I’ve spent a lot of time understanding the City’s operations and budgeting processes, plus I worked many years on the receiving side of municipal services. With that background, I do not favor the November 5 charter amendment that would make it easier to sell Lakeland Electric to a for-profit power company. Here’s why:
Selling Lakeland Electric will not benefit the citizens of Lakeland. The utility currently contributes a $30+ million dividend to the city annually. This is the equivalent of approximately 5 mil in additional taxes property owners would be paying if the dividend did not exist.
Additionally, while we have some of the lowest electric rates in the state, we could see increases under different ownership. In outage situations, such as we experienced with Hurricane Irma, Lakeland would not be the top priority for a non-local provider, as it is with Lakeland Electric.
A sale of Lakeland Electric could have other negative affects on our community. Service departments such as the call center, billing, accounting, and even some of the maintenance shops could be consolidated to the home location of the purchaser (ie, Tampa for TECO). This could result in loss of jobs or relocation of employees who currently live, own homes, and raise families in Lakeland. In addition, Lakeland Electric participates in job training programs for high wage, high skill jobs at two local high schools and Traviss, and if those were discontinued, we would lose opportunities for our community’s youth.
While the city could potentially receive a large dollar amount for the utility and use the interest to pay itself an annual dividend, it probably could not replace the current dividend without dipping into the principal. Also, there is no assurance future commissions would not continue to invade the principal for the general fund expenses, thereby leading to a major increase in property taxes.
If this charter amendment were to pass, it would require a super majority vote of the City Commission, 65% or 5 of 7 Commissioners, and then 65% of voters who turn out in an election, to sell the utility. Normal voter turnout in a non -presidential year ranges from 10-12,000, so 6,500-7,800 voters (10-12%) could determine the outcome for the 65,000 users in the City (over 100,000 in the service area for Lakeland Electric).
Again, I do not believe the charter amendment is in the best interests of citizens. Please take time to review the text and potential outcomes. If you’d like to talk with me about the issue, please reach out at electcarolephilipson@gmail.com and let’s meet.
