Gas heating bills on the way down

The department incurred the shortfall over a period of a few months because the formula it used to calculate the purchased gas adjustment didn't reflect the skyrocketing gas prices.

So while customers were seeing higher bills, the charges didn't keep up with what the borough was actually paying for the cost of natural gas.

The combination of a new formula and a cold spring that kept customers using their heat longer was enough to recoup the shortfall that was originally expected to take two years to recover, Leary said.

In addition to his report on the gas department's operations, Leary asked the council to approve amendments to its contract with the Municipal Gas Authority of Georgia (MGAG), which supplies the borough's gas.

The council approved the amendments, which require the borough to pay for its gas storage throughout the year rather than at one time and end speculative financial transactions by MGAG with the borough's gas supplies.

"In order to get more control, we will pay for the storage of gas," Borough Manager Eric Oyer said. "We're not paying any more, just at a different time."

Since the borough's contract began last year, MGAG had the authority to take gas the borough put into storage and sell it on the gas market for a higher cost.

Most of the profit would go to the borough. However, there were no guarantees the gas purchased to replace that could be bought for the same amount or less, Leary said.

In the new agreement MGAG already approved, it will not make transactions without the borough's approval.