BWL Customers Could See Higher Rates

By: Josh Sidorowicz Email
By: Josh Sidorowicz Email

Lansing City Council might have come up with a way to avoid the mayor's proposed streetlight and hydrant fees, but Board of Water & Light customers still might have to pay more.

For the second year in a row city council is turning to BWL to help get Lansing's budget balanced by asking for an increase in equity payments the utility company pays to the city.

The proposal would add an additional $4 million to BWL's revenue payments to the city to help close a $5.5 million deficit. That would bring BWL's total revenue payments to the city to about $20 million.

This is on the heels of last year's one percent increase the city handed down to BWL that raised the rate from four to five percent.

"Over the last two years about $10 million in extra revenue will be paid by the Board of Water & Light to the city of Lansing," said Steve Serkaian, a BWL spokesperson.

"This is unanticipated revenue that the board pays the city."

And that $10 million in unanticipated costs means customers could be footing the bill.

"That in and of itself places a lot of pressure on the prospect of future rate increases," Serkaian said.

But some council members, like Carol Wood, still contend it's a better alternative than the mayor's proposed fees.

"If there are rate increases it would affect all of the rate payers, not just the ones in Lansing," Wood said. "What we're being asked to do right now is impose a fee just on the Lansing rate payers."

Although the proposed 6.2 percent return on equity brings BWL in line with the national average, it could still hurt their competitive advantage.

"We pride ourselves on being a low cost utility and there's a lot of competition for economic development and what happens is it takes away one of our selling tools," Serkaian said.

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