PACKET 2026 6 8 Work Session website

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6 
 
 
Executive Summary 
 
 
As a staff we have produced a five-year budget plan for almost a decade.  Our objective is to 
provide a detailed budget document for the immediate fiscal year (FY) with conservative 
projections for the next four years in order to provide the board and our organization a long-
term vision and plan for the future.   
 
In lieu of a detailed executive summary, each division has a detailed “Year-One” budget and 
five-year projection summaries included within the appropriate sections of the report.   The 
“Year-One” budget ultimately serves as the upcoming fiscal year budget for the utility, in this 
case for the FY beginning July 1, 2026, and ending June 30, 2027. 
 
As always, the conclusions herein are qualified by the fact that all estimates are subject to 
variables outside the Athens Utilities Board’s (AUB) control.  Weather and economic 
pressures are two examples of factors beyond our control that directly affect our business.  
Inflationary pressures on all fronts continue to weigh heavily on net revenues for the utility 
overall. These pressures have resulted in recent local rate increases in the Power and Natural 
Gas divisions.  Weather influences the performance and sales of all four divisions (Power, 
Water, Natural Gas, and Wastewater), but is a primary and powerful driver of the power and 
gas division finances.  
 
The power division, like all divisions, continues to struggle with inflationary pressures. costs. 
This year, electrical revenues are projected to remain flat.  From a capital investment 
standpoint, we will need to issue debt to address the construction of the Englewood substation, 
replacement of copper primary and AMI this year.  We anticipate sufficient revenues to meet 
our needs and do not anticipate the need for an increase in power rates for this fiscal year 
budget.    
 
Water net revenues remain an area of concern for the management staff.  Based upon a 
worsening net revenue projection, we would anticipate the potential for a rate increase in late 
FY 2027.  This will of course be dependent upon the actual financial performance of the 
division. Our plans include a large capital investment project to be started this year.   This 
project, a $6.5 million dollar water reservoir and pump station, will address ongoing issues 
with fire protection and water supply to our industrial park and northwestern service area.   We 
plan on funding this project through a combination of grants and debt.  
 
The board passed a rate increase for the Natural Gas division last year. The final incremental 
increase will become effective July 1
st, 2026.  These rate actions, consistent with the 
recommendations from our rate consultant, should provide adequate revenues to address the 
concerns of the comptroller’s office. The division is expected to have positive net revenues for 
this year. 
 
Large wastewater capital projects at the treatment plants will require issuing debt in order to 
maintain our cash position and make necessary repairs and investment in our infrastructure.   
These projects will require at least $6.0 million to be added to our long-term indebtedness.  
Current projections for this year’s net revenues (before extraordinary) indicate that we should 
not have to recommend a rate increase for wastewater this year.