Make Utilities decisions for the right reasons
THE CITY COUNCIL OPTED
to have a study made of the Plymouth Utilities, its operations and plans, before deciding on financing for a new headquarters building for the utilities.
That’s a prudent step to take, given the magnitude of the investment that’s being looked at (as much as $8 million), but at the same time, there are a number of things that should be kept in mind.
First among those is the fact that, with its’ electric utility, Plymouth Utilities serves far beyond the boundaries of the city of Plymouth. While it provides sewer and water utilities to city residents only, it provides electrical service to a large area of northwestern Sheboygan County. Its’ electric customers stretch from large users like Johnsonville Sausage and the Kettle Moraine Correctional Institute to rural homes in the town of Mitchell and farms in the town of Sheboygan Falls.
That means, while the utilities is owned and operated by the city of Plymouth, its impact — as well as the source of its revenue — goes well beyond the city.
Plymouth Utilities receives just over 44 percent of its total electric utility revenue from customers — residential, commercial and industrial — outside the city limits. And since the electric utility accounts for almost 83 percent of the total revenue of Plymouth Utilities, that means that about 36.5 percent of the money that comes in to Plymouth Utilities comes from outside of the city — better than one of every three dollars Plymouth Utilities takes in.
It also means that, when proponents of selling off part of Plymouth Utilities talk of its book value of around $75 million, it can be argued that at least $25 million of that value was contributed by people and businesses outside the city of Plymouth — and what benefit would come to them, what return would they get from their investment, from such a sale, especially if it results in higher electric rates for them?
It seems a fair question to ask, and the answer to it should be a large part of whatever decision is ultimately made.
It all makes the suggestion of selling off the utilities’ electric service a little more complicated than just a matter of simply selling off a department of the city.
It is a business decision that should be made with the best interests of the business and its customers first and foremost, not the needs and desires of its owners. One would not expect local firms, such as Sargento or Sartori, to make business decisions based on the needs and desires of their owners, rather than the needs, desires and best interests of their customers. You can be sure that if they operated that way, they would not be as successful as they are or even stay in business very long. As the owner/operators of Plymouth Utilities, the City Council and city officials should keep that in mind as well.
Few can doubt that for most of those asking for the study and raising the questions, their motivation is to do what’s best for Plymouth Utilities, its customers and the city — hopefully in that order.
But it also has to be said that it seems possible that, for some, the motivation is a desperate attempt to reverse a decision to build a new Plymouth Utilities facility on a centrally located site that has already been voted on and approved by a majority of the City Council.
Hopefully, that is not the case. We expect better of our elected leaders and our responsible citizens.
At issue: Something or other Bottom line: Do something about it
