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279 <br /> <br />NOTICE OF SPECIAL MEETING <br /> <br />A SPECIAL MEETING OF THE COUNCIL WILL BE HELD ON Tuesday, May 17, <br />1994 AT 5:00 p.m. IN THE Basement Conference Room. <br /> <br />THE PROPOSED AGENDA IS AS FOLLOWS: <br /> <br />Work Session: Utility Rates <br /> <br />BY ORDER OF THE MAYOR <br /> <br />BY Jeanne Cox (signed) <br /> <br />BASEMENT CONFERENCE ROOM- May 17, 1994 <br /> <br /> Council met in special session on this date with the following members present: <br />Ms. Daugherty, Ms. Slaughter, Mr. Vandever. Absent: Rev. Edwards and Mr. Toscano. <br /> <br />WORK SESSION: UTILITY RATES <br /> <br /> Ms. Rita Scott, Director of Finance, reviewed the basic premises of the utility <br /> system: self-supporting; no general fund subsidy; water and sewer services provided to <br />. City residents only; gas service provided to City and County residents; major cost <br /> components are cost of purchased service, cost of operations, and capital costs; rates are <br /> based on estimated usage; the rates are designed to break even over time; working capital <br /> requirements are designed to cover cash flow needs. Ms. Scott explained that water rates <br /> are proposed to increase an average of 3.7%, sewer rates to increase an average of 7.5%, <br /> and gas rates to decrease an average of 4% (from last March rates). Ms. Scott also <br /> recormnended that the working capital be increased to 60 days from its current 45 days. <br /> Ms. Scott stated that a $145,000 loss is projected for the water system due to amount of <br /> water billed the City from Rivanna which the City is unable to bill for in return, but the <br /> loss may be offset by a potential refund of $265,608 from the Rivanna Water and Sewer <br /> Authority. The sewer system is expected to see a loss of $149,000 due to excessive rain, <br /> but a transfer from the water fund ~vill offset that loss. Ms. Scott stated that the gas <br /> system has a <br />surplus of $385,000 in the current year due to high gas usage. <br /> <br /> Ms. Slaughter questioned whether larger gas users have a lower gas rates and Ms. <br />Scott replied that there is a declining block rate structure for large gas users, but fixed cost <br />are the same for all users. Ms. Scott stated that interruptible gas customers have lower <br />rates. <br /> <br /> Council discussed increasing the amount for the Gas Assistance Program to <br />$50,000 to be funded out of the new business budget and eliminating the need for <br />matching funds (continuing to solicit contribution from the private sector) and expanding <br />those eligible to receive the funds. <br /> <br /> Ms. Scott stated that she would provide more information on proposed eligibility <br />requirements to receive gas assistance and would advertise the program more extensively <br />in the future. <br /> <br /> Ms. Slaughter stated that she was sympathetic to people who oppose using gas <br />funds for other purposes and she would not necessarily like to see the system always <br />having a profit for that purpose. Ms. Slaughter continued that she felt it was important <br />that there be a connection between the reason for the gas surplus and the way it is used to <br />benefit the public, noting that the surplus exists due to adverse weather conditions and the <br />infrastructure problems proposed to be corrected with the surplus were created as a result <br />of adverse weather conditions as well. <br /> <br /> Mr. Vandever stated that he did not think the alternative of providing a gas rebate <br />to all gas customers made sense because of the low amount which would be rebated to <br /> <br /> <br />