HomeMy WebLinkAbout1992-101-07/21/1992-LIGHT AND POWER FUND PURCHASE POWER RESERVE RESOLUTION 92-101
OF THE COUNCIL OF THE CITY OF FORT COLLINS
AUTHORIZING THE USE OF A PORTION OF THE PURCHASE
POWER RESERVE IN THE LIGHT AND POWER FUND
WHEREAS, the City Council has adopted Financial and Management Policies for
the Light and Power Fund requiring that "Rates shall be established and
maintained at a level sufficient: To Maintain positive net income after paying
the full cost of operating and maintaining the electric utility in good repair
and working order"; and
WHEREAS, an unanticipated purchase power rate increase occurred April 1 ,
1992, that will , without a corresponding retail rate increase, result in 1992
negative net income in the Light and Power Fund of approximately $450,000; and
WHEREAS, the City Council , Electric Board, and Light and Power Staff concur
that in order to allow sufficient time for customer notification and completion
of a cost of service based rate study, it is in the best interest of the electric
rate payers to defer implementation of the anticipated retail electric rate
increase until January 1, 1993; and
WHEREAS, the City Council wishes to avoid the perception of financial
difficulty in the Light and Power Fund, when in fact, a purchase power reserve
has been created to "partially off-set, defer, or mitigate the impact of purchase
power cost increases due to factors such as federal power issues" ; and
WHEREAS, sufficient funds are available in the Purchase Power Reserve to
off-set the impact of said rate increase for the year 1992.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS
that the Council recognizes that an unanticipated and unbudgeted increase in
purchase power rates will create negative net income in the Light and Power Fund
for 1992 and that in order to avoid an immediate retail rate increase, the
Council hereby authorizes the use of purchase power reserves to offset that
additional expense.
Passed and adopted at a regular meeting of the Council of the City of Fort
Collins held this 21st day of July, A.D. 1992.
ayor
ATTEST:
��}i�ity Clerk` `✓