The Commercial-News, Danville, IL

January 8, 2013

City receives initial OK

Committee approves referendum

BY JENNIFER BAILEY
Commercial-News

DANVILLE — Placement of a referendum question on the April municipal ballot regarding electrical aggregation in the city received initial approval Tuesday night.

Members of the city council’s Public Works Committee recommended approving the question of “Shall the City of Danville have the authority to arrange for the supply of electricity for its residential and small commercial retail customers who have not opted out of such program?” be on the April 9 ballot.

The full city council will vote on the referendum next week.

An aggregation program gives the city the authority to enter into an electric supply power contract on behalf of residents and small businesses in the city that have not opted out of the program with the intent to secure a lower rate for electric service. This would yield reduced electric bills.

A November referendum for the county was determined to make the program available only to unincorporated areas, not the city. It passed by a 2-to-1 margin in the city.

Mayor Scott Eisenhauer said the city would have the same “opt-out” program as the county’s.

The city can enter into an agreement with a consultant or negotiate with an energy supplier. The city would negotiate the fee for service of an energy supplier, in addition to the rate the energy supplier would charge city residents and small businesses with less than 15,000 kilowatt usage annually, unless they opt out of the program.

If a consultant is used, there also is a rate for the consultant paid by the energy supplier, not the city.

Two public hearings and then a bid process would occur after an approved referendum.

The bid process would include other municipalities and the rate would be based on the total possible usage, not just the usage of Danville residents.

Some aldermen, including Bill Gilbert, Bill Black and Jon Cooper, expressed some confusion by the whole process and for those residents who already are saving money by opting into a program on their own.

Eisenhauer said residents will still receive Ameren bills because Ameren is still the distributor.

Eisenhauer also said there is no additional cost for the referendum with the April citywide election.

Black said he’s concerned about residents who forget to opt out when they are already part of a program.

“It seems complicated,” Black said, adding that residents now can sign up any day they want with any company they want.

There can be penalty fees when opting out of other contracts; and some residents could miss out on the savings without the referendum, Eisenhauer said.

Black added that he likes the consultant idea where all energy suppliers bid at once. He likes bids and the city then can compare data.

Officials with Integrys Energy Services, the company used to provide the electricity program in unincorporated areas of the county, said they would offer the same cost per kilowatt hour to city residents as it does to county residents under the program.

The program, if approved in April, would be in effect within 60 days after the election.

Several aldermen also said they didn’t want the city to recapture additional funding through a tax/fee on the energy rate like the county did for funding for the courthouse.

Ward 1 Alderman Rickey Williams Jr. said residents have “had enough” in trying to pay all their bills.

Also Tuesday, the committee recommended:

Public Works Director Doug Ahrens said the total cost should be less than $45,000.