NCPA'S & PSREC's Co-generation Project at the State Prison
LMUD paid $81,997 to date.....for nothing!!!
February 28, 2006
LMUD STILL PAYING *NCPA FOR CO-GENERATION PLANT STUDY
$17,193 in 2006
LMUD SAID THEY PULLED OUT
*Northern California Party Association or MDT (Money Down the Toilet)
October 19, 2005
Under pressure LMUD BOARD
VOTES TO BACK OUT OF NCPA'S & PSREC's Co-generation Project at the State Prison
........but still continues to secretly pump money into this project that they will not get ANYTHING out of.........
At the LMUD meeting on October 19, 2005, the LMUD Board did not support the General Manager's position to continue pouring money into this project. Cady lied to the public about LMUD reimbusements
KWH STRONGLY OBJECTED TO THIS BOONDOGGLE
KWH files objection at the October 19, 2005 meeting
There is no provision to make any refunds (Section 4) to LMUD if they withdraw from the co-generation project. Frank Cady knew this when he told the public that "if PSREC goes through with the project and bonding, LMUD will be reimbursed". Phase II Agreement
October 19, 2005 LMUD minutes
LMUD General Manager and NCPA lied to the public and the LMUD Board to get $100,000
On March 29, 2004, LMUD signed an agreement to get involved with NCPA and PSREC (Fred Nagels utility) to "study" building a co-generation plant at the State Prison.
LMUD has no ability to help finance a $10,000,000 project (LMUD's commitment would be $4,300,000) or anything else for that matter. KWH files objection
So why did LMUD agree to help pay for PSREC's co-generation plant?
RATEPAYERS ASK YOURSELF,
Why would LMUD continue to fund this study when there is no possibility of financing it, ZERO %?
On March 29, 2004, LMUD hid paying for Phase I by disguising it as a "Needs Assessment". LMUD paid NCPA $10,000 for this, alleged and never to be released, "Needs Assessment".
While LMUD jumped right in and approved Phase II , at the same meeting, the Phase II Agreement did not include providing RFP's (Request for Proposals) or RFQ's (Request for Qualifications).
The "Needs Assessment" did...but NCPA is not asking for more money for the Needs Assessment, but asked suddenly for $100,000 for Phase II that doesn't even require or provide for RFP's.
Confused? You should be. This was a quickly put together scam that Frank Cady and NCPA cooked up.
The "Agreement" states that NCPA must give LMUD and PSREC a 30 day notice if they need to more money. LMUD was under no obligation to suddenly approve an additional $43,000. Phase II Agreement
Frank Cady presented NCPA's request for an additional $100,000 on Phase II anyway. Cady hoped that no one would pick up on the deception. Keep in mind, that the Board does not read anything and has shown no interest in curtailing bogus expenses. This Board has abdicated its financial responsibilities to Frank Cady.
LMUD has spent $64,816 ($21,816 over budget) without approving any additional funds for this.....Arrowrock like project (The Arrowrock Hydro project was a scam that Cady brought to the 2000 LMUD Board to distract the public from the $8.7 million loss by the Board. This Board was recalled in March/2002).
LMUD has been paying NCPA $3,426 a month.....for what? Do we have the right to ask?
LMUD RATEPAYERS WILL NEVER SEE "ANYTHING" FOR THIS MONEY
Cady simply needed the money to cover up the fact that the Board spent more than the amount approved for Phase II. Cady has a proven track record, that it is easy to lie and get away with it..........
High Sierra Gas Powered Co-Generation Project
LMUD/PSREC/NCPA SCAM
(No evidence that LMUD paid the $10,000)
Study phase, LMUD over-budget
Phase III- up to $4,300,000
Financing phase
(Fred Nagel does not reside in a LMUD service area and is a PSREC customer and will directly benefit from this project.)
*This project states a definite and significant savings to PSREC customers and makes no mention on any benefit to LMUD customers
PSREC/LMUD "BACK-ROOM DEALS" NEED CLOSE MONITORING
LMUD MOVES INTO PHASE III
OF GAS POWERED CO-GEN PLANT
WITHOUT A PUBLIC VOTE link
5/18/05: KWH PLACED A CALL TO NCPA REP TOM LEE. LEE HAS NOT RETURNED OUR CALL.
May 17, 2005
KWH QUESTIONS NCPA ON THE NATURAL GAS POWER PLANT
And LMUD's role in this $10,000,000 project link
NCPA will not finance project as per Don Dame
3/29/04: George Sargent questioned "why should we go into debt for millions when buying the 5 MW on the open market is less of a risk." Where was George when the Arrowrock Scam was being marketed by Frank Cady?
$800,000 annual savings to PSREC...LMUD Director Fred Nagel is a PSREC customer.
OUTGOING DIRECTOR, AL VAZQUEZ SAID....."It sounds like we're just passing a hot potato around".
If it walks like a duck and smells like a skunk....its probably a skunk.
NCPA claimed, at the March 29, 2004 LMUD meeting that they would float a $10,000,000 loan for this project. NCPA has suddenly backed out of financing this project. This should have sent red flags up for the LMUD Board. These co-gen plants typically are not cost effective, so why is LMUD still involved?
LMUD has never presented any PHASE II "Feasibility Study" to the public. LMUD has never approved Phase III of this project. Phase III would allow LMUD to proceed with financing the construction.
Plumas Sierra Rural Electric Cooperative has published a notice in the Lassen County Times that they are now looking for financing for this project. link
LMUD cannot borrow any money. They have reached their asset/debt ratio and the bondholders could not allow the bond covenants to be put in jeopardy. LMUD is cash poor!
This is not the first time Frank Cady has made "back room" deals without Board approval. link PSREC transfer of LMUD customers
So what is LMUD's real part in this?
LMUD is now in the process of making the same mistake with the co-generation plant at the prison as they did with the Arrowrock hydro scam. This is the PSREC/LMUD deal where NCPA planed to float the loan ($10 MILLION).
If the plant is built and fails, ratepayers will be paying for this mistake for years.
LMUD MEETING AGENDA
5/11/05
LMUD submits assessment report for financing scam
Special LMUD Board Meeting, March 29, 2004
*LMUD approved Phase I. NCPA presents Phase I. The report submitted by NCPA was dated September 24, 2003. LMUD agreed to pay $10,000 for this 2003 report and then proceeded to accept Phase II.
*LMUD approved Phase II. If this project does not pass air quality and EPA requirements...its dead. LMUD can stop expenses on this PSREC project at Phase II. This Phase II Project is over-budget ($13,365)
George Sargent questioned "why should we go into debt for millions when buying the 5 MW on the open market is less of a risk." Where was George when the Arrowrock Scam was being marketed?
OUTGOING DIRECTOR, AL VAZQUEZ SAID....."It sounds like we're just passing a hot potato around".
He is exactly correct. This is just another scam, like Arrowrock, that will be done in back rooms in secrecy. No disclosures to the public. LMUD ratepayers will foot the bill and will get nothing.
Has Twitchell seen the boondoggle at Lassen College. That was a taxpayer tragedy.
PROJECT OVER BUDGET IN PHASE II
UPDATE: 11/4/04
General Manager, Evelene Twitchell reported that Plumas Sierra Rural Electric Cooperative (PSREC) is in negotiations for agreements. She did not specify who the agreements are with, but definitely did not mention LMUD.
This is developing into another Arrowrock Scenario. The Boise Project Board of Controls, for 16 years has been in "negotiations", but never has produced a single executed agreement for power
THE NEW "ARROWROCK" PROJECT
Twitchell reported that PSREC is in negotiations regarding a marketing agreement for the PSREC's co-generation plant, at the Federal Prison. "No agreements have been signed but they are close". This scenario is exactly like Arrowrock. link Promises, promises and then nothing. No progress on feasibility study and it's not expected until 2006 ?
LMUD will continue to pour "secret" money into this scam.....Why?
Twitchell reports are filled with double talk. Why would anyone be willing to "negotiate" a contract for a product that is not being produced and may not be produced. The Feasibility Study has not been completed and it looks like it won't be completed, according to Twitchell, until mid 2006 ???
Twitchell indicated that LMUD, having given PSREC the Federal Prison, might be the LEAD agency in this project. This equates to: LMUD WILL BE SPENDING THE MOST MONEY......just like ARROWROCK.
LMUD was the LEAD agency in the PSREC transfer and did not produce the mandatory requirements to the CPUC ?
UPDATE: 10/7/04
Evelene Twitchell announced, at the October 7, 2004 LMUD meeting, that this project has been delayed until 2006. There seems to be environmental issues that have come up that have slowed the process down. She reported that N.C.P.A. is still working on the feasibility study and is having trouble finding any interest in the "hot water" they want to market from the co-generation plant. Sounds like ANOTHER ARROWROCK......the really bad news is that LMUD will continue to spend ratepayer money on this. Evelene Twitchell stated, to the Board, that "LMUD hasn't spent anywhere near the $44,000 maximum". How did $43,00 become $44,000? This warrants very close watching.
George Sargent questioned why we should go into debt for millions when buying the 5 MW on the open market is less of a risk.
LMUD President Fred Nagel, a PSREC customer, will push to spend our money so that PSREC will get their "generation plant". This project primarily benefits his utility company.
BAD DEAL FOR LMUD RATEPAYERS
GREAT DEAL FOR FRED NAGELS UTILITY (PSREC)
"There's nothing easy about this decision, except it makes sense," Nagel said. He's right. It MAKES ABSOLUTE SENSE FOR HIS PSREC
"Board member Wayne Langston said the project would make LMUD a power generator, *improve the utility's credit rating and give it more bargaining leverage in negotiating power purchase contracts.
*GUESS WHAT LANGSTON, INCREASING DEBT NEVER IMPROVES YOUR CREDIT RATING.......
GUESS WHAT LANGSTON, LMUD WILL NOT OWN THE HIGH DESERT PRISON GENERATION PLANT...
.LANGSTON NEEDS TO REALIZE THAT LMUD WILL ALWAYS BE A SPECK -IN-THE SAND -POWER PURCHASE PLAYER.
EGO'S ARE RUNNING AMUCK.....AGAIN.
IDIOTS.....ALL OF THEM.
LMUD ratepayers have heard this song and dance before.
"If we're going to get serious about looking at our own power generation, we have to spend some money", said LMUD President (PSREC customer) Fred Nagel.
This is the same story Frank Cady and Louie Templeton told the ratepayers about Arrowrock and then proceeded to spend over $150,000 on this scheme. The ratepayers have never been told where the money was spent and have yet to be given the Feasibility Study promised in 2002. All money was paid directly to the Boise Project Board of Controls...no invoices, no receipts.......????? WHAT DO THE RATEPAYERS HAVE FROM THE LAST SCHEME.......NOTHING!!!!!
LMUD ratepayers were told this about the Arrowrock Hydroelectric Facility in Boise, Idaho, four years ago. LMUD started spending money on this SCAM on December 18, 2000. Frank Cady refuses to disclose his legal fees for Arrowrock.
Arrowrock is Dead and now LMUD wants to start a new "boondoggle" at the High Desert Prison. Maybe Arrowrock is not dead...LMUD will finance $50,000,000 to build a hydro facility and will have enough left over to finance $4,300,000 for the PSREC project at the prison....(yes, TODO, this is a great, fabulous, STUPID IDEA..............)
THE BOND HOLDERS SAID NO TO ARROWROCK ...MAYBE THEY WILL SAY YES TO PUTTING THE BOND COVENANTS IN JEOPARDY FOR $4.3 MIL.
This project will save PSREC $800,000 during an average year.
Then let PSREC pay for this project. There is absolutely no reason for LMUD to get involved.
What's in it for LMUD ratepayers:
Estimated millions in debt
Estimated 5 MW of power to be sold back to LMUD
This project, to build a natural gas generation facility, benefits PSREC. Make no mistake about this project. This is exactly like the phantom Arrowrock Hydroelectric Facility this Board spent money on to help the Boise Project Board of Controls keep their FERC license. LMUD ratepayers GOT ABSOLUTELY NOTHING FROM THE MONEY SPENT ON ARROWROCK.
These generous donations, by the LMUD Board of Directors, to help other entities has to STOP. LMUD has not benefited one iota with their reckless spending.....
WE HAVE TO ASK OURSELVES...."WHO" HAS BENEFITED FROM THESE SCHEMES? {The money is going somewhere}
NCPA will carry the loan for this project.....
"Needs Assessment"...Hardly
The Lassen County Times reporter sat in the LMUD meeting on 3/29/04. This reporter heard very clearly that this project is a plan to share costs for a gas powered electrical generation plant at the High Desert Prison.
This reporter did not state that if this facility is not cost-effective that they will simply shut it down. There is a huge risk of this happening. PGE will only subsidize natural gas prices the first year. After that if prices go up on natural gas the plant will be shut down. Another LMUD scheme gone a wry.
This reporter made is sound like this is an annual LMUD assessment program and totally mislead the public.
The Times needs to find a reporter that can be objective and right a NEWS story. Let's see they have sent, Sam Williams. But he wrote the truth about LMUD and was put on sports. Bill Noonberg is out...really out...he doesn't work for the paper anymore...couldn't be that he couldn't control his temper. Woody Morgan did a stint......but couldn't take the heat. He wanted to be social buddies with LMUD.
Who do they have left that would write honest truthful articles about LMUD.....................................................................
LMUD can not finance anything. There's a big problem with LMUD's finances...asset to debt ratio=no loans for LMUD.
*Note: Cady has told the Boise Project Board of Controls that LMUD can finance $50,000,000 to build a hydroelectric facility in Idaho.......the bondholders said no to this........Cady continues to lead LMUD Boards down paths that only benefit him. Link
LMUD Ratepayers Beware:
There is nothing complicated about buying 20 mw of power.
he WAPA re-organization was supposed to be the answer to LMUD's power needs.
LMUD
Don Battles, LMUD General Manager, August 8, 2001 LMUD minutes (pg 3 of 9) told ratepayers:
"Mr. Battles explained that (SMUD) they are a much larger utility, and the cost to generate 30 mw's was expensive". "He added that SMUD also receives 361 mw allocation from WAPA".
The 30 mw, Mr. Battles was referring to was the proposed Arrowrock Hydroelectric project in Boise, Idaho. On one hand Don Battles was telling the ratepayers that this 30 mw was expensive to produce and Mr. Cady on the other hand was telling the ratepayers that it was cheap power (free).
LMUD, under the direction of LMUD President, Fred Nagel (not a LMUD customer, but a PSREC customer) now has entered into a contract with PSREC to build a gas driven co-generation plant for PSREC at the new Federal Prison. Link This plant will cost LMUD ratepayers an estimated $4,300,000. NCPA will carry the loan for this project but LMUD will take on a debt and assume the risk of not getting any power after this plant is built. The most power that LMUD could receive is 5 mw.
Wayne Langston's statement that proceeding with this project will improve LMUD's credit rating was so stupid, but so typical of his level of understanding.
George Sargent questioned why we should go into debt for millions when buying the 5 MW on the open market is less of a risk.
The NCPA representative stated at the LMUD meeting that if this plant is not economical that it will be shut down.