Council approves $19.8 million bond authorization for utility generators, MMU to issue debt

The City Council voted to authorize Marshall Municipal Utilities to proceed with issuing public utility revenue bonds in the proposed aggregate amount of $19,765,000 to purchase four diesel-fired distribution generators and to reimburse previously paid water-main improvements related to the College Drive project. Director of Administrative Services EJ Moberg said the resolution approves selection of Baker Tilly as municipal advisor and Kutak Rock as bond counsel and authorizes MMU to complete the final issuance. MMU General Manager Dave Schelkopf told the council the four generator sets would be roughly 3 megawatts each, for about 11 to 12 megawatts of dispatchable capacity. Schelkopf said the existing combustion turbine generator provides about 14 to 15 megawatts but is roughly 56 years old and approaching the end of typical service life. He said the new generators will serve as emergency backup for the community. Schelkopf and Moberg said financing is supported by a reserve-capacity agreement with the city’s power supplier, Missouri River Energy Services, which will pay MMU monthly for reserve capacity; those payments are expected to cover debt service and maintenance and therefore have no effect on retail electric rates. Council members asked about the scale of the backup capacity. Schelkopf said Marshall’s summer peak is about 81 megawatts, roughly 20 megawatts of which is residential; a 12-megawatt resource would sustain power to about half the city’s residential load at a time under emergency rotation plans. The city also expects 10 megawatts from a contracted solar farm plus 5 megawatts of battery storage during daylight hours. Craig moved approval of the resolution; John seconded. The council closed the vote and the motion passed. MMU will proceed toward final bond issuance.