Anoka will spend nearly $1.2 million to buy two new electric transformers to serve the city utility’s customers.
The city council unanimously approved the bid from MC Sales (SPX Waukesha) to pay $595,575 for each of the two transformers.
According to Utility Director Dan Voss, the city’s electric department is installing a new 115 kv transformer at the Enterprise Park substation and constructing a new substation at Fifth Avenue and Garfield Street as part of the Great River Energy 115 kv transmission line.
“It’s interesting that these bids came in very, very competitive,” said Voss. “If you look at the difference between the low bid and the second lowest bid it’s only $1,500 to $2,000.”
The upgrades will improve the city utility’s ability to handle more energy transmission.
The purchase will be funded from the city’s electric utility.
Voss said the transformers will be delivered in June, in time for Great River Energy’s completion of the transmission line in July.
Dr. Ed Evans, a member of Anoka’s Utility Advisory Board, raised concerns about the city purchasing a transformer to put on a piece of land it doesn’t yet own.
“I think that it’s a little improper putting out a bid for a transformer for a substation you don’t even have the land for yet,” Evans said. “I don’t understand why you would go and spend $600,000 or $700,000 ahead of time.”
The city has been negotiating with the state on a piece of property at Fifth Avenue and Garfield Street, which the state recently declared surplus.
They are in the middle of a four-week waiting period, which started Nov. 20 where other state agencies can weigh in if they are interested in the property, said City Manager Tim Cruikshank.
“I think the assumption is that we need that substation,” said Mayor Phil Rice. “Where we put it is negotiable. The plan is a location we currently do not own the property for.”
Along with the substation, the city also hopes to relocate its public works and electric utility operations to this site, to free up land for development near the Northstar Rail Station, where public works and electric are currently based.
“I would be surprised if we don’t have a purchase agreement to the council by February or March at the latest,” Cruikshank said.
This piece of property has been appraised at $563,000 by the city, according to Economic Development Manager Erik Thorvig.
The city is waiting on an appraisal from the state to determine the minimum asking price, he said.
If no other state agency shows interest in the land, another four-week period begins when the land is made available to all local government entities. This is when the city would express an interest in purchasing the land, according to Thorvig.
According to Evans, the new substation should be located off County Road 116 (Bunker Lake Boulevard), not on the land now owned by the state, to save money.
The construction of a new public works and electric utility facility is in the city’s capital improvement plan for 2019.
“Those are just plans,” Cruikshank told the council when it approved the purchase of the transformers last month. “Moving that (facility) fits in with the strategy to maximize the development at our rail station.”
Councilmember Steve Schmidt supported the purchase of both transformers at this time.
“I think it’s very prudent to buy both at the same time, even if one sits in the yard for a year because we don’t have the exact site we want,” Schmidt said.
Mandy Moran Froemming is at [email protected]