Fair Play on Propane Delivery Causes Stir at Mammoth Council

A question of competition and contracts over propane delivery came up at the Mammoth Town Council Wednesday night.

Reporter Laura Kirkner writes-

In a last dash effort, Town staff tried to push through a transfer of a franchise agreement from Rock Creek Energy to Amerigas. Negotiations had come down to the wire, and a final resolution had not been written until two hours before it was presented to Council at approximately 10 p.m. on Dec. 17.

Since Council is required by law to cut off their meetings at 10:30 p.m., representatives from Amerigas, Rock Creek, and Turner Propane, the company claiming that the franchise sale creates an anti-competitive situation between Amerigas and Turner, all rushed to the podium for their chances to speak.

Rock Creek Energy constructed the propane pipeline system that supplies many businesses and homes in Mammoth. In order to encourage competition, the original franchise agreement with Rock Creek Energy allowed the other two propane companies, Amerigas and Turner Propane, to use the system to supply customers along the 3.3 miles of line at a cost of $ .32 a gallon to deliver the gas.

Inside the lines owned by a third party, the gas of two competitors mingles together on its way to the customers. With Amerigas looking to buy the pipe system and franchise agreement from Rock Creek, Turner Propane and a number of homeowners associations are concerned that the deal could give one company too great of an advantage.

David Baumwohl, a local attorney who came to represent five Homeowners Associations, pointed out that the public really needed a chance to be able to comment on this situation.This affects the entire town, he said. There is insufficient information to approve this tonight.

The representative from Rock Creek Energy, however, pointed out that if the Council did not approve the transfer that evening, the deal might not go through. Amerigas seconded this thought.

Local John Vereuck, however, explained that the Town had tried to get Rock Creek to the table for several years with no success.

They have a business deal, we have a town, Vereuck said. The public needs to be allowed to comment.

After much hemming and hawing, Council decided to continue the item to the Jan. 7, 2009 meeting even though that could jeopardize the business deal.

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