The Murfreesboro City Council on Thursday heard Middle Tennessee Electric Membership Corp.’s sales pitch for why it should buy the city’s electric department.
Chris Jones, president and CEO of MTEMC, said the sale of Murfreesboro Electric Department would create efficiencies, reduce duplication and prevent the city and MED from having to spend on future capital investments for the power grid.
The sales price would be $245 million, with $43 million paid at closing and $202 million paid over 15 years at 3.3 percent interest, City Manager Craig Tindall said. With interest, the payment should work out to $302 million. The annual payment would be $17.3 million for the 15-year period.
Those funds would be used for the Capital Improvement Program (CIP), or large capital projects such as roads, parks and economic development efforts, Tindall said. The current CIP calls for about $777 million in projects over five years, and there is a $430 million gap.
The MED building and storage lot on North Walnut Street would not be sold to MTEMC, which would instead lease it for three years, Tindall said. The city would then have the opportunity to sell the building.
The Tennessee Valley Authority must approve the sale.
Read Tuesday’s Murfreesboro Post for additional information.