By KIRSTEN LASKEY
Los Alamos Daily Post
kirsten@ladailypost.com

It was not a pleasant ordinance to approve but the majority of Los Alamos County Council agreed it was necessary to approve a hike in gas service rates during its regular meeting Tuesday night.

Council approved 6-1, with Councilor David Reagor opposed, to pass the ordinance, which will adjust the Department of Public Utilities’ variable rate cap for natural gas, include an additional recovery rate component and add a compensatory minimum value for the variable portion.

As a result, the following will occur:

• The variable cap rate will increase from 99 cents to $4 a thermal unit, to broaden the range of allowable charges for the pass-through, cost-of-gas portion of the gas rate.
• A 44-cent per thermal unit “sunsetting” recovery rate mechanism will be installedto address the estimated $7.2 million shortfall in DPU’s natural gas fund, which was caused by escalating costs not being fully recovered under the current ordinance’s 99-cent cap. The recovery rate mechanism would sunset when the shortfall is recovered or two years from the new ordinance’s adoption, whichever happens first.
• A compensatory minimum of 11 cents per thermal unit for the variable portion of the gas rate will be set to soften the month-to-month rate swings caused by volatile commodity costs.

These changes will go into effect April 8. It was noted that the rate increases were necessary because DPU is operated as an enterprise fund with revenues and expenditures segregated from all other County governmental funds.

Councilor Randall Ryti said this ordinance wasn’t pleasant but given the reality of natural gas prices and the shortfall DPU finds itself in made the ordinance necessary.

“This is not a pleasant thing have to do, but it is the reality of increasing commodity price and with the shortfall … obviously (we) need to make this change because we need to recoup funds,” he said.

Ryti added that attention needs to be made to those who may struggle with their gas bills once the ordinance goes into effect, pointing out that DPU may need to adjust the income categories included in its utility assistance program.

He added that more outreach is needed so people are aware of the changes.

Ryti compared it to “like going to a restaurant with no prices on the menu. It’s something you absolutely have to have, and you actually don’t know the number until two months later. In this case, people are warned a little bit, but I think there’s going to be some surprise … utility bills could be in the several hundred dollars range for a typical customer. It is not trivial to highlight that …I hope the Department of Utilities and board (Board of Public Utilities) look at some policies that will assist people struggling to pay this.”

Reagor opposed the ordinance; he explained he felt natural gas prices would continue to rise and a long-term solution was needed.

“I would like to see a better plan,” he said.

In other business, council:

• Unanimously approved a consulting service for Ahmed Dadzie, Calyptus Consulting Group Inc. and The Bid Lab, LLC. not to exceed $500,000 for procurement consultant services
• Approved 6-1 with Ryti opposed the Community Services Department’s Integrated Master Plan. Ryti said he felt where the plan addresses open space should be brought to the Environmental Sustainability Board for additional review.
• Heard a report from Chair Denise Derkacs and Vice Chair Theresa Cull regarding the County’s nuisance code and what effects it has on Los Alamos National Laboratory employees’ security clearances. Derkacs and Cull met with laboratory security officials and learned the following regarding reporting requirements: a courtesy letter for a code violation does not need to be reported and a notice of violation does not need to be reported, but a citation (compliant) does need to be reported. However, once the citation is dismissed or resolved, no action is taken. Furthermore, even a conviction does not necessarily lead to a security review. What does raise security concerns are patterns of repeated offenses, demonstrated unwillingness to comply with laws and questionable actions or judgement.
• Nominated the following individuals to the Nuisance Code Implementation Review Task Force: John Bloodwood, Bob Day, Philip Gursky, David Hanson and Kyle Wheeler.
• Nominated Michael Wheeler, Matthew Allen and Trevor Shuman to the Lodgers Tax Advisory Board.