A tax that has gone to offset electric costs the past 16 years could soon be diverted to Amherst’s general fund.
A state kilowatt hour tax on energy consumption, which is rebated to the city, has helped offset local electrical rates since 2001.
Now city council is poised to take that earmarked money and make it available for use in any project or budget expense, from road paving to wages to building renovations and so on.
“There’s so many different ways we can spend that money,” mayor Mark Costilow told council, asking for the change.
“The general fund isn’t in trouble, by any means, but it’s dwindling. We’ve seen it lower over the years. This is a way of boosting that general fund,” he said.
The impact will be small. Some communities pay as much as 14.5 cents per kilowatt hour; Amherst is at 11.1 cents and the adjustment who move rates to 11.8 cents.
Costilow said Amherst ratepayers are significantly lower than every single other community listed on the Public Utilities Commission of Ohio website.
Councilman Joe Miller questioned taking the kilowatt hour tax out of the general fund when the mayor’s office plans to increase rates over the next three years to meet rising costs. Earlier in September, consultant John Courtney recommended increasing the base electric rate by $2.50 each year through 2020.
That’s because rates haven’t been adjusted for 33 years, Courtney said.
“It’s just a hard sell, it really is,” said Miller, who believes residents will see the changes as “a shell game.”
Councilman Chuck Winiarski said the kilowatt hour tax was specifically designed to help cities offset state reductions to income and property tax funding.
Because those cuts hurt cities’ general funds, he feels putting the kilowatt hour tax in Amherst’s general fund is appropriate.
Council president John Dietrich said he views the change as necessary. Amherst’s general fund is spent down every year due to pay raises, inflation, and other cost increases.
“We do need this money in the general fund to keep operating at the level that we’re operating at, basically,” he said.
“We’re not hurting our electric fund by doing this. I’m sorry, the rates are going to go up anyway in the city. They have to go up for us to stay alive.”
Dietrich said Amherst is operating in “a plus situation” and the administration wants to keep it that way.
In a preliminary vote Sept. 18, Miller was the lone council member to side against moving the kilowatt hour tax money. It now goes to the floor of council for consideration.
Jason Hawk can be reached at 440-988-2801 or @EditorHawk on Twitter.