Commission recommends KMEA power purchase, developer fee changes and $15,000 rate study

The Gardner City Utility Advisory Commission on July 2 voted to recommend several utility actions to City Council: a power purchase modification to secure an additional 7 megawatts of firm capacity through the Kansas Municipal Energy Agency (KMEA), text amendments to move single‑family development fees from a fixed per‑lot rate to actual‑cost billing with an 80% upfront estimate and final true‑up, and authorization for the utility director to contract with KMEA for a $15,000 comprehensive electric rate study.

Power purchase: staff said negotiations with Grand River Dam Authority through KMEA would add 7 MW of firm capacity under terms similar to Gardner’s earlier 4 MW agreement. Staff told commissioners the city’s wholesale bill from Grand River would increase because the city is buying more firm power, but the firm contract is intended to reduce market‑price volatility, particularly in winter. The commission moved to recommend Council adopt the resolution authorizing execution of the contract modification; the motion carried.

Developer fees and billing: staff proposed changing single‑family developer charges from a fixed per‑lot fee to actual‑cost billing. The recommended approach would bill developers about 80% upfront based on the best available estimate, allow staff to order materials, and true up final costs at project closeout so the city is not left absorbing tariff or delivery cost increases. Commissioners asked about consumer impacts; staff said the change protects ratepayers and reduces return trips for fee adjustments. Commercial projects are already billed on actual cost, but staff said current language lacks a clear true‑up mechanism and that the amendment would fix that.

Rate study: the commission authorized the utility director to execute a $15,000 contract with KMEA to study a three‑part rate structure: a fixed monthly meter charge to cover fixed costs, a demand charge using meter demand readings to allocate capacity costs, and an energy (kWh) charge. Staff said the study (expected in roughly 6–8 months) is intended to identify cost drivers and present options and that it is not itself an immediate rate increase; commissioners requested clear, plain‑language explanations and customer education if the structure is pursued.

What to watch: the recommended Council actions will be forwarded for consideration at the next Council meeting; if Council approves the rate‑study contract, staff and KMEA will return with analysis and recommendations before any rate ordinance changes are adopted.