A 4-3 majority of the Huntington Beach City Council made sure Monday that more than $1.7 million will flow into the city’s coffers via an agreement with natural gas provider SoCalGas. But in order to do so it had to stick it to the city’s SoCalGas ratepayers — some a lot more than others.
For twenty years, Huntington Beach enjoyed a deal with SoCalGas under which the city imposes a one-to-two percent franchise fee on every monthly bill issued by the utility. The fee was the result of court settlement in 1990 and, according to a city staff report, “among the highest in the SoCalGas territory.”
But that deal, which last year generated $1.5 million for the city, expired. And SoCalGas insisted on a new deal that is more in line with franchise agreements it has with other cities. The result would have reduced the franchise fee and cut revenue to the city by $650,000.
So the city cut the deal approved by council Monday that essentially passes a portion of the fee onto ratepayers.
Residents, on average, will pay about 33 cents per month on a one percent surcharge fee that winds up in city coffers. Commercial users would pay, $2.37 per month, industrial users $2.50 per month. Two “electric generation” users — companies that take natural gas and convert it into electricity — will be paying about $19,000 per month.
The good news for the city is that the money flowing into its general fund will go from $1.5 million last year to $1.7 million.
The debate at the dais centered around a presentation by city staff showing that the amount is enough for four police officers or four firefighters. It could also be equivocated to funding for the library, or the art center.
Councilman Joe Carchio scoffed at the example, saying that unless he could be provided a guarantee that the money would go toward saving firefighters and police officers, he could not vote for it.
Councilwoman Jill Hardy downplayed the impact of the surcharge, and said asking for 33 cents to maintain police services and library funding in the city was not much.
“We’re down to asking people for pennies,” Hardy said.
But Councilman Don Hansen, who voted against the surcharge, said he wasn’t comfortable with the “level of disclosure” and said a gas bill insert was not enough.
“It’s really an end-around on the taxpayer and a backdoor way of getting a sweetheart deal,” Hansen said.