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QUINCY, ILL. -- Now that the Quincy Hydro Project at Lock and Dam 21 seems to be derailed, what happens now?  

The city of Quincy is looking at its options after learning late last week that its hydropower project was stopped dead in its tracks.  The Federal Energy Regulatory Commission, or FERC, denied the city's appeal and upheld its decision earlier this year to deny a license and permit for the hydropower project at Lock and Dam 21.

Where does the city go from here?

Quincy Mayor John Spring said, "We're in an investigative process to figure out what our options are."

Mayor Spring says he's proceeding with caution, and isn't giving up on the idea just yet.  He says the city has to exhaust every avenue before closing the door on hydropower for Lock and Dam 21.

Spring said, "With something like this, you don't just rush and make a snap decision after you've spent three and a half years working on it."

Spring says he was disappointed in the ruling, but confused as well.

In the meantime, the city has another problem. When the Federal Energy Regulatory Commission upheld its February decision to dismiss the city's hydro permit and deny its license, it disrupted the city's plans to repay six million in bonds it borrowed back in 2009.

Third Ward Councilman Kyle Moore says the city has nothing to show for its investment, yet it has two big payments to pay off the bonds - the first due in 2013 and another in 2016.

Moore said, "The taxpayer is on the hook for six million worth of bonds. That means next year we're going to have to levy for $4.5 million of the $6 million. We have to find some way to make sure our taxpayers don't bear all the burden all at once in the form of a property tax increase which is going to be about 200 or 300 percent of what they pay right now."

Mayor Spring said, "We just have to have a game plan as to how the taxpayer doesn't get hurt and how we will pay those bonds back. We're not at that point yet, Melissa, but we have to work on that and make sure we do it properly."

Mayor Spring said, "I hope the people will hang in there with us. I know it's easy to say, 'we told you so', but I think there's an awful lot of people who saw the benefits in this. I still think we have a future in this...we just have to move ahead."

Other councilmen like Paul Havermale say it may be time to close the door on hydro.

Havermale said, "I think we are in a holding pattern right now but with the phone calls I've gotten I don't think there's much stomach to continue on with this.

Some background:  City council members voted to take out $6.6 million in bonds back in September 2009 to continue work on the licensing of the hydro power plant. 

But now that the Federal Energy Regulatory Commission, or FERC, denied a rehearing for the City of Quincy's Hydropower Project at Lock and Dam 21 last week, the city has nothing to show for the two big balloon payments on the bond that are coming due in 2013 and 2015.

A spokesperson with FERC couldn't talk to us on the record but directed us to the written opinion.  According to the documentation, FERC affirmed its decision to deny the city's request because it misused its municipal preference.

They say the city got its permit for the project as the city, then established a private corporation to be able to apply for grant funding.

Municipalities get preference for hydro licenses because it's supposed to benefit taxpayers, not shareholders.

The city still is looking into options for Locks and Dams 24 and 25.

Here is documentation on the list of bond payments due from the city of Quincy.

Click here for a timeline of how this hydropower project began and progressed since 2006.

In the meantime, two other companies are interested in getting a hydropower permit for Lock and Dam 21.  We contacted Mark Stover of Hydro Green Energy Company out of Texas Thursday via e-mail. He told us his company will see how things progress. If the site becomes available for another potential developer, his company will pursue it. Stover also told us another company called Symbiotics applied for a preliminary permit before his company did.