A few weeks ago, the City Council in Hudson, Iowa, voted to approve holding a special election this fall on whether to sell its electric utility. The decision comes after a two-year study looking at the issue. According to a July 15 Waterloo-Cedar Falls Courier article, “The reason is purely financial. The future doesn’t paint a rosy picture for the utility’s solvency, according to (Hudson Mayor George) Wessel, a problem that has become common for small government-owned utilities.”
This couldn’t be further from the truth. The future for municipal utilities is bright, and the millions of Iowa residents served by municipal utilities should feel confident that their local providers have their best interests at heart – financially and beyond. There are significant benefits to having municipal utilities in communities, not only monetary but also intangible. Municipal utilities serve as the backbone and heart of communities.
Iowa has more than 900 incorporated cities, and the Iowa Association of Municipal Utilities’ members own and operate 754 municipal utilities in every corner of the state – including 542 water utilities, 136 electric utilities, 51 natural gas utilities, and 25 telecommunications utilities. Almost 2.2 million Iowans are served by a municipal utility. That’s 69% of Iowans.
Iowa’s municipal utilities provide great value to their communities. They operate on a nonprofit basis. The mission of municipal utilities is to do what’s in the public interest by providing the best and lowest cost service possible to the residents and businesses of the communities that own them. Utilities that don’t have to maximize profits are free to prioritize reliable service and to develop least-cost business models. This helps communities achieve long-term objectives such as quality of life, economic growth, and affordability.
According to the American Public Power Association (APPA), public power utilities, in particular, have:
What may not be apparent in any data, but what is equally as important to mention when discussing municipal utilities is how municipal utilities allow communities to control their own destinies. Crucial decisions such as increasing rates or investing in new capital projects can be made in city hall instead of at a state agency or a board room in a far-off place. Residents can debate and determine whether to take on a new project, and all projects can be designed and built with community participation and stakeholder input.
Because municipal utilities’ council people, board members, managers, and employees live in the cities that the utilities service, there is a local presence that ensures the kind of personal service that comes from a strong sense of community. Municipal utilities can truly focus on customer needs because the customers are themselves the owners, managers, and employees of the utilities.
What’s more, if any customer is unhappy with the way their utilities are being run, they have the opportunity not just to attend a public meeting about it, but to serve on the local utilities’ governing bodies. The customers’ ability to take a direct role in the utilities’ management ensures municipal utilities will always respond to customer needs.
Municipal utilities and their employees have no one else’s interests in mind except the customers they serve – their friends, their neighbors, and their families. Municipal utilities go that extra mile and put in that extra effort. There is a certain sense of pride that municipal utility employees take knowing that they keep their community’s electricity, gas, water, and broadband running reliably, safely, and affordably.
This couldn’t be further from the truth. The future for municipal utilities is bright, and the millions of Iowa residents served by municipal utilities should feel confident that their local providers have their best interests at heart – financially and beyond. There are significant benefits to having municipal utilities in communities, not only monetary but also intangible. Municipal utilities serve as the backbone and heart of communities.
Iowa has more than 900 incorporated cities, and the Iowa Association of Municipal Utilities’ members own and operate 754 municipal utilities in every corner of the state – including 542 water utilities, 136 electric utilities, 51 natural gas utilities, and 25 telecommunications utilities. Almost 2.2 million Iowans are served by a municipal utility. That’s 69% of Iowans.
Iowa’s municipal utilities provide great value to their communities. They operate on a nonprofit basis. The mission of municipal utilities is to do what’s in the public interest by providing the best and lowest cost service possible to the residents and businesses of the communities that own them. Utilities that don’t have to maximize profits are free to prioritize reliable service and to develop least-cost business models. This helps communities achieve long-term objectives such as quality of life, economic growth, and affordability.
According to the American Public Power Association (APPA), public power utilities, in particular, have:
- Lower rates than other types of electric utilities. Residential customers of public power utilities pay 11% less than customers of investor-owned utilities – for the average U.S. household, that’s $176.79 saved each year or about $15 per month.
- More reliable service. Outside of major adverse events (e.g., storms), customers of a public power utility are likely to be without power for less time - 62 minutes a year, compared to 150 minutes a year for customers of private utilities.
- A strong, positive impact on local economies. Public power utilities generate more than $60 billion in annual revenue and invest more than $2 billion annually directly back into their communities. Public power utilities invest this revenue back into their communities through payments in lieu of taxes, providing hometown jobs, offering free or reduced cost electric services, and supporting local causes and charities.
What may not be apparent in any data, but what is equally as important to mention when discussing municipal utilities is how municipal utilities allow communities to control their own destinies. Crucial decisions such as increasing rates or investing in new capital projects can be made in city hall instead of at a state agency or a board room in a far-off place. Residents can debate and determine whether to take on a new project, and all projects can be designed and built with community participation and stakeholder input.
Because municipal utilities’ council people, board members, managers, and employees live in the cities that the utilities service, there is a local presence that ensures the kind of personal service that comes from a strong sense of community. Municipal utilities can truly focus on customer needs because the customers are themselves the owners, managers, and employees of the utilities.
What’s more, if any customer is unhappy with the way their utilities are being run, they have the opportunity not just to attend a public meeting about it, but to serve on the local utilities’ governing bodies. The customers’ ability to take a direct role in the utilities’ management ensures municipal utilities will always respond to customer needs.
Municipal utilities and their employees have no one else’s interests in mind except the customers they serve – their friends, their neighbors, and their families. Municipal utilities go that extra mile and put in that extra effort. There is a certain sense of pride that municipal utility employees take knowing that they keep their community’s electricity, gas, water, and broadband running reliably, safely, and affordably.
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