I think I might have a solution to the seven-months-long utility billing mess in the City of Salem.
There are 86 municipalities in the state of Missouri that sell utilities and have a membership in the American Public Power Association. I had no idea that many – and there might be more that aren’t APPA members – Missouri cities were in the utility business.
It does make sense though, because the utility business is big business. The average U.S. household spends about $2,000 per year on utility bills, according to the fed’s ENERGY STAR program. I’m sure it’s not that much around here, but with about 2,600 housing units in Salem, where the only choice is utilities from the city, we are talking about a lot of dollars.
The city budgets $706,500 per month for utility revenue, which translates into about $8.48 million a year, according to figures provided by the city in a public records request sent to the city May 27 by The Salem News.
I mentioned there are 86 municipalities in the utility business. Some of them are familiar to you. Along with Salem, the cities of Rolla, St. James, Ava, Cabool, Cuba, Houston, Lebanon, Mountain View, Newburg, St. Robert, Steelville, Sullivan, Thayer, Waynesville, West Plains and Willow Springs all make a business of selling utilities to its residents.
The strategy is, not-for-profit municipalities can sell utilities for less – an average of 11 percent less than other utility providers, according to the APPA – and still have profit left over to pay for police cars, sewer systems, sidewalks, etc. That means cities can invest more in their communities and/or charge less for taxes.
Sounds like a good idea, and it should be. But if utilities are business, then they should be run like a business. Rolla and St. James have boards that oversee municipal utilities. I don’t have any idea how many others do, but they should, or should at least have some oversight. And by oversight, I don’t mean a city administrator and a board of aldermen who probably know as much about utilities as I do. I am talking about a separate board that can acquire an expertise of sorts.
Maybe it would even pay for itself to hire someone with experience and know-how to oversee the utilities department, from the business end to the delivery of electricity and water and handling of sewer and refuse collection. I don’t know of many businesses that gross over $8 million a year and have a manager with no experience in that field spending only part of their time managing the business and no board of directors to provide oversight, checks and balances.
The time has come for Salem to do something about management and oversight of its utilities. Past due, in fact.
More than once through the years when a utility mess has developed in our community – and they arrive often – this newspaper has tried to get to the bottom of it. The same can be said for the current mess that started in November of 2019 and is still with us. The late utility bills, options to pay off a three-month old bill and the heartaches and headaches of our citizens, city administration and elected officials are well documented. We have written countless stories on the subject.
The Salem News in its public records request also asked for a list of all utility committee meetings that were held in 2019 and the first five months of 2020, along with the minutes of those meetings. There has been only one meeting, and that was held April 23. No minutes were taken, according to the response from the city.
So, during 2019 the city put in an entirely new utility billing system, new meters and a few other changes, and the utility committee – appointed by the mayor each year to do what? – never even met about it? Never met nor were informed of the utter failure of the new system? Not until citizens and this newspaper started banging on a few doors wanting to know what in the heck was going on did anyone respond publicly.
City utilities are too big – too important and complicated – of a business for a handful of people to run it with so little oversight. We can’t expect our city and elected officials to totally handle the job of utilities, especially with so many changes in technology. We must realize that. They must realize that. We have learned a valuable lesson in a most painful way.
Oh yes, I mentioned a solution to the utility mess we are in. By now you realize I believe it might be as simple as talking to some of our neighbor communities to see how their utility boards were set up and work. And, who literally runs the show. That would be a good start.