Utility co-op disaster funding bill goes forward in committee process

Rural cooperatives provide electricity needs to many parts of Greater Minnesota. Because they provide this, they are eligible for dollars from the Federal Emergency Management Agency when a disaster occurs.

By law, FEMA can provide up to 75 percent of a recipient’s disaster costs under a federal disaster declaration.

Rep. Dean Urdahl

“The State of Minnesota pays part or all of the remaining 25 percent of eligible costs for local government units,” said Rep. Dean Urdahl (R-Grove City). “I want to make utility co-ops eligible for this disaster relief.”

Sponsored by Urdahl, HF484 would authorize state grants to compensate utility cooperatives for their non-federally reimbursed share of disaster response costs. It would only apply to future disasters.

Approved Wednesday by the House Public Safety and Crime Prevention Policy and Finance Committee, the bill was sent to the House Job Growth and Energy Affordability Policy and Finance Committee. A companion, SF599, sponsored by Sen. Scott Newman (R-Hutchinson), awaits action by the Senate Finance Committee.

Urdahl said the bill is about fairness.

“If you have a disaster in a municipally owned power plant in a town, it’s eligible for the 75 percent FEMA and the 25 percent state match. If it is a disaster that occurs in Greater Minnesota with an electric co-op you get the 75 percent FEMA and your ratepayers have to make up the 25 percent.”

Tim Mergen, general manager of the Meeker Cooperative Light & Power Association, said all 45 utility cooperatives in the state are nonprofits.

He said money is not aside for potential disasters and there is no insurance available for such situations. “When you line goes down, you got to put it back up and it comes out of the ratepayer’s pocket.”