MLGW board approves rate hike - WMC Action News 5 - Memphis, Tennessee

Reported by Anna Marie Hartman

MLGW board approves rate hike

Ratepayers will soon be shelling out more money this winter. Late Thursday afternoon, MLGW Board Members approved a rate increase.

The winter months are just around the corner. After Thursday's meeting of MLGW's board of directors, it may cost you more to keep warm this winter.

When the gavel went down, MLGW rates went up. "Memphis Light Gas and Water has not had a rate increase in four years," MLGW Jerry Collins, MLGW Interim Chief. 

The budget, which still requires city council approval includes, a 6.8 increase in gas rates and a 14.9 percent increase in the cost of electricity. Water rates are actually going down 3.1 percent.

Collins adds, "Everybody knows that costs go up."

That's not what some rate payers wanted to hear. They say they're not happy at all.

More than half of the increase will be spent on Other Post Employment Benefits.

"Basically, what we're doing is we're setting money aside so that we'll have a pot of cash that will fund future health benefits for retirees," adds Collins.

It's a new federal mandate from The General Accounting Standards Board that affects all governmental agencies.

The utility has already set aside $66 million. "We're ahead of the game but we still have a large sum of money that has to be funded," Collins adds.

The rest of the money from the rate increase will be put toward other operating expenses.

Collins says it will go for things like employee raises, an increase in the cost of electricity and buying equipment.

If the city council approves the increase, an average utility bill of around $176 per month will go a little more than $3 a month.

The MLGW budget will go to the Memphis City Council on November 6th. The utility will also ask the council to hold a public forum on November 20th before the council's final vote on the budget.

While rates are going up in Memphis, Entergy Mississippi says its cutting electricity rates by nine percent.

The new rate will be in effect through the end of 2007.

Southwest Tennessee Electric says its rates will remain the same.

Click here to email Anna Marie Hartman.

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