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Mayor wants to reduce senior utility rates

COVINGTON -- Mayor Ronnie Johnston is requesting that the Covington City Council reduce the base rate for utility customers who are senior citizens.

Johnston wants to cut the base rate by up to 50 percent for customers age 65 and older.

Johnston said he met a lot of people while he was on the campaign trail last year who are on a fixed income. His proposal could save them about a month's worth of utility costs per year, he said.

The City Council agreed Monday night to table the issue for further study.

Johnston said 13.8 percent of the city's electric and gas customers are over age 65, based on 2010 Census data.

A 50 percent reduction to the base rate for electricity would reduce it from $8.45 to $4.23, saving the average customer about $50.70 a year. A 25 percent reduction would reduce it to $6.34, a savings of $25.35 a year. Also on the table is a flat $5 base rate, which would save the customer $41.40 a year.

The current base rate of $11.95 for gas customers at a 50 percent reduction would be $5.98, for a yearly savings of $71.70 and a 25 percent reduction would reduce the rate to $8.96 for a yearly savings of $35.85. A $5 base rate would result in a yearly savings of $83.40.

The city would lose nearly $162,000 in revenue annually with a 50 percent reduction, and just a few hundred dollars less with a $5 base rate. A 25 percent reduction would reduce revenue by about $81,000.

Senior citizens already receive a discount on solid waste service. City Manager Steve Horton told the council that if it agreed to extend the discount to electric and gas customers, it should not be effective until the next budget cycle, fiscal year 2013, which begins July 1. He also said the discount should not be automatic, but customers should be required to request it and to show proof of their birthdate.

If approved, the discount would apply to residential customers only. Those with multiple residential properties could receive a discount only on their primary residence.