After nearly two years disputing the cost of powers lines, Oro Valley and Tucson Electric Power find themselves at a stalemate.

Since 2007, town and utility officials have fought over who should pay to have a stretch of power lines running along Tangerine Road put underground.

The improvements could cost as much as $700,000. TEP has offered to pay $470,000 of the total if the town pays the rest.

“Our position remains unchanged,” TEP spokesman Joe Salkowski said.

TEP officials said a section of lines, between La Cañada Drive and La Cholla Boulevard, needs increased capacity or risk an overload that would leave as many as 2,200 households without power.

The company will pay for the extra capacity as long as the improvements remain above ground, possibly by adding another tier of lines atop the existing ones or installing a set of parallel lines.

But that’s unacceptable to town leaders.

“The town has been of the position that TEP has to abide by town ordinances,” Town Manager David Andrews said.

In 1997, the town council adopted an ordinance that mandates all new power lines along Tangerine go underground.

The ordinance was aimed at preserving mountain and desert views along the road.

The town council in 2007 rejected a plan that would have allowed TEP to build the needed power lined above ground.

Town leaders maintain that TEP, like any entity conducting business in Oro Valley, must abide by existing rules. That means putting power lines underground and paying 100 percent of the costs to do so.

That’s tantamount to asking customers in other areas served by TEP to pay for a cosmetic fix that benefits only Oro Valley customers, Salkowski said.

“We still don’t believe it’s appropriate to ask the rest of our customers to subsidize underground lines in other communities,” he said.

In a November 2007 letter to the Arizona Corporation Commission, TEP’s lawyer wrote that the town had partnered with the utility company in the past to pay some costs associated with putting power lines underground.

In fact, the attorney contends, the town in years past has allocated $800,000 for such undertakings.

When asked if the utility company would continue to serve residents in the affected areas, Salkowski said they would.

The town council recently met in a closed session to discuss with the town attorney a possible course of action. No official plan has emerged.

Town Attorney Tobin Rosen said that the Arizona Corporation Commission earlier this year chose not to act on an informal complaint filed by the town.

The town could file a formal complaint and allow the matter to course its way through the commission’s arbitration, Rosen said.

The town likely would not pursue a remedy in the Pima County Superior Court system, he added.

Salkowski offered two possible remedies.

Residents in the affected areas could work with the company to create a special improvement district, essentially agreeing to charge themselves more money to pay for underground power lines.

The other option, Salkowski said, would be for the town to use a portion of the 2 percent utility tax to pay for the work.

Oro Valley residents pay the tax on water, electric, gas and cable bills. Last year, the town collected more than $1 million from the tax.

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