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“Since electric rates and cost of chemicals are subject to fluctuation not within the control of the city of Morganton, a surcharge will be added to the base rate of the cost of either increases ,”Queen read from the draft of the contract. The contract goes on to say that the increases are based on 2012 electricity and chemical rates. England said the last time Tri-state EMC issued a rate increase, Morganton’s electricity rate increased 25 percent. If this should happen again over the course of the contract, he said, Morganton will charge the county 25 percent of 48 cents.
“My fear,”Queen said,
“is (that) I don’t want to come right out of the chute with a new water system and…start raising rates.”According to the discussion, the county would pay the surcharge only when Tri-State EMC increased prices or when chemical prices increase. Morganton currently pays approximately $1000 a month for chemicals, England said.
“At $3.75 per 1000 (gallons of water),”he said,
“We’re paying one of the highest rates in the state of Georgia.”He went on to say the deal with Morganton wouldn’t work if the county had to make loan payments for the project.
“(So), why would you up the $3.75 (for the electricity and chemical surcharge),” he said, “When it’s the highest rate in Georgia when you’re making money?”England said the future of the economy is uncertain, due to the outcome of last month’s election and certain legislation, suggesting the possibility of hyper-inflation.
“If that (hyper-inflation) happened,”he said,
“we would have to be able to do something to deal with that type of situation, because that would affect a whole lot more than just chemicals and electricity.”According to the conversation, the contract will be modified to reflect a more equitable means of addressing electricity and chemical increases. Although, not specified, the two parties seemed to favor an annual assessment.