(KLZA)-- The Falls City Council is scheduled to take action on a third and final reading of an ordinance to authorize and provide for the issuance of combined utility revenue bonds, in an amount not to exceed $20 million when they meet Monday evening.

The ordinance to approve sale of those bonds is seen as a key piece necessary to help bring a secondary electrical transmission line to the community to provide additional electricity to the community.

The current lack of electrical capacity hinders the communities ability to grow and puts electrical service reliability at risk.

The City Council has passed the ordinance on the first two readings, but a number of questions were brought up.

A fact sheet has been prepared by City Administrator Anthony Nussbaum regarding the ordinance and the Energy Forward: Falls City Transmission Project.

With the current transmission line nearing peak capacity, the city is limited in its ability to deliver needed electricity for base load growth of current customers and restricts opportunities to attract new developments.

In the report, it is pointed out that additional electrical capacity is not just for the Mid-American Rail Campus project. The need for additional electrical capacity was identified as far back as 2009.

Falls City has secured a $15 million grant from the state that requires a one-to-one cash match. The matching funds will not come from local tax dollars.
It is possible that an increase in utility rates will be required. Rate studies and the pursuit of additional revenue sources have a goal of keeping rates competitive and manageable. The bonds would be paid off over a 20-year period.

If the ordinance fails to pass, Falls City would lose the $15 million state grant and the electrical service constraints, limited growth potential and electrical system failures are issues Falls City Utility customers would continue to face in the future.

Without the bond funds, the city would not be able to provide the required one-to-one cash match to access the grant funds.

Transmission upgrades will be required in the future regardless. By declining the grant, it would mean the full cost of the future upgrades would be paid solely by Falls City Utility customers.

The total cost of the needed improvements is estimated to be $30 - $40 million depending on final design and engineering. Being able to access the grant funding from the state, approved by the Nebraska Legislature, would cut that cost by $15 million.

Approval of the ordinance on final reading Monday night will secure the funding necessary to proceed. If it were to fail, the upgrades will have to wait and be paid for by local rate payers.