Glendale City Council to consider electricity rate increases

The City Council on Tuesday is set to discuss a controversial set of electricity rate increases that would raise the compounded rate by 29% for residents and 24% for businesses by 2018.

The proposed hikes would begin with an average jump of 8% this year, followed by further increases of 7%, 5%, 2% and 2% in subsequent consecutive years. The rate increases would be compounded on top of each other.

Officials have warned that without the hikes, the utility would become insolvent by 2017.

Glendale Water & Power officials want to tap the money, and a proposed $60 million bond, to pay for $94 million in capital improvements over the next five years. Improvements include $18.6 million for the aging Grayson Power Plant.

The increases — the first for electricity rates since 2007 — have sparked opposition among some residents. Most attendees at about a half-dozen community meetings about the proposed rate hikes earlier this summer were either against the increases or called on the city to reduce the amount of the increases.

"If you talk to 100 people and ask if they want to pay more for a service, 100% are going to say 'no,'" said Councilwoman Laura Friedman during an interview. "But we can't just indefinitely cap our fees when our costs are going up."

Glendale Water & Power faces increasing costs of materials and rising energy prices as state law mandates a sharp shift toward renewable energy. The boosts come after the utility spent millions on capital improvements without any revenue increases, leaving the utility in a downward monetary spiral.

Councilman Zareh Sinanyan isn't as supportive of the rate changes as Friedman, though.

"I'm extremely concerned about the proposed plan," he said.

Councilman Ara Najarian said he wants to explore ways to reduce costs, find other revenue sources and postpone capital improvements.

Although Najarian has been a stalwart supporter of the utility's annual $21 million transfer from the electric side to the General Fund to pay for police, parks and other public services, he said he's open to reducing the transfer to give the utility some breathing room.

Opponents of the rate increase say the city's utility wouldn't be in such a dire financial position if the city stopped sucking away its funds, calling the rate increases a backdoor tax.

Although officials expect a packed council chambers Tuesday night, Mayor Dave Weaver said at a council meeting this week that he aims to keep the meeting short by limiting the speaking time for members of the public.

"In the desire to make it a short meeting, maybe I'll just do two minutes on everybody so we can get out faster," he said.


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