ELY – Rate increases for electricity service for Ely Utility Commission (EUC) customers won’t be quite as high this year as originally proposed.

After a brief public hearing prior to their Jan. 15 regular meeting, where one resident, Mike Banovetz, spoke in support of the increases, members of the city council here approved the rate hike sought by the city’s utilities commission.

City sewer rates will remain the same and the fixed monthly water rate will climb by $1. However, the council opted to trim the proposed three-percent across-the-board electrical rate hike, presented late last year, to one-percent.

Clerk-Treasurer Harold Langowski noted that the rate hikes were arrived at by careful scrutiny of the utility budgets, historical fund balances and projected revenues and expenses. “When we put these (recommendations) together back in December, we had a proposed rate increase from Minnesota Power of approximately two percent as part of our capacity charge,” he said.

“We then received good news that the (transmission) charge increase is less than anticipated due to favorable energy conditions, and also some non-capacity charges are going down because of the tax reform, reduced operating and maintenance costs, as well as lower (expenditures) in capital investments.”

Langowski noted that Minnesota Power’s investments in wind and solar projects are bearing a positive pay-back due to increases in tax rebates that result in an overall reduction in energy charges. “We should see our wholesale rate from Minnesota Power stay pretty constant compared to 2018,” he said.

He noted that the three-percent rate increase proposed by the EUC last December was put in place to cover the anticipated two-percent rate increase from Minnesota Power, plus a one-percent increase in costs in the local utility.

“Costs continue to rise, such as employee costs, health insurance costs, supplies, contractors and other things,” Langowski said, “so we are proposing just a one-percent hike across the board.”

Banovetz, who serves on the city’s planning commission, said he was fully in support of the latest proposal. No other residents spoke in favor of or against the rate hikes.

The recommendation from the EUC for a $1 increase in the fixed fee rate for water service will increase that fee from $14.25 to $15.25 per month. There was no recommended rate increase for sewer service.

“We feel really good about our rates as proposed and our projected revenues,” said Langowski. “We continue to invest in capital improvements.”

The council unanimously approved the rate increases and they will go into effect starting in February.

In other business, the city council:

 Named city council members to various city committees with new council member Angela Campbell named to the Gardner Trust, Employee Relations, and Heritage Preservation committees.

 Named former mayor Ross Petersen to the Events Coordinator Board;

 Asked for interested community members to submit their name to serve on the Ely Ambulance Board.

Selected Warren Nikkola to a renewed term on the Ely Utility Commission, and also named Mauro Caruso and former EUC member Anthony Colarich to the oversight committee.

Hired Justin Akins as the Ely Fire Department’s newest member, pending his passing of a physical and drug test.

 Granted a request from Tour Minnesota requesting camping in Whiteside Park, June 17-18.

 Agreed to provide in-kind services for the Ely Winter Festival, set for Feb. 7-17.

Approved a Residential Rehab Loan for Ryan and Michale Callen for $4,500 to replace basement sewer lines.

 Named Heidi Omerza as the acting mayor for 2019.