If you go

What: Boulder City Council second reading and public hearing on municipalization

When: 6 p.m. Aug. 6

Where: Boulder Municipal Building, 1777 Broadway

More info: bouldercolorado.gov

Boulder took a major step toward forming a city utility Wednesday night when the City Council voted 6-3 that the utility meets the charter requirements and that the city should begin negotiations to acquire Xcel Energy's distribution system.

Those negotiations appear likely to end with the city filing for condemnation, but that won't happen until January at the earliest.

Boulder Mayor Matt Appelbaum and council members Tim Plass, Lisa Morzel, Macon Cowles, Suzanne Jones and K.C. Becker voted yes. Council members Suzy Ageton, George Karakehian and Ken Wilson voted no.

The vote is an initial vote on first reading, and a second reading and public hearing on the issues are set for Aug. 6.

Cowles, in his motion supporting the acquisition ordinance, said the city has a unique opportunity to create a new type of utility that provides most of its power from renewable sources while offering lower rates and promoting the city's economic vitality.

"This is an opportunity that comes along once every 20 years," Cowles said.


Wilson, who has raised persistent questions about the validity of the city's analysis, proposed a substitute ordinance that the city delay voting on an acquisition ordinance for six months to work more with Xcel Energy on alternatives to meet the city's energy goals while staying with Xcel.

Those alternatives, developed through a joint task force with the city, include new products and services like allowing customers to pay more to cover the extra cost of replacing coal generation with cleaner natural gas and allowing entire communities to opt into tiered rates that encourage conservation.

"I think we should take some time to really negotiate with Xcel about what these options could be," Wilson said. "My goal has always been to see change on the state level, and I think this is the way to do this."

Appelbaum said delaying the acquisition ordinance would hurt the city's negotiating position as it pursues condemnation and that Xcel would be more likely to negotiate seriously if Boulder continues to pursue the creation of a municipal utility.

Morzel compared continuing to work with Xcel to a couple in a "failed marriage" thinking they'll work on the relationship for six more months after years of counseling that failed to bridge their differences.

After a study session Tuesday, a majority of council members said they wanted a "parallel track" in which the city moves forward with plans for a municipal utility while also analyzing the proposals from Xcel. Several council members strongly criticized Xcel Energy for not bringing its proposals forward in a more timely manner and for not considering partnership models that would give the city more control over its energy supply.

At that study session, city staff members and an independent evaluator told the City Council that a utility could meet the charter requirements that rates do not exceed those charged by Xcel Energy at the time Boulder acquires the system; that the rates produce enough revenue to pay operating expenses and debt payments, along with a reserve worth 25 percent of debt payments; that the system's reliability be comparable to Xcel's; and that the city have a plan to reduce greenhouse gas emissions and increase renewable energy.

However, the evaluator has not finished a complete report on the city's analysis, and that report may not be finished before the Aug. 6 meeting.

"We got a 16-page Power Point and answers to questions, yet his evaluation is critical to what we're deciding here," Ageton said. "I'm troubled by that."

City Manager Jane Brautigam said she would ask the evaluator to expedite the report.

Senior Assistant City Attorney Kathy Haddock said the acquisition ordinance authorizes the City Attorney's Office to pursue condemnation, but the process would start with negotiations and an attempt to buy Xcel's distribution system without going to court.

Haddock said Xcel Energy has said it is not interested in negotiations to sell its system, but the city is required by law to attempt to arrive at an agreement before filing for condemnation.

During the discovery process, the city expects to get more information about Xcel's property in Boulder, including maintenance records and the company's own appraisal.