MLGW still pushing for rate hike despite city council’s rejection

MEMPHIS, TN (WMC) - The Memphis City Council rejected proposed gas and electric rate increases at Tuesday's meeting.

However, Memphis Light, Gas, and Water said they aren't giving up hope that the hikes could pass.

MLGW President and CEO Jerry Collins will formally retire at the end of the month. Before he walks out the door, he said he hopes the council will change their minds.

"I feel like we're being held hostage at this point, being asked to make tough decisions in a snap when we could continue talking about cuts," said council member Frank Colvett Jr.

Colvett was one of the council members who voted no, but Collins said never say never.

"Who knows, we might be able to work something out before it's all over with," Collins said.

Collins said the proposed 9 percent gas rate hike and 7 percent electric hike would make sure both divisions have enough cash on hand long term.

Gas rates haven't gone up in 10 years, and electric rates haven't increased in 14 years.

"It's been an exercise that is normal in most communities," Collins said. "Rate increases are always difficult in Memphis."

So if nothing's done - what's the impact on you?

Collins said MLGW could have to do more borrowing with bond money and potentially defer some electric improvements that are part of a 5-year, $61 million plan. Part of that plan includes $24 million for new switches aimed at better isolating outages after major storms.

"It's about making our system more reliable, more efficient, and keeping in step with the latest technology," Collins said.

It's a point council member Bill Morrison tried to prove to his colleagues Tuesday.

"When the next heavy storm comes through this city, when your constituents are calling saying 'my power is not on,' I hope that you that vote no can say, 'oh but I kept your rate down,'" Morrison said.

The council also did not approve MLGW's budget, deferring that for two weeks.

Collins said since the minutes haven't been approved, he's hopeful the decision isn't final since water rate increases were voted down, then brought back and approved.

The process to name his replacement will formally start next week.

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