March 22, 2018 • EPE Related News
El Paso Times: El Paso Electric rebate to customers shrinks as city increases fee for streets
El Paso Electric ratepayers will see a smaller than expected rebate since the city opted to increase a fee that will give its economic development department about $6 million to draw and retain businesses.
Ratepayers were going to see an average of $3 to $4 per month refund on their electric bills beginning later this year due to lower federal corporate tax rates that took effect in January. Ratepayers still will see an overall decrease, but it’s about .90 cents less than what they would have gotten.
“It (the rebate) would have been larger if that fee had not been increased,” said Economic and International Development Director Jessica Herrera.
The City Council on Tuesday approved a 1 percent increase to the fee it charges the utility for access and use of city streets, also known as the Street Rental Charge.
City officials said the increase is expected to generate an additional $5.6 million that will be used as an economic development tool.
“That all goes to retain jobs or draw jobs,” Herrera said. “It will help us remain competitive.”
The city and economic development department have been on an aggressive plan aimed at attracting and retaining businesses by offering incentives to companies like Top Golf, Whole Foods, UPS and Fivestar, a Silicon Valley tech company, for opening locations in the city or for expansions.
El Paso Electric previously was paying the city 4 percent of its revenues for the fee. A large portion of those fees went toward the city’s general fund and .75 percent of that was designated for the Medical Center of the Americas. The economic development department also was using about .75 percent of the funding.
In fiscal year 2017, about $17 million was generated from the fee it charges the utility.
Robert Cortinas, director of the Office of Management and Budget, said in email responses to the El Paso Times that the economic development department will use funding from the fee increase, as well as the .75 percent it already was using.
Herrera said the funding is used for recruiting companies, job retention and job creation.
She also said in some instances funding is used for infrastructure projects, such as street improvements at development sites.
El Paso-area electric customers are likely to see the tax-related rebates begin by the middle of this year. The city’s fee increase will take effect in May, city officials said.
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