I understand there are concerns about the City of Pineville taking back management of Pineville Utilities. To be clear, the City of Pineville has always owned the utility company; it has simply been managed by the Utility Commission.
To help everyone understand why we are making this change, Pineville Utilities approached the City requesting that we extend a bond that would allow them to access approximately $500,000 in capital. We did not extend the bond but during those discussions, we agreed that if the capital was needed by the end of the year, the City would sign off on a loan to help them meet their financial obligations.
As those conversations continued, we offered suggestions on ways to improve the utility's financial health. Unfortunately, those suggestions were met with resistance. The response from Pineville Utilities was that the solution was to raise water rates and seek additional grant funding.
I took that information back to our City Council, and we all agreed that raising rates was not the right answer. We had several options before us:
1) We could sit back and see what happened,
2) We could sell the utility to a private company, which would only benefit the City financially
3) We could take a more active role, bring management back under the City's control, pool our resources, and work to put the utility on stronger financial footing without increasing rates or placing a greater burden on our customers.
I can promise you that the last option is by far the most difficult. However, every City employee and every member of the City Council agreed that it was the right thing to do because it serves the best interests of our community. We chose the harder road because we believe it is the road that best protects our customers and the future of Pineville Utilities and its employees.
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