Archive for Thursday, February 24, 2005

Electric shock is finally good

February 24, 2005

Although it won't take affect until April, it looks like city residents and business will see their electric bills go down. That's no April Fool's joke, either.

The city council had the first reading of an ordinance that would amend the city code regarding electric utility rates. The rates would go down for everyone, but savings would depend on usage. For the average home, the decrease will amount to at least $4.27 per month and businesses will see an $11.44 reduction, according to figures supplied by Terry McKinney, director of utilities.

"The net on that for every resident is about a 5 percent reduction," said McKinney. "For businesses, it's a 3.4 percent reduction."

The rates would be changed to do away with different charges for the different stages of usage. In the past, residents have been charged 15 cents for the first 25 kilowatt hours, 13 cents for the next 25 kWh and 12 cents for each 25 kWh. Instead, only a base rate will be used and it's being reduced from $0.0106 per kWh to $0.0103 per kWh.

While Baldwin residents will see savings, the city will have a reduction in revenue.

"It results in a $125,000 change in revenue projections," said City Administrator Jeff Dingman.

He said that would be mean a reduction in the amount of money to transfer to the electric utility reserve, but would not effect funds already in reserve. Dingman also said that continued growth in the customer base could eventually offset the reduction in revenues.

The rates were also adjusted for industrial usage (those using more than six million kWh per year) and for Baker University's demand and energy rates.

"We all were for it," said Council member Ted Brecheisen Jr., a member of the utility committee that recommended the rate reductions. "Everybody is getting some advantage out of this, residents and businesses."

In other business, the council:

  • Approved the use of city streets for the Baldwin City Stage Race on June 11-12.
  • Heard the second reading for the 2005 Code of the City of Baldwin City, Kansas.
  • Approved the ordinance authorizing the issuance of $9.1 million in General Obligation Electric Utility System Refunding Bonds and the resolution that prescribes how that process will be done. The refinancing will save the city more than $120,000.

The council did not meet in executive session.

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