Marshfield, WI (OnFocus) Marshfield Utilities (MU) recently presented the City of Marshfield with their annual PILOT payment and 2018 Dividend check in the amount of $2,114,438.57.
The check provided is MU’s annual PILOT (Payment in Lieu of Tax) and dividend payment. The Public Service Commission of Wisconsin Administrative Code requires municipal electric and water utilities to pay an annual PILOT. Similar to the property taxes paid on a residential or commercial property, a PILOT is one example of how a municipal owned utility is a significant asset to a community.
A municipal utility is owned by the city it serves, and exists to provide a public service to the citizens, businesses, and industries of the community. As is the case with municipal owned MU, service, not profit, is the utility’s mission.
“Being municipally owned means there are no stockowners. We provide value and service to our stakeholders: City, Customers, and Community. We manage our rates though state regulations to ensure financial stability with a focus on re-investing into the utility infrastructure (pole, wire, water main, etc.) to increase reliability and support the community,” said Nicolas Kumm, General Manager at MU.
Having a municipally-owned utility means many benefits for citizens of that municipality, as is the case in Marshfield. Instead of going toward investor bonuses as it would for a private utility, profit at municipally-owned MU goes directly back into the community. In addition, municipal utilities generally have lower rates and more reliable service.
“Our electric rates are up to 30% lower than other local IOU (investor owned utilities) and cooperatives,” said Kumm. “This means the average Marshfield Utilities residential customer saves nearly $30 per month ($336 per year) on their electric bill compared to nearing communities.”
Being municipal also means local control, support, and presence.
“MU is a local company that provides local support,” said Kumm. “No matter the request, from a new service to updating existing facilities or billing inquires customers can contact MU electrically through our website or email, give us a call, or can stop in to meet face to face with a local utility employee.”
Operated in the public interest, for the benefit of the residents of the city, a municipal utility is not operated for the benefit of stockholders who may live far away and have little interest in the community. Dollars are spent locally, including those provided by the PILOT.
The PILOT is based on the utilities’ cost of plant in service located in the City of Marshfield. As defined in Public Service of Wisconsin Administrative Code Section 109.02, the PILOT amount is determined by applying the property tax rates of the City of Marshfield and local schools to the cost of plant in service multiplied by the assessment ratio for the City.
“The plant in service include poles, conductor, water mains, fire hydrants, and buildings to name a few,” explained Kumm.
Dividend payment is provided to City’s Economic Development Board to support Economic Development projects, which have included the downtown façade program, the downtown master plan update, Tools for Business Success Website, Wenzel Plaza, and the recent housing study, to name a few.
Author: News Desk
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