Fluoride Action Network

Nome: NJUS proposes rate hike, cuts to labor and fluoridation in 2015 budget scramble

Source: KNOM Radio Mission 96.1 FM | 780 AM | December 15th, 2014 | By Matthew F. Smith
Location: United States, Alaska

In its continuing efforts to pare down its budget in the wake ongoing financial issues, the Nome Joint Utility Board heard proposals to trim thousands of dollars from it’s 2015 budget during a work session Saturday.

Utility Manager John Handeland said he looked at the utility budget “line by line” when he brought forward suggestions adding up to tens of thousands of dollars in reductions across the board: from engineering and office expenses, to maintenance and materials, to reduced labor.

The labor cuts come from what Handeland called a rebuilding of the utility’ workforce.

“We’re having to rebuild our labor pool,” he said. “We’ve lost senior people, and we’re down to not enough, and we have to replace them. And so they’ll come down at a lower cost.” Handeland said he hopes to train new operators—and even an apprentice position—to grow the local qualified workforce and avoid expensive labor that would have to be brought to Nome.

Another area that could see cuts is the city’s water fluoridation program. The utility’s new proposal would not eliminate the addition of fluoride to Nome’s water all together, but Handeland proposed to stop fluoride additions on weekends to save on labor costs.

“I believe that this system can be shut off on Friday and started again on Monday” Handeland said, noting that constant monitoring would otherwise be necessary on weekends to ensure safe levels of fluoridation. “There would never not be fluoride in the water, it would simply come down in level over the weekend and then return by Monday afternoon.” Reducing fluoride addition to weekdays could save an estimated $10,000 to $13,000 in water operations, maintenance, and testing, according to a budget analysis provided at the work session.

Finally, the utility looked at reassessing its debt through a plan with the state Department of Environmental Conversation that would spread existing NJUS loans over 30 years, instead of the current 20-year window. That change could mean a savings of a quarter of a million dollars, but even so, Handeland said the utility as a whole could still face a $116,000 deficit, just as the board is aiming to build up a reserve fund to weather future emergencies. The only way to both build reserves and weather a deficit, Handeland proposed, would be through a rate hike.

“In order to fund that reserve, and the slight deficit currently projected, would require us to make a kilowatt change of, I’d have to verify that but, approximately two cents,” he said.

Despite falling oil prices around the world, cheaper fuel isn’t part of the utility’s plans for 2015. Any drop in price would be calculated when bulk fuel purchases come during the summer barge season, still many months away.

The utility board’s next meeting to hopefully solve the puzzle of its 2015 budget is now set for Thursday, Dec. 18.