MID customers asked to weigh in on rate hike

Electricity customers of the Modesto Irrigation District can weigh in Tuesday on a proposed rate increase of up to 9 percent.

The district board will hold a hearing on the proposal but is expected to delay a vote until later this month.

The full 9 percent hike would raise the average residential bill from $139.55 to $152.11 a month.

District officials said an increase is needed to cover operating costs, including expensive renewable energy mandated by the state.

They also say the increase would help boost reserves to a level that satisfies bond rating agencies. The ratings are a factor in how much interest the MID pays on bonds that finance capital projects.

Critics of the proposal last month said it would hurt customers suffering from the weak economy and discourage new employers from moving to the area.

The 9 percent proposal includes 7 percent for general operations and 2 percent that would go to paying down debt, reducing interest costs over the long term.

The staff warned that an even higher increase would be needed in 2012 if there is none in 2011.

The board will meet at 9 a.m. Tuesday at the district office, 1231 11th St., Modesto.