01/06/09 — Pikeville increases electric rates 4 percent

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Pikeville increases electric rates 4 percent

By Nick Hiltunen
Published in News on January 6, 2009 1:46 PM

PIKEVILLE -- The Pikeville Town Board approved a 4 percent increase in electricity rates Monday night that will become effective next month.

The increase is the second that the town, a member of the public power co-operative ElectriCities, has had to endure in the past year.

Town officials decided to absorb part of the first increase, letting town tax funding handle 6 percent of an 11 percent electricity rate increase.

But with another 4 percent increase just handed down to ElectriCities members, the town budget could not afford another hit because of the contract's terms, town accountant Gary Pittman said.

A loan, audited by the North Carolina Local Government Commission, binds Pikeville to earn at least $81,000 in electricity revenue from residents each year, town officials said.

The realization that Pikeville's residents would have to absorb a rate increase left Pikeville officials discussing what to do for over an hour.

Commissioner Dennis Lewis even wondered whether generators could be used during "peak hours" when Progress Energy charges ElectriCities and its members the most money for power.

In Pikeville and Fremont, Wayne County's only ElectriCities members, electric bills already average higher than many other places in the county.

ElectriCities members who are part of the North Carolina Eastern Municipal Power Agency -- including such municipalities as Fremont, Pikeville, Smithfield, Benson, Wilson, Kinston and LaGrange -- have endured 15 percent increases this year.

The vote to increase the rate passed by a 4-1 margin, with commissioner Lyman Galloway voting no because he wanted to pass a 10-percent increase.

"If we don't go up 10 percent, we're going to be in a world of hurt," Galloway said.

Mayor Herbert Sieger said he is fearful that the state Local Government Commis-sion would take control of the town's books.

"Anyone that's familiar with the state, if the Local Government Commission comes in, they've got the hammer, whether we've got a check for $5, or $50,000, they'll tell you whether you can put it out or not."

Lewis questioned why some of the money couldn't be extracted from the town's general fund.

The accountant said that the contract firmly provides that the $81,000 must come almost exclusively from electrical revenue.