July 17, 2019

Commissioners OK agreement for sharing study expenses - Daily Leader Extra : Top Stories

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Commissioners OK agreement for sharing study expenses

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Posted: Wednesday, June 12, 2019 3:13 pm

The city commissioners approved an agreement on Monday that will have Madison participate in three-party funding for studies related to Tru Shrimp constructing a shrimp-raising facility on the south side of the city.

In early 2019, Tru Shrimp, state and local officials announced plans for locating a "shrimp harbor" in Madison's Lakeview Industrial Park to raise shrimp for human consumption. To operate the plant, Madison is expected to provide electricity, water and sanitary-sewer services.

Since the announcement, city officials have organized studies to determine what infrastructure Madison needs to provide for the Tru Shrimp plant.

Within the three-party agreement, both the state -- through the Governor's Office of Economic Development -- and Tru Shrimp, a Minnesota-based company, have offered to pay up to $50,000 each for costs related to Madison's infrastructure studies. The agreement will stay in effect until June 30, 2020.

The three parties have agreed to split the study expenses three equal ways up to $150,000.

In the agreement, Madison officials will need to pay the bills associated with any studies and provide the related documents, such as invoices and canceled checks, to state GOED officials. City officials will also need to provide a final expense report to GOED and Tru Shrimp by no later than June 2020.

Tru Shrimp officials have agreed to make payment to Madison for one-third of the study expenses. GOED officials have agreed to make monthly payments after they have received acceptable documentation.

Previous to the city commissioners voting on the agreement, Michael Ziebell, Tru Shrimp CEO, and Steve Westra, GOED commissioner, signed the document.

So far during 2019, the Madison City Commission has hired DGR Engineering of Rock Rapids, Iowa, to perform some initial work.

In May, DGR engineers were hired to look at options such as expanding Madison's Southeast electrical substation vs. constructing a new substation near the proposed Tru Shrimp plant. The engineers are expected to identify the financial impacts to Madison, such as infrastructure costs and power supply and transmission costs. They will work with city officials and Heartland Consumers Power District to develop a rate package that will meet the requirements of Heartland's power supply offer to Tru Shrimp and recover the costs that the city would incur in providing electrical power to the proposed plant.

At the time, Brad Lawrence, city utility director, said the reason for performing the study was to have the city avoid any extraordinary expenses related to a new Tru Shrimp plant.

The city commissioners had approved in March a payment of $7,000 to DGR Engineering for the original professional-services agreement. In early May, the commissioners approved up to an additional $17,000 to pay for the work that was specified.

Madison officials also expect engineers with Banner Associates of Brookings to perform work related to Tru Shrimp infrastructure studies.

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