A citizens group in Delta is balking at the village’s Nov. 6 ballot proposal to establish a municipal electric utility. The members claim the village can’t afford it, the plan risks higher electric rates, and that local taxes paid by the current supplier will be lost.
Voters will decide on Issue 8, or Ordinance 18-08A, the village’s request to establish the municipal ultility which would focus on industrial complexes along the State Route 109 corridor. The approximately $4 million project would require the village to purchase a substation built by NatureFresh Farms over two years ago at Airport Highway and State Route 109.
If voters approve the purchase, the village would contract with NatureFresh to assume repayment of the debt and to pay a monthly user fee. The substation would provide Delta with an electrical energy alternative to its current provider, Toledo Edison, a subsidiary of First Energy Corporation.
The village submitted a referendum petition to the Fulton County Board of Elections in July.
Delta Administrator Brad Peebles has said that a municipal electric utility would redirect to the village approximately $150,000 in taxes sent annually to the state.
The proposed municipal utility would first focus entirely on NatureFresh as a customer. Peebles said after the municipal utility was established the village would consider other industries along the State Route 109 corridor as customers. He said in the future the invitation might be extended to village residents as well.
“Given the current circumstances, we’re not actively seeking other businesses until this issue is resolved by the voters,” Peebles told the Expositor. “I only hope that educated people will make informed decisions.”
He said electric rates for the municipal utility couldn’t be established until the village contracted with NatureFresh and until the village secured power for up to three years. But he added they would likely be competitive with First Energy.
A notice being distributed by the five-member Association of Concerned Delta Citizens (ACDC) argues that the $4 million cost of the NatureFresh substation could be better used for village improvements. It also questioned by how much the maintenance, upkeep, and equipment for a village-owned utility would increase rates, and warned that the village would lose $195,000 in annual taxes paid by Toledo Edison.
“Government-run water and sewer has shown us that government-run electric will cost more in the end than we are told at the beginning,” the notice states.
Peebles held a village forum Oct. 16 to clarify the facts of Issue 8 to residents. He told the Expositor the concerns of the opposing citizens’ group are unfounded, beginning with its assertion that the $4 million cost would better serve village improvements.
“The reality is that the $4 million will be paid by NatureFresh, so the debt service will not be paid by taxpayers,” he said.
As for fears of an electric rate increase, Peebles said the village’s scope of territory for Issue 8 would be limited to industrial users within the State Route 109 corridor in the village. He said only NatureFresh and those customers would pay for the plan, leaving residential and commercial electric bills in the village unaffected.
“The rate issues will be minimal, and will not be impacting the tax-paying citizens of Delta,” he said.
Because Issue 8 focuses only on the State Route 109 corridor, Toledo Edison would continue providing utility service to the rest of the village, Peebles added.
He said 120 citizens attended the public forum, “and it was very clear that, once the facts were presented, the core for Issue 8 was much larger than we thought.”
Tim Cowden, ACDC chair, said the group was started because the village showed no transparency or resident exclusion pertaining to Ordinance 18-08A. He said the ordinance section stating Delta found it “in the best interest of the village to establish an electrical utility to serve the electrical needs of business and residents within the village where it is appropriate and financially feasible” can force electrical distribution to the residents.
Cowden noted Peebles will head the municipal electrical system, and residents won’t be able to contest whatever rates are chosen. “I would like to know what qualifications the administrator has to undertake such a responsibility,” he said.
ACDC’s other objections to Issue 8 include: the absence of the Public Utility Commission of Ohio in matters of power distribution; the outsourcing of electrical maintenance crews located 27 miles from Delta, when Toledo Edison crews are just nine miles away; taxpayers footing the bill for unforeseen maintenance and repair; and outside contractors staffing the municipal utility, eliminating the opportunity for job creation.
As for the village’s claim that Toledo Edison, which is funding ACDC’s campaign, will still service Delta with the exception of NatureFresh and the State Highway 109 corridor, Cowden said that’s not what the ordinance states.
“Mr. Peebles and the Village Council have come up with a ‘bait and switch’ ordinance, No. 18-25, which established the proposed electrical 109 corridor, which is not what the village residents are voting on,” he said. “This is how they are attempting to make the residents feel like they have a choice.”
He said ACDC fears the power by Peebles and the village council to control and adjust the electric rates under the municipal utility could follow the same path as “the village controlling our water treatment plant and setting our outrageous water rates.”
Cowden added, “If the sole purpose is to gain tax revenue for the Village of Delta, then why was a tax leniency drafted in the deal with NatureFresh when annexed into the village in the first place? Can we expect the same dealings with other potential businesses?”
He said Toledo Edison’s support of ACDC shows it’s determination to maintain Delta as a customer, regardless of its small-town stature. “Having (it) back the ‘little guy’ has made it possible for us to get the information out to the village residents that otherwise wouldn’t have been made available,” he said.
Reach David J. Coehrs at 419-335-2010.