Your PUD PUD News Line

5/15/2007

PUD commissioners prepare to set financial strategy

Strategic planning sessions are continuing, with General Manager Rich Riazzi outlining for commissioners possible approaches to Chelan County PUD’s finances for the next five years.

Discussions include detailed analysis of the impacts from choices ranging from raising electric, water and sewer rates to slowing the fiber build-out and what effect the choices would have on key financial measurements through 2012.

In the next month, PUD commissioners will be setting the financial direction of the utility through 2012. Commissioners will be asked to make those decisions on June 11 at the fourth community strategic planning session.

PUD revenues up; Riazzi cautious about volatility

Joe Jarvis, chief financial officer, reported to commissioners yesterday that PUD assets are $9.6 million greater than budgeted after the first three months of the year. Revenues are up primarily due to wholesale power sales that have been better than expected.

“We got lucky this year,” cautioned General Manager Rich Riazzi, “and from a financial prudency standpoint, it’s not always a good idea to run your business on luck.”

Executive Manager of Energy Resources Randy Lowe reported that wholesale power sales were $12.4 million as of March 31, $10.3 million ahead of budget projections. Lowe warned, however, that power prices have been lower recently and remain volatile, as do other energy sources including crude oil and natural gas. The 2007 budget forecasts $35.3 million in wholesale revenues for the year.

The financial update included a few expenses that are over budget, specifically January wind storm damages of about $2 million.

Hearing on Monitor water project set for June 25

PUD commissioners have taken the next step in considering whether to extend water service to Monitor by setting a public hearing at 7 p.m.on June 25 in the PUD Auditoriumin Wenatchee.

At the hearing, community members can ask questions and offer opinions on forming a local utility district (LUD) to finance construction of a water system. The LUD would serve about 225 customers and cover about 1,400 acres in and around Monitor.

At a May 7 PUD meeting, Monitor Community Council members presented petitions asking the PUD to form an LUD for the project signed by 61 percent of the property owners in the proposed district. The signatures represent 76 percent of the land that would be included.

Cost to build the water system is estimated at $6.5 million, with grants covering 62 percent of the cost and government loans covering 38 percent. If the LUD is approved, plans call for construction to start in November and take about a year to complete.

Efforts to improve the drinking water supply for Monitor, west of Wenatchee, date back to 1995. The work that culminated in Monday’s LUD request started in 2005.

2006 Annual Report online

Chelan CountyPUD’s 2006 report is now available online.

This year, the report has a focus on renewal -- a new general manager, renewed community involvement and increased awareness of renewable power sources.

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