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Development ...CU continues to examine service extension policy

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by Karen E. Culp

SBJ Staff

City Utilities continues to examine its service extension policy and hopes to have a new policy in place by this summer.

Over the past two years, the utility has been examining its 10-year-old policy, and it has employed GDS Associates, a consulting firm, to help develop guidelines for a new policy.

The consultant has completed the major portion of its work, but will be retained to write the policy, said John Twitty, deputy general manager at CU.

One of the major concerns with writing a new policy will be the cost elements: how much the utility will charge developers for extending its service to their new subdivisions.

The extension of electric services has traditionally been at no cost to the developer, but because the utility is concerned about recovering its costs, that may change.

"We might be asking the customer to expend for the extension of the services to that customer.

"What we have to determine is what charges are justified on a case-by-case basis," Twitty said.

Across the board, because it's been 10 years since the policy was updated, the costs will likely have to increase for developers, Twitty said.

The utility has been in conversations with developers and has had several meetings with them about what the new charges may be.

"We know there will be some compromises on both parts. We want to give the developers that opportunity and make this available for comment by them," Twitty said.

City Utilities would like to present a new document for the Board of Public Utilities to examine in May, but the presentation could be as early as April or as late as June, Twitty said.

Stephanie Stenger Montgomery, an attorney with Ron Stenger Development, said she and some other developers met with CU March 2.

Montgomery serves as chair of the Home Builders Association's development committee.

"The HBA had raised some concerns that this would raise the cost of development, but since CU has not yet set what they're going to propose, we feel like we have an opportunity to make sure that's in the best interest of the development community," Montgomery said.

Montgomery said when she looked at Stenger Develop-ment's properties, and at what GDS had proposed as increases in the service extension fees, the increase was substantial. However, after the meeting March 2, she said she felt officials at CU are listening to the developers and that the policy may not be as cost-prohibitive as the developers had suspected it would be.

"I feel confident that they're listening to us and taking what we have to say into account. I feel like CU will come up with something we can all live with," Montgomery said.

Montgomery also said the developers favored an incremental change to the fees, instead of an all-at-once increase.

"We hope there's some way they can implement those new fees incrementally," she said.

Though the utility has not yet established its new fees for extension of service, both Twitty and Montgomery agree that because it has been 10 years since CU examined those fees, they will increase.

Twitty said GDS recommended that the utility examine its policy every two to three years from now on.

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