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Martinsville Bulletin, Inc.
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Martinsville, Virginia 24115
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City to mull electric rates

Monday, March 24, 2014

By MICKEY POWELL - Bulletin Staff Writer

Martinsville City Council on Tuesday will consider whether to raise electric rates to enable the city to get a grip on wholesale power costs.

That is a decision that the council — not city staff members — must make, said city Utilities Director Dennis Bowles.

On March 11, the council learned that the city’s bill for wholesale electricity purchased in January — power that ultimately was distributed to city electric department customers — was $2,248,197. That was about $1 million more than city officials expected, according to City Manager Leon Towarnicki.

Towarnicki blamed the increase largely on three factors:

• Customers needing a lot more electricity than normal to heat their homes during an unusually cold month.

• Having to buy the extra electricity on the wholesale market, instead of American Municipal Power, at inflated prices due to many communities and utility companies also needing more power, and

• Higher charges to get the electricity transmitted to Martinsville over the regional electric grid because the high demand clogged the system.

Also, wholesale power costs are projected to increase in the future, according to city officials.

When the council meets at 7:30 p.m. Tuesday, Bowles said, he will provide details of projected wholesale electricity costs for 2015 and show “what it will take for (the city) to get a profit margin.”

Profits from city electricity sales are used to support other city operations.

Bowles declined to discuss his presentation at length ahead of time.

He said, though, that based on the wholesale power bill that the city received for January, “I think ... a rate increase is indicated.”

But “I can’t speculate” as to what the council will do, he said.

Towarnicki has promised that any rate increase imposed by the council will be structured to keep city customers’ rates lower than those charged by Appalachian Power to homes and businesses in Henry County.

Also Tuesday, the council will hold a public comment period on a proposal to transfer the administration of Martinsville’s Section 8 Housing Choice Voucher Program to the Danville Redevelopment and Housing Authority.

The city’s program also serves Henry County households, which comprise about 65 percent of the roughly 430 city-county households participating.

Amid budget constraints, the transfer would save the city up to $65,000 a year by not having to operate its Housing Services Office on Fourth Street, according to Assistant City Manager Wayne Knox.

Officials have said that Danville’s authority would communicate with local Section 8 recipients largely by phone or mail, although it might send staff members to Martinsville to meet with recipients if necessary.

The council will hold an official public hearing required as part of a proposed Northside neighborhood revitalization project.

Firm details of the project are to be presented during the meeting.

Knox, who doubles as the city’s director of community development, has said, however, that the project is to focus on the area surrounding Franklin and Dillard streets and Warren Court.

The city hopes to be able to get enough Community Development Block Grant funds to make improvements to at least 30 of 44 structures in the neighborhood, he has said.

Other items on the council’s agenda include:

• Presenting proclamations recognizing Raymond Carr of the Martinsville Electoral Board as well as Child Abuse Prevention Month and Sexual Assault Awareness Month.

• Considering a resolution recognizing the Martinsville-Henry County Chamber of Commerce for achieving 5-Star Accreditation.

• Hearing an update on the uptown farmer’s market.

• Considering setting a public hearing on a Martinsville Planning Commission recommendation pertaining to zoning ordinance amendments involving land use as a temporary flexibility option while the ordinance is being updated.

• Hearing a report on city finances.

• Considering routine-type budget amendments.

• Receiving semi-annual progress reports from agencies outside city government that receive city funds, and

• Hearing business from the floor.

At 7 p.m., the council will meet in closed session to consider matters related to a possible disposition of city-owned property.

The council meets in its chambers on the second floor of the municipal building on West Church Street uptown.


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