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Increased gas prices and budget cuts to Fulton’s city budget may come to recoup after ‘financial disaster’

FULTON, Mo. (KMIZ)

Fulton residents may see higher gas prices and the city may have to tighten it's budget after the "financial disaster" caused by skyrocketing natural gas prices last week.

The city council received an update Tuesday about the issue. The council held an emergency meeting the previous Tuesday about the issue caused by frozen wellheads across the country after the polar vortex.

The city of Fulton had to pay more than $3 million dollars out of its gas reserve fund to pay the commodity price, set by wellhead operators in other areas of the country. The city's reserve was around $5 million and was at around $1.8 million after just four days.

Mayor Lowe Cannell started the update with a grim analogy about the dollars spent in those 4 days, saying while the crisis is over now, the impacts will be felt for years.

"The 3 million dollars that we spent over the weekend is money that you could have just put in a burn barrel out in front of city hall and lit on fire," Cannell said. "That's what it made me feel, it just made me sick."

The city's gas reserve funds now stand at $1.8 million, where it used to be $5 million just weeks ago. The utilities board passed a motion Monday to ask the council to try to recoup the funds in 3 years.

That may mean major budget cuts to city departments. The council was given a list of potential cuts totaling $1.752 million. There will be a meeting with department heads next week to go over the cuts, which will likely be lower than that number.

The city plans to bring back a plan about the cuts to council next meeting.

Councilman John Braun brought up concerns that the city was acting too fast to cut capital spending just a few weeks after the crisis.

"I would rather see things settle out a little bit, maybe we will get some funds back, potentially, do I think we will, I'm saying no at this point," Braun said. "I think it's too soon to have a knee-jerk reaction to adjusting anything at this point."

The City Administrator Bill Johnson said there is some urgency to get those dollars back in case of another emergency.

"This could happen again next month," Johnson said.

The mayor also mentioned that a small increase in gas prices for customers may be necessary to get back some of those funds, but those discussions are still in the works.

City leaders have been in contact with the state and federal leaders about investigations into potential "price gouging" and aid coming down to cities. Governor Mike Parson said Thursday he will not tolerate potential "price gouging" by natural gas providers.

Some council members were frustrated with the lack of help they have received from the state and the federal government. Johnson said he has contacted both state and federal officials several times

"Looks like Texas is going to get some cash, how about the rest of us? We need it too," Johnson said.

Parson's spokeswoman Kelli Jones reiterated in a statement Tuesday the governor is working with the Attorney General to get to the bottom of any potential price gouging.

"Governor Parson made clear in his statement last week that the State of Missouri would not tolerate price gouging by those seeking to exploit a crisis for personal gain. The Governor and his staff continue to confer with the Attorney General's Office and support the AGO in their efforts to use Missouri law to protect Missouri citizens."

Kelli Jones, Communications Director for Governor Mike Parson

Jones did not give an update on if the state is looking at emergency aid for communities impacted by the crisis.

Cannell said the city will have to move forward assuming no aid will be coming down from the state or federal government.

ABC17 News has also contacted the attorney general's office for more information about their role but did not immediately receive a response.

ABC17 News will be at the meeting tonight. Check back for updates and watch ABC17 News at 9 and 10 for a full report.

Fulton / Governor of Missouri / Missouri / News / Politics / Video

Connor Hirsch

Connor Hirsch reports for the weekday night shows, as well as Sunday nights.

Comments

1 Comment

  1. Perhaps a bit of work needs doing on the contract between Fulton and the gas suppliers. It’s not Fulton’s fault the well heads failed, it’s the suppliers fault. Why is Fulton paying for it?

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