Sue Sitter/PCT Cody Chilson of Dakota Natural Gas gives a presentation to the Rugby City Council April 5.

The Rugby City Council gave its support at its April meeting to a plan by energy firm Dakota Natural Gas for a feasibility study to bring natural gas to the community.

Cody Chilson, the firm’s vice president of operations, and Greg Palmer, president of the firm, presented their proposal to the council at its regular meeting April 5 at city hall.

The energy firm comes under the umbrella of Greater Minnesota Synergy and, according to Chilson, formed after American Crystal Sugar and the city of Drayton requested natural gas service.

“We started Dakota Natural Gas to make that happen and as of last fall, that community and the sugar beet processing company have natural gas,” Chilson said. “We’re currently working to bring natural gas to Hillsboro and Mayville, North Dakota. We have about half of the pipeline in the ground. They have natural gas by the next heating season.”

“The reason I’m here,” Chilson said, “is about a month ago the city of Harvey reached out to us after hearing about some work we were doing in the eastern part of North Dakota and wondering if we could bring natural gas to their community.”

” As we took a hard look at that it became pretty clear that a project that would only serve Harvey would not be economically viable, so, we took a step back and thought, if natural gas is going to be coming to central North Dakota, we needed a more regional project. Due to the size of Rugby and the proximity of Rugby to the Alliance pipeline, this was the first city I reached out to knowing it would be a key part of any potential project,” Chilson added.

“So, I called Mayor (Sue) Steinke asking if the city would be interested. In very short notice, she invited me to come to a meeting of potential large users,” Chilson said, adding, “It was well attended and she asked that I come back and give a presentation to the full council.”

Potential large users at the meeting included Rugby Manufacturing and Heart of America Medical Center.

Chilson said most customers choose natural gas due to its cost. He presented a chart to attendees at the council meeting comparing the cost of natural gas, converted to gallon units for propane. According to the chart, residential and commercial customers pay the equivalent of 66 cents per gallon of propane. “If you’re heating with fuel oil, the equivalent price for natural gas would be 99 cents per gallon, so if you’re getting fuel oil for 99 cents or less, then you wouldn’t get savings; if you’re paying more than that, then natural gas would save you money,” Chilson added.

The cost equivalent for electricity amounts to 2.5 cents per kilowatt of electricity, according to Chilson’s information.

“Prices would fluctuate due to natural gas being traded on the NYMEX (New York Mercantile Exchange),” Chilson noted.

Proposed steps for the natural gas project include analyzing costs and determining the feasibility of connecting to the Alliance pipeline, which passes diagonally through North Dakota with its closest point to Rugby located a few miles from Towner.

If the study shows potential for Rugby to receive natural gas, Dakota Natural Gas plans to secure franchise agreements with the city and large users in the community. The company will next hold public information meetings and begin construction.

Chilson said the firm hopes to secure grant funds for the project from the state.

“That being said, we have not done the study yet,” Chilson added. “We haven’t looked at everything.”

However, he added, “If I didn’t think it was possible to bring natural gas here, I wouldn’t be here.

We’ll work very hard to make this possible. I’m not telling you it is possible right now, but I’m telling you we’ll spend the time to do a study to see what can happen.”

Community members in attendance at the meeting expressed support for the project. Rugby resident and former city council member Neil Lotvedt referred to the uncertainty of electricity rates.

“The community wants a hospital and if the hospital (is) to get a new modern building, that is exactly what they’re going to use,” Lotvedt said of natural gas.

Lotvedt called the fuel option ” a no-brainer.”

In other council business, Rugby resident Maurus Brossart shared concerns with the board about a bid he placed on mowing work at Rugby’s Chalmers Addition.

“I have never dealt with any organization that has tabled a bid and either not accepted or denied it. I don’t think their legal process was handled very well. Nobody planned the bidding out at well.”

Brossart referred to a decision by the Rugby Job Development Authority at a March meeting to table his bid along with another submitted for the work.

“I feel there were several laws violated in this process of bidding,” he added.

Brossart attended the meeting by phone along with attorney Paul Murphy, who asked whether or not the bidding process complied with the North Dakota Century Code.

Council members and Steinke referred the questions to Rugby City Attorney Bill Hart, who said since neither bid was accepted by the JDA they were both rejected.

Council members discussed the role of the JDA as an arm of the City of Rugby. Steinke said City of Rugby workers were mowing the land at the Chalmers Addition.

Lotvedt asked the council about the cost of a city employee doing the work compared to the cost of hiring an outside party for the work.

“At the hundred and ninety-some dollars Maurus was going to charge to mow, do you think it’s cheaper if the JDA paid that bill direct, or do you think the city should just eat it?” Lotvedt asked.

Council member Jackie Albrecht said, “That may be a question that should be asked at a JDA meeting or in another forum.”

“They wouldn’t have any better answer than anyone here, that’s the whole thing,” Lotvedt said. “This is the only reason I’m here because you really can’t answer that question.”

“I’m just saying as a business person it’s not really feasible to not hire somebody at $190 to cut it when it’s beyond the city ordinance of eight inches,” Lotvedt said.

The council voted to reopen the work for bids and refer it back to the JDA.

Their discussion about the JDA’s role continued after they reviewed the JDA’s March minutes and financials. Steinke reported the board had hired a new director, Karl Frigaard of Greenbush, Minn.,

The council approved the minutes and financials.

In other business, the council heard a report from the City Recreation Committee detailing work done on a softball field to enable the Rugby High School girls softball team to practice. The City Ordinance Committee told the council it had declined a request to change ordinances to allow residents to keep pet snakes in their homes. Both the Finance and Ordinance Committees reported they would examine purchasing policies for the city.

The Public Works Committee reported the city water plant’s new carbon dioxide tank needed some work done in order to function properly. The tank’s seller planned to come to the water plant to service the tank. The committee reported part of the payment on the new tank would be withheld by the city until the work was completed.

The council approved a bid from floor contractor FLR Sanders, Inc. to put a water-based finish on the armory floor at a cost of $4128. Rugby High School has hired the contractor for work on their floors.

Council members also heard an update from Jim Olson of engineering firm AE2S, who recommended soliciting bids for new windows and fans for the Rugby swimming pool building. The council approved the request.

The council also approved a request by Olson to cross N.D. Highway 3 for work needed on an infrastructure project for the area near 2 ¢ Avenue.

Council members also reviewed and accepted bids for gravel and hauling grass clippings, awarding the gravel bid to B and J Excavating at $20 per square foot. Bob Spellanger’s bid for grass clipping hauls at $25 for the first two loads and $15 to $17 per subsequent load were accepted contingent on Spellanger’s compliance with city insurance liability policy.

The council approved a limited English proficiency plan to serve Rugby sewer and water customers. Council member Wayne Trottier suggested surveying residents to determine their spoken languages to better serve them.

The council also approved an accessibility plan for city buildings proposed by Independence Inc., Minot. Compliance with the plan is necessary for the city to receive grants and funds from USDA programs. The city has three years to comply with the accessibility plan.