HomeMy WebLinkAbout8 Schedule a Public Hearing Rate IncreaseAgendaItem#8.TRUCKEEDONNERPublicUtilityDistrictCONSENTTo:BoardofDirectorsFrom:LisaHallDate:February06,2019Subject:ScheduleaPublicHearingRegardingtheElectricUtilityRateIncrease1.WHYTHISMATTERISBEFORETHEBOARDItistheBoard’spurviewtoscheduleapublichearingrelatedtotheadoptionofanElectricUtilityrateincrease.2.HISTORYOnJanuary16th,2019StaffpresentedaworkshopitemduringwhichShawnKoornofHDREngineeringpresentedandmaderecommendationsforElectricUtilityrates.ImportanthighlightsoftheJanuaryworkshopincluded:.ThisElectricUtilityCostofServiceandRateStudyanalyzestheDistrict’srevenueandcostofservicetodeterminerevenuenecessarytooperateandmaintaintheDistrict’selectricinfrastructure,developequitableandcost-basedrates,reflectprudentfinancialplanningcriteria,andestablishcost-basedratedesigns.ItisnecessarytopreparetheDistrictforchangesintechnologyandindustryshiftsandtoidentifyinflationaryadjustmentsneededtomaintainadequaterevenuetocoveroperatingcosts;.Theraterecommendationevaluatestheneedforincreasedcashreservesandwasbuiltonthefollowingcashreserveassumptions;1.Electricgeneralfundgoalwithsixmonthsoperatingbudget;2.Electricratestabilizationfundwithsixmonthscostofpurchasedpower;and3.Adeferredliabilityfundwithadequatecashreservestocoverescalatingpensionandotherunfundedliabilitycosts.4.Capitalreservefundwithoneyearbudgetedcapitalreplacement..Therecommendationisforatwo-yeartimeframeofFY2O-21asratesshouldbere-evaluatedmorefrequentlytomaintainrevenuestabilityfromyeartoyear.TheElectricUtilityoperatingenvironmentisshiftingmorerapidlyduetoincreasedregulatorycostsandnewlegislation,and;.Theresidentialandprimaryratecategoriesshouldremainseparate.
3.NEWINFORMATIONApublichearingregardingtheElectricUtilityrateincreaseisrequestedforMarch6,2019.IftheBoardadoptsnewratesforfutureyearsthefollowingschedulewillbeimplemented:.Scheduleapublichearingfortheproposedelectricrates-February6,2019(tonight);.Holdapublichearingregardingproposedrates-March6,2019;.ConsiderationofOrdinance2019-01toincreaseelectricrates-March6,2019;and.RateswouldbeeffectivewiththefirstbillprintedafterJanuary1stofeachyearbeginningin2020.Theratedesignproposesarateadjustmentof2.7%acrossallclassesofserviceinFY20andarangeof2.7%-3%foryear2021.Theproposalincludesincreasingthecustomerchargeforresidentialcustomersandincreasingtheenergyanddemandcustomers.Followingisacomparisonofcurrentratesvs.ProposedRateAdj.PermanentResidentsCustomerCharge$/MoEnergyCharge$/kWhNon-PermanentResidentsEnergyCharge$/kWhCustomerCharge$/MoEnergyCharge$/kWhSmallCommercialCustomerCharge$/MoEnergyCharge$/kWhMediumCommercialCustomerCharge$/MoEnergyCharge$/kWhDemandCharge$/kWLargeCommercialCustomerCharge$/MoEnergyCharge$/kWhDemandCharge$/kW4.FISCALIMPACTPresentRatesIFY2020Janl,2019[2.7O%I$14.10$16.18$0.132$0.132$0.132$o.132I$14.10$16.18$0.151$o.151$27.32$27.32I$0.159$0.164$272.84$272.84$0.103$0.1o6$12.86$13.24$1,196.79$1,196.79ThisrequesttosetapublichearingispartoftheoverallratedesignprocessthatmayaffecttheDistrict’sfinancesforthenextthreeyears.chargesforcommercialproposedFY20rates:$0.097$12.29$o.ioo$12.65
5.RECOMMENDATIONSetaPublicHearingfortheMarch6,2019DistrictBoardmeetingat6:00pmorshortlythereafterforproposedchangestotheElectricUtilityrates.tz:4a1UfrzLisaHallMichaelD.HolleyAdministrativeServicesDirectorGeneralManager