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Logistics company to buy land for $1.5M
Published 2/7/2012 in Local News
TP&L president says local operation a long-term business.
By SHAJIA AHMAD
sahmad@gctelegram.com
Finney County commissioners have agreed to sell a 50-acre property for $1.5 million to a logistics company that recently moved into town and plans to make rail improvements to the site.
Commissioners on Monday heard from representatives of Transportation Partners and Logistics, LLC, a Casper, Wyo.-based company that has been leasing county-owned industrial land at the southeast corner of Jennie Barker Road and U.S. Highway 50/400 since late December.
TP&L uses the grounds as an offloading and distribution site for wind generating components such as blades and towers, and unloads, stores and transfers the items from railcars to trucks.
Company representatives approached the commission Monday about purchasing the entirety of the property due to their plans to spend millions of dollars to add about 8,344 feet of track to the site, an effort to significantly expand the scope of their business by bringing in more wind parts and components by rail for their customers.
Jim Orr, president of TP&L, told commissioners that their business plans for Finney County are permanent.
"As we developed the site and our customers have seen it, it's turned into a long-term (business)," Orr said. "We thought we'd receive some (Kansas Department of Transportation) rail grants, but that's not come to fruition, so we'll belly up the money. ... (But) it just didn't make a lot of sense to do that without ownership."
County commissioners had agreed in a Jan. 26 special meeting to apply on TP&L's behalf for funding for rail improvements through KDOT.
Since that time, local officials and company representatives have learned that KDOT has denied the county's request for any assistance on the private project. The improvements are estimated to cost $2.7 million for materials and construction and $3.4 million for related costs, including "dirt work to build up the rail bed, installation of the additional track and of the switch required to move the trains onto the spur," according to the documents submitted to KDOT.
Commissioners spoke in support of the company's interest to purchase the site but also expressed a few of their concerns about the long-term viability of the business.
Commissioners also mandated a stipulation in their agreement to sell the land that will give Finney County or Garden City the first right of refusal to purchase back the property if or when TP&L would decide to re-sell.
Orr, TP&L's president, tried to assuage some of the commissioners' concerns.
"We're in a radius that fits the future development of wind for the next five to 10 years — that's how we've come to where we're at now," he said. "We live and die by tax credits, like many industries. However, we all need power and the (federal) government has mandated that by 2020 every state is using 20 percent green energy. The most feasible way to get green energy is through wind. ... Without the tax incentives, it still makes sense. I can't predict the future, but our customers have orders through 2015, and that's without tax credits."
County Commission Chairman Don Doll said in a separate interview he fully supports the sale of the industrial site.
"They want ownership of the ground, and I don't blame 'em," Doll said.
The property at hand was acquired by Finney County last year through a private-public agreement and with the aid of city officials in the hopes of turning the location into an industrial park.
Starting in 2010, local officials worked to acquire the land via a legal agreement that included the two governmental agencies, Bonanza BioEnergy (Conestoga) and KDOT.
As part of the agreement, the city and county agreed to pay off a $1 million KDOT loan for Bonanza at a 2 percent interest rate over the next decade, funds that would benefit the completion of a $2.58 million railroad spur adjacent to the plant to accommodate Conestoga's increased track usage.
In exchange for the loan's repayment, the ethanol company agreed to sell its 50-acre property to the county for $1.
Garden City Mayor John Doll and City Manager Matt Allen, who were also present at Monday's commission meeting, gave their blessing to the county's decision.
"I have the full faith of the (county) commission on this matter," John Doll said.
The successful completion of the railroad improvements and continued business of TP&L also is expected to create 40 direct jobs and 85 indirect jobs, such as trucking and hauling work, local economic development officials have said.
TP&L company officials have said the project will "allow western Kansas to be an integral player in the wind generation industry," and "immediately serve the needs of wind generation companies in Kansas and in a 1,000-mile radius of Garden City."
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