Burley City Council increases electric and water rates Staff Reports

BURLEY – The Burley City Council voted to increase electric rates for its residential customers and agreed in principle to an additional two-percent increase in the water base rate and two and a half percent increase in the water use rate for residential customers. Because the increases are less than five percent there will be no public hearings for the public to give comment.

These increases mark the fourth time in the past five years that water rates have been increased and the fifth time in the last five years that rates for electricity have gone up. Managers for the water and electrical departments said the rates were to keep up with inflation and to pass along wholesale rate increases from Bonneville Power.

According to managers from both departments, there haven’t been any equipment purchases that would have caused these increases and that the bottom line was trying to generate funds for a contingency in the electric department to cover any future substation improvements. The water department will use the additional funds to make improvements in the water master plan, including improvements in the city’s above ground water storage tanks.

As a municipal run utility the City of Burley professes that it only charges residents the operational costs of providing services, but it is well recognized that the city uses the surpluses it generates in the electric department to fund operations in other parts of the city. Losses at the golf course are one of the perpetual siphons of cash out of the electric department. This is one way that non-golfers are forced to pay for a game they don’t play.

In the 2019 budget year there is $127,000 budgeted for new vehicles in the electric department alone. It is a common practice for the electric department to buy new vehicles on a perpetual basis, giving their one or two-year-old vehicles to other departments in the city that don’t have the regular surpluses in cash. Another common way that the electric department siphons cash away is by city hall charging it extraordinary fees to send out statements to city utility customers.

In 2019 the city charged the electric department $427,000 for mailing bills to customers while at the same time only charging the sanitation department just $25,000 for the same services. Other departments pay more, water - $120,000, sewer - $45,000. Rent on city owned facilities is another method of moving cash surpluses out of the utility funds and into the general fund where it can be used for whatever the council determines. The library pays $2,500 rent while the electric department pays $45,000 rent, the water department pays $33,000 in rent and the wastewater plant pays $12,000 rent.

Councilman Jon Anderson once proclaimed that the city could be sued for its practice of overcharging its electric customers, though he must have forgotten about it because he voted in favor of all rate increases. The only councilman who did not vote to raise rates was Bryce Morgan, who was absent from the meeting.

Water rates will be on the agenda at the November meeting but the council has already voted in principle for its proposed increases. The 2019 city budget can be found on the city website as well as financials going back to 2013.

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