By KIRSTEN LASKEY
Los Alamos Daily Post
kirsten@ladailypost.com
Department of Public Utilities (DPU) customers will not see, at least for the time being, an increase in their gas rates.
The proposed rate increase, which the Board of Public Utilities (BPU) recommended, was voted down 4-3 during the regular Los Alamos County Council meeting Tuesday night. Councilor David Reagor, Councilor Melanee Hand, Vice Chair Ryn Herrman and Council Chair Randall Ryti voted against the new rate while Councilors Beverly Neal-Clinton, Theresa Cull and Suzie Havemann voted in favor.
According to agenda documents, if approved, the rates increase would have spanned two consecutive fiscal years (FY): There would have been a 29 percent increase in FY 2027 and 17 percent increase in FY 2028 for residential, multi-family and commercial customers. Meanwhile, the County and schools would have been given a 30 percent increase in FY 2027 and a 19 percent increase in FY 2028.
The reason behind the proposed rate increase, DPU Deputy Manager for Finance and Administration Joann Gentry said, was to restore the gas funds’ cash flow.
According to agenda documents, the gas fund has a deficit.
It is stated in the documents that “Due to a warmer winter and lower usage, current projections indicate sales revenue will be approximately $5.9 million-about $2.45 million below expectations. The FY 2025 audited net income for the Gas Fund reflected a loss of $489,267, and the projected net loss for FY2026 is approximately $2.36 million.”
Looking at the 10-year forecast, “with these current proposed rates, we’re expected to restore our gas fund cash flow to a sustainable level,” Gentry said. “It will also fund our essential repairs, replacements, operations and fund the long-term case reserves.”
She added that the fund would be expected to hit a positive cash flow by FY 2029 and be fully funded by FY 2032.
Hand and Herrmann did not explain their opposition, but Ryti and Reagor expressed skepticism that this was the correct path forward.
“I think we need a more comprehensive long-term plan … I know all our gas costs are going down and somehow or another we needed a rate increase when gas was expensive … and then when gas is going down, we still have to raise rates,” Reagor said. “I think there is a better explanation to all of this. We certainly should not approve it unless it’s been explained more completely.”
Ryti noted that during his 8-year tenure on council, this would have been the ninth utility rate increase he’d approved.
“I would like to see a one-year option,” he said. “I’ve been voting on rate increases more than once a year on average, so I don’t think it’s inappropriate for council to look at this more to understand where we are on the deficit. The fact that this is for two years – I could understand the one year to try to recover some funds. but I can’t support two years.”
He added that while the utility assistance fund is available, he felt an even better way to assist people would be to not charge them as much to begin with.
Even those who voted to support the rate increase said it was a difficult decision.
“Our climate action plan wants folks to basically get off of gas,” Cull said. “We want to encourage that. Maybe some of the downward trend we’re seeing is folks doing what we are hoping they do.”
She added it felt like people were being penalized for using less gas.
“I know many people are struggling and contrary to popular belief, we’re not money bags, we are very cognizant about what we spend but at the same time the reality is that everything is costing more,” Neal-Clinton said.
She emphasized the importance of promoting and educating the public about the utility assistance fund.
“The problem we have is that people are feeling the pinch and it is hard to swallow the huge percentage increase … to me … the percentage increase seems really high, but when you look at it in terms of dollars, it might feel a lot higher,” Havemann said. “To some families, we could be talking a thousand dollars a year and to others it might not feel like more than a few cups of coffee a month and that’s tough when it comes to equity.”
In her presentation, Gentry broke down the charges for gas.
She said the gas rate consists of three components: a monthly service charge, a fixed charge per therm and a variable charge, which is the cost of gas – it is a pass-through rate. Gentry added that the monthly service charge covers various expenses such as finance and administrative costs, while the fixed charge per therm covers expenses, salaries, benefits, operations and maintenance and debt. The cost of gas is what gas costs a month.
Gentry shared what a typical bill for 70 therms would like. Through June 30, 2026, customers would pay a total of $67.45 through June 30, 2026, then $78.53 after June 30, 2026, and then $86.93 after June 30, 2027, for gas. During the winter months, the usual bills for 126 therms would total $110.01 through June 30, 2026, then $128.93 after June 30, 2026 and then $142.93 after June 30, 2027, for gas. Following Gentry’s presentation, Cull asked what would happen if the increase isn’t approved.
DPU Manager Philo Shelton said the fund would continue to be in the negative, capital improvements may be canceled, and DPU may end up in violation with the Public Regulatory Commission for not completing required inspections.
After the rate increase failed to be approved, it was stated that Council could not suggest a new proposed rate; that would need to be recommended by BPU. Council could, at a future meeting, give direction to the BPU regarding the gas rate.