Traverse City Record-Eagle

Archive: Tuesday

January 22, 2013

Traverse City may cut heating assistance contribution

'I think going back to the 50 percent makes sense'

TRAVERSE CITY — City officials may cut $8,000 from an annual charitable contribution that benefits those who need home heating assistance, money that's generated by fees on delinquent electricity ratepayers.

Traverse City Light & Power charges $5 every time it hangs a shut-off notice on a customer's door. The city-owned utility has given 100 percent of the money collected — more than $64,000 — to four charities over the last three years.

Today the board will consider returning to its pre-recession policy of keeping half the money to help offset the cost of its collection efforts.

"I know the economy is not at 100 percent, but I think we are doing somewhat better and I think going back to the 50 percent makes sense," said Pat McGuire, utility board chairman.

But Barbara Budros, a city commissioner and utility board member, supports continuing the donation at 100 percent, if it's used to help people with their utility bills.

"I wouldn't have a problem with giving them all of it," she said.

The utility board meets at 5:15 p.m. and the city commission will take up the same issue when it meets at 7 p.m. Both meetings are at the Governmental Center.

Area charities report the need for winter utility assistance continues to rise, despite signs of economic gains.

"We are not seeing a reduction in heating assistance need because the price of heat continues to go up," said Kris Brady, community services director for the Northwest Michigan Community Action Agency. "We see a lot of people underemployed ... living paycheck-to-paycheck and when the cold weather hits, people see a big increase in bills they haven't been able to prepare for because they've been living paycheck-to-paycheck."

TCL&P issued about 5,800 shut-off notices in 2012 that generated $29,115.

"The fee is very low," said Tim Arends, the utility's interim executive director. "It doesn't cover the cost of going to the door and hanging the tag, but obviously the people already have a problem because they aren't paying the utility bill."

Should the city stick with its recent 100 percent contribution model, charities would get to split an extra $6,000 over the previous contribution, made in November 2011. There's more money because it covers a few extra months, Arends said. The board normally addresses the issue in November.

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