UCAG begins reviewing utility rates
LAS CRUCES — In early February, an Ad Hoc Committee called the Utility Customer Advisory Group began the arduous task of learning how utility rates are set.
It’s a first step in reviewing the rates for all four utilities (gas, water, wastewater, and solid waste) provided to customers by Las Cruces Utilities.
Two NMSU economists — Larry Blank and Doug Gegax — provided a full day of training for UCAG members, an LCU Board member, as well as several LCU staffers.
By noon, the group had a good understanding of the variables that determine how much it costs a utility to provide safe and reliable services to customers during the course of one year, called a “test year.”
Water has been chosen as the first utility up for a rate review by LCU.
To understand all the costs associated with providing water to more than 35,000 homes and businesses in Las Cruces, the UCAG looks at expenses and capital costs, which include:
- physical assets (plants and equipment)
- costs associated with drilling and maintaining water wells and pumps, booster pumps, transmission and distribution pipes, repairing leaks and water main breaks
- processing water to Safe Drinking Water Act standards
- vehicles, payroll and benefits, billing, and customer service
Then the overall cost of providing water service is split among all customers.
That seems straightforward, but there are multiple classes of water users (residential, small commercial, large commercial, industrial, etc.) that use water differently and there are various ways of splitting costs to each class of service.
Rate design plays a critical role in determining rates for each class.
LCU reviews utility rates periodically and the UCAG was established in May 2016 by Mayor and City Council to be the focal point for customer outreach and dialog providing input during utility rate review process.
The committee is composed of five volunteer residents of the city: William Daly, Shirley Clark (Vice Chair), Eugene Suttmiller (Chair), Frank D. Gomez, and Robert Snyder.
“It’s most important to us that this process is very transparent, and everyone knows our meetings are open because we want input from the public,” said William Daly, UCAG member.
To that end, new UCAG webpages have been added to the City website at www.las-cruces.org where everyone can simply search for “UCAG” and find meeting notifications, minutes, and all documents associated with the Committee.
Emails may be sent to the group at ucag@las-cruces.org
UCAG meets the second Wednesday of each month at 3 p.m. at LCU offices, 680 N. Motel Blvd.
The next meeting is April 12th.
You can reach Las Cruces Utilities at 528-3500 from 8 a.m. - 5 p.m. Monday through Friday.Las Cruces Utilities providesGAS – WATER – WASTEWATER – SOLID WASTE services to approximately 100,000 Las Cruces residents.
