Shelby City Council amends utility-deposit rules, adopts uniform crediting timeline and sets certain deposits at $300

Shelby City Council on Oct. 20 approved a package of ordinances that revise how the city handles security deposits and billing for electricity, water and sewer accounts, adopting a uniform crediting timeline and changing proposed deposit levels after debate.

Council amended language to require the utility office ‘‘to have a reasonable time to ascertain that the obligations of the customer have been fully performed before being required to return any deposit’’ and to credit homeowner and commercial industrial deposits after 60 months (five years) unless the account has been terminated. For rental accounts, deposits are to be credited when the account is terminated. Any remaining deposit not used to credit an account is to be reimbursed within 30 calendar days, the ordinance text read into the record by Councilmember McLaughlin.

The proposal initially cited consumer-price-index calculations showing that a $300 deposit in 2017 equates roughly to $400 in 2025; supporters said raising the deposit would help reduce outstanding balances the city absorbs. Opponents argued that electric rates in Shelby have not tracked CPI and that a higher deposit would place an undue burden on renters. ‘‘There are a lot of people out there can't afford decent housing, and this is just adding to their problems,’’ Councilmember Robb said during the debate. Councilmember Cutlip said the CPI adjustment ‘‘doesn’t really correct the problem’’ and that even the $400 figure would not solve outstanding-balance issues.

After extended discussion about equity, landlord/tenant circumstances and historical outcomes when deposits were previously changed, councilmembers debated and voted on an amendment to subsection G(4) that reduced a proposed $400 amount to $300 to create a single deposit level across account types. Several members said they preferred taking a year to measure the ordinance’s effects before seeking a higher level. ‘‘If it doesn’t work, we can always increase it later,’’ one councilmember said.

The ordinances were considered across three separate codified sections (electric meter/billing/deposit rules, municipal water rules, and sewer charges) and were amended in parallel so the deposit-crediting language and the $300 G(4) figure apply across the utility rules as approved.

Council members who took part in the substantive debate included Councilmember McLaughlin (mover of the amendment to adopt the packet language), Councilmember Robb (expressing opposition to increases), Councilmember Cutlip (critiquing CPI-based adjustments), Councilmember Martin (supporting a compromise and moving an amendment during the ordinance sequence) and others who asked for additional data or supported the one-year review approach.

The council approved the amended ordinances in roll-call votes recorded on the minutes. The ordinances amend chapter 10 (electric), chapter 10.40 (water) and chapter 10.24 (sewer) of the codified ordinances of the City of Shelby.

Council members scheduled no immediate implementation exceptions; several said staff should report back with data after a year so council could revisit deposit levels if needed.