Morgan City could see hike in all utilities

Morgan City residents may have to dig deeper next month to pay their utility bills if the city council grants Mayor Tim Matte’s wish to approve a utility rate hike.

The increase, according to the mayor’s estimate, could cost residential customers an extra $20 a month, or at least $240 a year. Businesses could have to fork up an extra $40 a month, or at least $480 a year.

Morgan City uses revenue from its utility payments to fund police and fire budgets, along with public work crews. This practice dates back to the mayoral term of Dr. Charles Russell Brownell, who held the office for 32 years from 1951 through 1982.

Matte said he wants to hike rates on electricity, water, gas and garbage collection because utility funds account for less and less of the city budget.

At the close of 2008, Morgan City had a $1.236 million profit in utilities. However, the mayor said dwindling sales tax collections have been an ongoing cause for concern.

Residents and business owners will have an opportunity Aug. 25 to voice their views at the Morgan City Council meeting. A vote will follow the public hearing.

As he introduced details on his plan to increase electricity, water and gas prices, Matte told the council last week, “We will not be pricing ourselves out of the market as far as new residents or businesses are concerned.

“I can assure you that every day we look at all of our expenditures,” he added. “It’s not as if we’re continuing to go out and spend. Last fall, our cash position was dangerously low… working capital was also dangerously low, as we had extended hundreds of thousands of dollars for hurricane recovery and we had to wait to be reimbursed by FEMA.”

Matte conceded that the timing of a rate hike was unfortunate given the current economic climate. “It’s never a good time for a rate increase,” he said.

The last rate hike on electricity in Morgan City was in the 1970s, Matte said. Gas rates were raised by the city in the mid-1980s, and water rates were increased in 2003.

Matte offered no long-term plan to combat the city’s shrinking city utility fund, despite suggestions from city councilmen – including reducing the city’s government work schedule to four days a week.

However, the mayor said programs have been eliminated, a move he would again consider if needed. “We will continue to do that to make the burden on taxpayers as little as possible,” Matte said.

According to numbers provided by the mayor’s office, Morgan City’s electrical department experienced a $987,517 profit in 2008. The gas department finished the year with a $325,718 profit, while mosquito control saw a $23,779 profit.

Matte said personnel costs within the electrical department rose $400,000 between 2001 and 2008.

The water department was the city’s lone utility posting a loss last year – $100,775. The mayor is proposing a 15 percent hike in 2010, followed by another 15 percent increase in 2011 to ensure the utility closes the year with a profit.

The city recently rebuilt its clarifier to improve water quality and is upgrading its distribution system. The council is also seeking federal stimulus dollars to build a new water tower.

“But it’s still imperative that we raise the funds to continue to provide good services and to avoid things like boil water notices,” Matte said.

Morgan City resident Sara Kidd was the only citizen to address the council last week regarding the proposed utility rate hikes. However, she limited her comments to the garbage rate hike, expressing concerns about the city’s plan to discontinue curbside trash collection. Kidd is the sister of Morgan City Councilman Luke Manfre.

Kidd agreed that citizens should pay more for garbage collection, particularly since the $1.08 fee per month “is less than the price of a snowball.” She said that periodically while traveling to work, she has noticed everything from baby strollers to sofas placed on curbs for garbage pickup. “Why do we need to look at these things for days,” she asked, commenting that the discarded items are unsightly in the city’s neighborhoods.

“This is costing the city a fortune,” she said, noting the city pays $525,000 annually in landfill tipping fees. She also urged the council “to stop babysitting” residents who rely on the city to collect their debris, asking that the governing body create a penalty for setting large debris curbside.