May 26, 2010 7:34 PM by David Ortiviz

Black Hills proposed plant hits roadblock

Plans to build a $525 million dollar power complex in Pueblo has hit a roadblock. The sticking point, one sentence in a 24-page agreement. Now Black Hills Energy and some Pueblo City Council members are on opposite sides of the fence.

It all comes down to something called a project labor agreement. It's one sentence in the annexation agreement, which requires Black Hills to work with the Colorado Building Trades Council to hire union workers and pay them higher wages and benefits. Under that condition, Black Hills Energy refuses to sign on the dotted line.

The company says the labor agreement could raise the cost of the project by up to $50 million--an expense that would be passed on to customers.

Now the City of Pueblo finds itself in a tough position. If they take out the labor agreement, they upset the unions. If they leave it in, Black Hills Energy could build somewhere else and the city would loose millions of dollars in tax revenues.

"I do support the project labor agreement, but I'm also a realist," said City Council President Larry Atencio. "If (Black Hills Energy) won't sign it, it could mess up everything," he added.

Council is expected to vote on the agreement in a couple of weeks. If council decides not to move forward with the project, the city would have to refund nearly $5 million it has already received from the energy company.


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