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| DATE:
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8/19/2014 7:00:00 PM |
| SUBJECT: |
| Council Consideration of A Resolution Concerning the Financing of Improvements For the Gillette Electrical System; Approving a Lease, an Amended and Restated Generation Dispatch and Energy Management Agreement, an Economy Energy Power Purchase Agreement, a Gas Transportation Agreement, and Related Documents and Transactions; and Appointing the Lessee Representative Pursuant to the Terms of the Lease. |
| BACKGROUND: |
A Resolution has been prepared to approve all the various agreements to acquire the CT-II unit from Black Hills through the Consolidated Wyoming Municipalities Electric Power System Joint Powers Board (the “Board”). Gillette has requested that the Board finance the acquisition of a simple-cycle gas turbine peaking facility (the “CT II Facility” or “Facility”) from Black Hills Wyoming, LLC (“BHW”), and working capital. The Board was created for the purpose of jointly expanding, financing or operating electrical systems owned by its member municipalities prior to March 1, 1975. The Board has issued lease revenue bonds in the amount of $21,935,000 to purchase the CT-II and an additional $2,535,000 for working capital.
The Resolution approves and provides direction for the City of Gillette to enter into the Lease and Agreement dated as of August 26, 2014 (the “Lease”), wherein Gillette, as sublessee, will sublease the Facility Land from the Board, and Gillette will further lease from the Board the CT II Facility. In addition, by passing the Resolution, the City approves agreements with Black Hills Wyoming including the Amended and Restated Generation Dispatch and Energy Management Agreement, the Economy Energy Power Purchase Agreement and the Gas Transportation Agreement. The Resolution specifically authorizes the execution of all those agreements. |
| SUGGESTED MOTION: |
| I move for the Approval of a Resolution Concerning the Financing of Improvements For the Gillette Electrical System; Approving a Lease, an Amended and Restated Generation Dispatch and Energy Management Agreement, an Economy Energy Power Purchase Agreement, a Gas Transportation Agreement, and Related Documents and Transactions; and Appointing the Lessee Representative Pursuant to the Terms of the Lease. |
| STAFF REFERENCE: |
| Charlie Anderson, City Attorney |
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