FPB Board takes care of business at June meeting

FPB’s June Board meeting was chock full of business action items Tuesday night. In addition to approving the 2017-18 budget, the board also approved multiple annual price contracts, rate changes and new business service options. In addition, the board accepted a report from Energy + Environmental Economics, Inc. (E3), a consultant hired to analyze the risks and benefits of FPB’s participation in the Kentucky Municipal Energy Agency (KyMEA).

After participating in three public meetings to discuss budget needs, answering questions, and taking direction from board members, FPB staff presented its final budget proposal to the board. The budget and the encompassing five-year financial plan focus on bringing value to customers. The goal is to maintain system infrastructure that will provide reliable services at affordable, competitive rates while ensuring a sound company financial position.

In addition to staff’s recommendations, the board proposed initiatives to fund. These included potential energy efficiency programs, credit/debit card payment processing services, moving the timeline of Advanced Metering Infrastructure implementation from 2019 to 2018, considering colocation options for the data centers, and re-examining the employee compensation plan.

The board unanimously approved the budget that will go into effect July 1, 2017.

On June 6, 2017, FPB held public hearings to discuss proposed rate changes for electric and water services and to establish rates for new business telephone features and service. No oral or written comments were received. The board approved all proposed rate changes and optional additional business services.

Kentucky Utilities has notified FPB of an estimated 7.08 percent wholesale rate increase, including projected ash pond cleanup costs effective July 1, 2017. This would be a 5.2 - 5.9 percent retail increase depending on the specific rate class with an estimated increase of $6.71 per month for the average residential customer. This increase is a 100 percent pass-thru to KU. None of that increase would stay at FPB.

A recent Cost of Service study indicates water revenues fall short of revenue requirements. In an effort to minimize larger future rate increases, FPB staff recommended smaller annual incremental rate increases over the next four years. The recommended 4.8 percent overall rate increase averages to approximately $1.90 per residential city customer who uses 4,000 gallons of water per month. The average commercial customer using approximately 30,000 gallons of water will see an increase of about $6.25 per month. FPB currently provides water to its customers for about a dollar a day. The new water rates are proposed to be effective August 1, 2017.

FPB staff has received requests from customers and potential customers for additional features with the Business Telephone Service. Added features will enhance the service and give business customers more options. Hosted PBX service will provide an internet-based phone service solution that will help small business get big business features and help big businesses control phone service and costs more efficiently. These additional features and services are optional and will be available August 1, 2017 to FPB Business Telephone customers.

In response to community and FPB board concerns, in April 2017, FPB hired E3 to analyze the economic and contractual risks and benefits of FPB’s participation in KyMEA. At a special meeting on June 13, consultant Michele Chait presented the report’s findings, including a list of recommendations.

At its regular June meeting, the board accepted the report and approved 11 motions based on E3’s recommendations. FPB’s Board of Directors requested KyMEA’s board review the comments and provide a preliminary response by August 4, 2017. KyMEA is scheduled to meet Thursday, June 22 in Bowling Green. Assistant General Manager Vent Foster reminded board members and the public that anyone can view KyMEA board materials from FPB’s website (http://fpb.cc/electric)

In other business, the board approved annual price contracts for water treatment chemicals, tree trimming services, wood poles, ductile iron pipe, fittings, valves, hydrants and tapping services. The board also approved a contract renewal for cable installation services to assist in the installation of cable TV, telephone and broadband products.

In order to meet city requirements, the board executed a contract to construct a sidewalk and bus pad at the new location on Flynn Avenue. FPB will also add landscaping in parking areas there.

The FPB Board of Directors’ July monthly meeting will be Tuesday, July 18, 2017 at 5 p.m. at the FPB administration building at 151 Flynn Ave in Frankfort.