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Copper costs a concern for downtown utility project

By Staff | Oct 20, 2010

City Manager Gary King is concerned the increasing price of copper will drive up the cost of the underground transmission line project through the CRA.
The Community Redevelopment Agency board has a not-to-exceed amount of $4.5 million dedicated to the project.
King said he has not received an answer from Lee County Electric Co-op about how much copper is needed “pound wise”, nor has city council given a clear indication of how to move forward.
King said he has a resolution drafted to present to council, but until council commits to a futures contract, LCEC begins communicating, the city is at risk for cost overruns.
“By doing nothing we’re gambling with taxpayers’ dollars,” King said Tuesday.
Construction for the project is scheduled to start in January 2011, according to documentation provided by the CRA staff.
Cable design from the under-grounding should be completed by the end of the year. LCEC should be able to provide the necessary information so the city can purchase the copper, King said.
King said the price tag on the project has already increased an additional $160,000, as the price of copper has increased since the contract between LCEC and the city was signed in June. As the price of copper increases by 10 cents, it tags an additional $24,000 onto the project, according to King.
“I’ve been watching with great pain as copper continues to climb,” King said.
CRA Board member Jack Evans said LCEC’s “lack of communication” was “nothing new”, while CRA Executive John Jacobsen said he’s urged the co-op to buy futures for the project.
“We suggested months and months ago they buy futures on this … they didn’t want to do this then and they don’t want to do it now,” Jacobsen said.
CRA Chairman Don Heisler urged the board to not jump ahead of the process, and to exercise patience as LCEC finishes the design portion of the project.
“Posturing and aggravation doesn’t get us anywhere,” Heisler said. “Historically we’ve had less-than-perfect relations with this company but we’ve gotten past it and we’ll get past it this time”