MADISON, Wis., March 21, 2003 -- The City of Beloit and Wisconsin Power and Light Company (WP&L) reached an agreement in principle on the sale of the water utility serving the Beloit area.
Pending resolution to outstanding details in the sale, the final transaction is scheduled to take place later this fall. The agreed upon sale price is approximately $20.85 million with contingencies.
"I'm confident community ownership of the water utility will prove to be a major benefit for the city and its residents," says Jane Wood, City Administrator. "The city will be taking over ownership of a quality water system and we will ensure successful operation in our community for years to come."
Wood expects one of the first outcomes of the transaction will be for the city to set new water rates, anticipating a 10 percent reduction from current rates.
"Local control of the water system means our city has the financial flexibility to establish rates," says Wood. "Because many of the costs incurred by a regulated utility to run a water system are not applicable under community ownership, we expect to pursue and implement an immediate reduction in rates."
Wood says she anticipates the reduction in rates to remain at that level for two years.
WP&L is exiting the water business after making the strategic decision last year to focus on increased investments in electric and natural gas infrastructure. The utility offered the Beloit area the first opportunity to purchase the water system serving that location.
"WP&L has been serving the Beloit area for more than 100 years, and we're committed to a continuing energy partnership with this community," says Tom Adelman, Managing Director of Strategic Accounts. "We appreciate the hard work and professionalism of all those involved in this transaction, and look forward to a continuing energy partnership with the city for many years to come."
The agreement in principle between the City of Beloit and WP&L outlines the purchase of the water system located in Wisconsin. The portion of the system located in South Beloit, Ill., will not be included in the sale to the City of Beloit.
"City officials and WP&L representatives did an outstanding job working together to reach this agreement," says Wood. "It's also an historic moment for the various government entities from the City of Beloit, the Town of Beloit and the Town of Turtle, too, who had the wisdom and foresight to pursue this opportunity for the good of the Beloit area."
The public will vote on the purchase of the water utility at a referendum tentatively planned for May 28. The purchase is also subject to approval by the Public Service Commission of Wisconsin.
Alliant Energy Corporation (NYSE: LNT - News) is an energy holding company based in Madison, Wis. Alliant Energy's utility subsidiaries provide electric, natural gas and water services to 1.3 million customers throughout the Midwest. On the non-regulated side of the business, Alliant Energy has subsidiaries that operate utilities in targeted international markets and another that is working to increase generation capacity in select regions of the United States. For more information, visit the company's Web site at www.alliantenergy.com .
