City of Red Wing kisses Xcel Energy butt… to raise your electric bills

The City of Red Wing, Minnesota, contains various harmful facilities owned by Xcel Energy (Northern States Power Company of Minnesota).

These include two nuclear power reactors, two garbage burner units, and an nuclear waste cask parking lot.

Of course it’s no secret that utilities tend to accumulate great political, economic, and psychological power in the places they operate.  A place like Red Wing, where Xcel pays a lot of taxes and employs many residents, can become, and has become, a caricature of a self-governing community.  I’m not sure the Minnesota Legislature is a lot better.

Utilities are facing a world of change, of technological obsolesence, a world of existential threats, which are making them ever more aggressive and unscrupulous.  How, with electricity getting cheaper at the wholesale level, can they keep screwing their customers with rate increases?

Roughly speaking, Xcel not only owns innumerable local officials, but seems to own basically all of the Republicans in the Legislature and at least half of the Democrats, not to mention most of Minnesota’s mainstream reporters and NGOs.   Xcel’s chokehold on Minnesota is impressive in a horrible sort of way.

Xcel is pushing a pair of nuclear subsidy bills that would give it a whole new channel to reach into ratepayers’ pockets with little regulatory review.  I wrote about them here:

How bad are these bills? Well, at a Senate committee hearing , only Xcel and an IBEW guy spoke in favor. Opposed were the Minnesota Chamber of Commerce, Xcel Large Industrial Customers group, Sierra Club, Environment Minnesota, Citizens Utility Board, Minnesota Department of Commerce, and TakeAction Minnesota (NE). (And lots more were ready to testify but testimony was arbitrarily cut off after 20 minutes.) Hearing minutes here:

Basically, no informed person, not an Xcel stooge, with the public interest in mind, would support these bills.

John Marty, former Senate Energy Committee Chair, spoke eloquently against the bill.  All the Republicans voted for it, plus half the DFLers, these two: Sen. Erik Simonson (represents Duluth) and Se. John A. Hoffman (represents a Coon Rapids district).  Hoffman boasted of his support for the nuclear ripoff in his constituent email newsletter.  Sen Mike Goggin, an Xcel employee, recused himself from *voting* but not from discussion.

Xcel, of course, has a whole portfolio of legislative, regulatory, legal, and other scams in the pipeline.  Few if any of these are reported on in meaningful ways so most people have no idea….

But lets go back to Red Wing, where the City Council, on the guidance of staff, is set to endorse the nuclear ripoff bills on April 23th.  Here’s the Council packet item.  There are no names on it but it was written by top Red Wing bean counter Marshall Hallock.  Note how the ripoff bills are given meaningless labels:  “Providing an Additional Regulatory Option by Which the Public Utilities Commission May Consider Investments Made at the Prairie Island Nuclear Generating Plant.”  This is NOT the actual caption of the bills (in packet).

Do Red Wing officials reading this bumf know that Xcel already has more than adequate means to soak ratepayers for any nuclear investments, and that the only likely effect would be to increase their constituents’ electric bills?  It’s hard to say.  None of the seven City Council members nor the Mayor show observable independence of mind, at least with regard to Xcel.  It’s clear from the staff memo that there was no due diligence; no attempt to consider other points of view.  And they are rolling out this butt-kissing, anti-constituent move although they know Xcel is running other scams aimed at reducing the taxes Xcel pays to the City.

Another amusing item is called “Alignment with Strategic Plan.”  It’s customary in Red Wing that any scheme, no matter how absurd, will be promoted to the Council as consistent with the “Strategic Plan.”  But do you really think that residents were ever told that the “Strategic Plan” included ripoff electric bill increases?
Get this “Alignment:”  “Community Vitality: Xcel as a place where people of all ages want to live and work …”  Seems to me that the next step here would be to rename “Red Wing” to “Xceltown.”

You can try to communicate with the City Council (I have no luck but you might):

Red Wing City Council Regular Meeting
Monday, April 23 2018 6:00 PM
City Council Chambers, 315 West 4th Street, Red Wing, MN 55066
The Xcel ripoff resolution is Agenda Item 9c.

Contact information.

Alan Muller

10 Responses to City of Red Wing kisses Xcel Energy butt… to raise your electric bills

  1. The_Justin April 24, 2018 at 00:40 #

    Seems in line with the kakistocracy. How about going to your councilmembers and instead of them meddling in things they don’t understand, work towards something more concrete: making Redwing a better place to live. One thing they could do is say that Xcel has to find a permanent storage location for all of their nuclear waste, that is not Redwing. Not just for what they are storing in your community now, but for the waste they generate the next 40 years, let’s say. These seven people are supposed to work for you right? You are the people, Xcel has no vote in your elections (unless your kakistocracy has shifted to a full corporatocracy), right? I don’t think I understand politicians, and people in general. If the “job” or “jobs” are breaking people’s skulls, or something else harmful–like generating untold toxics lasting a 100,000 years– why should we be encouraging that job or work environment at all? Better the council scratches together the funds for those people to play tiddly winks all day than to let them go to “work”.

    • alan April 24, 2018 at 09:15 #

      Thanks, Justin. As a Red Wing resident I’d like to have a better relationship with the city government, be able to work with them rather than just bash them in public. But there seems to be no willingness on their part. I suspect they are so used to doing as they are told by Xcel that they can’t seriously imagine a different sort of relationship….

  2. John Howe April 24, 2018 at 00:53 #

    Very unfortunate that there was not some in depth discussion about this issue. It appears Xcel placed a small bone in for host communities stating that grants may be available, However, the rest of the City of Red Wing taxpayers are being ripped off. The list is long, from the way the DOR values Prairie Island Nuclear Plant for tax purposes to the pollution control tax exemptions bestowed to Xcel. The plant is taxed at about 10% of it’s real value. And let’s not talk about the nuclear waste storage (the money ratepayers have paid.) Furthermore, the reason they “run-the-show” at the capital…..follow the money. They spend the most on lobbying in Minnesota. Keep informing the public Alan.

    • alan April 24, 2018 at 09:11 #

      Thanks, John, for your comment. As Mayor of Red Wing you showed a willingness to stand up for the interests of the City that has been lacking since. (I was not fully aware of it at the time.) This is much appreciated by those who know of it. I expect there is a heavy political price to be paid in Minnesota for opposing Xcel. One sad aspect of all this is that the so-called Renewable Development Fund (or Account) was set up to compensate the Red Wing, and Monticello–in some sense–for the burden of having the nuclear waste storage here. Yet it is hard to see that this “fund” has benefited Red Wing in any way, or is likely to do so in the future. This fund has also been used as a piggy bank by the Legislature, most recently to give the city of Benson a payoff for the shutdown of a dirty burner. The payoff may have been justified, but this sort of thing was not the intended purpose of the RDF. My impression is that the Dept. of Revenue does not do any real due diligence in vetting claims of “pollution control” tax exemptions, etc. Certainly a different standard than that applied to individual taxpayers… The bigger picture I see is that the day is coming when the “PINGP” has been fully milked and Xcel will decide it’s more profitable to shut it down. At that point all the selling out and sucking up by Red Wing officials will count for very little and the City will likely be unprepared. Residents may experience serious declines in property values, a taxation death spiral, and etc.

      • T.W. Day April 25, 2018 at 22:55 #

        As bad as the city is, the county government is drastically worse. Red Wing is in a position a lot like Atlantic city was before the collection of Trump scams and other casino money-laundering “investments” went to hell and the city “made up for” all the debt, hyped city worker pensions, and bureaucracy with sky-high property taxes: I don’t see any sign either the city or the county can recognize reality if it smacks them between eyes. Unfortunately, that goes for the residents, too. I’ve heard numbers from 20% to 40+% of the city’s tax revenue comes from Xcel and we all know that is going to come to a crashing end when the nuke plants shut down somewhere between now and 2030. All of the plant employees I know are planning on selling out before that happens. When you see a whole lot of over-priced homes suddenly go up for sale and those homeowners are Xcel employees, you know the bottom is about to drop out of Red Wing house prices.

        Probably not coincidentally, the county is suddenly assessing homes for a lot more than market value. I think they are getting us conditioned to high property taxes and a disconnect between actual value and assessed value.

        • alan April 26, 2018 at 01:21 #

          Tom, being an old fart from the east coast, I can remember Atlantic City before gambling, during gambling, and now (a little) post gambling. Sad story.

          Assuming for the sake of discussion that our City and County governments were able to look ahead and plan intelligently, do you see any potential scenarios that could enable a successful transition to post-nuclear prosperity?

          • T.W. Day July 17, 2018 at 13:47 #

            I do, but I’m not sure our pseudo-conservative public is up for it. When a well-run business anticipates a down-turn due to changes in taste, technology, or operating costs, a trio of budget plans are generated: great, good, and awful. The city appears to be operating on a series of “irrational exuberance” plans, anticipating growth that hasn’t occurred and income sources that are down right mythical and that has gone on for at least 20 years. City employee salaries are grossly out-of-line for a town of an unstable population of 16k and that has to be addressed before the costs of the related pensions crashes the budget. City services growth also needs careful review with long range expectations connected to past performance, not wildly optimistic pipedreams. Obviously, putting the tax revenues into conservative savings to buffer the eventual cutbacks is only sensible, but that would require residents to plan for the future by maintaining the current tax basis to create those savings. Humans, on average and Americans more than most, have demonstrated an incapacity for future planning. So, those savings will be a hard sell.

  3. Lydia Howell April 24, 2018 at 08:33 #

    On issue after issue, the people will [we] elect to represent THE PUBLIC INTEREST are BOUGHT & PAID for by the CORPORATIONS. Regardless of the cost to working people, public health & the preservation of a liveable planet, these BIPARTISAN SHILLS sell out over & over again .It’s So damn discouraging!(are you on Facebook? I shared your post thru email)

  4. alan July 17, 2018 at 14:36 #

    Tom, I see Xcel Energy as having a sophisticated management that often seems to own/control most of the people/orgs/reporters that ought to be asking hard questions and doing some of their own thinking.

    I’m under the impression that comparable Minnesota cities without a nuclear sugar daddy manage to provide city services with similar or lower taxes. this something I’ve been meaning to do some research on and pull together some numbers.

    • T.W. Day July 18, 2018 at 08:46 #

      I have spent a lot of time traveling around a lot of rural middle America, mostly by motorcycle. I don’t see many cities our size (not physically, but population-wise) with the kinds of resources and expenses of Red Wing. None, in fact, but I don’t know of another city this size that has a nuclear power plant tit to suck on. San Clemente, sort of, but that 63k and on the California Pacific. Most of small town America is shriveling up and dying with 80% of the US population living in urban areas, that is only going to accelerate the decay and death of many small towns. Not that many years ago, I noticed the dramatic difference between a 1940’s North Dakota map and the current map, with many of the state’s cities vanishing in 60 years. I planned a “North Dakota Ghost Town Tour” and it was eyeopening to see how much of the state’s population had shifted either to Bismark or vanished entirely. Many of those towns were as substantial as Red Wing in the 50’s.

      The infamous intolerance toward “difference” and general level of uneducated ignorance small towns are famous for is not an attractive feature for either business or talent. Fighting against a natural tendency is a hard road and the fact that 56% of Goodhue County voted for Lewis and 53% for Trump is an indication of how inflexible and unfriendly the area’s cultural environment is to the kinds of people the area desperately needs to survive. Replacing Xcel’s tax “contribution” looks like an overwhelming obstacle to the city’s future, with those barriers in mind.

      When I ran for RW city council, I couldn’t get a straight answer as to how much of the city’s budget came from Xcel property and employees, but the numbers I did hear ran from 20% to 40%. I know that many of Prairie Island’s tech workers are the highest paid people in the area, by a large factor, and few of them expect to be living in RW when they retire because they don’t want to be here when the tax burdent shifts from Xcel to local residents. The city, on the other hand, seems to imagine that their revenues are going to increase nearly exponentially and their “planning” is based on that. Like Atlantic City, if the only revenue source available becomes increased property taxes the house of cards is going to fall fast and hard.

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