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Gas division looks for room to grow

The city's gas division has problems with service, internal operations and marketing, according to a recently completed report. But that isn't news to Clearwater officials who say the $9,000 report also points to the potential of the system. Some of that potential may lie in Pasco County.

"It's basically a good system _ it makes money and it has room to grow," said Assistant City Manager Betty Deptula, Clearwater's budget director.

City Manager Michael Wright on Tuesday told members of the Budget Advisory Committee he still was waiting for more information before deciding what action to take.

Wright said one thing is clear: It's time to expand the city's natural gas services into Pasco County.

"Pasco is virtually untapped," he said. "And I've been talking with people in Pasco."

Gas companies must have continuous lines, he said, and can only move into areas adjacent to their own.

If the city does not expand the service from northern Pinellas into Pasco, it will be unable to move anywhere because other gas companies have the territories to the east and south of Clearwater.

The report, prepared by the accounting firm of Grant Thornton International, did indicate the gas division's profitability is second-highest in the state, with a rate of 14.4 percent.

But committee member Vito Nigrelli said that if the division was doing what it should in marketing and service, the figure would be lower because those things take money.

The report stated the city's objectives should be to achieve 90 percent service efficiency, add 150 customers, including 10 new commercial customers and extend the pipeline into Pasco County as far north as New Port Richey.

Clearwater wants more commercial accounts, Wright said, because they are more profitable.

Of the gas division's 10,000 customers, 8,700 are residential, but only 20 percent of the system's money is made from residential accounts, the report stated.

Last August, when commissioners debated selling the gas division last in August, they were told that it contributes $2.4-million annually to Clearwater coffers.

Selling it would have only produced only about $1.6-million.

So they decided to keep the gas division and figure out find the best way to operate and expand it, hoping to make it more profitable.

"We knew there were problems," Deptula said. "That's why we had the report done."