Truce called on LP&L budget battle, rate-hike battle - KCBD NewsChannel 11 Lubbock

Truce called on LP&L budget battle, rate-hike battle

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LUBBOCK, TX (KCBD) -

Councilman Victor Hernandez proposes a "conference committee" of sorts to hash out a battle over the Lubbock Power & Light budget.  At stake: will LP&L customers will see a rate hike soon?

Hernandez says in a Wednesday news release, "One of my suggestions is that a joint meeting of the entire LP&L board and the entire city council be called in order to resolve any disagreements."   Or, the other idea is a meeting with some members of both.

However, also on Wednesday morning, a truce was called between the supporters of competing ideas that might reduce the need for a conference committee.  Or maybe not.  Hernandez says the cease fire is fragile.  "The vibes I get are nobody is 100% happy."

On Monday KCBD.com broke the story of a behind-the-scenes battle.  The LP&L Board proposes a rate hike, which is met with objections by the Mayor and City Council.  At the same time, the city staff wrote a counter-proposal which avoids, at least through December, any need for a rate hike.  However, the counter-proposal calls for borrowing more than $10 million for capital projects that the LP&L had planned for pay-as-you-go.

Mayor Glen Robertson says the LP&L finance committee met with the city staff and agreed to use the counter-proposal.  "The finance committee is okay with it.  The LP&L board is telling me they don't have an issue," says Robertson. 

Former Mayor Marc McDougal is on the committee.  He says, "We're okay with it.  It's gonna be a short term solution.  It will give Council another option on the table so they can get their budget finalized."

McDougal echoes a sentiment by LP&L Chairman Mike Davis earlier this year about not borrowing money to balance the electric utility's budget.  "It's not something I want to see done on a routine basis." 

So why do it?  "It buys us some time and makes sure the council is comfortable with where LP&L is," says McDougal. 

Robertson and other Council members want final numbers on summer revenues and expenses, LP&L's most profitable time of year, before agreeing to a rate hike.  So that means rates won't change until December, or later. 

Like McDougal, Hernandez doesn't like borrowing money to operate LP&L.  "It really makes no sense to me to do that," Hernandez says.

When asked if a conference committee was still needed, Hernandez said Wednesday afternoon, "In order to not have a public rift, a lot of folks are going to go along with it [the counter proposal]."  So Hernandez still thinks it might be a good idea.

The Mayor disagrees and makes reference to the finance committee.  "They'll recommend the full [LP&L] board endorse it."  

Council will take up the counter-proposal budget Thursday evening.

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