By Juan Montoya
The indications that the Tenaska-PUB-COB plans for a gas-fired electric plant were speculative at best, started appearing late in 2012 when the City of Brownsville commissioners dutifully approved the rate hikes pushed for by Da Mayor Tony Martinez that extended into 2016.
According to Da Mayor vaguely mentioned that the power to be generated would bring industry and manufacturers flocking to Brownsville for a, ahem, slight investment of $325 million to be paid by the rate hikes.
At that time, efforts to get the documents accompanying the agreement between the private company and the municipal utility announced on January 2013 were stymied by lawyers for Tenaska and the PUB who replied to the information requests by denying them and sending off their justifications for not releasing them to the Texas Attorney General. They claimed that releasing the documents would harm them since they contained information that was proprietary and should not be released because it would put them at a disadvantage in the "competitive" world of energy production.
At least three entities requested the full terms of the agreement, HinoGas of Harlingen, El Rrun-Rrun, and a Virginia-based company which does consulting work for the U.S. Dept. of Energy.
Despite the fact that critics pointed out that the coming online of at least two gas-powered, electric generating plants (Edinburg and Harlingen) would make the construction of the Tenaska -PUB plant unnecessary for the needs of the city, Martinez and the city commission inked the deal and raised PUB rates to meet its bond obligations.
At the time, Martinez did not mention the cost associated with the deal that never went before the voters, and the only guesstimate the PUB ratepayers got was a vague mention of incurred debt. That debt, interestingly, forced Fitch Ratings to lower its rating for PUB bonds that made it more expensive to borrow money.
About the only indication Brownsville residents were able to get was from Fitch, the only player in the mix that was not gagged by Martinez or the energy company.
The Fitch Ratings report from March 2014 stated that the Tenaska project would add an extra $362 million to the roughly $200 million BPUB was planning to spend on capital projects through fiscal year 2017. The extra capital expenditures would be funded completely with long-term debt, according to the report.
Most of that debt will be paid by "small" rate increases, PUB spokesmen said.
Those "small" increases were approved in December 2012 during a special meeting of the Brownsville City Commission and the PUB members the ratepayers were never told why. They adopted upwards rate hikes that saw city residents pay a 36 percent increase in electric rates over the next three years, a 20 percent increase in water rates over the same period, and a 6 percent hike in waste water costs over two years.
Under the plan approved by both bodies, electric rates alone went up by 14 percent by October 2013 and another 22 percent by October 2016. (Click on graphic to enlarge.)
Now that Tenaska has withdrawn its request for tax abatements from Cameron County and told the county commissioners that it was holding off on construction because they had not found the customers needed to sell the power they expected to generate, the question becomes: what about the millions already collected from suffering PUB ratepayers?
The cost to PUB was said to be some $325 million which would guarantee it 200 MW of the 800 planned production.
Bu there was a caveat. that Tenaska would not begin construction until it had found customers for the other 600 MW.
Apparently, lower energy costs and demand has stymied the company's efforts and they have moved the original scheduled to beginning construction in 2014 and to complete it by the summer of 2016.
Then, Fitch Ratings reported that adding the plant's planned capacity to the energy already available would exceed the area's projected total requirement of 426 MW.
There is a 700-megawatt plant near McColl and Monte Cristo roads in Edinburg that has pumped power into the local grid for more than a dozen years. And the South Texas Electricity Cooperative, a member-owned collective nonprofit based in Victoria, is building $200 million gas-fired power plant with capacity up to another 225 megawatts.
Additionally, the U.S. Environmental Protection Agency in November 2013 to issued a permit for the construction of a similar plant under the name of La Paloma Energy Center, LLC (LPEC). The permit authorizes LPEC to construct and operate a 637-MW to 735-MW natural gas-fired power plant in Harlingen, Texas.
That permit was challenged by the Sierra Club claiming its emissions would harm the environment, but that challenge was denied.The secrecy surrounding the use of public funds to construct the Tenaska plant is characteristic of deals involving Da MAyor (an ex-oficio member of the PUB board) and PUB legal counsel Eddie Treviño, the new Cameron County Judge.
Besides the requested information on the details of the city-private firm deal, PUB and Treviño resisted all efforts during the recent runoff for county judge on the amounts paid to the Treviño-Boden Law Firm to represet the utility as legal counsel. That information has been withheld up to today.
12 comments:
Just another failure in the legacy of Da Mayor, Tony Martinez. He has used tax dollars to buy useless real estate....pandering to his friend Julieta Garcia (who like Hillary Clinton has fallen from the public eye) and now this fiasco. Everything substantial is going to the upper valley. Soon Brownsville will just be the poorest city in the valley.....oh, yeah, and bicycle riding capital of the valley.
any news on neece, juan?
El neece anda bien grifo
The dog ate the stash.
Will Trevino keep his job with PUB? His only responsibility is to see to it that the PUB board members don't speak out of turn. And for that he gets #350,000.00 per year.
I always said it was a scam and that the project was not feasible from day one. The mayor and Eddie Trevino were the one's pushing the Tenaska project and it has cost us millions. It was made clear that Magic Valley was building a plant for $893,000 a megawatt while the Tenaska project was going to cost us $1.6 million for the same megawatt. It was a no brainer that Tenaska would never be able to sell any megawatts to another third party based on cost and that PUB was the only stupid entity to go along with mayor Tony Martinez and Eddie Trevino. Now, let's see if PUB and the city rebate the utility customers that were scammed with the rate increases. I bet this will never happen and that they won't even eliminate the increases obtained under the scam. They get away with it, while they send other's to prison for malfeasance or try to like they are doing to Tony Yzaguirre over a someone leaving $150 on his desk, if you want to believe it.
Where is the "Like" button?
Eddie's fees from PUB is not $350,000, but $489,000 + per year for the past 3 years
Trevino is a no-class leech that deserves to be in jail with Limas and other buddies . How his mom can stand to make appearances with him is beyond me . Eddie no vale madre ! Hopefully his greed and ego will lead to his indictment soon.
Where is the "LIKE" button?
The good news is that with planning and uniting by setting aside differences we can polarize the current political establishment and return government to the people of Brownsville by encouraging Trey Mendez to run for mayor, Rey Montanaro for District 2 and recruiting other good candidates to run for At Large-A in 2019. I assure you, the current corruption will end by electing these kind of public servants who are willing to give of their time for the better good of Brownsville.
It takes time to plan and the time is now. In the short term, we hear Erasmo Castro, Martin Sarkis, William Garza and Judge Ben Neece are planning to run for different positions in 2017, which I hope you discourage with the exception of Ben Neece. Ben is of, for, and by the people, he will make a great District-4 city commissioner and I hope you encourage him to run.
I met with William Garza yesterday and told him he was not electable and told him why. Neither is Erasmo Castro and Martin Sarkis, who in my opinion are would be running for the wrong reasons. In my opinion it it is about the title, power, and attention and not public service, but everyone is entitled to run if they want, but I think they take away votes from those who can win and do a better job. We need true public servants who seek to do the job with transparency, integrity and ethics, all of which the current administration lacks. We need individuals who are willing to say NO when it needs to be said and stand up to special interest. We need accountability on management and we need above all else good transparent government. We need people who get elected and will do something, other than wait for things to happen. Hopefully some good citizens seriously think about running for At Large B and District 3 which are both up for election in May 2017.
The corruption is allowed because we allow it. We elect people that have low standards, go along with what is wrong when they know it is wrong and have done a lot of damage to our city, as the current elected individuals on the commission have, in my opinion. Just ask yourself what has Cesar de Leon, Jessica Tetreau, Gowen, Villarreal done for our city? They were given the opportunity and their lack of engagement and initiatives in my opinion is very poor. I am sure they have all done some good, but they have beeen more busy with personal agendas, politics and doing nothing, or allow our city to be poorly managed that over all the score card is failure. They may be nice people, but Brownsville can do better in electing people who will be true public servants without a personal agenda or an ego to feed. We need to elect people who will actually work on behalf of the citizens of Brownsville and not just wait for things to happen to take credit, when it was going to happen anyway.
If you do not like what has been going on with our city, it is up to us to set differences aside for the common goal to elect people that will be the voice of the people for good government. Let me remind you they are responsible for continuing to fund United Brownsville, which is accountable to no one and has produced nothing. They are rsponsible for the Casa Nylon purchase and other real estate purchases that has scammed taxpayers. They are responsible for allowing Tenaska to scam us and approved higher utility rates. This city cannot be a single issue city with bicycle lanes, this city needs leadership to address the needs and priorities, not just bicycle lanes.
I ask everyone to encourage Trey to run for mayor in 2019, Rey Montanoar for District-2 in 2019 and Ben Neece for District 4 in 2017. I also encourage some good people who want to run for the right reasons to bring change to our city to come forward. I personally will support only candidates with the heart and soul to give of themselves with nothing to gain to serve our city, as I did. I love Brownsville and want to see Brownsville fulfill its's potential.
Merry Christmas,
Pat Ahumada
It appears that the meteoric rise in utility rates in Brownsville were yet another scam to raise money for the runaway project waste at City Hall. No tax increase! But ethically, all that overcharge to customers should be refunded and the original rates restored.
There is a class action suit in this somewhere if they don't.
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