval from the Company to
amend the public recreation easement to allow for the continued construction of a pathway that is
intended to connect with the existing trail system within several new subdivisions that have been
built along the western side of the Corridor. The transaction amount of this easement as
determined by the Company is $99 ($1 500 x 0.066 acres = $99).
Sidewalk and Lighting
West Valley City (West Valley), Utah, is in the process of improving portions of its 3500 South
public roadway. As part of the improvement process, West Valley City submitted a request for
an easement necessary for the construction of a new public sidewalk and lighting over and across
a portion of the Company s Terminal- Ninetieth South transmission corridor. West Valley has
also requested a temporary construction easement adjacent to the public sidewalk and lighting
easement.
Rather than base the value of an easement of this type on property value, the Company has
charged an administrative fee of $1 500 per acre as the fair and reasonable compensation to
cover the Company s administrative expenses. The transaction amount of this easement as
determined by the Company is $78 ($1 500 x 0.052 acres = $78). The public has treated this
area of the transmission corridor as a public sidewalk for over 20 years, and the installation of
sidewalk and lighting will greatly improve the safety of the individuals crossing over this portion
of the transmission corridor. The proposed improvements will enhance the value of the property.
Regulatory Impacts
The proposed sale transactions will not adversely affect the Company s customers because the
transactions recover a portion of the value of the property in question and Rocky Mountain
Power will retain ownership of the property and safe access to its transmission lines. The
respective improvements will not interfere with the Company s use of the transmission corridors
and in each case Company access to the corridor is actually improved. The requested easements
are consistent with others that have been approved by the Company. If the parties are unable to
consummate these transactions, the respective local municipality has the option to pursue
acquisition of this easement through eminent domain.
The Company will meet all requirements regarding these transactions required by other public
utility commissions having jurisdiction over the Company s retail operations. A copy of filings
made with other commissions will be provided to the Commission if requested.
It is respectfully requested that all formal correspondence and staff requests regarding this matter
be addressed to one or more of the following:
By E-mail (preferred):datareq uest(illp acifi corp. com
By fax:[phone]
By regular mail:Data Request Response Center
PacifiCorp
825 NE Multnomah, Suite 2000
Portland, OR 97232
Informal inquiries may be directed to:
Brian Dickman
Manager, Regulation
201 South Main, Suite 2300
Salt Lake City, UT 84111
Telephone: [phone]
Facsimile: [phone]
E-mail: Brian.Dickman~PacifiCorp.com
Justin Lee Brown
Senior Counsel
201 South Main, Suite 2300
Salt Lake City, UT 84111
Telephone: [phone]
Facsimile: [phone]
E-mail: Justin.Brown~PacifiCorp.com