CITY COUNCIL APPROVES 10% REDUCTION FOR JANUARY
The city council voted unanimously to authorize a 10% reduction of all customers' natural gas rates effective next month. There are separate rate schedules for inside and outside the city limits. Rates outside city limits are set higher than those for city residents.
Rates Were Kept Higher Through the Fall
Mayor Kant: "We've had them up higher all Fall . . . they need to come down."
Kant said he favored another 5% reduction to better compete with other gas providers outside the city limits like Mobile Gas Company. Kant said the city provides gas for Spanish Fort and all the way up to Bay Minette.
Some Confusion Over Further Reductions
The Mayor asked the council for the added 5% in competitive areas, but--according to the gas ordinance-- as the city's Utilities Superintendent he has the power to do that himself--without action by council (Article 5, Section 21.61, 11: The foregoing retail rate schedule shall be further subject to adjustment in certain areas defined and specified as subject to the competitive rate environment. Such areas are those in which the city is competing or will have to compete with other gas suppliers for market share. The superintendent of the municipal utility system shall define those areas and set the rates in these areas. The purpose of this discretion to adjust rates in the defined area or areas is to enhance the municipal utility's ability to successfully compete and gain market share.)
Councilman Kingrea: "Since we (Fairhope) do not have a superintendent of utilities, the mayor acts as the super and under the cited Rule/regulation can make the adjustment outside the corporate limits."
Councilman Mixon said later he thought the Council alone had such authority over rates.
Further Cuts May Put Budget/Infrastructure in Jeopardy
Financial and Budget Committee Chairman Chuck Zunk worries that any further cuts may jeopardize next year's budget and gas infrastructure upgrades:
"In my opinion if we follow the Mayor's suggestion to lower our rates even more than what has already been done, then we will be putting the budget in jeopardy and we won't have enough money to do necessary upgrades to our system. For example, the natural gas system has miles of cast iron pipe in the downtown district that must be replaced for safety reasons, and if we cut our budget then this project, and others, will be at risk of being completed on time."
The city council voted unanimously to authorize a 10% reduction of all customers' natural gas rates effective next month. There are separate rate schedules for inside and outside the city limits. Rates outside city limits are set higher than those for city residents.
Rates Were Kept Higher Through the Fall
Mayor Kant: "We've had them up higher all Fall . . . they need to come down."
Kant said he favored another 5% reduction to better compete with other gas providers outside the city limits like Mobile Gas Company. Kant said the city provides gas for Spanish Fort and all the way up to Bay Minette.
Some Confusion Over Further Reductions
The Mayor asked the council for the added 5% in competitive areas, but--according to the gas ordinance-- as the city's Utilities Superintendent he has the power to do that himself--without action by council (Article 5, Section 21.61, 11: The foregoing retail rate schedule shall be further subject to adjustment in certain areas defined and specified as subject to the competitive rate environment. Such areas are those in which the city is competing or will have to compete with other gas suppliers for market share. The superintendent of the municipal utility system shall define those areas and set the rates in these areas. The purpose of this discretion to adjust rates in the defined area or areas is to enhance the municipal utility's ability to successfully compete and gain market share.)
Councilman Kingrea: "Since we (Fairhope) do not have a superintendent of utilities, the mayor acts as the super and under the cited Rule/regulation can make the adjustment outside the corporate limits."
Councilman Mixon said later he thought the Council alone had such authority over rates.
Further Cuts May Put Budget/Infrastructure in Jeopardy
Financial and Budget Committee Chairman Chuck Zunk worries that any further cuts may jeopardize next year's budget and gas infrastructure upgrades:
"In my opinion if we follow the Mayor's suggestion to lower our rates even more than what has already been done, then we will be putting the budget in jeopardy and we won't have enough money to do necessary upgrades to our system. For example, the natural gas system has miles of cast iron pipe in the downtown district that must be replaced for safety reasons, and if we cut our budget then this project, and others, will be at risk of being completed on time."
Comments
i dont trust politicians to set my utility rates honestly, for heavens sake!