The Trenton Board of Public Works last night approved electric rate increases designed to improve revenue for Trenton Municipal Utilities by 11-1/2%.
However, with changes in the way rates are calculated, some customers will receive an increase of less than 11 1/2% while others will have a greater hike. The new rates go into effect with June usage, which shows up on bills received in July.
During a break between last night's open portion of the Board of Public Works meeting and a closed session, TMU Director, Chad Davis, indicated the electric rate increases would range from about 5% to 25%.
One of the changes, in the way rates are calculated, is to eliminate the all-electric rate that's been available to residential and commercial â€ś electricâ€ť customers.
Another change for residential and commercial electric customers is to have a rate for the summer months of June through September that's higher than during the non-summer months of October through May.
As a result, customers who now have all-electric rates could see increases of 15 to 25%.
Residential and commercial electric rates and commercial â€śpowerâ€ť rates all have a base charge of $10 a month.
In addition, residential customers will be charged 14 cents per kilowatt hour during the summer months and 9 cents a kilowatt hour the rest of the year.
Commercial electric customers will be charged 13 cents a kilowatt hour during the summer and 8 cents a kilowatt hour the remainder of the year.
Commercial power rates are 10 cents per kilowatt hour for the first 50,000 kilowatt hours and 9 cents per kilowatt hour for over 50,000 kilowatt hours.
There also are large industrial, street light, and security light rates.
The engineering firm Burns and McDonnell last year conducted a study to determine the cost for TMU to provide utility services. The firm also made recommendations for a series of rate increases for the electric, water, and sewer departments during a 4 year period.
This is the 1st among the series of suggested electric rate increases. Last night's vote by the Board of Public Works for an 11 1/2% increase in revenue compares to the 9% suggested by Burns and McDonnel when it issued its report last year.
However, TMU Director, Chad Davis, and Comptroller, Rosetta Marsh, cited a need for the higher figure. Mrs. Marsh explained the Burns and McDonnell model was used in determining the increase approved by the Board of Public Works.
The Board of Public Works has been expressing concern about declining reserve funds in the TMU Electric Department.
The Electric Department's expenses were about $647,000 greater than income for the 1st 10 months of the fiscal year. The net losses was more than $964,000 when depreciation is included. The Electric Department did have a $13,000 profit in February and the figures for the remaining 2 months of the fiscal year are expected to improve.
In other action last night, the Board of Public Works approved a TMU budget for the fiscal year beginning May 1st which includes the electric rate increase approved last night.
The operating budget shows profits for the Electric, Water, and Wastewater Departments. However, the operating budgets do not include debt payments and capital projects. When those figures are included, each of those departments shows a drop in cash flow from the beginning of the fiscal year on May 1st to the end of the year on April 30th of 2015. Those declines are approximately $1,413,000 in the Wastewater Department, $657,000 in the Electric Department, and $481,000 in the Water Department. That would leave unrestricted cash and investments of $1,561,000 in the Electric Department, $822,000 in the Water Division, and $656,000 in the Wastewater Department.
Those figures include TMU paying the anticipated increase of nearly 10% for employee health insurance rates. The amount of the premium increase has not been finalized.
It's also possible TMU may not pay for the increase in the insurance premiums depending on what happens with the City of Trenton's budget. The City of Trenton's budget for the upcoming fiscal year still is in the process of being developed. It was mentioned during the Board of Public Works meeting that consideration is being made for City workers to be responsible for the increase in the premium. It also was mentioned consideration was being made for spouses of City employees to no longer be eligible for health insurance through the City if they can receive coverage through their employer.
The TMU budget includes a transfer of money to the City of Trenton's general fund. Comptroller Rosetta Marsh said the amount of the transfer of funds is approximately 120 thousand dollars. The City Council last April adopted an ordinance calling for an annual transfer from TMU to the City equal to 1% of the charges for services from the electric, water, and wastewater funds as stated in the most recently completed audit of TMU. The ordinance says the amount from the electric fund is less street lighting revenue.
The Board of Public Works, when approving the TMU budget, agreed to provide a 3% increase in funds to each department for salary increases. The amount of increase individual employees receive is to be determined by department heads. That's the same system used during the current fiscal yearâ€”which also had 3% allocated for raises and associated expenses. It was stated last night the full 3% allocated was not actually used.
The Board of Public Works did not have guidance from the City of Trenton regarding salary increases for the upcoming fiscal year. That's because a decision has not been
made yet in the City's budget making process.
In other action, the Board of Public Works has granted Irvinbilt Constructors of Chillicothe an extra 6 weeks to complete the upgrades being made to the water treatment plant area. The project was delayed by the cold weather this winter. The company now has until April 17th to be substantially completed and May 17th to to be done. TMU has until July 14th to meet a Missouri Department of Natural Resources deadline for trihalomethane levels to comply with government standards. TMU already met those requirements during sampling last September and December. Another test is to be taken this week. The samples in September and December were said to meet the standards by good margins.
The Board of Public Works also approved a $4,100 change order for the water treatment plant project. The contract amount with Irvinbilt now totals $3,554-thousand dollars. That's up nearly $63,000 from the original contract amount.
The Board of Public Works held a closed session regarding legal matters. There was no announcement afterward.