While the squelching of the Wendover Gas purchase could mean financial disaster for owner Nancy Green it may hardly be felt by the rest of West Wendover or Wendover, Utah.
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In Tuesday’s city council meeting the council voted against purchasing Green’s gas company which was estimated to be worth about $2.5 million ( see related story this page). Most of that sum would have gone toward paying off Green’s creditors the largest of which was her long time wholesaler Turner Gas of Salt Lake and paying off the building loan for her underground pipeline system.
Without the purchase warned Green and her attorneys and the Nevada Public Utilities Commissions that Wendover Gas, which has been a major supplier of propane for over half a century, could very well face bankruptcy and be liquidated.
While a personal tragedy for Green the closing of her business could have very little impact on her customers.
According to her own attorney Jeffrey Crockett whether Wendover Gas is purchased or not the company will cease to exist before next winter.
“The PUC have been watching the situation carefully,” Crockett told the council by telephone two weeks ago. “If Nancy cannot find an alternative plan, we will have the transition for her customers to switch to propane tanks this summer. There will not be another winter like this.”
Last November the West Wendover City Council agreed to be the source of emergency funding for the near bankrupt gas company under its emergency powers for the first time in history.
At least four and perhaps six times the city came to the rescue purchasing loads of propane for Green and her customer. The purchases totaled so far some $60,000 for 37,500 gallons of propane.
But while those emergency loans came in handy for Green they apparently did not come cheap. Indeed they may have cost her, her company Crockett strongly implied.
“The PUC cannot stand idly by and allow the situation to continue” he added.
For Green’s customers on her pipeline that would mean either the purchase or lease of propane tanks from their new supplier.
“The problem is that no one wants to buy Nancy’s pipes,” explained councilman Izzy Gutierrez last month. “There are several companies who said they could take up her customers and deliver propane in tanks but no one wants the pipe system.”
The largest customer Green has on the pipe system is the Elko County School District for the West Wendover Elementary and the West Wendover Jr/Sr High School.
And it was primarily the specter of the schools being closed for lack of heat that prompted the council to lend Green the city credit card this winter.
The city of West Wendover budget would also be affected by the closure of the company in lost franchise fee revenue which averages about $60,000 a year. The revenue however would have been lost to the city anyway if the company was purchased.
Beyond the possible bankruptcy of the company, the council’s decision not to purchase Wendover Gas could indicate a decline in the power of City Manager Chris Melville.
Since becoming City Manager in 1999 Melville was the driving force on a variety of large city projects such as the new city hall, the industrial park and major upgrades to the city’s sewer system.
But while certainly impressive to the beholder none of those projects have delivered the economic growth they were originally touted to bring and have indebted the city to the tens of millions of dollars.
Last summer West Wendover even received an award from its major lender the United States Department of Agriculture for being one of its biggest borrowers in the state per capita.
Bringing natural gas to Wendover was to have been the crowning achievement for the city manager and he fought former Mayor Donnie Andersen four years just to keep the item in one way or another on the agenda.
When Andersen was defeated last November by Emily Carter the path for acquiring Wendover Gas as well as building a natural gas pipeline seemed to be clear.
The 11th hour rejection of the purchase could mean that even for Melville’s supporters Wendover entering the gas business was a project too far.
“Maybe people are waking up,” said one Wendover businessman who declined to be identified. “The gas buy was done just like every other huge project only this time the pie in the sky numbers just weren’t believed.”