Rate issue with utilitiy company resolved

Bismarck Township has approved Presque Isle Electric & Gas Co-op?s proposal for support and a rate increase in order to maintain the existing franchise and ?home-rule.? With four members of PIE&G management team present at Bismarck?s July 14 meeting, including Brian Burns, the president and CEO, Alan Joppich, Byron Nolde, and Rick Kieliszewski, along with seven residents and business owners of Bismarck Township, the board heard all comments and weighed heavily the decision before taking the final vote.

All board members voted yes with the exception of Ken McNealy?s ?no? vote. It was a vote in good conscience for all the members, who heard comments from several residents that thought the board should approve the measure that includes an 11-cent rate increase. The meeting at Bismarck Township Hall in Hawks began with an apology from PIE&G president Burns, who said, ?I?d like to apologize for anything I?ve done to make this a difficult issue that lacks a resolution.

?WE?VE DONE everything we can to control the gas rate. We?ve simply come here asking for the 11-cent rate increase over MichCon?s and so you can see what?s fair and what?s warranted.? Burns asked for approval of the original resolution or to at least join PIE&G at the Michigan Public Service Commission to preserve the franchise.

Resident Chuck Higle told PIE&G officials he thought their letters were confusing and asked for clarifications. He also said he didn?t agree with the 11-cent increase, but said, ?I think we should join with them, but disagree with the 11-cent increase, in order to maintain the home-rule franchise.?

Board member Jeff Prell asked what the general amount of debt was that PIE&G had, which Nolde said was around $18.5 million for gas alone. ?It?s not in dollars, it?s in interest expenses spread on long term debt,? Nolde attempted to explain the confusing financial situation.

Nolde also said there was about $27 million in electric debt, and Prell told him that at the rate they were going and the amount of customers, ?You?re never going to make it!?

?YOU?RE RIGHT…not at the current rate ? we need the increase to cover the debt and the expenses,? Nolde said. ?We reduced our business expenditures by $90,000 last year,? Burns added. ?Our goal is to control capital expenditures. We think we can live within our cash flow means with the increased gas rate. ? It?s what we need to return to a break-even position.?

Board member McNealy asked the PIE&G officials if they were prepared to take a pay-cut to save their company. ?If it came to that,? said Burns, ?I think we would.? Joppich reminded McNealy they had already taken a hit in 1997 when they gave up insurance coverage. Township resident Al Maten, told t

hose present he thought PIE&G had done a good job and hoped the Bismarck Township board would support the co-op.

MCNEALY SAID that 62 percent of the 400 residents lived on Social Security and that the rate increase could present a real problem for them. ?We saved 7,000 customers a lot of money (when they signed up for gas) and we tried to bring value to the customer,? Burns said. ?If we go to the commission it will be expensive. We don?t want to waste any more money going to the commission as they already approved this once, and 33 out of the 35 townships have already given their approval on the increase.?