Beaufort City Council considers citywide special fee district for SCE&G

emoody@beaufortgazette.comMay 28, 2014 

SCEG.COM

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    Beaufort City Council will vote a second and final time on a special franchise fee district for S.C. Electric and Gas during a meeting 7 p.m. June 3 at City Hall, 1911 Boundary St. The fee would mean the utility company could charge customers an additional fee to recoup costs of putting wires underground.

All city of Beaufort residents could get a 2 percent fee tacked onto their SCE&G bills for about seven years, to help defray the costs of burying power lines along Boundary Street.

The fee is being discussed by City Council as a compromise with the utility. The city wants the company to bury its wires as part of the Boundary Street project, which would cost the company about $2.87 million.

The original proposal -- which received initial City Council approval Thursday -- was to create a franchise-fee district of 160 customers near the project. Those customers would pay an additional 7 percent on their bills for no more than 10 years.

The 7 percent, 10-year maximums are outlined in a 1999 agreement between the city and SCE&G, and that agreement would have to be extended if a special district is needed beyond 2019.

But "it's only fair that the entire city has this," Councilman George O'Kelley Jr. argued Tuesday during a council work session.

The city intends to construct the underground conduit for utilities, which city manager Scott Dadson said would cost about $3.5 million.

Council members said they voted for the 7 percent fee district because the project is time-sensitive. However, they asked city staff to come up with alternatives before the second and final vote June 3.

During Tuesday's work session, council members did not vote on the alternatives, but the majority said they preferred a citywide increase of 2 percent for about seven years, rather than the 7 percent fee district.

Burying wires would take between six and 12 months, according to city staff. The fee would not begin until after the wires are placed in the underground conduit.

SCE&G spokeswoman Kim Asbill said the decision about the fee district was up to the council and that the company would work with the city no matter what was decided.

A citywide, 2 percent district would raise an estimated $2.941 million in seven years.

A 7 percent, 160-customer district would raise and estimated $2.145 million in 10 years -- about $700,000 short of the cost SCE&G will be advancing for the project.

SCE&G customers in the city already are charged a 5 percent fee to help the utility pay for "nonstandard services," which include city projects such as line burial. A citywide fee would raise the $2.87 million faster, and it won't require the city to dip into the nonstandard services fund to make up the $700,000 shortfall, Dadson said.

Follow reporter Erin Moody at twitter.com/IPBG_Erin.

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