Business

PSE rate hike proposal surprises schools

"With an unexpected electricity rate hike in the works, the South Whidbey School District is a bit uneasy about its utility budget for the coming school year.Puget Sound Energy caught the school district entirely by surprise when it asked state regulators for an emergency electricity rate hike of 18 percent beginning Nov. 1.That's not what they communicated to us, said Dr. Martin Laster, superintendent of schools, at Monday's board meeting. He said early in the budget process PSE officials told the district to expect little if any rate increase during the next school year.There were two reasons for that advice, Laster told the board. First, PSE was legally precluded from raising prices during the calendar year 2001 due to an agreement with the state. Second, any rate increase applied for next January would take several months to process. So the 2001-2002 school year would be nearly over before any increase could take effect.The message from PSE, Laster said, was to expect no impact this fiscal year from rate hikes.Even though PSE is now seeking an emergency rate increase, Laster said the school district probably has the wherewithal to absorb it, because utility fee flexibility was built into the budget. You never know where there may be a particularly cold year, he said. But he estimated that flexibility to be in the 12 to 15 percent range, rather than 18 percent. And a PSE rate increase combined with cold weather could hit the utility budget even harder. "

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