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Council leans toward higher business electric rates, keeps residential rates unchanged as school funding gaps loom
Summary
During a budget work session Mayor and council signaled support for modest increases to business electric charges while leaving residential rates intact pending further analysis; city staff warned state education funding changes could raise the city's required local school match by several hundred thousand dollars.
At a budget work session Monday evening, Franklin City Council heard staff propose modest increases to basic and industrial electric customer charges while agreeing, by consensus, to leave residential electric rates unchanged for now.
City Manager Miss Oglesby presented a comparison of municipal electric rates and recommended creating a new ‘large industrial’ rate class and modest increases to the basic customer charge for business accounts (examples given were small general service basic charge from $12.61 to $13.24). She said Dominion’s proposed 5% increase on kilowatt charges for utility providers supports applying a 5% kilowatt increase to commercial accounts but not necessarily to residential customers.
“I'm not trying to be anti-business,” Oglesby said in the discussion; her framing emphasized sustaining the electric enterprise fund and infrastructure needs. Councilors asked about rebate mechanisms and whether a targeted residential rebate or alternative application across the entire utility bill would be preferable. Oglesby said she would return with modeled numbers for a rebate option and enterprise-fund impacts.
Councilors reached a consensus to keep residential kilowatt and basic charges at current levels, while supporting modest basic‑charge increases for business accounts to stabilize the enterprise fund. The manager characterized most business accounts as facing only a $1–$2 monthly increase on the basic charge under the proposed structure.
The budget discussion then turned to the school system’s finances. Oglesby reviewed state average daily membership (ADM) and required local-match calculations, saying changes in state figures could increase the city’s required FY25 local contribution by about $475,000 and create a FY26 gap of roughly $96,000 compared with prior projections. She cautioned that the school division’s request included encumbered capital expenditures that may not have been properly authorized before spending, and she asked for detailed invoices and the school audit to be completed before council makes additional appropriations.
Oglesby also recommended amending the FY25 budget to move $330,237 from the schools’ capital fund to the schools’ operating fund so the city receives credit toward the local‑matching requirement; council adopted that amendment by voice vote.
Next steps: staff will return with modeled rate and rebate figures for residential and commercial customers, provide updated school appropriation analysis once the audit and invoices are available, and include the topics in upcoming work sessions on the proposed FY26 operating budget.
