Utility Board Approves 2021 Budget, Moves Forward on Rate Adjustment

South Plant Scheduled for Demolition

The Lamar Utility Board members discussed the Light Plant’s 2021 budget with Superintendent Houssin Hourieh during their October 13^th meeting. The budget includes total revenues in excess of $17.8 million of which $16.4 million is from retail electric sales and the balance generated from wind turbine production. Total operating expenses are estimate at $15.2 million which includes $11.1 million for power supply. Personnel costs are set at $1,275,722 and $1,780,461 for repairs and maintenance. The annual Charter Appropriations for 2021, an amount paid to the City of Lamar by the Utility Board, is $1,780,285. However, that is reduced by a $350,000 credit transfer from the Lamar/ARPA settlement stemming from the Lamar Repowering Project. Other expenses are for assorted capital outlays up to $801,000. Board members approved the new budget with a unanimous vote.

The board also considered proposed rate modifications derived from the study conducted by the Nebraska Municipal Power Pool and outlined for board members during its September 29^th public hearing and subsequent meeting.

The board has recommended introducing rate increases over five separate phases each year between 2021 and 2025 starting on January 1, 2021. The Residential (General Service Classification) monthly service charge, based on kilowatt hours, would start at $13.75 for 2021 and increase by approximately $1.75 as a Customer charge each year, up to $20.75 per month by the year 2025.

General Service/Small Customer charge rates would begin at $25 in 2021 and increase to $37 by 2025; General Service/Large will begin at $37.50 in 2021 and increase to $55.50 by 2025. General Service/Large Power Secondary works on a summer and winter rate schedule with both schedules ranging between $316 in 2021 to $350 in 2025; Large Power Primary would range between $372 to $425 for the five-year phase.

Uncollected accounts to be written off for 2019 totaled $36,393.53 which is one quarter of one percent of the utility’s electric sales revenue of $14,035,973 for the year. The annual budget for write-offs is $70,000, which according to LUB accountant, Lisa Denman, is considerably less than previous years with 2019 at $63,000. The delinquent accounts are being turned over to a collection agency for future action.

The board reviewed purchase orders amounting to $1,090,060.72 of which $1,078,455.04 required approval. This included $1,062,345.72 for the September estimate for power purchases from Arkansas River Power Authority, ARPA. The board approved payment of bills for the month at $162,791.42 and was presented with a summary of its annual audit for 2019 by Ron Farmer of RFarmer, LLC.

By Russ Baldwin