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CU board to review $510M budget for fiscal 2016

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City Utilities of Springfield officials this afternoon are scheduled to present a $510.1 million operating budget to the Board of Public Utilities for approval.

The budget for the year starting Oct. 1 needs the board’s green light before Springfield City Council can approve the plan next month, according to budget details available on CityUtilities.net.

Total receipts for CU are forecasted at $510.1 million for the upcoming fiscal year, a decrease of $48.4 million compared to the 2015 reprojected budget - largely due to a 2015 debt issuance of $41.5 million. That debt was incurred to fund capital projects designed to ensure environmental regulatory compliance, including improvements to rail unloading and the drinking water storage tank at the Blackman Water Treatment Plant.

Electric operating revenues, which make up 58 percent of the budget, are expected to increase slightly to $294 million from $291 million. Natural gas revenues are forecasted at $83.2 million, a decline of 10.6 percent from $91.9 million. The forecasts leans on less gas usage by customers in the past year, with sales volumes in 2015 projected down by 5 percent. Water receipts are moving in the other direction in the proposed budget to $50.7 million from $45.8 million – a 10.7 percent increase.

The fiscal 2016 budget reflects the second of three electric rate increases approved by the CU board and council, and the third in a series of water rate increases – approved in 2012 – will be implemented in the coming fiscal year.

Nonutility receipts - such as wastewater revenue collected for the city of Springfield and taxes - are expected to fall slightly to $46.1 million from $47.4 million, with modest declines expected from wastewater billing.

SpringNet division revenues are budgeted to decline slightly for fiscal 2016, with total receipts forecast at $9.68 million, down from $10.15 million. The 2015 reprojected budget included $590,000 from the sale of SpringNet Underground.

Transit operating revenues are projected to remain relatively flat at $1.1 million. The bus system is scheduled to be subsidized by ratepayers in fiscal 2016 to the tune of $2.5 million, roughly equal to the current fiscal year.  

Looking forward, on Aug. 11, CU has scheduled a joint-study session with council to review the proposed budget. Board approval of the budget is expected by Aug. 20, according to CityUtilities.net. On Sept. 14, the budget is slated to receive a first reading and public hearing before council. A second reading and council approval is scheduled for Sept. 28, just before the end of fiscal 2015.

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