| In 1999, the Oregon legislature passed an electric
deregulation bill that deregulated the Investor Owned utilities in Oregon.
As part of that bill, these utilities were also mandated to begin a low-income
bill paying assistance program. Publicly owned utilities (Municipals, PUD's
and Coop's) were also required to have a low-income program implemented by
October 2001. The IOU's were required to collect and re-distribute a total
of $10 million beginning on Oct. 1, 2001. The Public utilities were given
considerable discretion in program design and funding levels.
The City of Ashland implemented its low-income program in FY 2001-02
and it has continued during the current budget year (02-03). We utilized
the same formula that the IOU's were required to use and this resulted in
an annual budgeted amount $67,000 for bill paying assistance. In 01-02, the
program was initiated in January 2002 and all of the money was spent. During
this budget year the program was started in November, 2002 and to date all
funds have been allocated.
Because of increased wholesale rates from BPA, the city has had to
increase its retail rates considerably over the last couple of years. This
has increased the demand for energy assistance funding beyond the amount
available under the utility's program.
Many public utilities in the United States operate a "round-up" program
to provide public purpose funding. A round-up program rounds up customers'
bills to the nearest dollar each month and the extra money is then devoted
to public purpose programs.
There are two ways that utilities typically operate this type of program.
The first is what is called and "opt in" program. What is means is that customers
must actively approve enrollment in the program. The other is an "opt out"
program. Here the customer is voluntarily enrolled unless they actively ask
to be left out of the program.
The opt out approach typically results in higher participation levels
but also can result in more complaints from customers who didn't notice the
need or forgot to opt out of the program. It would be a policy call by the
council has to which method to use, should the council decide to implement
this program.
In discussions of this proposed program with the utility billing staff,
they felt strongly that the 'opt in' approach would be the better avenue
to pursue. While this will no doubt result in more customer contacts, they
felt that customer discontent would be higher if we enrolled everyone in
the program instead of having customers enroll themselves.
If we are successful in getting 3,000 customers to voluntarily agree
to this program, base on an average cost of $6.00/year, we would have an
additional $18,000/year in additional revenue to be used for bill paying
assistance. Higher numbers of participants would result in more available
dollars for this purpose. Also, since this money would be donated by citizens,
the City could use the money to pay for water or sewer billing paying assistance
where warranted, which isn't allowed under our current utility funded
program. |
