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LCUB announces 9 percent rate hike
LCUB manager Nelson to retire after 44 years

Lenoir City Utilities Board unanimously approved passing along a nine percent rate increase from TVA, to be effective Oct. 1.

“We can’t absorb this,” LCUB general manager Fred Nelson said at the Board’s meeting, Monday, Sept. 21.

Nelson said TVA had been discussing the rate increase for months, a majority of which was stemming from the ash spill in Kingston and the Clean Air Act.

“They’re raising base rates by nine percent. … At the time, we can’t absorb it,” Nelson said.

Nelson said other area utilities also were passing the rate increase along to their customers.

TVA has issued statements that, while it is increasing base rates, it is also passing along an 11 percent decline in the fuel adjustment charge.

Joel Garber, former Farragut alderman and LCUB Board member, asked Nelson about that fuel surcharge.

Nelson said in meetings over the past months, TVA had agreed to adjust the fuel surcharge monthly instead of quarterly. In other words, changes in fuel costs would be reflected more quickly in the fuel surcharge, whether gas prices rise or fall.

“It’s like the market, it’s whatever the market does,” Nelson said.

“[But] it will be dropping. … It will be lower on the next [bill],” he added.

That could mean lower rates overall for customers, if the fuel surcharge drop offsets the base rate hike. Nelson stressed these charges are passed by TVA and simply passed on to customers by LCUB.

At the end of the meeting, Nelson announced his retirement from LCUB, effective early next year.

“It has been a privilege to be general manager of this company,” Nelson said.

“I’ve really tried my hardest to do a good job. … I feel I’ve done the best job I could do,” he added.

Nelson said his retirement will be effective Friday, Jan 22, 2010. He did not elaborate on the process for determining LCUB’s next GM.

Nelson said he came to work for the Utility in 1966, working his way up from a groundsman.

“It’s been a great ride. … It’s been a pleasure,” he said.

Nelson will be 66 next year. He thanked the Board for its work and praised LCUB’s department heads.

“This company [has] been my life,” he said.

In other business, the Board:

• Authorized the water department to seek and approve bids for repainting the Fifth Avenue water tank.

“There is a lot of rust on it. … Greg [Jones, water and wastewater management] had it inspected; we need to paint the tank,” Nelson said.

The painting would need to be done in October, during the area’s driest season, to prevent the tank from sweating and interrupting the paint project.

Anticipated cost of painting the 1.375 million gallon tank is about $80,000.

• Approved the purchase of a turner type AD 3-way 1200 amp 69,000 volt switch from JCB Associates for $25,217

• Authorized the electric department to seek bids to replace Unit 88’s line truck

• Approved an extension of Tennessee Gas Pipeline gas storage agreements and gas firm transportation agreement

• Declared four LCUB vehicles as surplus and approved auctioning those vehicles at an auction held Sept. 26


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