Higher water rates over the next two years are locked in for customers of Muscatine Power and Water. The Board of Water, Electric, and Communications Trustees on Tuesday evening approved 5.5 percent water rate adjustments effective April 1, 2018 and April 1, 2019.

General Manager Sal LoBianco commented the company still will have some of the lowest water rates in the Midwest. "The adjustments are necessary to maintain financial stability," he said. "The increase is based on a rate study."

The board also approved the 2018 operating budgets for the Electric, Water, and Communications Utilities that were presented during the Oct. 31 board meeting. LoBianco reported the only change was a revised project summary for the West Sewer Separation Project, raising the company's 2018 cost to $392,490.

Going to the wells

The cost for drilling three new wells is going up. The board approved a change order increasing the cost of drilling wells 47, 48 and 49 by $130,683 to $1,130,987.

LoBianco said the increase was necessary after efforts by the contractor, Cahoy Pump Service of Sumner, Iowa, to drill Well 47 were unsuccessful because of soil conditions. A change in the scope of drilling Well 47 caused the cost to be revised from $321,100 to $476,686, LoBianco said.

Financial report

Muscatine Power and Water's Electric and Communications Utilities continued to outperform the budget in October, but there was a dip in the Communications Utility's profit. The October profit of $172,394 was budgeted for the Communications Utility, but actual profit was $77,994. Finance and Administrative Services Director Jerry Gowey said revenue was $50,068 below budget, driven primarily to the credit given to cable TV customers because of transmission problems.

At the same time, expenses were $47,000 above budget with cable programming costs being higher by $30,000 and maintenance higher by $19,000. For the year to date through October, profit of $1,276,391 was budgeted, but profit of $1,818,206 was posted for a cash balance of $5,731,000 and debt of $9,044,000, all to the Electric Utility.

A net loss of $212,623 was budgeted for the Electric Utility in October, but profit of $318,110 was posted. Gowey said revenue was 21.9 percent above budget, but expenses were also above budget by $319,000. For the year to date, loss of $3,077,249 was budgeted, but profit of $525,873 was posted for a cash balance of $52,645,000 with no debt.

October profit of $43,754 was budgeted for the Water Utility, but actual profit was $58,911. Gowey said revenue was 1.2 percent above budget while expenses were $11,000 below. For the year to date, profit of $3,571 was budgeted, but the actual profit was $130,225 for a closing balance of $8,905,000 and debt of $14,965,000.

In other business:

  • The board ratified payment of October expenditures and transactions totaling $10,258,071.
  • Board members were presented with 2018 MP&W calendars, which include several photos that were submitted by the public. The calendars are available at the administration and operations lobby and also be available in front of The Flower Gallery during the Dec. 1 Holiday Stroll.
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