Newspaper article St Louis Post-Dispatch (MO)

Courts to Decide Whether Utility Can Keep Facility

Newspaper article St Louis Post-Dispatch (MO)

Courts to Decide Whether Utility Can Keep Facility

Article excerpt

Missouri courts will decide whether Union Electric Co. or Kirkwood property taxpayers should benefit from providing electricity to slightly more than one-fourth of the city's residents.

Kirkwood is one of the few municipalities in the St. Louis area that operates an electric utility. The city serves slightly less than three-fourths of its residents. The utility's profits of up to $3 million a year heavily support the city's general revenue budget.

Union Electric serves residents generally in the western and southern edges of the city. The city wants the approximately $1.5 million in profits they estimate that the service provides to Union Electric.

Kirkwood has offered Union Electric $3.25 million for its facilities. Union Electric refuses to sell.

"We sell when we have business reasons," said Susan L. Gallagher, manager of corporate communications. "In this case, we have no reason to give up business and customers."

The company has sold facilities at its fringes in northern Illinois and Iowa, but she noted, "80 percent of our customer base is in the St. Louis metropolitan area. We serve all the surrounding communities" of Kirkwood.

In August, Kirkwood asked the St. Louis County Circuit Court to condemn by eminent domain Union Electric's facilities in the city. A hearing on the request was scheduled for this week but has been postponed. Instead, a pretrial conference will be held Nov. 16.

The city buys electricity at wholesale prices from Union Electric and transmits it to residents and businesses. The city charges its customers the same rates as Union Electric.

Kirkwood's utility started nearly 93 years ago when the city was much smaller. Through annexations, Kirkwood acquired areas already served by Union Electric. The city utility also expanded into unserved areas annexed by the city. In 1951, the city and Union Electric consolidated their holdings into the current arrangement. Kirkwood has about 9,300 customers and Union Electric has nearly 3,600 in the city. …

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