At Tuesday night’s Board of Water, Electric and Communications Trustees meeting, the Board
approved the Utility’s 2022 Operating Budget. Several ongoing projects are reflected in the
budget, including MPW’s Powering the Future initiative, expansion of the communication
services footprint and significant community improvement projects being completed in
coordination with the City of Muscatine.

“Muscatine is embarking on a period of progress,” shared General Manager Gage Huston.
“Investments in utility infrastructure will secure Muscatine’s future growth and prosperity. These
types of capital investments create an atmosphere that will attract business and industry while
providing world-class utility services to residents for decades to come.”

Highlights from the approved budget include funding the completion of a new 161 kV
transmission line, support for the City’s Grandview Avenue Corridor Improvement project, the
expansion of fiber services to outlying neighborhoods, development of a new customer
information system and early expenditures to support MPW’s Powering the Future initiative.

Ryan Streck, director of utility service delivery, provided an update on the Utility’s Line 106
project. MPW partnered with Central Iowa Power Cooperative to jointly develop the
transmission line. The new asset is an important addition to MPW’s electric system, adding
transmission redundancy and maintaining reliability as the Utility transitions its generation fleet
and adds more renewables to its portfolio.

“Maintaining MPW’s award-winning reliability despite continued changes in how power is generated and transmitted across the grid is no accident,” shared Streck. “MPW’s ongoing efforts to be in step with industry advancements is our commitment to the Muscatine community. Line 106 is critical to our ability to be nimble in an ever-changing industry.”

The Trustees were provided an update on the Water Utility’s well capacity after a maximum flow test was conducted earlier in the month. This type of flow testing is a new process this year, and the results give Utility leadership additional assurance that customer demand will be met with ample margin.

In January, Water Utility staff saw a sharp increase in water demand from a large industrial customer. After confirming the high water usage would continue, MPW staff re-evaluated pumping capacity. MPW’s well capacity planning includes efforts to maintain an adequate margin of reserve capacity. The margin is calculated by assuming three wells could be out of service at any given time. This worst-case scenario allows for routine and emergency repairs while still providing full water service to all customers.

“The testing of well capacity is another example of how MPW is active in its efforts to meet and exceed customer demand,” shared Streck. “We feel more comfortable now knowing we can accommodate increased industrial processes, allowing for our business and industrial customers’ production to continue without curtailment.”

The Trustees were apprised of an MPW application for grant funding to complete an additional expansion of the fiber network. The State of Iowa issued a Notice of Funding Availability #7 (“NOFA #7”) of $200M for continued expansion of broadband to unserved/underserved areas of the state. This NOFA allows for funding up to 60% of project costs.

The Utility’s communications team considered five areas adjacent to MPW’s existing system but chose just one area for possible expansion. The chosen area is northwest of MPW’s current service territory (outlined in red in picture below).

The cost to serve this rural area is still quite high, even with the requested 60% funding from the State. MPW has had informal discussions with Muscatine County and is hopeful that some level of support from the County can also be accomplished. MPW staff will continue to work with the County in the coming weeks to make a formal request.

Utility staff has been monitoring other possible funding opportunities provided in the federal government’s infrastructure bill. The $1.2 trillion Infrastructure Investment and Jobs Act allocates funding for a variety of infrastructure categories that could apply to future MPW projects. The details and funding mechanisms are yet to be determined.

Lastly, the Board learned the negotiations with Crown Media and NBC Universal (“NBCU”) have concluded with the renewal of both programming contracts. Channels included in the agreement:

  • Crown Media – Hallmark Channel, Hallmark Movies and Mysteries
  • NBCU – Bravo, CNBC, E!, Golf Channel, MSNBC, NBC Sports Net (will be discontinued), NBC Universo, Oxygen, SyFy, Telemundo, Universal Kids, USA

Both contracts were in line with budget projections. NBCU came in at budgeted amounts because NBC Sports Network is being discontinued, with content moving to USA Network, NBC-6 and Peacock.

Following the monthly Powering the Future update to the Board, Angie Johnson, former Trinity Muscatine executive director, shared her perspective on the initiative. “The necessity of reliable power to health care and emergency management organizations cannot be overstated,” shared Johnson. “The loss of power could cause harm, even death to patients in the hospital or relying on health care equipment at home. I am confident in the leadership at MPW and trust their expertise in navigating our community through the power generation transition. From all I have learned about MPW’s balanced approach, I know the Muscatine community is in good hands.”

Mark Roberts, director of finance and administrative services, reported on MPW’s October financial results. For the month, MPW Net Income was $647K, which was $1,153K above the budgeted loss. According to Roberts, “despite outages at MPW’s Unit 9 power plant for a third of the month, strong wholesale markets supported better-than-planned margins on sales from MPW’s power plants.” In addition, retail electricity sales were strong due to warm temperatures in the first half of October. For the Electric, Water and Communications utilities, Net Incomes were $410K, $56K and $181K, respectively.

In other Board business:

  • Appointed Trustee Susan Eversmeyer to the MAGIC Board effective January 2022 for a two-year term.
  • Approved payment for the October 2021 expenditures and transactions.