MEMPHIS, TN (WMC) - After months of contentious debate, Memphis City Council signed off on a plan to raise gas and electric rates this year.
MLGW customers will face more expensive monthly bills later in 2018.
Tuesday, Memphis City Council voted in favor of increasing gas and electric rates by 2 percent after council members settled on a last-minute compromise.
MLGW said that will be roughly $18 total on the average homeowners' bill this year.
Council members appeared poised to vote down the increases again Tuesday until pleas from the council's MLGW committee chair Patrice Robinson and others to reconsider.
Memphis Light, Gas and Water officials said electric and gas hikes are needed to address "dire financial problems," including a loss of cash reserves and increased borrowing costs.
The utility said the increase is enough to keep their gas and electric divisions running with sufficient cash in the books in 2018.
It's been a highly debated agenda item at Memphis City Council meetings since December. The council already approved a 1.05 percent water rate hike to study the city's water resources.
"I want to make it clear this is heartbreaking to me and embarrassing to me that this is all this body thinks of their utility company," said councilmember Bill Morrison, who is in favor of the raises.
MLGW officials continue to reiterate that power rates haven't been raised in Memphis since 2004 and said customers enjoy some of the lowest utility bills of any major city in the nation.
"We put forth initially the proposals that we felt like were the most prudent, but in the spirit of compromise we introduced these other options and we are pleased," said MLGW's interim CEO Dana Jeanes.
MLGW's new CEO JT Young starts in mid-March. Some council members indicated the compromise was so Young could independently evaluate the utility's financial situation without walking into such a heated debate.