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VOL. 133 | NO. 28 | Wednesday, February 7, 2018

City Council Approves 2 Percent Gas and Electric Rate Hikes

By Bill Dries

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Memphis City Council membes approved 2 percent gas and electric rate hikes Tuesday, Feb. 6, in a busy council day at City Hall.

Memphis City Council members approved gas and electric rate hikes Tuesday, Feb. 6, for Memphis Light Gas and Water Division effective in July.

The two percent rate hikes for each of the sectors came after a prolonged council debate and a council vote that initially voted down the 2 percent rate hike for gas.

A majority of the 13-member body opposed larger multi-year rate hikes of 9 percent for gas and 6.3 percent for electricity. And in that majority was considerable sentiment that any longer term rate proposals and financial decision should come after J.T. Young becomes CEO of the utility in March.

Other council members, however, said the council will soon be discussing the issue of rate hikes again, most likely at the beginning of 2019. And they argued the larger rate increases will be necessary in the future for utility infrastructure projects that are needed.

Interim chief utility officer Dana Jeanes said the 2 percent rate hikes for a year would allow MLGW to continue to fund capital projects upgrading the utility’s infrastructure with hard decisions about budget cuts to come beyond that if there are no further rate hikes.

The multi-year rates hikes for higher percentages would have meant no rate hikes until at least 2023, according to Jeanes. The lower rate hikes mean there would be additional rates hikes sooner, he added.

The council also gave final approval Tuesday to a third ballot question for city voters to decide in the November elections. The new ballot question would, if approved by voters, eliminate the runoff provision in single-member council district races if no contender gets a majority of the votes cast.

It joins a proposed extension of term limits for council members and the mayor from two consecutive terms to three terms and a repeal of ranked-choice voting on the Nov. 6 ballot.

Meanwhile, the Memphis Police Association has started an online survey that includes a question about a half-cent city sales tax increase “to restore police benefits and retiree healthcare” – a reference to city employee benefits cuts the council approved several years ago.

Such a sales tax increase would require the approval of a ballot question by the council and then approval by voters in the resulting referendum.

The idea drew a neutral reaction from city chief operating officer Doug McGowen.

“What benefits will be affected?” McGowen asked in a written statement. “All employees or just police and fire? If just police and fire, is it all employees in the Memphis Police Department and Memphis Fire Department or just commissioned officers and firefighters? … If the revenue is greater than the cost of the benefits, when the revenues of the sales tax increase is greater than the cost of the benefits, what will the excess revenue be spent on?”

The administration and council are weighing a plan to fund an expansion of prekindergarten in the city that could include a sales tax increase referendum on a ballot this year. The group working toward that goal is expected to make its recommendation on funding in April as Memphis Mayor Jim Strickland takes his budget proposal to the council.

In other action, the council approved Tuesday on third and final reading an ordinance requiring more advance notice of street closings for marathons and 5ks as well as an appeals process to the permits granted by the city for such events.

The council delayed until March 6 a final vote on an ordinance that would amend the procedures for ticketing cars parked overtime in commercial parking lots.

The council approved a memorandum of understanding with county government that would allocate and appropriate $4 million in storm water funds to cover the city’s match of funding for resiliency projects at Rodney Baber and Kennedy Parks in Raleigh as well as southwest Memphis in the flood plain of Cypress Creek. The projects plus a water recreation area in Millington are funded with a $60 million federal grant as well as a longer term resiliency study to identify other projects.

And the council approved up to $50,000 for the firm ERMS to study and recommend crowd control methods for the Beale Street Entertainment District. The funding comes from the $257,779 in cover fees collected with and without the Beale Street Bucks program. '

The original bucks program charged a $10 cover to get on Beale Street on spring and summer Saturday nights after 10 p.m. It included rebate coupons worth $8 in Beale Street businesses. The council cut the cover charge to $5 this past summer and did away with the rebate coupons. The council voted still later last year to do away with any cover charge to get in the district at any time.

The study will be overseen by the Downtown Memphis Commission which currently runs day-to-day operations of the entertainment district for the city of Memphis.

ERMS – Event Risk Management Solutions is a Boise, Idaho firm that recommends risk management methods for festivals and similar events. Peter Ashwin, a former Australian Army Special Forces offices, leads ERMS and has been a consultant to six Olympic games as well as the G8 Summit in 2010. He has also provided support to the Memphis In May International Festival.

In morning council committee sessions Tuesday, Memphis Area Transit Authority CEO Gary Rosenfeld announced MATA will end bus service March 31 to and from West Memphis, Arkansas. Rosenfeld said the decision was based on cuts in federal grant funds to West Memphis and declining ridership.

PROPERTY SALES 53 210 10,146
MORTGAGES 53 214 11,160
BUILDING PERMITS 245 474 22,646
BANKRUPTCIES 271 271 6,490