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County-owned Old Galley dam lease transferring; new lessee expected to assume power generation lease
Summary
Staff reported that the county owns the Old Galley dam and that a Minnesota company labeled “06” is expected to take over the lease from O'Galley Hydro; staff are updating the lease with county counsel.
Staff reported that the county owns the Old Galley dam (impounding Lake O'Galley) and that O'Galley Hydro had been leasing the facility since about 2012 to produce hydroelectric power. The lessee has had intermittent production and turbine problems.
A Minnesota company referred to in the transcript as “06” is expected to take over the lease; staff are working with county corp counsel (Jim) to revise the lease. The lease structure ties payment to energy production with a minimum annual payment of $5,000 and a maximum of $7,500, and recent annual receipts have averaged near $7,000.
Why it matters: The county owns the structure and receives lease revenue; changes in lessee and intermittent generation affect annual revenue and operations at a county‑owned facility.
Staff noted the dam is classified as a low‑hazard dam (breach would not cause life‑loss downstream but could take out roads). They also noted other local hydro generation: Cedar Falls and Menomonie facilities generate power for Excel, while Old Galley is the only county‑owned generating dam.
Ending: Staff will proceed with lease updates in coordination with corp counsel and monitor generation and revenue during the transition.
