Where they stand: Candidates discuss Franklin Power Light

Published 12:00 am Tuesday, April 29, 2008

This is the second installment in a question-and-answer series with candidates for the Franklin City Council.

Would you support the creation of an independent authority or commission to govern Franklin Power & Light? Why or why not?

Ward 1

Barry Cheatham

Several months ago, I was not sure I wanted another layer of bureaucracy in our government. I decided to look into it and see what the benefits were and whether they outweighed the costs associated with it. I have since decided that I would in fact support an independent utility commission appointed by the City Council. It would be responsible for setting the rates (lower than Virginia Electric and Power Co.), responsible for maintaining a reserve fund, and controlling the amount of city cash transfers.

The deciding factor for me was the amount the city takes from the utility. We currently have a take-and-spend city, and a barrier on money needs to be placed between the city and the utility. Now, if we have a problem in the utility or need new equipment or infrastructure, we no longer have the funds to cover these costs and more debt is imminent n as in the proposed budget. Higher utility bills will be used to pay this back. The commission will keep our utility under our control and not the state’s.

Dan Hoctor

I am on the fence with this due to my respect for both parties’ stance on the issue. We could look into an independent commission for the not-so-near future, but my major concern is where we are going to make up the money that is taken out of the electric fund and transferred to the general fund that the City Council deems necessary, reasonable and prudent in the best interest of the city.

The current proposed budget calls for $1,709,891 to be transferred from the electrical fund to the general fund. Where are we going to make this amount of money up without raising real estate taxes? I don’t believe this would be a decision that most of my constituents would support. If the concerned-citizens group could explain to me how we could make this money up without major cuts to current departments, I would be more willing to support it.

Currently, I have not heard a reasonable plan to make up the revenue, and due to this I currently am leaning toward not supporting an independent commission.

Ward 2

Benny Burgess

I believe an independent third-party commission will instill more financial discipline in city government. While claiming to be rebuilding the Reserve Fund by $150,000 per year, in reality our government has been tapping the electric fund to cover operating expenses/losses. Within two years, the reserve has been reduced from $2.7 million to $1.4 million. The effect is detrimental to Power and Light and ultimately to citizens.

Money in the Reserve Fund sufficient for future equipment maintenance and upgrades could have reduced electric rates for all citizens.

The proverbial robbing of Peter to pay Paul is not healthy. Legal? Yes. Open and transparent? Hardly. It masks the true fiscal picture for taxpayers and is something of a shell game. Forcing administrators to look elsewhere for revenue would have resulted either in spending cuts or more awareness on the part of taxpayers who would see a tax rate increase.

Establishing an independent commission to govern Franklin Power and Light will reduce the chance that current and future administrations will be tempted to dip into important electric reserves.

Charles Wrenn

Franklin has a stellar Electrical Department. Their successes are many. I do not see any benefit in establishing a commission to oversee a department that is running this well. It would be another layer of management that is not needed.

The electric rates charged by the city should be at or below those charged by Dominion Power for their customers.

I support using some of the profit generated by the Electric Department for other general fund needs to offset real estate taxes. These funds belong to all citizens and should be used to best serve the entire city. Stopping the transfer of these funds will have an adverse impact on our real estate tax rate, if we want to maintain the same level of services.

Mayoral candidates

Jim Councill

Under current circumstances, no, but no idea should be off the table forever.

The Honorable R. Baird Cabell, retired judge, wrote in 1948 in The Tidewater News, “One of the few towns in the State with its own electric utilities plant, Franklin derives enough revenue from the retail sale of electric current to maintain a consistently low tax rate.”

For over 70 years that department has been a vital part of the city’s overall quality service and revenue source as planned. Nothing has changed. We are still very much dependent upon that $1,800,000 in net revenue each year to keep your real estate taxes lower. If we had no electric department, and we were on Dominion Power, your rates today would be even higher and we would not have $1,800,000 of general fund revenue. Replacing that revenue would be a 30 percent increase in real estate taxes to offset $1,800,000 in lost revenue.

Having electric fund revenue has saved the citizens millions in reduced rates and outside borrowing. We are way too small to incur such additional wasted expense.

Ellis Crum

Yes. The citizens’ group that presented this idea to the City Council has convincingly argued that the city is out of control in regards to its use of resources from Franklin Power and Light. The council’s response was, “We don’t want to lose control of the funds.” I think it is tragic that the mayor and City Council do not think that citizens are astute, interested or energized enough to be more involved in city government.

At the very least, a citizens’ group to advise the council is in order. It is the height of arrogance to believe that any seven people would be able to have ALL the answers for a city of more than 8,000. I welcome citizen involvement in all aspects of city government, especially this important part that affects all of us. This helps the leadership be more transparent. This idea of city government by the few, for the few and of the few MUST STOP. The people, city and the future deserve a mayor who champions greater citizen involvement.

Greg McLemore

Yes, because the City Council has not proven to be good stewards of the citizens’ interest in regards to the electric funds, as well as the other utilities. The Franklin electric company was established to reduce and save on the rates for electric power to Franklin, not to create a profit. Since then the city has turned the electric department into a for-profit operation, transferring the profits from the electric department, which should have only had operating expenses and a rational emergency reserve fund anyway.

With the implementation of an independent authority or commission to govern Franklin Power & Light, it could monitor and restrict the transfer of funds that is currently leaving the electric department operating at a deficit. Once the funds-transfer hemorrhage is stopped, the electric company can actually reduce rates.

The true financial burden on most citizens comes from the water and sewage rates and measuring methods n also, SPSA.

No other candidate has been for, or mentioned, lowering the entire utility bill. Let’s talk about the water, sewage and SPSA! Then the entire utility bill will come down!