UPDATE - MC UTILITY RATES ON THE RISE?

MC Utility rates on the rise?
By: Howard J. Castay, Jr.
(from the Tri-Parish Times)

Morgan City residents may have to dig deeper next month to pay their utility bills, if the city council grants Mayor Tim Matte’s wish to approve a utility rate hike.

The increase, according to the mayor’s estimate, could cost a residential customer with an average utility bill, an extra $20 a month, or at least $240 a year, and it could cost a business customer with an average utility bill, an extra $40 a month, or at least $480 a year.

Morgan City uses revenue from its utility payments to fund police and fire budgets, along with public work crews. This practice dates back to Dr. Charles Russell Brownell, who was mayor for 32 years, from the 1951 through 1982.

Matte said he wants to hike up utility rates on electricity, water, gas and garbage collection, because utility funds are contributing less and less to the city budget, yet at the end of 2008, the city had a $1.236 million profit in utilities.

Matte explained his reasons for the rate hikes last Tuesday before the city council. On August 25th, residents and business owners will have an opportunity to weigh in on the issue, before the city council votes on the matter.

But while introducing the ordinances detailing the plans for the increases on electricity, water and gas last week, Matte told the city council, “We will not be pricing ourselves out of the market as far as new residents or businesses are concerned.”

But he said another reason for the utility hikes is that the city is now experiencing dwindling sales tax collections, after experiencing a huge increase in tax collections.

“I can assure you that every day we look at all of our expenditures and it’s not as if we’re continuing to go out and spend. Last fall, our cash position was dangerously low…working capital was also dangerously low, as we had extended hundreds of thousands of dollars for hurricane recovery, and we had to wait to be reimbursed by FEMA…It’s never a good time for a rate increase,” he said.

Matte said these high collection rates have been one reason why the city has been able to postpone a rate hike. “But now, obviously this is not going to happen with what we see going on in the nation’s economy,” he said.

Matte said the last time the city raise rates base rates on electric bills was in the mid-to late 70’s. He said the city raised gas rates in the mid 80’s and water rates in 2003.

Matte offered no plans or suggestions to combat what he said is shrinking effort from the city utility fund, like a instituting a four day work week at city hall. Nor did he bring up plans for personnel lay-offs. He said that over the past couple of years, the city has had to eliminate some programs it could no longer afford, and “we will continue to do that, to make the burdens on the tax payers as little as possible.”

Still, a breakdown of the city’s year end 2008 utility fund budget shows the electrical department with a $987,517 profit, and the gas department with a $325,718 profit department. Mosquito

Control expenses even saw a profit at $23,779.

But, there is a $400,000 jump in personnel expenses, from 2001 to 2008, in the electrical department.

The water department saw a loss of $100,775.
Matte is proposing a 15 percent water increase in 2010 and another 15 percent increase in 2011.
Although the city is making progress toward making improvements in its water quality and distribution system, as it just rebuilt a new clarifier, and has applied for stimulus money to build a new water tower, the mayor said, “It’s imperative that we raise the funds to continue to provide good services, and to avoid things like boil water notices.”

Also, Matte said personnel costs in the water system have risen because the city needs to hire persons who are certified in various issues dealing with clean water. “Years ago, this used to be an entry point for persons who wanted to work for the city. That’s not the case anymore,” he said.

Morgan City resident Sara Kidd was the only citizen to address the council last week, on the proposed utility rate hikes. However, she limited her comments to the garbage rate hike as she expressed concerns about discontinuing curbside trash. Kidd is the sister of Morgan City Councilman Luke Manfre.

Kidd agreed that citizens should pay more for garbage collection, particularly because the $1.08 fee per month is less than a price of a snowball. She said that periodically while travelling en route to work, she has noticed everything from baby strollers to sofas placed on curbs for garbage pickup. “Why do we need to look at these things for days,” she said, commenting that they appear to be unsightly in the city’s neighborhoods.

“This is costing the city a fortune,” as she said the city is paying an annual $525,000 in landfill tipping fees. She also urged the council to stop “babysitting,” residents who rely on the city to collect their debris.