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Council annexes Blue Stem Trail property, votes to notify electric co-op despite Clay Union opposition
Summary
The Vermilion City Council approved annexation of roughly 11.8 acres for the Blue Stem Trail development and voted to notify Clay Union Electric of the city’s intent to provide electric service, despite a written objection from Clay Union’s general manager urging the cooperative to retain service rights.
The Vermilion City Council voted March 2 to annex about 11.81 acres known in the record as the Blue Stem Trail Edition into city limits and to notify Clay Union Electric Corporation of the city’s intent to provide electricity to the area.
City staff described the parcel as currently farmed land in a rural residential zone that would be rezoned to allow future residential lots served by city utilities. Jose told the council the owner has petitioned for annexation and that administration recommends approving the annexation and related notices required by state statute.
During the agenda item, Jose read an email from Chris Larson, general manager of Clay Union Electric, in which Larson said the cooperative’s board opposes transferring electric-service rights to the city and offered to continue servicing the development if the council so chose. The email said allowing Clay Union to serve would save the city the cost of installing infrastructure and return a municipal share of revenue to the city and school district.
“[T]he board of directors opposition to the transfer of the electric service rights from Clay Union Electric to the city of Vermilion,” Jose read on behalf of the cooperative, quoting Larson.
Councilor Cheeseman moved to approve the annexation resolution; Councilor Mura seconded and the motion carried by voice vote. Council later approved the accompanying resolution to notify Clay Union Electric of the city’s intent to serve and to proceed under state law on offers to purchase distribution facilities; the notice is required within one year of annexation under SDCL 10-36-10.
The city record notes administration’s intent to work with Clay Union to identify distribution property within the annex area and that compensation for any facilities would follow state statute. Jose said the city historically elects to serve newly annexed areas and that the annexation does not reduce property-tax revenue to the school district or county unless customers and kilowatt-hour usage shift.
Next steps: the annexation and the notice to the cooperative are approved and the city will coordinate with Clay Union on identifying affected facilities and pricing under state law.
Votes at a glance: annexation — motion carried (mover: Cheeseman; second: Mura). Notice of intent to serve — motion carried (mover: Mura; second: Hellwig).
