Grant PUD approves 2017 budget, but without rates
EPHRATA — Grant County PUD commissioners passed a 2017 budget at the regular meeting Tuesday, but did not include 2017 rates. Retail rates will be on the agenda beginning in January but a decision on rates probably won’t be made until spring.
Utility district board chair Tom Flint said the rate discussion would be part of “a longer process.” Utility district public information officer Chuck Allen explained the PUD is in the process of updating its “cost of service analysis,” (COSA) upon which rates are based. Commissioner Bob Bernd said commissioners anticipate the revised rates would become effective about April 1.
Customers would be allowed to have their say on the proposals, whatever they are, before the rates are established. Some public meetings will be scheduled, both for stakeholders and the general public.
The underlying rate strategy remains the same. Utility district commissioners voted in 2014 to initiate a 10-year plan, including an overall rate increase of 2 percent per year through 2024. Rates might be more or less than 2 percent each year for individual rate classes – and that’s how it worked out in practice, with the 2016 rates increasing by 2 percent for large industrial customers and 3.1 percent for irrigators.
According to Bernd, commissioners haven’t decided yet whether any rate increase would be retroactive to the beginning of the year. Allen commented the PUD doesn’t typically impose rate increases retroactively.
The budget resolution passed 4-1, with commissioner Dale Walker voting no. He had asked that the resolution be tabled until the Nov. 22 meeting, but that was defeated on a 4-1 vote.
Walker said he had asked for more information from PUD chief financial officer John Janney, and wanted to wait until he had the results. The budget includes assumptions based on a rate increase, Walker said. “I question whether we don’t get ahead of ourselves” by approving a budget before approving the actual rates. He also had questions about the PUD’s substantial cash reserves.
Commissioner Terry Brewer said the rates weren’t actually included in the budget, and that the budget had been discussed and considered for a couple months. “I think it’s a good plan,” he added.
Flint said he thinks the budget process “has been on the right track for the last couple of years, as far as I’m concerned. We brought the budget amount down considerably from where we were four or five years ago, and essentially we’re doing a lot more with less.”
Schaapman said he wanted to address the question of cash reserves. “I don’t want this looming cloud to always be around this cash.” The PUD does have a substantial cash reserve, he said, “and there’s a specific reason why we have that cash.”
The PUD is about halfway through a two-decade project to upgrade the turbines and generators at Priest Rapids and Wanapum dams. That requires the PUD to borrow money, and Schaapman said the cash balance is important in ensuring the PUD gets favorable interest rates, especially since the other financial operations assessed by rating agencies aren’t so good for the PUD. “I have no doubt that it’s imperative that we do.” Until the rest of the PUD’s financial picture improves “that cash is going to have to stay in place and that’s just going to be a fact of life for this district.”
Cheryl Schweizer can be reached via email at education@columbiabasinherald.com.