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k, �L <br />MEMO TO: Mayor and City Council <br />P ` FROM: Clerk -Administrator <br />DATE: July 22, 1983r <br />SUBJECT: SUBURBAN RATE AUTHORITY ASSESSMENT <br />As alluded to in my July 25, 1983 Administrative Newsletter, <br />the Suburban Rate Authority proposes to levy an assessment <br />in 1984 to all members equal to $245/vote or, in the case of <br />Mounds View, $735. Prior to discussing the stated need for <br />the assessment or value of our membership in this organization, <br />I would like to review the organization's history for the new <br />Councilmembers. <br />The Suburban Rate Authority was organized on May 1, 1963 to <br />enforce the rate provisions of franchises its members granted <br />to the Minneapolis Gas Company. In January, 1975 the Authority <br />was reorganized into a state-wide organization with its staffed <br />purpose being to participate on behalf of its members in the <br />regulating processes of the Minnesota Public Utilities <br />Commission (PUC). <br />Since its reorganization in 1975 the Authority has not needed <br />to levy an assessment to its members because of a substantial <br />reserve it developed from franchise fees paid by the Minneapolis <br />Gas Company. The By -Laws of the organization provide the <br />authority for an assessment when it is determined to be necessary. <br />The Authority presently has a balance of cash and investments of <br />$47,000 which would not fund its activities through 1984 even if <br />there are no major rate cases before the PUC. At the present <br />time it is anticipated that the first major rate case from <br />Northwestern Bell (NWB) since the recent reorganization of the <br />Bell system will go before the PUC before the end of this year. <br />This office has received information during our budgetary process <br />that NWB could be proposing rate increases up to 80% for resi- <br />dential customers. <br />Except for the PUC staff there is no other organization that <br />regularly intervenes in these rate hearings to dispute the rate <br />requests from the public utilities serving our area. The value <br />of the SRA is that they serve as a "watch dog" agency in a very <br />specialized area representing the interests of our citizens at <br />a time when utility rates seem to be in an uncontrollable upward <br />spiral. The cost of a $735 assessment to the City is minute in <br />relationship to the cost of utility rates we could be paying <br />were it not for the activities of organizations such as the <br />u Suburban Rate Authority. <br />.i <br />