Council asked to reconsider listing excise tax on bills

COLUMBIANA – City Manager Lance Willard wants City Council to reconsider listing a kilowatt hour excise tax on customers’ electric bills.

He said including the information is logistically too difficult for the software system, not to mention expensive.

Councilman Bryan Blakeman said in June the city should show residents their money is going toward the tax. With the exception of Councilman Dick McBane, council approved his motion to include the tax on utility bills, pending the capability of the software.

The change was for informational purposes and would not have resulted in a change to customers’ bills. That revenue is already being put toward the tax, which is factored into the electric rate.

“It is very impractical. It would be quite cumbersome to put it on there. But more importantly, we have been in contact with other AMP Ohio communities and they do not put it on their bill,” Willard said Tuesday.

He explained the tax is not a tax on citizens, but on the city and described it as more of “an operating cost.”

At the June council meeting Blakeman pointed out the city is expecting to receive $315,000 in revenue from the tax this year.

The tax was implemented as part of Senate Bill 287 in 2001, and Finance Director Mike Harold said it is built into the overhead rate.

He also said adding the tax to bills would be difficult and expensive.

“There are three different rates on kilowatts itself based on usage … the bills are so small there is no way to get all those rates on there,” he said.

Currently, customers using up to 2,000 kilowatts are paying .00456 cents toward the tax and .11122 cents toward usage and overhead costs for a total monthly electric rate of .11587 cents, which Harold said is most customers.

Customers using more than 2,000 kilowatts are paying a different tax and regular rate, combined to equal the total rate of .11587 cents, according to information provided by Harold.

The city did away with separate rates for residential, commercial and industrial users a few years ago.

After hearing from Willard and Harold, Blakeman asked if the city could put a sentence on the bill explaining the rate being charged includes the tax and additional information could be posted on the city’s website,

Harold said that would be cheaper and he would look into it.

In other business, council approved:

– A request from the Columbiana Athletic Booster Club for a tag day on July 27 from 10 a.m. to 1 p.m., with middle school students at different businesses soliciting donations, and a request to hold a door-to-door membership drive on Aug. 7 beginning at 6 p.m.

– A request from Steve Sirota of Heartland Christian School for a car show on Aug. 17.

– The 2014 proposed tax budget. The city expects to receive $1.79 million in local and other taxes to the general fund.

– Giving second readings to legislation amending several sections of the city’s planning and zoning code.

– Ratifying the city manager’s expenditure of $12,000 to wards for easements for property owners regarding the new water treatment plant.

– Emergency ordinances allowing Willard to advertise for bids for the South Main Street Bridge replacement project and the new water treatment plant/well fields/water system improvements project.

– A request from Willard to hold a special meeting Aug. 6 to accept bids for the bridge project.

With regards to the water treatment plant project he said the United States Department of Agriculture is reviewing the items the city submitted and he believes their permission will be forthcoming.

The federal department is financing a majority of the multi-million-dollar project through a grant and 40-year loan and has requested the city demonstrate it has the ability to pay back the loan.

As a result, the city paid the Rural Community Assistance Program to perform a utility rate study and Willard said those results will be presented at the Aug. 20 council meeting.

He also said once the USDA permits the project to move forward construction would likely get under way in December.