Yahoo Weather

You are here

North Little Rock | Electric Department can cover its debts

While North Little Rock Electric remains to have indebtedness, the municipal utility will continue charging rates to repay it.

According to a recently released audit of the department to the City of North Little Rock, the city will be charging rates sufficient to produce net revenues equal to at least 125 percent of the annual debt service.

The utility continues having indebtedness stretching over decades.

The Department issued $15.3 million in bonds in December 1997 for capital improvements. In July 2009, the Department issued $10 million in working capital bonds. In May 2011, $16 million in revenue bonds were issued.

In June 2012, bonds totaling $55.78 million were issued.

“The 2012A and 2012B bonds were issued for the refunding of the 1992, 1997, and 2009 Series Bonds and to provide $7 million for capital improvements,” states the audit. “The 2012C bonds were issued to finance working capital of $10.185 million for the department.”

As a result of this refunding, $3.98 million of the deferred bond issuance costs are to be amortized over the life of the old bonds.

As of Dec. 31, 2013, $1.97 million in remaining deferred bond costs is reported as a reduction from the bond liability, according to the audit.

Another area of costs for the department is the helping of funding for non-uniform employee retirement plans.

All full-time employees of the department are participants of the city’s retirement system defined benefit plan.

The provisions of the plan call for employee contributions of 4 percent of gross earnings to be paid through payroll withholdings.

Each month, the department contributes 6 percent of each employee’s monthly compensation.

Employer contributions reflected in the financial statements of the years ended Dec. 31, 2013 and 2012 was $310,035 and $298,911, respectively, and was included in operating expenses, according to the report.

“Employee contributions to the plan were $206,691 and $199,274 for the years ended Dec. 31, 2013 and 2012,” according to the report.

Close
The North Little Rock Times, Sherwood Voice, Maumelle Monitor, and Jacksonville Patriot websites are available only to print and digital subscribers. If you are already a subscriber, you can access these websites at no additional charge.