The City of Colstrip is located in Rosebud county and is located in the south central portion of Montana. More specifically situated midway between Seattle, Washington and Minneapolis, Minnesota and approximately 550 miles northwest of Denver, Colorado. Colstrip was established by the Northern Pacific Railway in 1924 as a company town to provide coal for their steam locomotives. The mining is open pit strip mining, where draglines remove soil above the layer of bituminous coal from the Fort Union Formation.
In 1958 the railroad switched to using diesel locomotives and the Colstrip mine was shut down. In 1959 Montana Power Company purchased the rights to the mine and the town, and resumed mining operations in the 1970s with plans to build coal-fired electrical plants.
Coal mining and agriculture use has been the focus of this region for many years. In 1959 Montana Power purchased the mine and the town and Colstrip’s rich coal reserves were tapped for four large coal-fire power plants. Western Energy Company purchased the original townsite of Colstrip in 1968. The official plat of the townsite of the community of Colstrip was surveyed in 1974 and was officially dedicated on 28, July 1975. As a consequence, all street improvements and nearly all real estate is but a few decades old. In January of 2000 Montana Power transferred ownership of the power plants to PP&L.
The population base and economic circumstances impacting the region and locale continue to characterize the city, which is Montana’s newest incorporated city in the state. The community in 2007 has a population of approximately 2,375 people. Most of the population is employed by PP&L, Western Energy, the school district, in ranching, or in coal-related occupations. Colstrip has nearly 84% white population and an 11.3% American Indian population.
Although nearly 20% of persons in Rosebud County are below the poverty line, Colstrip enjoys a fairly high relative per capita income at $29,094 and a median household income of $74,473. The power plants were built in the 1970s and 1980's by a collection of contractors including Bechtel. During this construction period Colstrip was a boomtown, with a large increase in population. Plants 1 & 2 were operational in 1975 and 1976, and plants 3 & 4 were operational in 1984 and 1986.
In 1998 plants 1-4 were sold to a consortium led by Pennsylvania Power and Light (PPL), and the Rosebud Coal Mine was sold to Westmoreland Mining LLC. In this same year the City of Colstrip was incorporated.
Of the 15 major coal producing states, Montana ranks first in coal resources and reserves. In 1994, Montana produced 41.6 million tons of coal placing it 7th in the nation for coal production, today Montana ranks 6th. Two mines near Colstrip, Rosebud and Big Sky Mines, are two of the largest in the state. In 1995, the two mines produced nearly 16 million tons. The Big Sky Mine recently closed down mining operations. In 1990 the Colstrip Energy Limited Project started commercial operations. Located six miles north of Colstrip, this experimental electricity production facility is owned by Rosebud Energy Corp., a partnership that at one point included Enron. The plant uses high sulfur waste coal from the Rosebud Coal Mine's topmost one foot layer of coal.
In 1974 construction of Colstrip's 150 acre Castle Rock Lake (formerly named surge pond) was completed. The Colstrip plants produce electricity from coal using steam. The water for the steam is pumped in an underground pipe 30 miles from the Yellowstone River and stored in the lake. The lake is stocked with fish and the home for a wide variety of wildlife.
Colstrip was incorporated as a city in November 1998. After incorporation, ownership of streets and community water and sewer infrastructure was transferred from Rosebud County to the City. In addition Colstrip Community Services (CCSC), a subsidiary of Montana Power Company, transferred responsibility for community infrastructure they were maintaining to the City. The City conducted major sewer, water and street infrastructure improvements within its first three years of incorporation and in 2004 started its own Police Department. In 2007, the City of Colstrip dropped its contract with Waste Connections, Inc. for solid waste services and started handling these services within the public works department.
Colstrip has received nationally recognized awards for planning and city engineering as well as environmental awards for land reclamation. Quality of life issues are an important aspect of community living and Colstrip is home to numerous parks and a sophisticated trail system that connects the entire community. Castle Rock Lake provides outdoor recreation and wildlife habitat opportunities. With a comparatively large tax base and priority for quality of life issues, two tax districts were formed to provide services to the Colstrip community. These districts include the Colstrip Medical District and Colstrip Parks and Recreation District. Colstrip averages one park for every 100 residents. For the Sports Illustrated Magazine's 50th anniversary, it named Colstrip the top sports town in Montana. The entire community celebrates Colstrip Days annually on the weekend prior to the 4th of July.