LUB Discusses Solution for ARPA Repayment to Light Plant Customers


The Lamar Utility Board began their 2018 monthly meeting with the financial statements for November 2017 which showed that cash is up $326,438 from October and accounts receivable decreased by $233,471. The total operating revenue for the month was $1,097,657 with operating costs of $840,985 for a gross operating income of $256,672.  When the non-operating revenues and expenses are considered, there is a net income of $84,290 for the month.

Total operating revenues for the year are $13,949,033 and total operating costs are $11,044,322 for a gross operating income of $2,904,711. When the non-operating revenues and expenses are taken into consideration, there is a net income of $1,320,254 year to date.  When compared to 2016 revenue from retail sales are up approximately $875,442 or 7% comparing November 2017 to November 2016 and overall operating expenses are up approximately $446,127 or 4% resulting in a net income of $1,320,254 for the year.

The monthly systems operating report showed that Lamar’s three wind turbines have generated 10,579.62 MWH’s of electricity. This is about 236.60 MWH’s more than what was generated in 2016.  The T-1 turbine was down in March and April to replace a control system PC.  Since the turbines were installed in 2003, 2010 has been the best year, followed by 2008 and 2012.  The T-3 turbine has been off-line since December 12th and an investigation showed that it was due to a failed slip ring insulator.  The investigation also determined that the generator front and rear bearings need to be replaced.  The repairs will be conducted by G.E. Wind with an estimated service cost of $14,901.98 including labor and materials.  Work will begin the week of January 8th.

The Light Plant is accepting applications for the 2018/2019 scholarship program, available to Lamar, Wiley and McClave High School seniors. This year’s topic is, “Lamar Utilities Board owns and operates three wind turbines.  Discuss how renewable energy impacts the environment and what challenges electric utilities face in implementing renewable energy.”  The scholarship application is available online and is available from each school’s guidance counselor.  The deadline for returned applications is April 20th and winners will be announced May 11, 2018.  “Each winning student from each of the schools will receive $1,000 with half from the Utility Board and the other have from the Arkansas River Power Authority,” said Light Plant Superintendent, Houssin Hourieh.

In an annual housekeeping move, the members approved the Light Plant offices on North 2nd Street as the official posting area for the bi-monthly board meeting agenda.

Although the discussion was not on the agenda, the board discussed the best and most equitable means of using the annual $350,000 settlement from ARPA to reimburse Lamar Light Plant customers with payments extending over the next 26 years as outlined in the official settlement agreement in the lawsuit between the City of Lamar and ARPA. Hourieh suggested one of two scenarios for consideration.  One would be to simply divide the number of Light Plant customers, 5,606, into the $350,000 which averages $62.43 a year or $5.20 a month based on an average of 500KWH of electricity used per customer.  The other alternative would be to apply the $350,000 against the annual Charter Appropriations Fund which the Light Plant pays to the City of Lamar each year.  That figure for 2018 will be $1,647,903 before any sugggested deduction.  He said that would be fairer to each customer based on usage as that Appropriations sum is also based on the total amount of electricity sold to customers each year.  “This way, the more you are spending on your electric bill, the more you would be able to save.  City Clerk, Linda Williams, said that the formula used to calculate personal savings could be put on a customer’s bill, but they would have to figure out their individual savings value based on their personal bill.  The board tabled any action on this matter pending additional discussion.  Per the Resolution from the City of Lamar to reduce customer’s bills, the procedure would not go into effect for several months, once the city had recouped the cost of attorney’s fees from the payments made to them by ARPA, approximately $2.5 million.

By Russ Baldwin

Filed Under: City of LamarConsumer IssuesEconomyFeaturedUtilities


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