Northern New York Newspapers
Watertown
Ogdensburg
Massena-Potsdam
Lowville
Carthage
Malone
NNY Business
NNY Living
NNY Ads
Sat., Nov. 29
SUBSCRIBE
Serving the communities of Massena and Potsdam, New York
Related Stories

MED says negative cash flow is not a concern

PREV
NEXT
ARTICLE OPTIONS
A A
print this article
e-mail this article

MASSENA - The Massena Electric Department found out about their negative cash flow total last week, but they say the numbers were not a surprise and are not a cause for concern.

Auditor William C. Freitag of Bollam, Sheed, Torani & Co. shared his findings with the Massena Electric UtilityBoard

MED Superintendent Andrew J. McMahon said the findings reflected an increase in expenses at the same time as rates have stayed stable, but he stressed that a rate increase is not planned for the near future.

“It was pretty standard stuff, looking at the financial health of the organization. Generally we’re doing ok. We had a negative cash flow but most of our indicators are still strong,” Mr. McMahon said.

“We told them that we have been doing the cost of service analysis since around June and when that flushes out we will develop a plan based on that analysis. There were no changes that the auditors came through and they didn’t find any evidence of us doing anything wrong.”

MED Treasurer Jeffrey M. Dobbins reported that the group’s net loss totaled $224,000 in 2013. “We were aware of that,” he said. “The reason why we showed a net loss is because our operating expenses have increased and we have not changed our base rates. Operating expenses refers to health care, maintenance, etc. and then the cost of materials have all increased.

“There were also no changes with the financial statements that we provided the auditors. They agreed with the financial statements that we provided them,” Mr. Dobbins added.

At last year’s meeting with Mr. Freitag, he stated that the utility’s net income had decreased from $553,000 in 2009 to $134,000 in 2012.

The auditor also noted that the ideal rate of return for the company would be between 5 and 6 percent.

MED currently has $7.2 million in total reserves, a figure that Mr. Dobbins said officials were expecting.

“This is where we expected to be. Those reserves did decrease by $738,000 this year but $1.4 million was added without incurring any debt,” he said.

The superintendent also noted the average usage of energy from customers has also gone up considerably.

“We’ve been talking about the importance of energy efficiency and we’ve seen the average annual consumption of our customers go up 600, KWH so that growth has been expensive,” Mr. McMahon said.

“Eight hundred ninety-six dollars is what the average customer paid last year, which is 8.8 percent higher. From 2012 to 2013 the cost was $73 more but they also used more kilowatts per hour, so it is not a big shock,” he noted.

Commenting rules:
  1. Stick to the topic of the article/letter/editorial.
  2. When responding to issues raised by other commenters, do not engage in personal attacks or name-calling.
  3. Comments that include profanity/obscenities or are libelous in nature will be removed without warning.
Violators' commenting privileges may be revoked indefinitely. By commenting you agree to our full Terms of Use.
Giveaway
Syracuse Football Tickets Giveaway
Connect with Us
DCO on FacebookWDT on Twitter