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Consultant: Grafton’s projected electric revenues fall short; recommends about 5% increase
Summary
A consultant told the Village of Grafton council that projected electricity revenues through 2030 are insufficient to cover costs and debt service and recommended roughly a 5% revenue increase; the village can meet 2026 obligations at current rates but faces a 4.5–5% shortfall thereafter.
John Courtney of Courtney & Associates told the Village of Grafton council on March 3 that projected energy revenues at current rates will not meet the village’s revenue requirements through 2030 and recommended an approximately 5% revenue increase.
Courtney presented a four-step rate-study process—data acquisition, projected revenue analysis, rate review and organization—and said he separated sales by rate classification and normalized historical data. He reported projected average residential rates of about 14.7 cents per kilowatt-hour, general service about 15.2¢/kWh and large power about 11.7¢/kWh; those figures include a power-supply cost adjustment charge of $0.01196 per kWh. Courtney summarized projected dollar revenues at current rates as just under $3.5 million across rate classes for the projection period.
Courtney outlined debt-service obligations affecting revenues: a JV-5 (Bellville Hydro) payment of roughly $58,000 annually, retiring in 2030; an AMP loan with projected annual payments of about $262,000; and a Farmer Savings Bank loan tied to land purchases projected to be paid off in 2027. Accounting for those obligations, he said the projection shows about a 4.5–5% shortfall through 2030 if rates remain unchanged, though the Village should be able to operate at current rates for 2026.
"Projected revenues at current rates are not sufficient to meet the projected revenue requirements," Courtney said, "and revenues would need to be increased by approximately 5%." The presentation noted that growth assumptions were not included in the study and that projected energy sales include the wastewater/sewer plant sales now being billed in the large power class.
The consultant presented revenue totals by class—roughly $1.5 million residential, $800,000 general service and $1.15 million large power—and explained those totals inform the overall revenue-requirement calculation. Council members did not take a rate vote at the meeting; the study was presented as information and recommendation for future consideration.
Next steps identified by Courtney and staff include further review of projections, discussion of timing for any rate adjustment, and consideration of debt-service schedules. The council may schedule separate action to consider rate changes and formal adoption of any ordinance or resolution authorizing adjustments.
