During the January 28th, 2013 City Commission Financial Viability Target Issue Committee Meeting, city staff informed city commissioners Gillum and Maddox that fuel costs for the electric utility would decrease by approximately $10.5 million in 2013. However, the commissioners were also told that base rates would have to be increased by approximately $8.0 million.
Base rates are the portion of the electric bill that covers the expenses required to produce and deliver electricity. These expenses include salaries, debt service, and routine maintenance.
The staff pointed that for the last two years the electric utility had run deficits of approximately $9 million. These deficits were funded from the operating reserve fund.
City staff also noted that fuel costs for the Natural Gas utility would decrease by approximately $1 million and base rates will need to increase by $400,000.
Staff recommends that the revised rates be implemented on April 1, 2013.
As Fuel Costs Decrease, City Staff Proposes Base Rate Increase in Electric Rates for 2013 added by Staff on
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