Debbie Strickland, president of Strickland Construction Company, got a rude surprise when she walked into the Valley Electric Association offices to hook up power to three new manufactured homes Tuesday.

A new impact fee took effect Oct. 3. The lowest cost will be $2,325 to hook up a 200-amp connection for a standard house. The new fee meant $6,975 in costs she hadn't budgeted for on the three new homes.

"Nobody's been notified they decided to implement impact fees," Strickland said. "I know a lot of big groups are coming in -- Focus, Concordia, Beazer -- that isn't the way to do it."

The impact fees will be tacked on to the service connection fees, or "drop fees," which can already be $1,600 to $2,500 for most single-family homes, depending on the size of the lot.

"All the builders are affected. If they sold a house over the weekend their house just went up $2,300," Strickland said. "Valley Electric was already getting an extension fee. It was only about two years ago they started doing that. They started charging us from the power pole to the house."

The impact fees were one of four policies approved unanimously by the Valley Electric board of directors Sept. 27. The cooperative sent out a letter dated Oct. 10 informing builders and developers of the changes.

Valley Electric also implemented an idle facility charge, where distribution line facilities have been constructed but customers haven't yet requested service.

A $60 connection and re-connection charge will also be in effect.

The cooperative however is proposing energy efficiency performance discounts -- yet to be finalized -- for new customers subject to impact fees.

Valley Electric Association Chief Executive Officer Tom Husted said the impact fees are needed to pay for the $25 million in additional infrastructure expected to be built in the next 12 to 18 months on top of the $62 million in current debt. That includes the new transmission line around Mount Sterling to the Nevada Power grid and the completion of a circular loop around the west side of Pahrump Valley. The length of transmission lines will increase from 280 to 350 miles.

"Impact fees go to aid in the financial contribution for the new facilities to meet customer growth, that being transmission and substation facilities," Husted said.

Valley Electric executives emphasized it prevents rate increases for existing members. They repeated the mantra of county planners, that growth pays for itself.

VEA Chief Operations Officer Jim Su'euga said, "the costs are there, going to the ratepayers. They're not recovered ahead of time. The question becomes one of equity, the preservation of the members equity. We're the stewards of the trust.

"We're in an environment today that requires a huge investment. We've been trying to get a transmission line for 10 years," Su'euga said.

Husted said the cooperative will be receiving materials to begin the line extensions later this month, after finalizing the right-of-way permit from the U.S. Bureau of Land Management.

"I understand they need it but the way they went about it. They said this is going into effect today and we're not telling anybody about it," Strickland said. "They wait for a contractor to walk in the door and ask for power."

The reason the policy wasn't publicized after the vote was the cooperative was concerned about an attempt to avoid "a big free-for-all, trying to get under the wire," Su'euga said. Husted said that's what happened when the utility increased line extension costs in 2006.

The only comments the cooperative has received so far have been from the builders and developers who make a living off construction and property management, Su'euga said.

"If you went to any 10 neighbors down the street and asked, 'Are you willing to pull out your wallet and pay this cost for me,' what would the answer be?" Su'euga asked. "It's a rhetorical question, we all know what the answer will be."

The Valley Electric Cooperative is unique in the West, with a high annual growth rate that averaged 6 percent the last five years, which Husted said has now slowed to only 4 percent, still double the national average. Su'euga said VEA also doesn't have a "sugar daddy" like Bonneville Power with abundant hydroelectric supplies.

"We're seeing the greatest amount of growth that most any co-op in the West have seen. We're seeing an economic burden being placed on our system in terms of trying to keep up with that growth," Su'euga said.

The connection and re-connection charges will affect the roughly 650 connections VEA makes per month, Husted said.

"Every time we have a new connect, there's administrative cost, there's the cost of sending a lineman out to read the meter," he said. "Right now, if there is no charge, that means that those costs are being paid for in the electric rates."

Customers could reduce their power usage and their need for say, a 400 amp impact fee at $4,650, or a 600 amp connection at $6,975, Su'euga said. Impact fees for three-phase 120/208 service begin at $7,259 for 200 amps, rising up to $43,554 for 1,200 amps. Impact fees for three phase general service 277/480 begin at $16,751 and run up to $134,015 for a 1600-amp connection.

"We believe there are ways that our members can become more energy efficient whether it be with water heating, whether it be with heat pumps, improving the thermal envelope of some of our homes. So as we develop the energy efficient standards, the impact fee will be reduced for those who decide to lower the energy efficiency rating and it will be retroactive," Husted said.

Ultimately energy costs will go up, Su'euga said. But none of the VEA executives would admit the new fees will ensure monthly utility bills will be stable for the immediate future. Husted said, "This will help alleviate the pressure on upward rates."

Impact fees are already charged by utilities like Dixie Escalante Power and Overton Power in other fast-growing areas, Husted said.

People who request new service but haven't yet hooked up to the system will pay the idle facilities charge, the minimum of $20 per month.

"We've got several hundred members that have requested facilities to be built in. We've built those in and they've never utilized them. Obviously there's an investment that has been made by the utility to meet those demands," Husted said. "If we build facilities in to serve a load and if they don't take service we still have operations costs, maintenance costs, administration costs, taxes, insurance on those facilities. So that allows us to have a revenue stream that will take care of those expenses."

Strickland said the impact fees are added onto about $11,000 in costs already to hook up a new home with well, septic and the VEA line extension fee.

"We're a co-op here. Why aren't we getting an opportunity to vote on this?" Strickland asked.