May Valley Water Addresses Rate Concerns to Lamar Utility Board

Lamar Light and Power Offices

Greg Colvin, President of the May Valley Water Association and Robert Fleming, board member, asked the Lamar Utilities Board what are the available rate schedules for May Valley’s potable water well and pumping facilities this past Tuesday, June 14^th.  They also asked about the potential of the Lamar Light Plant swapping some out-of-territory customers with Southeast Colorado Power Association, an idea that was forwarded to both parties last year during a legal dispute before the Public Utilities Commission over customer jurisdiction between both power suppliers.

Light Plant Superintendent, Houssin Hourieh, explained there was no rate classification for May Valley, but the closest approximation would be under irrigation.  “Any decision like that would have to come from a decision voted upon by the board,” he explained. Fleming explained that unlike an irrigation rate which would be in use for perhaps six months a year, May Valley is 24/7 throughout the year which adds to their expense. Hourieh suggested a rate study for May Valley, a move that would take from 60 to 90 days to complete, “But there’s a chance the study could make a recommendation for a rate higher than what you’re now charged.  It could go either way. The cost of service is based on a lot of factors such as inflation, interest rate, distance from a main line,” he cautioned, adding that if May Valley were classified as a water authority, the board could take that into consideration for a rate review or alteration.

Lamar Mayor, Kirk Crespin, who serves as the city’s liaison to the utility board, explained, “Because of the structure of LL&P, we can’t get into a bidding war over electric rates.  A rate study is required before any rate change occurs and the study looks at comparative costs over a certain area and once that’s done, we can make a determination on future rates based on cost of service, but it’s an involved process.”

Colvin and Fleming said they would ask their water association board for guidance on the rate study, but asked if LUB and SECPA could also explore a customer exchange based on served areas.

Hourieh noted sales of electricity through this May are up approximately 0.89% when compared to this time last year.  Resident sale were down only a fraction of a percent and irrigation sales were up approximately 25.60%.  Commercial/industrial sales were up 0.84%.  The line crew completed a three-pole circuit upgrade that feeds a sprinkler system at CR 7 and Highway 50.  Four, forty-foot wooden pole were replaced on the east end of the 24.9kv circuit when they failed pole testing.

The attorney for SECPA, Southeast Colorado Power Association, notified the board they have agreed to reimburse LUB $16,824.15 for loss of revenue linked to SECPA serving May Valley Water Association well #7 from March 2020 to August 2021, pending approval of a settlement agreement.

The Utility Board approved $709,660.60 in purchase orders out of a total of $737,136.55 of which $642,312.57 was for the May estimated power purchase from ARPA, Arkansas River Power Authority.  The total amount of monthly bills paid was $289,305.16.

The board went into executive session to discuss legal questions associated with a draft settlement agreement review.
By Russ Baldwin