LUB Considers Finances, New Members and Donations

Lamar Utility Board members discussed aspects of Light Plant finance during their meeting on Tuesday, August 23^rd.  The slim agenda covered the July financial report as well as the System Operating report, a brief overview of the pending 2017 budget and the three applications received for board membership, to replace former member Rick Beard.

Light Plant Superintendent Houssin Hourieh recapped the July financial statement which indicated that cash was down $300,678 from June. He explained the drop was due to several large payments for the month including property insurance, workmen’s compensation, interest on construction bonds and a monthly payment to ARPA, Arkansas River Power Authority.  Accounts Receivables increased for that period by $430,794.  “The difference is due in part to the fact that we pay our bills when they are received, and the accounts receivables will come back to us usually over a two month period,” he explained.

Regarding year to date figures, retail sales revenues were up 3% or $249,993 comparing July 2015 to 2016. Overall operating expenses were up approximately $394,886 or 6% resulting in a net loss of $122,573 for the year.  Hourieh noted several factors which accounted for the drop, mostly on infrastructure upkeep and a loss of one revenue source to the Light Plant.

Some of those reasons were attributed to absorbing ARPA’s payroll for Light Plant employees, having to maintain the gas fields stipulated by PUC regulations pertaining to what is termed stranded assets and the loss of revenue from Prowers Gas Gathering which ended its contract with the Light Plant due to current low prices for natural gas. The company met with the board back in November of last year, seeking some form of financial consideration of up to $120,000 on their contract to use the Light Plant pipeline through southeast Colorado.

Hourieh gave a general overview for expenses in the 2017 budget, noting that these are only working numbers at present. “The current estimate for Capital Outlay and Improvements is $861,000 and Operations and Management is in at $355,000.  This is the first step in the budget process until we arrive at the line by line itemization.”

He explained that there was a power outage to Wiley and McClave areas on the night of Wednesday, August 17^th.  A power pole along Highway 50 north of the Arkansas River was taken out when the dump bed on an end dump semi started to raise, catching the CDOT Prepass Scanner steel pole which broke off and hit the adjacent 40 foot power pole which went down, taking the West End Circuit offline.  The accident occurred at 11pm and power was restored at 2am on Thursday.  An insurance claim will be submitted on the loss of revenue and replacement of fixtures.

“We’ve received three applications this week for a replacement on the utility board,” Hourieh explained, noting that they will be discussed in executive session, along with legal questions concerning the Lamar Repowering Project. The board will make its recommendation to the Lamar City Council which will act on filling the vacancy at a future meeting.  Regarding ARPA, Arkansas River Power Authority, Hourieh noted that the company’s agreement allowing potential buyers on site for the Repowering Project will end on August 26^th.  The agreement allowed visitors to the site and Hourieh noted a lack of interest during the 90 day period until visitors were received earlier this month.

Interim board chairman, Doug Thrall, who is also a board member to PCDI-PEP, requested time on the agenda to brief other members about PEP fundraising activities. Donations from the private sector, county-wide, are being sought to cover expenses for the next three years for the economic development organization which plans to expand the board up to 15 members and become a more business-aggressive board.  Thrall noted that the private sector is responding to requests for funding and asked if the utility board would consider a $5,000 commitment for the next three years to assist with a salary for an experienced and proven executive director, as well as operational and management funding.  Board attorney, John Lefferdink, indicated that a donation of that size could be within the parameters of the charter and the board will discuss its options during budget talks.

By Russ Baldwin