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Money matters in Lewiston: NYPA power rebates, water improvement costs discussed

Fri, Jul 14th 2017 04:25 pm
Town to hold information sessions
By Terry Duffy
Money matters were prominent discussion topics at Monday's Lewiston Town Board work session.
Leading off, in coming weeks Town of Lewiston residents can look forward to a mid-summer present - courtesy of an agreement reached between the New York Power Authority and the town. Supervisor Steve Broderick announced the long-anticipated issuance of NYPA electrical power rebates to town and village residential power users is finally happening.
Eligible National Grid customers, including all residents of the Village and Town of Lewiston, will be getting a NYPA power rebate of $153 per account. Residents can expect to receive what Broderick referred to as plain white envelopes similar to junk mail, but containing debit cards issued by KeyBank.
"The hydro reimbursement, we finalized the list and sent it off. The hydro resident reimbursement will be going out sometime between now and Sept. 30," Broderick said. "We ask all residents to please open your mail, all your mail, whether you believe it to be junk or not. Please open it (once) you get your card."
"We're using the residents' list paid to National Grid as of May 18, 2017," he added. "This is a one-time disbursement. A prepaid card will be loaded with (a rebate of) $153 per resident."
Months in discussion, the reimbursement represents the latest chapter in the now years-long electrical power rebate benefit agreement reached in 2007 between NYPA and the town as part of NYPA's 50-year relicensing pact with the federal government. As part of that agreement, the town was provided 6.5 megawatts of low-cost electrical power by NYPA to use as it wished.
Part of Lewiston's intent back then, beyond using the low-cost electricity to cover the town's own needs - power its properties, town buildings, street lights, etc. -- was to provide a benefit stipend to the town's electrical users in the form of reduced electrical bills. The Town Board opted to sell off its excess power allocation - back then a valuable commodity due to market factors - and reimburse town and village electrical customers from the profits.
However, as the market changed, those excess electrical profits to the town declined sharply, brought on by a number of factors that resulted in a far lower cost of energy overall on the open market. So did the electrical reimbursements. Over past months, the Town Board, faced with reinstating a town tax on residents to help fund its budget, opted to retain all elements of the 6.5 megawatts power benefit for its own future uses and completely eliminate the residents' benefit stipend.
To settle the issue of the remaining disbursements, the town negotiated an agreement with KeyBank for a one-time electrical benefit in the form of $153 per household. The cards will be mailed out in the aforementioned nondescript envelopes to all eligible customers.
"The envelope will not identify the sender. The mailing will contain a letter by myself, and the card will be embossed with 'Town of Lewiston NYPA 2017,' " Broderick said. "The envelope will contain detailed instructions on how to activate the card. We recommend that people call the number given and activate the card immediately. The envelope will contain a number to call at KeyBank."
Broderick said that, for security purposes, he wouldn't detail the exact timeframe the rebate cards would be mailed out, other than saying "it would be between now and September."
"Once the cards are issued, KeyBank will be the point of contact. Those with any questions can call the town, as well," he said.
Call Town Hall at 754-8213.
In other significant financial news of interest, Brian Seaman, formerly attorney for the town, now assisting the board on legal matters with its planned $10.3 million water line replacement project, detailed the cost analysis impact to residents contained in the recently issued map plan report by GHD Engineering Consultants of Buffalo.
"There's a section (in the plan) on the cost (to residents) on the improvements, specifically to analyze how much it will cost for a typical property in the town," Seaman said. He told board members it includes both single properties as well as one- and two-family residences. "The map plan report, section 4, lays that all out."
The report's "Detailed Explanation of Estimated Costs" evaluates the town's existing water costs contained in the current system, covering operations and maintenance, water supply costs and earlier town water improvement debt obligations (from past capital projects). Seaman said that totals $2.147 million annually.
As far as how Lewiston actually pays for that expenditure, Seaman it's funded first through water bills paid by residents. "People who consume water get a bill based on their consumption and they pay that."
Lewiston netted an estimated $1,438,000 in revenue of from its metered water sales in 2016, he said.
Seaman said another funding mechanism is via a tax line item contained on residents' tax bills (town, outside the village and the Tuscarora Indian Reservation). "That amount of that tax equates to the amount ... $570,319 in existing debt obligations," he said. "So, for all practical purposes, what the town is doing today is raising money to pay for the operations, maintenance and purchase of water through sale of water, and paying for the outstanding debt on our old bond issues through a real property tax. It's called a special district tax."
In preparing its calculations on the cost impact for a typical one- or two-family (or typical) property in the town, Seaman said GHD utilized what he called "mode assessments, where you find the assessed value that occurs most often in the town."
Factored in is the aforementioned $570,319 in debt service; the total taxable assessed value in the Lewiston water district - $924,260,378 (paid via an ad valorem assessment of all Lewiston residential properties); and an estimated .62 cents per $1,000 of assessed value to reach a residential mode assessment of $90,000 or $56 in real property tax.
That "represents the most common occurring assessments for a property in the town (one- and two-family homes)," Seaman said.
In further discussing the cost estimate for the water district improvement project, Seaman said GHD considered bonding costs (30-year serial bonds at a fixed interest rate of 3.5 percent), and estimated the annual debt service cost for the town to be $555,000.
Considering that figure with the town's taxable assessed valuation, Seaman said the cost for the water line improvement would be an additional $55 for a one- or two-family house.
Explained further, Seaman offered a scenario where a typical one- or two-family residence pays $230 ($174 in water costs plus $56 in real property taxes). Estimated costs factoring in the proposed water line improvement project would add $55 in debt service costs, bringing a new total of $285 for the proposed project for a typical one- or two family household, or an increase of less than $25 per month, he said.
The Town Board announced Seaman would return to hold expanded information sessions on the GHD cost report analysis at 1 p.m. Tuesday, July 18, and 6:30 p.m. Thursday, July 20, in Town Hall. Both sessions will take place in Broderick's office and are open to the public.
Following that, the next step would be the Town Board's holding of a public hearing at 6 p.m. July 24 to hear public comments on the project en route to its vote to approve, followed by setting the timetable of actually getting the water improvement project underway (RFPs, reviews, etc.).
"This is the most drastic (of all the town's water line improvement projects to date)," Broderick said. "These are the ones that should been done yesterday."
He closed by inviting residents with questions to email him at [email protected], and attend either one of the upcoming information sessions.

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