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1998 is expected to be a year of transition for the Jamestown Board of Public Utilities because of deregulation of electric utilities statewide and the conversion of its coal-fired power plant to natural gas.

General Manager James Gronquist said the board already has taken steps to save money by working with labor unions on new contracts and by making some changes at its waste-water treatment plant, but electric deregulation is a big unknown. He predicted a switch to market-based rates in the next year or two.

"Market-based rates, under any scenario, means there are winners and losers," he said. "You are either going to be able to compete or you're not.

"It's important to this community that we maintain the value of this utility, and the value is always going to be a measure of whether we are competitive or not."

Crediting board managers with implementing cost-cutting measures, Gronquist said: "We need this kind of cooperation from our employees in order to stay competitive."

He said a combination of increased sewer, district heating and sanitation fees will allow the board to make an additional $400,000 payment in lieu of taxes to the city. He called that increase "a cost of doing business."

The additional funds will help the city keep property tax rates nearly stable in the coming year.

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