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June 2, 2025 Commission Minutes

GOODLAND CITY COMMISSION

Regular Meeting

June 2, 2025                                                                                                                  5:00 P.M.

Mayor Jason Showalter called the meeting to order with Vice-Mayor J. J. Howard, Commissioner Sarah Artzer, Commissioner Ann Myers and Commissioner Brook Redlin responding to roll call. 

Also present were Dustin Bedore – Director of Electric Utilities, Joshua Jordan – IT Director, Kenton Keith – Director of Streets and Facilities, Danny Krayca – Director of Parks, Zach Hildebrand – Code Enforcement/Building Official, Jake Kling – City Attorney, Neal Thornburg – Director of Water and Wastewater, Shauna Johnson – Deputy City Clerk, Mary Volk – City Clerk and Kent Brown – City Manager.

Mayor Showalter led Pledge of Allegiance

PUBLIC COMMENT

  1. Jessica Cole with the Sherman County Alumni Association was present to ask if the Alumni Association could have permission for the High School Art Class to paint a Cowboy Logo on either 12th or 13th street intersection on Main Street.  This would be for the upcoming all school reunion July 24th through the 26th. Mayor Showalter asked, I assume this would be at the expense of the Alumni Association? Jessica confirmed that was correct. The City Commission gave majority consent to allow the Cowboy Logo be painted on Main Street by the Art Class.  Jessica also thanked the city for helping water flowers on Main Street.

PROCLAMATIONS AN PRESENTATIONS

CONSENT AGENDA

  1. 05/19/2025 Commission Meeting Minutes
  2. 05/19/2025 Joint City/County Commission Meeting Minutes
  3. 05/27/2025 Special Commission Work Session Minutes
  4. Appropriation Ordinances: 2025-11, 2025-11A and 2025-P11

ON A MOTION by Commissioner Redlin to approve Consent Agenda seconded by Vice-Mayor Howard.  MOTION carried on a VOTE of 5-0. 

ORDINANCES AND RESOLUTIONS

  1. Ordinance 1798 – Nonexclusive franchise agreement for telecommunications system with IdeaTek – Kent stated, IdeaTek seeks to enter the City’s right of way to install, maintain, and operate fiber network facilities so that it may provide data, telecommunications, broadband internet and related services to residents of the City.  As per Section 4 of the agreement, there will be a one-time permit and license fee of $1,000.00 for each DAS facility installed within the public right of way of the City. This would also include the standard pole attachment agreement. Commissioner Artzer asked, is this something that will benefit a community our size. Kent stated, they have done the same in smaller communities like Goodland across the state.  ON A MOTION by Commissioner Redlin to approve Ordinance 1798 Nonexclusive franchise agreement for telecommunications system with IdeaTek seconded by Commissioner Artzer.  MOTION carried on a VOTE of 5-0.
  2. Resolution 2025-15 A Resolutions authorizing and providing for the calling of a special question election in the City of Goodland, Kansas, for the purpose of submitting to the electors of the City the question of imposing a one-quarter percent (0.25%) citywide general purpose retailers’ sales tax for various educational purposes of USD No.352 – Kent stated this is a request from USD 352 to extend current sales tax. This resolution would put a question on the November 4th election ballot to levy a sales tax of 0.25% for USD 352 to construct, equip and furnish a new Career and Technical Education Building and to finance the same by the issuance of general obligations bonds of the district.  That sales tax would commence at the termination of the existing 0.25% sales tax for USD 352 in 2026 and continue until 2036. Commissioner Artzer verified this was for the school district to build the Career and Technical Education Building. Mayor Showalter stated, I am unsure if voters would support, but feel it is their right to decide. Commissioner Redlin stated, I am looking forward to the transparency of the school district in the months to come. ON A MOTION by Mayor Showalter to approve Resolution 2025-15 A Resolutions authorizing and providing for the calling of a special question election in the City of Goodland, Kansas, for the purpose of submitting to the electors of the City the question of imposing a one-quarter percent (0.25%) citywide general purpose retailers’ sales tax for various educational purposes of USD No.352 seconded by Vice-Mayor Howard.  MOTION carried on a VOTE of 5-0.

FORMAL ACTIONS

  1. JSC816 Enterprises Cereal Malt Beverage License – Kent stated, Tera Bona has applied for a CMB license for consumption on the premise.  Brian James and Zach have done an inspection on the property.  There are a few items that will need to be finished to complete the passing of the inspection.  This was brought to the commission to approve the license contingent on items listed in the inspection being finished. Suzie Connor, owner, gave a quick back ground on the property and why the Tera Bona name has been consistent.  This property will be open Friday and Saturday evenings only and will be an area to watch sporting events, play games and watch movies. Suzie also commented the few items needed for the license would be finished by Friday. ON A MOTION by Mayor Showalter to approve the Cereal Malt Beverage License for JSC816 Enterprises pending passing of the inspection seconded by Commissioner Redlin. MOTION carried on a VOTE of 5-0.
  2. Financial software system proposal – Mary stated, the office is having issues with the current software provider and need to replace it with a system that is reliable and efficient.  Mary and staff have had demonstrations from two software providers Edmunds GovTech and Caselle. Edmunds GovTech has done three demonstrations with the office, one on premise.  Edmunds would automate the permitting and licensing process.  Time and Attendance software will be required to be purchased also.  Mayor Showalter asked, do you feel the tech support is going to be good to work with. Mary stated, I believe between the company support and other cities transitioning to them support will be available.  Mayor Showalter inquired if there would be any hardware purchased with this software.  Mary stated, I have the option to purchase four point-of-sale credit card scanners, but will only purchase if necessary. Commissioner Artzer asked, is the cost something that can be pulled from the budget?  Kent stated, yes from reserves. ON A MOTION by Commissioner Redlin to approve the purchase of the software from Edmunds GovTech in the amount of $75,750.00 seconded by Commissioner Artzer. MOTION carried on a VOTE of 5-0.
  3. 2025 Utility Charge – Mary stated, annually the city reviews past due utility accounts for balances that appear to be uncollectable.  Customers considered are 1. Accounts the City has received notice party is deceased; 2. Accounts the City has received notice party has filed bankruptcy; 3. A payment has not been received on the account for three years; and 4. Accounts the City has not had any communication from the customer for three years.  Total for 2025 utility charge off’s is $16,992.80. ON A MOTION by Vice-Mayor Howard to approve the 2025 Utility Charge offs in the amount of $16,992.80 seconded by Commissioner Redlin. MOTION carried on a VOTE of 5-0.

DISCUSSION ITEMS

  1. Midwest Municipal Solutions report on power supply contract proposals – Kent introduced Jon Quinday of Midwest Municipal Solutions to present his report on the evaluation of the electric power supply proposals from Sunflower Electric (Sunflower) and the Kansas Municipal Energy Agency (KMEA).  Jon stated, before I start, I want to point out this morning I received an email from Mr. Linville, CEO of Sunflower Electric Power Corporation, regarding his concern that the report was biased towards KMEA based on my prior affiliation.  I have 35 years in public service, 27 in municipal Government and 12 as the City Manager for Russell. Six of those years I was President of KMEA but that relationship ended when I retired last year. Since then, I have no affiliation with KMEA. During that same 12- year period, I also had a relationship with Sunflower Electric and Western who has the transformer in our local access charge, so there’s a relationship there. But to be fair, I did tell Mr. Linville that I would add a slide that talks about his concerns. One of those is the perceived bias towards KMEA based on my prior affiliation. Like I said, I have no allegiance to KMEA or Sunflower for this report. I work for the City of Goodland, nobody else. The omission of a 2024 comparison using SEPs or Sunflower’s Proposal, I did acknowledge to Mr. Linville that it was not included, but that section of the 2024 comparison was not for a monetary purpose. The purpose was the impact of the structure of the agreements and the risk allocation. Could have been left out.

One of the things in my time as a city manager and previous, whenever we are talking about something new is to look at the history of things. How does that structure look back in 2024? The third thing Mr. Linville says that I mischaracterized Sunflower’s market risk and resource diversity. That analysis reflects contractual, not system level risk exposure and uneven application of stress testing. He is accurate as I only did a stress test on Sunflower’s ECA. Mr. Linville said that they projected a 2.2 cent per kilowatt hour ECA. When you do stress testing, what happens if the energy, fuel and market prices go up? Therefore, I used a $.03 cent per kilowatt hour. The stress test is not to say this one’s better than that one. It’s to illustrate the structural differences and not favoritism. It really shows a hypothetical situation that if Sunflower’s financial position changed and they could no longer sustain a 2.2 cent per kilowatt hour ECA, for example if there was a capacity deficit or fuel or market prices jump drastically, what would that look like? You’ll see at the end of the report I recommend further stress test analysis under multiple scenarios. This is not a one-all, be-all. This is just a hypothetical of what it would look like.

In evaluating the Auction Revenue Rights (ARR) and Transmission Congestion Rights (TCR) benefits in Sunflower’s proposal, the distinction between that in the report is not the dollar amount, it’s the governance. Local control versus a pooled management structure for the ARR and TCR. In regards to the omission of Sunflower’s renewable and generation flexibility, I did acknowledge that section 5.7 of their proposal does allow the city to integrate local renewable projects. You can do if you give Sunflower one year’s notice. Then if you move forward with it, you can keep the renewable energy credits as a city and then any capacity that you gain from that renewable project benefits Sunflower. Article 5.2 prohibits the city from running your credit generation in lieu of taking firm energy from Prairieland, except during emergencies. An Emergency is defined as insufficient energy at the interconnect to serve Goodland’s demand. That would be one way and the other is for maintenance purposes. His final concern is insufficient scrutiny of KMEA’s capacity risk, which I will address later in the proposal. 

As I mentioned before, whenever looking at something, I always like looking at the history of a community or a project. Goodland’s been a public power community since 1949. It was established under Mayor George Kelly’s leadership to ensure reliable, affordable and locally governed power. Community benefits are affordable power, reliable service, revenue reinvestment and local jobs. The understanding of public power, a lot of people do not realize what that is. You may drive around Kansas or other states and you will see signs that say a public power community. That just means the community owns and operates its own electric utility. The key benefits are local control, affordable rates, reliable service, community investment and transparency. One in six electricity customers in Kansas are served by public power. The average size of a public power community is about 832. The current power supply agreement with Sunflower, is a wholesale power supply agreement and programed electric. The contract is structured as a bundled four requirements contract. That means they provide the energy capacity and transmission in a single contract and billing structure. It has demand and energy charges and currently, you pay your demand based on your peak load and your energy charges are on Sunflower’s Western Kansas Municipal Tariff or WHM tariff. You do have market exposure subject to the ECA adjustment and that’s based on the Southwest Power Pool’s market volatility. You receive a capacity credit for your generation. Currently, that’s $31,775 and you are currently paying Prairieland one half of one cent per kilowatt hour or approximately $225,000 in 2024 to acknowledge its role as the city’s cooperative point of contact and grant you access to capital credits. Key financial metrics in the report show that from January 2024 to December 2024, the average cost to Goodland was $0.056 cents per kilowatt hour. I had some additional information come in.  If you look from January of 2024 to March of 2025, that cost has gone down to $0.053 cents a kilowatt hour.

You have two proposals, one from Sunflower and Prairie Land and the other from KMEA through its energy management project number two. Each offers city distinct trade-offs in cost, flexibility, governance and risk exposure.  You will do fine under either one. It is just a matter of what you want for the future of the city.  Sunflower and Prairieland proposal is a discounted full requirements contract. It has fixed energy pricing of $0.015 cents for the first two years, $0.018 cents for the third year, and then $0.021 cents per kilowatt hour in years four and five. They take away the demand charges. That’s a huge savings for you, and they will also increase your capacity payment to $3.00 per kilowatt hour or kilowatt, and that’s about $44,100 a month credit to you. The use of your local generation is limited to emergencies as previously indicated and you cannot use it in lieu of taking firm energy from Prairieland. You have to have prior approval from Sunflower. They did have an option two in their agreement that I did not model, and that does allow you more access to operate your generation, but there was not enough data in the proposal to model that. That is why at the end of the report you will see there is a lot of extra due diligence that should be done. If that is a key point for the city that, no, we want to operate our generation, that’s something you can explore under option two that Sunflower has presented. Currently, there is no governance role for Goodland in Sunflower Electric or Prairie Land Electric, and Sunflower has the lowest model cost if, the ECA, as they project at $0.022 cents per kilowatt hour averages that for the five-year term.

On the other hand, you have Kansas Municipal Energy Agency which is an unbundled supply, a diverse mix of solar, WAPA, fixed energy blocks, and then SPP market. I should go back and state that Sunflower’s proposal also has WAPA and solar because those are products that you already have. You do have direct access to ARR and TCR for congestion cost hedging. You have full dispatch control of city generation, voting rights on EMP2 and the KMEA Board of Directors.  There’s lower volatility with potential for long-term savings as shown with the comparison on page 9 of the report. Then page 10 will show you what that looks like with the 2.2 cent per kilowatt hour that Sunflower has projected as their ECA. You can see there that the price in 2027, with all things being the same, would be $.044 cents, then it goes to $.045, $.048, $.052 and then $.053. Under KMEAs, it starts off higher at $.056, $.0568, $.057, $.0586 and $.0595. Then scenario 2 is the stress test that I talked about, where you change that ECA to 3 cents, and again, that is to illustrate potential implications if the ECA were to adjust, whether that’s because of capacity deficiency, deficits, higher fuel prices or market prices. We all remember what happened back in 2019 when prices were $200 to $500 a megawatt hour for a while. Table 3 on page 11 shows with that 3 cent ECA that those costs for Sunflower jump to $.051, $.052, $.055, $.058 and $.059. They have a lower energy price than KMEA, and that transition or crossover begins in 2030 and 2031. There is some unmodeled value under the KMEA proposal, which is participation in the TCR and ARR market, which could generate between $60,000 and $200,000 a year for the City of Goodland, based on your load and historical TCR and ARR auctions. What that means is you could see about 1 tenth of 1 cent to 4 tenths of 1 cent reduction in those prices. On table 4 on page 12 I show you what KMEA’s adjusted cost would be using the mid-range, or $130,00,0 a year in TCR and ARR credits, which is about 2 tenths of a cent off of your energy cost. I think the important one, and again, these are all models based on assumptions using the same amount of energy, is table 5, which is a scenario comparison. You have Sunflower with a $.022 cent ECA would be a 5-year cost of about $12.7 million, or $.0486 a kilowatt hour. If that ECA were to average $.03 cents, that cost goes to $14.3 million over 5 years, or $.055. KMEA’s base proposal, without factoring in any TCR and ARR credit, is $13.9 million, or about $.0576 per kilowatt hour. If you factor in the 2 tenths or 2.5 tenths of a cent credit, the 5-year cost for KMEA is 13.3 million or $.055 cents. The next slide just shows the average costs based on those numbers I just showed you, where you have Sunflower’s proposal, Sunflower’s proposal with the stress ECA, KMEA’s base proposal and KMEA with a TCR and ARR credits. You can see those on pages 10, 11, and 12 of the report. The next one is TCR and ARR participation in market exposure. There’s a section in report that describes what those are and how they are used. Overall, auction revenue rights give rights to receive revenue from congestion and transmission congestion rights offset higher prices caused by congestion.  Sunflower uses ACES to maximize the value to their ARR and TCRs, which is on page 17. They average $1.30 to $4.00 per megawatt hour annually. That was between 2019 and year-to-date 2025. 

When I received that information from Mr. Linville last week, again, the distinction is not in value because the ECA fluctuates so many things can change, but the distinction is local control versus pooled management. The operational flexibility that I talk about in the report is your 15 megawatts of generation in a power plant that you have had for 75 years. Under the discounted full requirements proposal, the use of those generators will be restricted to emergencies, which is defined as “Prairieland is unable to serve your demand at the interconnect point”. Therefore, you would not be able to use them if prices spike to $200 an hour for half a day. If you look at the Southwest Power Pool, they have a live view of the market and can see how those prices spike. There have been times in the last week where it has spiked over $500. You do not see that on your bill because it smooths out. But during long-term events, you can see those prices stay there for a while and people may decide to run their generators to offset those costs. Option two, I can mention, is not modeled because there is not enough data, but that is something that can be looked at in the enhanced due diligence. Under KMEA’s proposal, there’s full control of its generation, which would enable strategic operation to reduce exposure to high-cost market events.

In terms of long-term considerations, the Kansas Corporation Commission issued a report in 2025 that talked about capacity deficits. I did put in the report what the cooperative capacity deficits are, and I believe it’s 2033 when there’s an about 11megawatt deficit. Mr. Linville told me that that is not what Sunflower projects for them. This report is all cooperatives in Kansas. I did not address the capacity deficiency in the report for municipal utilities for one reason. If a city, another public power entity in Kansas becomes capacity deficient, it does not affect your contract. But if a cooperative, like Sunflower or Prairie Land, becomes capacity deficient, that is going to affect your contract. In 2023, KCC says that all cooperatives would have a surplus of 83 megawatts. In 2028 it shrinks to 11 megawatts and then 45 megawatts deficient in 2033. The forecast reflects tightening reserve margins in the region due to increased demand and updated planning reserve margins. Again, Mr. Linville says that is not what they project for their cooperative. This does not project the potential 7-megawatt load growth for the city, should your economic development project come to fruition. So there are some unknowns and modeling assumptions in this report. First, the future ECA levels are not guaranteed. Sunflower projected a $.022 cent per kilowatt hour ECA. I modeled that, plus a stress test of $.03 cents. I estimated the revenue estimates for KMEA at 1 tenth of 1 cent per kilowatt hour or 4 tenths of 1 cent. Solar energy at approximately 9% and WAPA at 6% of your portfolio are included in all the scenarios. Market price and solar/WAPA output impact your cost projections. Mr. Linville did tell me that from 2019 to 2025 year-to-date, it is about $1.30 to $4.00 per megawatt hour that their ECA provided to their customers when it’s pulled together. When you take those $4 per megawatt hour and convert that to kilowatt hours, it is $.004 cents, which would be about the same as the 4 tenths of a cent which I modeled for KMEA.

I know it is a lot of information and I went through it pretty fast. Both of those proposals are distinct advantages and trade-off. Sunflower emphasizes simplicity, familiarity and lower projected costs under favorable marketing conditions. KMEA offers broader operational flexibility, increased governance participation and access to potential cost savings through market tools and local generation management. However, to support a fully informed decision, the city may wish to conduct additional sensitivity analysis, legal review, and scenario testing before finalizing its strategy. The sensitivity analysis should model the impact of key variables. The stress test scenarios should simulate multivariable adverse conditions and evaluate the cost exposure under the discounted full requirement structure. I believe you would be the fifth city in that structure. What would be the implications of covering your share if there were future capacity obligations? In addition, a legal and contractual review just to make sure that all risk and responsibilities are clearly identified for the city, before you make a decision. I will stand for any questions.

Mayor Showalter stated, I will start by saying I appreciate all your work on this. It is obvious you spent a great deal of time working through proposals for us. I would point out I have had a chance to look through Sunflower’s response they sent you. It is pretty pointed at the end, but I would point out, we came looking for you. You did not come to us looking to make a proposal or a recommendation. I believe that I know the answer to this, but I am going to ask it anyway just so the information is out there. You do not receive any compensation from either of these companies based on who we choose to go with? John replied, no sir, since I retired September 1st, I do not interact professionally with them whatsoever. Mayor Showalter stated, you definitely have given us a lot of information to go over. That is one of the reasons why when Kent and I felt like we needed to bring in somebody who was not involved with either of the companies and not involved with us that could give us an evaluation to help make that decision. Quite frankly, this is above some of our heads, at least mine for sure. We wanted a chance to have somebody independent a look at information so we appreciate your work. Commissioner Artzer stated, one thing that stuck out to me was in the event of emergency situations for Sunflower.  You stated it would be considered when Sunflower is unable to serve the community. Jon stated, Section 5.7 states that you are not allowed to run your accredited generation in lieu of taking firm energy from Prairieland except in an emergency.  An emergency is considered if Prairieland cannot provide the amount of energy you need at the interconnection point to serve your load or demand, then you could operate or for maintenance. Kent stated, I think the report lays a foundation for what we were trying to grasp and what staff put together to try to make proposal comparisons apples-to-apples. We had two different proposals and going to two different ways of governing operations. It is the business models that are significantly different so Jon has put quite a bit of information here that allows you to compare information in layman’s terms rather than terms of the contractual language. I do appreciate the report and it has caused staff as well as myself to go through a number of questions to make sure we are understanding completely what Jon is show.  I think it provides a foundation. It does not mean that it is the end of information that needs to be gathered to make your decision, but I think it was well worth it to have Jon produce this report for the two different proposals.

At 5:55 p.m. Commissioner Artzer requested a five minutes recess.  ON A MOTION by Mayor Showalter to take a five minutes recess seconded by Commissioner Redlin. MOTION carried on a VOTE of 5-0. Meeting resumed at 6:00 p.m. Mayor Showalter stated, I know we have some representatives from Sunflower present, I offer you the floor if you somebody wanted to speak. Mr. Linville stated, we did document most of our concerns in the written letter and I appreciate you taking a look at that. In the end, we want the city to make the right decision to meet your goals and objectives. We just want to make sure that you have the most accurate information to allow you to make that decision. To that end, Sunflower is willing to pay for an outside consultant to come in and complete the additional analysis that Jon discussed as long as the city, Sunflower and KMEA agree on who it is. Again, we want to give you guys the best information that you can have to make that decision. We feel that some of the information documented in the report is not necessarily the best information for you to make that decision. If you want to pursue this, we are willing to pay for analysis and outside consultant to do that additional sensitivity and stress test analysis. Mayor Showalter stated, I know this is an extremely difficult decision for us. We are talking about a lot of money and what decision we make means a lot to the city moving forward. It is not one we take lightly. We appreciate you stepping up to the plate and making that offer.

REPORTS

  1. City Manager – 1. Manager memo is in the packet. 2.  Zach stated, due to devastating tornado occurring in Grinnell, KS, S&M asked if they could pull their equipment from demolition site to help the town clean up.  The property is on schedule and demolition is finished.  Vice-Mayor Howard asked, what about the one tree that remains on the property? Zach stated, the tree is on the property line and I would like to talk to the property owner of the adjoining property before have the tree taken down. For 302 W 15th, the owner arrived 2 days after work began and was upset.  He notified the city that he would be contacting his attorney.  The city has not heard from the owner or his attorney; therefore, I will have Yarger continue with the project.  For 1004 Kansas, owners were approved for the Grant, the permit has been pulled, the project may not be done by June 20th, but will be done shortly after. 3. Kent stated, street crew is doing a wonderful job with the sidewalk at the Arts Center.  The steps also need to be repaired but because this is a Historic building, it will need to go through the State Historic Presentation Office for approval. 4. Pool finally is open. 5. Grant award letter from SCCF was received for the basketball goals. 6. Kent stated, the firework law has changed but local ordinance still stands the same. 7. Kent stated, there has been one application received for planning commission.  I encourage any public interested to apply. 8. We need to set date to continue planning work session.  Commissioner Showalter suggested after the regular meeting on June 16th. 9. The LKM City forum June 4th at City Hall has been cancelled and the registrations has been switched to Garden City on June 5th if interested.

City Commissioners

Vice-Mayor Howard – 1.  I am concerned about the speed and number of motorized scooters around town.  We need to address before someone gets hurt.  They need to follow the laws of the road.

Commissioner Artzer – 1.  No Report

Commissioner Myers – 1.  No Report

Commissioner Redlin – 1.  I want to commend the pool and Barb for their efforts. 

ADJOURNMENT WAS HAD ON A MOTION BY Commissioner Meyers seconded by Commissioner Artzer.  Motion carried by unanimous VOTE, meeting adjourned at 6:28 p.m.  Next meeting is scheduled for June 16, 2025.

_____________________________

ATTEST:                                                                                 Jason Showalter, Mayor

_______________________

Shauna Johnson, Deputy City Clerk 

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