Loudon Utilities Board discussed at length Sept. 23 the policies and procedures in place for gas customers whose service is temporarily discontinued for repairs.

The issue arose after a contractor inspected a gas line at a Loudon restaurant on a recent Sunday afternoon, then cut a lock and reconnected the service without calling the city.

John Davis, city engineer, said the business owner had been told she must contact the city before service was restored. The policy had been in place for years, Davis said, emphasizing that lines are disconnected when somebody smells gas and suspects a leak.

"It is a pretty standard procedure, but people don't like it when we cut their gas off," Davis said.

John Hutton, LUB chairman, said each department must get policies and procedures together for review and adoption by the board. Without that, the city could be liable if an explosion occurred, he said.

LUB member Michael Cartwright said the city should oversee all utility reconnections.

Loudon electric customers will be paying a bit less for electricity in the coming month thanks to a Tennessee Valley Authority fuel cost adjustment. The reduction will cut residential customers' bills by 28 cents per kilowatt hour, Lynn Mills, LUB general manager, said.

But the reduction will last only a few days, Mills said. A rate increase of 1.5 percent will take effect Oct. 1, but will be offset by lower usage, he said.

"The rates will be higher in December, January, February and March, when seasonal rates kick in," Mills said. Traditionally, customers see a decrease in usage in fall, before heating costs elevate cost again in winter, he said. "The winter costs are not as high was in summer, but they are higher than October and November."

The cost of natural gas for September rose to $3.9601 per dekatherm, which converts to a price of $1.06 per cubic feet of gas billed after Oct. 1. Mills said the price of natural gas is rising and may be expected to continue rising next month.

LUB voted to authorize a contract with East Tennessee Development District for the administration of a grant for electrical system improvements in Sugarlimb Industrial Park. The ETDD will ensure that all rules and regulations pertaining to the $1.5 million federal economic development grant are followed.

"This is what we did in 2005-2006 when we received the grant for Blair Bend," Mills said. "They have built in all kinds of procedures we have to follow for a federal grant and we don't want to jeopardize that $1.5 million." The administration fee of $25,000 will be paid from grant funds.

The board approved proceeding with the third phase of sewer rehabilitation, at an estimated cost of $109,762. Action was not taken on the schedule of sewer rate increases needed to fund the project. Mills said LUB is working with several banks to determine the best bond program, and the rate structure will hinge on some issues not yet determined.

Rick Kirby, project engineer, asked the board to allow work to proceed with examining pipes with closed circuit television, a project contracted with SanTek. "We were hoping to get this done before the weather gets bad," Kirby said.

Hutton asked for a motion, which passed unanimously. "It looks like this is something we have to do," Hutton said.

The city hired Ty Thearp for the position of water department plant operator, Mills said.