By Dave Thompson
Bismarck, ND – The Bismarck City Commission has decided that Montana-Dakota Utilities will be able to serve a newly annexed subdivision.
MDU and Capital Electric Co-Operative were competing to serve the new Boulder Ridge subdivision, which is just north of Bismarck. When the city negotiated a service area agreement with M-D-U and Capital, it said MDU is the main franchise holder -- but Capital could continue to serve customers in the annexed areas. The new subdivision has no customers -- and MDU argued that, since it holds the main franchise, it gets first dibs. Capital argued that it was already serving areas surrounding Boulder Ridge -- and should be allowed to serve that area.
Bismarck Mayor John Warford says the service area agreement called for both utilities to negotiate over which would serve that area. But he says they couldn't come to an agreement -- so the City Commission had to step in.
"There's plenty of business out there," said Warford. "But it just was not happening, and the issue was forced upon the City Commission to make that decision."
The Commission awarded the area to MDU on a four to one vote.
"This is a significant victory for investor-owned utilities in the state," said MDU spokesman Dan Sharp. "We do believe we have the right to serve customers as the city expands."
"What we find disappointing is that we've acted this way for 32 years, doing the same thing consistently with the city," said Capital general manager Lars Nygren. "Functionally, we've done nothing different at Boulder Ridge than we have in any of the other subdivisions. Yet today they found that the franchise rights belong to M-D-U. So we don't understand what changed in their finding."
The Commission made clear that this only affects the named subdivision. Warford says he hopes that the two will be able to work out agreements without city government being involved.
"I'm hoping that -- by the Commission's decision on Boulder Ridge -- that we're sending a message back to the original intent -- and that is that we have two very good companies that provide wonderful electric and consistent service to our community. And when we have further annexations into the community, let's go back to the original agreement, and let's have the companies decide, so they don't have to have government decide for the companies."
Sharp says he expects his utility to be able to serve even more annexed areas. Meanwhile, Capital says it will now further study what the Commission did -- and will determine what its next step will be.