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July 29, 2013

TVA study recommends city pay power board more for joint billing services

CULLMAN — The Cullman Utilities Board is considering a joint cost study created by the Tennessee Valley Authority (TVA) that recommends the city pay more money to the power board for billing, postage and clerical services. The report was generated as part of the TVA’s role as regulator over the power board.

Billing for water, sewer and sanitation services are all managed from the power board office, and the report concludes the city should be paying more to the power board to provide those services.

The city currently pays the utilities board $9,532 per month for those services, though the cost study recommended the city should be paying an additional $8,000 per month.

“That looks at things like postage, from first contact, as well as sending out monthly bills, collecting and accounting for all those things,” power board manager Mike Manning said. “This looks at the total cost involved, like customer service, computer costs and all those things we do to interface with the City of Cullman on water, sewer and sanitation. Of course, those are services we’re happy to provide, because it saves on postage and makes things more convenient for customers.”

This marks the first cost study in 20 years, and Manning said the recommendations reflect inflation and increased costs associated with handling all departmental billing.

“TVA completed a joint cost study to analyze costs for services done jointly by the power board for the City of Cullman. We’re working with the city to arrive at a solution to adopt those recommendations,” Manning said. “The study hasn’t been updated since 1993, and some increases have not been adjusted over the years. TVA has recommended this be adjusted to account for increases in cost over that time.”

That 1993 study has never been adopted by the utilities board, and the city and power board have essentially been operating under an informal agreement for several years. The new cost analysis was done as part of a renewed effort by TVA to update recommendations, and Manning said new studies are also being done all across the southeast.

Cullman Mayor Max Townson, members of the utilities board and some city council members met with TVA to discuss the findings recently, and Townson said he expects the city and utilities board to approve the cost study sometime soon.

“They analyzed it from all areas and explained how they came to their conclusions,” he said. “We’ll always work for the community, and I believe this is something we should get taken care of.”

 * Trent Moore can be reached by e-mail at trentm@cullmantimes.com, or by telephone at 734-2131, ext. 220.

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