Burn plant, landfill to cut rates 20%

LAYTON — Wasatch Energy Systems is making good on its February proposal to cut rates by 20 percent starting July 1.

The board of the special service district that operates a landfill and the Davis County Burn Plant east of Hill Air Force Base has approved a tentative budget for fiscal year 2005 of $23.2 million, up from $21.4 million this year. The new budget calls for the operation to bring in $15.2 million, down from $18.2 million this year, about a 20 percent reduction in revenue.

"We were targeting a 22 percent reduction in revenue earlier in the year, based on a reduction in rates; however, an increase in anticipated energy sales, which are linked to the price of natural gas, will put us at about a 20 percent reduction in overall revenue," said Nathan Rich, district manager.

As anticipated, the rate reduction plan would make the following changes, including some rate increases:

• Remove the $2 per bulk yard commercial container fee.

• Remove the $6.50 per month charge per apartment unit fee.

• Decrease the rate for first residential cans from $10 to $9 per month.

• Increase the rate for second residential cans from $3 to $4 per month.

• Increase the tipping fee from $25 to $28 per ton.

Rich said the district has accumulated a reserve fund of $17 million and will take it down to $10 million in the next two years by operating in the red about $3.5 million each year.

"There is no law that requires us to maintain cash reserves, but we agreed with our bond holders to maintain at least $3 million in reserve. However, we do have other capital requirements including about a $7 million liability to close the the landfill properly," Rich said.

The burn unit's power generator failed after a power surge earlier in the year and the district had to spend $143,000 buying electricity from Utah Power, he said, noting that the district has bought a new generator that has been online since April 11. Part of the 2005 budget includes purchase of a new backup generator.

Rich said the district last made substantial rate changes in 1995-96 and at that time set rates with the goal of keeping them the same through 2006, at which time the district's $30 million in bond indebtedness will be paid off.

A public hearing on the budget will be held May 21 at 6 p.m. in the Davis County Memorial Courthouse, 28 E. State, Farmington.

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