Archive for Thursday, September 29, 2011

Mayor, city council discuss utility rates with patrons

September 29, 2011

Lloyd Lam and Doug Combs' public comments about Baldwin City utility rates sparked a response and conversation with Mayor Ken Wagner at the Sept. 19 meeting.

Lam and Combs, both Baldwin City residents, spoke separately about the cost of their water and electricity during the summer months. The Baldwin City Council and Wagner listened to their concerns, responded by saying they understand and explained why the rates are high.

“I know you've heard this many places from many people and I've heard it from many people, too,” Lam said. “I've had people ask me what my bill was for that month. I think, 'wow', we're hurting ourselves. I've heard two businesses closed because they can't afford to do business here.”

Wagner expressed his sympathy for the city raising the rates in July.

“We probably shouldn't have picked the hottest month in Kansas to do a rate increase,” Wagner said. “That wasn't the wisest decision.”

The city council approved a 6 percent raise that took effect in July 2010 and another 6 percent raise in July this year. Wagner said the city was spending about $100,000 of its electricity reserve fund because it was losing money two years ago. A rate increase was debated at that time, but wasn't approved until a later date.

He also said that a fuel-cost adjustment has been added to bills of city customers. Kansas City Power and Light began adding it to the city's bill, so the city has passed the fee to its customers during the past year.

“When I ran for city council in 2000, I thought our electrical rates were very high,” Wagner said. “That was one of the major factors that made me want to run for city council. I thought I could change that. Once I got into, I discovered that the electricity enterprise funds pay a lot of bills here in the city. If we got out of the power business our taxes were going to go up, because we take the profits from that electric utility and put it back into the general fund through some transfers.”

Wagner and members of the city council agreed with the patrons that Baldwin City has high utility rates, but Wagner and City Council Member Jason Mock tried to rationalize the high costs.

“At Heritage Tractor, we were without power for three days this summer,” Wagner said. “KCPL dropped its feed three different times to the industrial park east of town. I called some of business buddies and their power was on. So as a business owner, I appreciate the fact that Baldwin City power is on, what I perceive, KCPL does. It didn't always used to be that.

“There is a level of service that we're probably paying for,” he said. “It's the dagger in that which rate payers see and what is it worth? Everybody has their own determination of what it's worth.”

Mock later stated a similar sentiment to Wagner's regarding the electrical rates.

“I want to emphasize that we have a high quality of service,” Mock said. “While it is a bit more expensive, you're not just paying for electricity, you're paying to keep your lights on. Some of those big storms that rolled through this summer, knocked out parts of Topeka, Lawrence and Kansas City. We didn't have anything like that this summer. So it's kind of a catch-22. You can pay a bit less and your lights will go out or pay a bit more to keep them on, especially in winter when you want those lights on.”

Electricity wasn't the only utility cost that was discussed at the meeting. Wagner also touched on the cost of water in Baldwin City. He said the Baldwin City has endured double-digit percent increases from the city of Lawrence for its water.

He also said that the city council has dipped into the water reserve funds to pay for the extra costs, instead of increasing rates. However, that may change in the near future.

“Every gallon of water we sell to rate payers, we're losing money, because we've elected not to pass on those water rate increases,” Wagner said. “We're getting between a rock and a hard place. If you owned a business, you wouldn't run it like this. You wouldn't be dipping into your savings and running it at a loss like we are right now. That's why we are partnering up with the Sunflower Water Authority and the city of De Soto.”

Baldwin and De Soto have agreed to create the Sunflower Water Authority, but it's in the planning stages. If it progresses, major infrastructure upgrades will have to be made between the two cities to get the water to Baldwin City. For now, Baldwin City will continue to get water from Lawrence.

“We appreciate you coming here and telling us this,” Wagner said. “We hear it as a council and Chris and I have talked about it. We're trying to hold the line on that kind of stuff, but give the people of Baldwin a level of service they deserve and respect. I've probably said way too much here. The reason I've said all of this is because we take it very seriously. You can debate whether we are doing it the right way or not.”

Comments

Stacy Napier 2 years, 6 months ago

I sense some double speak here. Mayor says the rates had to be increased because 'Wagner said the city was spending about $100,000 of its electricity reserve fund because it was losing money two years ago'

Then he explains that it is ok

"because we take the profits from that electric utility and put it back into the general fund through some transfers.”

Now which is it ? You can't lose money and then have profits. Give me a break. We need out of the power business for good. Same things the crooks in office ln Lawrence are doing with that money.

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