MEMPHIS, Tenn. (WMC) - MLGW is proposing new hikes to water, gas and electric rates for customers.
It’s the utility company’s latest request to Memphis city councilors to increase rates.
The good news is this request isn’t as high as last year’s. But the bad news is the total cost for improvements is higher -- $1 million.
On Tuesday, MLGW CEO J.T. Young made his budget presentation to council members in committee. He says their biggest concern is the city’s aging infrastructure with some equipment dating back to the 1920s.
MGLW wants to increase water and electric to the tune of about $14 a month for customers over a three-year period.
But the big question is if customers are willing to pay more.
“We know customers don't want to pay more and I get that and that's understandable, but I do believe from a value perspective our customers understand that if you want to get better you have to make an investment.”
Young says Memphis has had the lowest average utility bills in the country 4 of the last 7 years.
A recent review by Baker Tilly and HDR Engineering found the city's infrastructure to be in urgent need of repair.
“You can look at the data, our power outages are too high, our water is a treasure we have to protect, so the only way to make those investments is to increase rates,” said City Council chairman Kemp Conrad.
Conrad says he would be in favor of raising rates... primarily because of all the savings that has been identified this time around. MLGW offered more than 90 million dollars in internal operational savings such as cutting staff by 11 to 13 percent over a period of time.
“Everybody just want to pay a fair amount. They don’t want to be overcharged because of inefficiencies in how we're running the utility,” said Conrad.
Items on the high priority list for MLGW includes tree trimming and sub-station repairs.
They also want to work towards improvements such as LED lighting and converting overhead powerlines, underground where feasible.
In the coming weeks look for a public hearing on the rate increase.