City To Vote On Issuing $18.2M In Bonds For Smart Grid, Fiber Expansion Projects

Traverse City commissioners will vote tonight (Monday) on issuing up to $18.2 million in bonds for Traverse City Light & Power (TCLP) to build out the rest of its citywide fiber network and create a city smart grid, which will allow for real-time monitoring of power usage and outages and give customers the option to track and adjust their energy consumption. The move comes after the U.S. Department of Agriculture (USDA) approved a $14.69 million loan for the projects, with the city committing additional funds to cover drop costs for connecting customers to the fiber network.

TCLP board members voted in March to accept the USDA loan, with city commissioners required to do the same tonight and to approve issuing bonds to cover project costs. The commission’s vote would signal the city’s intent to borrow up to $18.2 million – $14.69 million for the grid upgrades and another $3.5 million for fiber drop costs – and kick off a 45-day period when city voters can petition to put the bonds on the ballot. If no petitions are submitted, final bond documents will be brought to commissioners in May for authorization, clearing the way for work to begin. If commissioners approve the bonding resolution, included language states that TCLP is responsible for the costs “to ensure that city funds are ultimately not vulnerable.”

Funding will allow TCLP to expand its fiber system beyond the current service radius of downtown Traverse City – where just over 3,200 customers now have fiber access – to the entire city, reaching nearly 8,000 more customers. As of March, TCLP had 640 active fiber customers, with another 56 pending. Those numbers included 470 residential and 84 commercial clients, plus 86 VoIP and 80 bundled discount accounts. While the USDA loan will help cover backbone infrastructure costs for the network buildout, drop costs to provide the final connection from the network to the customer aren’t eligible for funding, requiring the city to cover those costs separately through capital improvement bonds.

Funding will also cover the buildout of a city smart grid. Hardware, software, and advanced communication upgrades to the TCLP distribution system will allow for “operators to assess grid stability, advanced digital meters that give consumers better information and automatically report outages, relays that sense and recover from faults in the substation automatically, automated feeder switches that re-route power around problems, and batteries that store excess energy and make it available later to the grid to meet customer demand,” according to TCLP documents.

Those upgrades can provide technicians with real-time grid data, allow customers to monitor their energy usage and adjust consumption, and reduce demand during peak hours – a step toward reducing the city’s carbon footprint, according to TCLP. Smart grid upgrades will also provide upgraded security that will better protect the utility against potential threats, with the electric sector identified by the government as a vulnerable target for terrorist attacks. In a memo to commissioners, City Manager Marty Colburn called the opportunity to both expand fiber citywide and build out a smart grid “an exciting moment for this community and TCLP.”

Also at tonight’s city commission meeting…
> Commissioners will consider a request from Commissioner Tim Werner to allocate $50,000 toward a request-for-proposals for a green infrastructure conceptual design to be integrated into reconstruction plans for Madison and Jefferson streets. “Traverse City has the unique opportunity to pursue an ecologically rooted, green infrastructure approach to handle ground, surface, and storm waters that interact with the project footprint,” he wrote in a memo to commissioners and staff. Examples of what could be included are “conversations with property owners regarding their experiences with waters in the project area, hydrologic analyses to understand current and past water flow, projections of more extreme weather events resulting from climate change, (and) maximizing tree lawn width to allow for green infrastructure and reduce the stormwater burden with narrow streets,” according to Werner. Madison and Jefferson streets are set to be rebuilt from the base up in 2022-23 at a cost of $1.44 million and $939,000, respectively.

> Commissioners will consider approving a $34,000 contract with Molon Excavating to replace the sand at the West End volleyball courts. Parks and Recreation Superintendent Michele Hunt wrote that the current sand has been in place at the courts since the 1980s, with additions over the years, and is “too coarse and has become rocky and filled with detritus. This type of sand is also not suited for sand volleyball courts and is often too hot and mixed with sharp aggregate causing scrapes for players’ knees, shins, and feet. The type of sand chosen is a much finer grade of sand and will be easier for Parks staff to mechanically groom and rid of litter and debris.” The contract will cover the cost for Molon to deliver 1,200 yards of new sand. The city’s Department of Public Services will “recycle the existing sand and use it for backfill site leveling at the compost facility,” according to Hunt.

> Commissioners will vote to approve a 10-year extension with the firm Jacobs to continue operating and maintaining the city’s wastewater treatment plant, which it has done for the past 32 years. The agreement sets a base fee of $3,007,616 for 2022-23 (an increase from the most recent base fee of $2,837,858) and allows for that fee to be renegotiated annually over the next decade. Jacobs will also provide several new value-added services as part of the contract at no cost to the city, such as hosting annual innovation workshops with industry leaders “to review and discuss specific challenges and opportunities to continuously improve and advance the city’s wastewater and water treatment operations,” design and install at least one charging station at the plant that will become the property of the city, update a 2016 solar study, and provide up to $250,000 in out-of-scope consulting engineering services at a discounted rate. Also tonight, a Jacobs representative and City Director of Municipal Utilities Art Krueger will present the city’s 2021 wastewater treatment plan annual report and answer questions from commissioners.