Joe Heggendefer, director of Independence Power & Light (IPL), presented the utility’s FY2025–26 proposed budget and a multi‑year capital program focused on reliability and economic development.

Key capital items: Heggendefer highlighted several major CIP items: roughly $1 million for a substation to improve dual‑feed reliability in the Country Meadows/Cliffs area; $3 million to construct substations and $2 million for distribution feeders to serve the Eastgate Commerce Center; $2 million allocated to demolish the Blue Valley power plant chimney and associated structures (bids have come in higher than initial estimates); and $8.5 million earmarked for replacement of 400 MVA substation transformers that are past expected lifespans.

Funding, reserves and rates: The IPL presentation showed total FY2026 expenditures higher than projected revenues; Heggendefer said the utility will draw on its enterprise reserves (PUAB reported roughly $80 million at the last commission meeting) to fund near‑term capital requirements, and that the utility intends to operate prudently and present any future rate adjustments to council following standard procedures. He noted that some budget increases reflect the customer‑service function moving into IPL this year (about $5 million of the budget change) and that a large share of the increase is capital work.

Demolition and costs: Heggendefer said the Blue Valley chimney demo is complex and may require more than the $2 million currently budgeted depending on bids and possible asbestos abatement; the city previously spent millions on other environmental remediation work and IPL said costs for large infrastructure removals can be significant.

Reliability rationale: Heggendefer and council members discussed how strategic replacement of aging transformers and substation upgrades will reduce the risk of longer and more disruptive outages; he explained lead times for new transformers can be multiple years, so planned replacement is necessary to avoid emergency failures.

Ending: IPL will present more detailed financial modeling and a multi‑year CIP at future meetings; the FY2026 proposed capital plan was presented for consideration as part of the overall city budget adoption process and no formal action was taken in the study session.