Inland Power & Light Co. says it is considering developing a 25,000-square-foot administrative building on the West Plains, near its main warehouse and maintenance facility, and moving its headquarters there from 320 E. Second, where its offices have been since 1951.


Separately, the electric cooperative says it boosted its net margins to $3.2 million in 2006, up nearly 6 percent from 2005, and recorded strong gains in other growth indicators, with some of the strongest growth in its system coming on the West Plains.


Inland Powers 14,000-square-foot main warehouse and maintenance facility has been located on the West Plains for many years, occupying a 5 1/2acre site at 10110 W. Hallett Road, on the south side of Interstate 90 near the Medical Lake interchange.


Last year, the cooperative bought 17 acres of adjoining land and said it plans to expand the warehouse facility, built in the early 1970s when it had half the 36,300 customers it has now. It didnt disclose how large a warehouse expansion its considering, but CEO Kris Mikkelsen says now that it also is considering moving its administrative offices there, mostly to expand its space and improve communications and coordination of services.


So far, Mikkelsen says, Inland has developed only rough cost estimates for the project, which she declines to disclose, and hasnt begun to draft detailed drawings of it. Still,, she adds, Sometime this year well make a decision about the scope of that project, and whether the relocation of Inlands headquarters there is financially feasible.


The 20,000-square-foot building on Second Avenue that the company has occupied for 56 years needs updating, so one of the factors Inland Power boards will weigh will be whether it would be better to build new offices instead of updating the old building, she says.


On the financial side, Mikkelsen says Inland Powers net marginsequivalent to a private companys net incomeclimbed by $176,000 in 2006, rebounding a bit after falling sharply to about $3 million in 2005 from $4.2 million the previous year due to rising health-care and other operating costs.


I would say we had a good year, Mikkelsen says. I think weve done a good job holding down costs.


The co-op added more than 1,200 new customers last year, slightly topping the record number of new customers in 2005, and had record sales of 777 million kilowatt-hours, up from 744 million in 2005. It also had record operating revenue of $44.2 million, up from $39.4 million, but that gain was due largely to a 12 percent rate hike imposed last April 1.


The sales have been robust. The growth on the system has been robust, and the company expects its overall growth this year to be on par with last year, Mikkelsen says.


Inland Power will raise its rates another 6.5 percent on April 1, dueas with last years increaseto a sharp jump in the wholesale price it pays for electricity to the Bonneville Power Administration, which markets the power from the Northwests federal dams.


The co-op decided to spread the increase over two years to minimize its impact on customers, but Mikkelsen says this years rate hike will be smaller than previously expected because the BPA didnt boost rates as much as had been projected.


Inland Power previously had benefited from a long-term, fixed-price contract with BPA, but that contract expired last fall. For years, the co-op has touted itself as having among the lowest rates in the nation. It even had lowered its rates for a time, so the 12 percent increase last year returned residential customers to the same rates they were paying a decade earlier.


Inland Power says it refunded $1.25 million in what are called capital credits to its members in 2006, which was the same amount as in the three previous years. Capital credits are sums returned to members in the form of checks out of any revenue surplus above what the co-op needs to cover operating expenses and capital expenditures. For more than a decade, Inland Power has refunded between about $1 million and $1.25 million in capital credits each year.


The co-op employs about 100 people and now provides power to 36,300 mostly rural customers spread across 13 counties.


Contact Kim Crompton at (509) 344-1263 or via e-mail at kimc@spokanejournal.com.