Traverse City Record-Eagle

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June 13, 2014

Hearing set for electric rate increases

TRAVERSE CITY — City utility customers will face an electric rate increase pushed by utility board members who at the same meeting voted to spend $350,000 on an expansion of their employee meeting space and lunch room.

Residents will have the opportunity to vote on a $1.50 a month base-rate increase at a public hearing scheduled by Traverse City Light & Power board members for June 24 at 5:15 p.m. in the Governmental Center. The rate increase will move customers' base rate from $4.50 to $6 a month and overall generate about 1.8 percent a year additional revenue for the utility.

Seniors will see a slightly larger increase of about 2.7 percent annually as the utility tries to slowly do away with their discounted rates.

Commercial customers will get hit even harder, said Tim Arends, executive director of TCL&P.

Commercial users face a 2.8 percent increase, worth about $17 to $18 a month, while Industrial customers will see rate increases of just 0.7 percent. The adjustments follow recommendations from a rate study to bring rates in line with the cost of servicing different customers.

"We are only trying to adjust the monthly base charges to get closer to what the actual cost to provide service is," Arends said.

TCL&P board members also voted to expand their service building by creating a larger employee eating area that's also capable of seating all line employees for a meeting. The project also will add one office at an estimated overall cost of $350,000.

City Commissioner and TCL&P board member Jim Carruthers was the lone vote against the project.

"I'm not 100 percent opposed to this project but you vote to raise rates and then you're turning around and doing what I consider a non-essential addition to the facility," Carruthers said. "It's not the best timing."

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