Council takes steps to have one gas franchise

Patrick Fisher, Staff Writer

The New Prague City Council came to the consensus at its Monday meeting that it would prefer one gas franchise in the city.

The city viewed a presentation from Greater Minnesota Gas in March during which the company requested a non-exclusive franchise agreement. The city currently has a non-exclusive franchise agreement with CenterPoint Energy Minnegasco. Greater Minnesota has gas lines in a portion of the city that had recently been annexed.

State statutes require that a natural gas utility must have a franchise to operate or maintain a pipeline within the boundaries of a city.

The council discussed the item with attorney Bob Vose of the city's law firm, Kennedy & Graven. Vose said, in his view, Greater Minnesota Gas was not entitled to a franchise, although there were different possibilities the city could explore. They included granting a franchise for Greater Minnesota Gas to keep serving only the customers it already has, or the company could be granted a portion of the city where its has existing gas lines.

Vose said city staff had expressed concern about having to deal with two companies and having two sets of gas lines underneath city streets.

Councilmember Kay Wilcox asked, if they granted Greater Minnesota Gas a franchise to keep serving its customers, would CenterPoint Energy Minnegasco have to leapfrog over that area.

Vose said if both companies had a franchise, one would have to build a line past the area being served by the other. It would raise various issues, including safety.

Wilcox asked if the city could have an ordinance stating that any developer annexed into the city would have to be served by CenterPoint Energy Minnegasco.

Vose hadn't seen that type of ordinance, but it was possible. He pointed out that a franchise is both an ordinance and a contract. Like a contract, it would have to have a term of usage.

Mayor W.A. Bink Bender didn't think the idea of having two franchises in a city the size of New Prague was something they should follow.

Councilmember Jim Kratochvil felt that from a safety point of view, one gas company was enough.

The council instructed New Prague City Administrator Jerry Bohnsack to check if Greater Minnesota Gas had any customers within the city limits. He should also prepare a resolution or letter the city would have just one gas franchise.

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