JSDC OKs grant to GRE

The Jamestown/Stutsman Development Corp. Board approved a $300,000 jobs incentive grant for Great River Energy.

The grant, which will go to the City Council and County Commission for final approval, is based on 24 full-time jobs once the $356 million power plant is completed. The minimum hourly wage level is $25.50 and the average wage level is $34. Eight of those permanent positions have already been filled and the employees are on site, said Dennis Pozarnsky, construction site manager. Pozarnsky will be plant manager when Spiritwood Station, an electrical power and steam heat operation, is up and running in the spring of 2010. He said the rest of the positions will be filled by the end of this year.

“Not only is GRE adding jobs, but they’re helping to retain jobs at Cargill (Malt),” said Connie Ova, JSDC chief executive officer.

Ova explained Cargill needed to lower its energy costs to stay in the area. When Spiritwood Station is online, it will supply waste steam heat for use in processing at Cargill. Its contract with Cargill is 30 years.

Greg Ridderbusch, GRE vice president for business development and strategy, updated the JSDC Board on construction of the heat and power plant. He said the design puts the power plant in close proximity to industry that needs energy.

“Power plants usually have a lot of waste energy,” he said. “The heat and power design is better economics for everyone.”

Ridderbusch said the design includes backup boilers to provide steam because “a business doesn’t care if you have a hiccup in the system or a planned shutdown.”

The grant funding is an 80 percent city, 20 percent county split. The city’s share is $240,000 and the county’s is $60,000. Along with 24 direct jobs, Spiritwood Station is also looking at 18 indirect jobs in coal refining and transportation. The plant will use 610,000 tons of refined coal, dried with waste heat from Coal Creek Station near Underwood. It will be transported by Burlington Northern Santa Fe Railway.

Other spinoff jobs are possible as well, Ridderbusch said. GRE is actively seeking a second steam host, which would add more jobs to the area. If it’s ag-based it could also be a boon to area farmers.

Construction of the plant has put an average of 250 workers on site daily. On Friday, when construction was shut down because of dangerous mud and water conditions, there were 317 people working. Pozarnsky said the site is shut down until May 4 to get it back in shape and, he hopes, dry.

Mayor Clarice Liechty, who is a JSDC Board member, asked if GRE had gone to Barnes County for funding as it benefits from construction of the power plant, too. Ridderbusch said GRE has been working with JSDC as the plant is in Stutsman County. When the roll call vote was taken, the mayor said “I refrain. This will be coming to the City Council.”

She refrained from voting on the JSDC purchase of the site of the proposed ethanol plant as well. Ridderbusch described the 551.8 acres of land owned by Harold Newman and the Newman Group as “an ideal site for economic development.”

The JSDC Executive Committee is offering to buy the land for $1.975 million. In addition, JSDC will be reimbursed the total amount of $4.5 million plus interest now in escrow for construction of an ethanol plant. Along with the reimbursement, JSDC will receive a business credit of $75,000 for advertising from Newman Outdoor Advertising.

“The advertising is for economic development to attract business from outside North Dakota,” Ova said.

GRE has offered to buy 451.8 acres of the property from JSDC for $1.7 million. That leaves 100 acres for land in the hands of the JSDC for future industrial development.

JSDC Board member Ken Schulz said it’s a good deal.

“We will have invested $169,000 in this for 100 acres of prime industrial development land,” Schulz said. “And we’re getting money back that’s been tied up in escrow.”

Ova said Newman’s cautiousness about building a corn-based ethanol plant was very fortunate. The JSDC is not out millions of dollars in equity, farmers in the county aren’t holding worthless corn contracts and a there’s an opportunity to find a second steam host for GRE, she said.

Ridderbusch agreed. GRE owns an ethanol plant, he said, and corn-based ethanol is not the direction the industry is going. Cellulosic biofuels and industrial materials will be the future base for ethanol, he said.

“We’re talking with a lot of people and businesses on the cellulosic and we’re working with the (North Dakota) Department of Commerce,” Ridderbusch said. “We don’t believe a corn-based ethanol plant will work.”

The board approved recommending the purchase to the City Council and County Commission.

In other business the board:

* elected Alex Schweitzer to finish out Dr. Jim Zubernis’ term. Zubernis is taking a medical position elsewhere.

* granted the city $42,000 to cover engineering costs on the milling and overlay of Third Street Southeast.

Sun reporter Toni Pirkl can be reached at (701) 952-8453 or by e-mail at tonip@jamestownsun.com

Tags: jamestown stutsman development, great river energy, news, gre, jsdc, jamestown, grant