City of Shakopee vs. SPUC: The path forward

As we’ve all probably heard by now, the Shakopee Public Utilities Commission voted earlier this week to waive the $211,000 water connection fee that threatened to thwart the donated splash pad project at Lions Park, but the waiver won’t be the last we hear about SPUC.

In June, the Shakopee City Council directed city staff to look into the process of bringing the utilities back under the jurisdiction of the city, which would essentially eradicate SPUC and put the city council in charge of utilities. At the council’s Tuesday night meeting, folks heard some answers about the path forward, though that path appears to be … potentially muddy.

According to a memo drafted by the city’s attorney, Jim Thomson of Kennedy & Graven, there are a couple of options under state statute, but all of those options ultimately require voter approval via referendum (which costs money). Just like a school district bond referendum, the vote can take place at the general election or by special election.

Here is a snippet of Thomson’s memo, for those who don’t care to read the entire three pages linked in the previous paragraph. Highlights added by me:

Basically, a petition could force a vote to abolish or transfer the utility. The only question the city council can independently decide to put on the ballot is whether to abolish SPUC.

To trigger a referendum to transfer the utilities to city control, a total of 2,220 Shakopee residents would have to sign a petition, the contents and format of which are dictated by state statute.

After Tuesday’s council meeting, I spoke briefly with Thomson, who clarified that abolishing SPUC would have a similar outcome to transferring it. If voters approve abolishing the commission, the city council would have to decide what to do with the utilities, at which time it could vote to control them going forward.

Keep in mind, there are two utilities in question — water and electric. Council could take them both or opt to just take water and let the free market provide electricity (though I’m unclear how the latter would have to play out).

For now, the council is going to attempt to get some answers out of SPUC in response to the letter City Administrator Bill Reynolds (backed by the city council) sent on June 7. (You can read about that here, if you need to play some catch up).

SPUC decided at its July 1 meeting not to respond to Reynolds’s letter, but Tuesday the council voted to attend the next SPUC meeting July 15 in an attempt to get answers.

There’s been a lot of chatter on social media about abolishing or transferring SPUC back under the city’s jurisdiction. What do you think should be the path forward?

To read Thomson’s 3-page memo (linked also in the story), click here.

To read the June 7 letter from Reynolds to SPUC (linked in the story), click here.

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1 Comment

  1. SPUC has millions of dollars in reserved for future expansion. Why would we risk another allowing another Rod Thompson like administrator to blow thru these funds? Despite what conspiracy theorist would like to believe SPUC is not ripping us off. SPUC is making new business pay for the water usage and future development rather than the citizens.

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