Moyie Dam slated for repairs

BONNERS FERRY — The city of Bonners Ferry hopes to ask voters for permission to issue a bond that would finance $4.1 million in repairs to the aging Moyie Dam.

At a recent meeting, the Bonners Ferry City Council discussed the proposed repair plan for the 70-year-old Moyie Dam and took the first steps toward a May bond referendum. This follows a September rate increase for city electric customers which would pay for the debt service on a proposed bond.

The 9.5 percent rate hike for Bonners Ferry electric customers was the first time the city increased electric rates in more than 10 years.

Bonners Ferry City Administrator Lisa Ailport said the rate increase was based on a rate analysis that was conducted by a utility rate consulting firm hired by the city. The rate analysis looked at the projected electric department capital needs and the rates at the time and proposed rate increases that would address future electric department capital needs. The recent rate increase is expected to generate around $500,000 per year.

In the October 2019 city newsletter, Bonners Ferry City Engineer Mike Klaus wrote, “The Moyie Dam has provided reliable power to Bonners Ferry Electric customers for nearly 70 years. The greatest advantage of having the dam is that the City can produce approximately 30 percent of its annual need, which helps the City provide some of the lowest cost power in the nation.”

According to Mayor Dick Staples, “The city completed construction on the dam in 1950, making the dam over 70 years old. The dam has served the local community for that time with extremely low electrical rates. After the 9.5 percent rate increase, the base rate for electricity is $11.46 inside the City limits compared to a Northern Lights base rate of $30. The dam is an asset to the City and the repairs are a necessity for the City to be able to continue providing relatively inexpensive power.”

The slated repairs to the dam are anticipated to occur over the course of three construction seasons, beginning in 2021. The months when construction can occur is during months of low water flow, which corresponds to late July through mid October of each year.

Staples recognizes the urgency of the repairs for preventing further damage to the infrastructure of the dam: “I think we are going to have to try and float a bond. There is no other way to do it. The other option would be no improvements and then face having to shut the dam down; all the city power would then be purchased from Bonneville Power Administration.”

The city is hopeful the bond referendum may be a part of the upcoming May 2020 election.

“If the bond isn’t supported by city residents the city will be faced with having to complete the improvements and pay for those in some manner, which could include further electrical rate increases,” said Ailport.

Idaho State law requires a vote of the citizens to incur debt, like the debt that may be voted on in May concerning the Moyie Dam.

The type of approval depends on the type of debt, Ailport noted. For example, a general obligation bond requires a two-thirds approval vote from the citizens, while a revenue bond requires just a majority vote.

“Simply put, the electric rate increase does not allow the city to cover the entire cost of the project in one fell swoop, thus the need to take on debt through a bond,” Ailport said. “The [electric] rate increase will help cover bond payments, but would not be sufficient to cover the cost of the project as a whole.

The proposed $4.1 million in improvements to the dam include resurfacing the spillway and the walls on either side of the spillway, she added.

“The improvements that are needed at the dam are required in order to keep the dam operational and also in order to keep our license in good standing with the Federal Energy Regulatory Commission (FERC),” Ailport said. “FERC is requiring that the city begin these improvements by 2021.”

The revenue bond would provide the repair funding up front, and would be paid back, over a 20-year period, by the increased electric rates.

“It is our hope that the previous rate increase of 9.5 percent, done last September, will cover the debt service on the bond,” said Ailport. “The city is working with Bond Counsel on the ballot language, and drafting of the ballot, and we are also working with a financial advisor on the financial path that is most advantageous to our citizens.”

The electric rate increase monies are also slated to other debts within the electric department.

“The 9.5 percent rate increase was to cover the future bond debt as well as contribute toward other capital needs in the electric department,” said Ailport. “In addition to the dam, we are also facing other capital expenses across the electric utility.”

The Bonners Ferry City Council is tentatively scheduled to consider and possibly pass the bond ordinance at its March 3 meeting, scheduled at City Hall, 7232 Main St. This would direct the County Clerk to prepare the ballot measure for the Tuesday, May 19, election.

The City Council has committed to further public meetings around the city to discuss the proposed bond prior to the May election. The dates and locations for these meetings are still being planned but will be posted at city hall and shared with local media outlets.

Bonners Ferry residents may register to vote for the possible May 19 bond election online at idahovotes.gov or by visiting or calling the County Clerk/Elections office in the Boundary County courthouse: 208-267-2242.