The Seaford City Council approved the request of the Nanticoke Riverfest committee to discontinue the annual event. Superintendent of Parks and Recreation Katie Hickey spoke on behalf of the committee and told the council that what was once a 35-member committee is down to 12 members.
The first Riverfest launched in 1994 as a float in on the Nanticoke River and grew into a three-day event but most recently was a single day event.
The committee contacted Seaford Tomorrow, who conducts the Friday Night Live events which has grown in participation and attendance. The Nanticoke Riverfest will now sponsor a Friday Night Live event as a tribute with the annual float in on the following day. The 2024 float in will take place on Saturday, July 13 beginning at noon.
The committee recognizes that some may feel great disappointment in the discontinuation of the Riverfest event and Hickey said the committee did not make this decision easily but believes this is the best decision to keep the float in and avoid continued decline in participation in the event.
Electric rates- The council members struggled with a decision on a proposed PCAC increase, the power cost adjustment clause between the current and base power costs. This amounts to an automatic adjustment that utilities use to adjust customer’s monthly bills. The increase comes because wholesale electric rates as well as maintenance items have increased. There is a reported 8.4 percent DEMEC rate increase for the year 2024 which amounts to a price of $91.28 per MW. DEMEC is the Delaware Electric Municipal Electric Corporation wholesale electric utility that distributes power to the city. According to the projection of Chase Barnes with the University Institute for Public Administration, there will be an increase of $813,259 in 2024 to the city. Barnes showed the total operating costs for the electric department (not including power supply) was $2.18 million dollars and in 2024 projected to be $2.44 million, which is an increase of $218,460 in operating expenses.
There were three options presented to council, option 1 (4.9 percent increase in bill) would raise the rates to collect the 2024 increase alone and $813,259 goes to DEMEC; option 2 (6.2 percent increase in bill) would also include operating expenses increase of $218,460 beginning in 2022 which is a total of $1,031,719. The city electric fund also covers some general fund expenses therefore the third option (7.5 percent increase in bill) is to also include the transfer out fund shortage for salary increases in departments for a total of $1,247,672. In option three it is an average increase of $10 per residential bill.
City Manager Charles Anderson reviewed the rate changes and adjustments in the fee schedules. Mayor David Genshaw noted, “When we were asked by the people to increase our police force on the street, we knew at some point we will have to come up with options on how to pay for all of that.”
A comparison of Delmarva Power and Delaware Cooperative showed Seaford residents on average pay nine percent less than DPL and although higher than Delaware Electric Cooperative, DEC does not have to fund a police department. Barnes said DPL customers experience increases in June while the city is not required to raise costs in a set month and added power supply cost increases are never good timing.
Councilman James King said he believes this is in poor choice to be discussing increases at this time of year when people may be struggling to keep the heat on and inquired if passed tonight would the increases go into effect next month (February). He said it is typically one of the highest months of usage. He suggested the structuring of the PCAC needs to change because of the timing of increases.
Councilman Dan Henderson disagreed with King pointing out that the usage report shows higher electrical uses in summer hours when using air conditioning. The projected usage is based on previous years with winter usage the highest in January of 10,214,012 metered hours and July and August both above 11 million metered kWh each.
Councilman King interjected, “I’d rather be hot than cold.” Henderson responded that in his experience in the HVAC business, “People would not tolerate a hot house. I would get more service calls in the summer for having a hot house than a cool house.” Henderson said he agrees with King in principle that there is never a suitable time for a rate increase but to attempt to get a change would require soliciting eight other communities that use public power to lobby for fiscal year structure change.
“All rate increases impact both residential and commercial customers,” King said. “We can sit up here and argue apples to oranges all day. Even on a residential or commercial side, we are just taking five percent of their profit. So, this isn’t an easy task to sit up here and say ‘oh well we’re just putting up energy rates by five percent’. “King said commercial customers will need to offset the price increase in order to get that back, “so just for me it is not a feel-good conversation.” King later said there was a recent water/sewer rate increase and now power, “dollars only go so far.”
Councilman Michael Bradley commented, as a business owner, if he were aware of the rate increase for an entire year, that amount would be in a projected budget for the year.
Mayor Genshaw said, “Just so we are clear, this is the cost for the city of Seaford to purchase power.”
Councilman Matt MacCoy requested Barnes explain to the residents how the city has attempted a gradual increase over the years and for many years there were no increases. “When people hear the rate increases and how people understand it, is important,” he said.
Barnes said when Seaford raised rates in 2021 to increase operating expenses it was three percent which was half the cost of the living adjustment and was the first increase in operating expenses since 2011. Many public powers customers experience increases in operating expenses on a yearly basis. The city has been able to manage expenses well enough to have a minimal increase in operating expenses.
MacCoy said, “The bill is coming due and to the mayor’s point we knew by making the decision to keep the city safe the bill would come due.” In rate increases, “No one wants to raise rates, but it is the reality and what I would ask of anyone on council, if they do not agree with raising rates or comment about it make a motion with a solution based behind it. If you think there is another way to go, I am open to suggestions about alternative solutions. If you are going to sit up here as a council person and say I am going to vote against this with no solution behind it, that is worthless. Bring up a solution to back what you are saying.”
“Not only are we saying let us add the cost to the new cost of power on top of that, if we go with option three we want to add another $434,413. To Councilman MacCoy’s point, once again as a sitting councilman, I have an alternative. We have never sat up here and talked once about cutting any expenses. All we are saying is let’s add $500,000, vote yes tonight and none of us have done our due diligence and looked over where we can alleviate some of the cost. I’d be happy to make a motion to table this until each of us sit down and look over this to see where we can get the $500,000 and not have an increase on anything,” said King.
Barnes said there are communities that calculate the PCAC on a three-month rolling basis and are changing their PCAC every month but with DEMEC the benefit is they get one rate for the entire year. “Having that stability is very valuable to customers,” he said.
MacCoy inquired if the council was to consider a motion to table the vote until the next meeting would billing be able to go out with new fees and Director of Finance June Merritt told council billing would be on time with new rates.
Henderson commented that there is a scheduled annual planning session soon and may be the time to have discussions on cost saving measures for the future, “I think we all have been very diligent about controlling costs in the face of rising expenses,” said Henderson.
MacCoy remarked that he agrees with Henderson and is ready to move forward but also understands and would support delaying the vote two weeks to evaluate finding the money in another way. Henderson remarked that it takes three months to prepare for the next fiscal budget and this would be a request to reduce a $30 million operating fiscal year budget in two weeks which is unreasonable and unfair to the citizens of the city.
King said he disagrees because of cost increases, “It is always quick to go up and slow to come down. I feel a rate increase should be the last thing that any of us do. I think we should do our due diligence and look through and see if there is any way that we can save the residents of this community money, and we have not done that.” King made a motion to table the vote and bring it back to council in two weeks when council has done due diligence to evaluate cost savings for customers. King and MacCoy voted in favor of the motion. Bradley, Orlando Holland, and Henderson voted no, defeating the motion.
Mayor Genshaw said, “Before we have another motion what bothers me a little bit is that everybody at this table spent hours and hours in meetings to discuss the rate increases for the electric department and they were voted on unanimously to give those increases. We voted unanimously to increase our police department to provide safety to our community. We all knew these costs were coming. I appreciate that no one wants to raise rates, I get it is a difficult vote. We all gleefully voted to do those things to take care of our employees and to make sure our departments ran and to keep our citizens safe. We all knew this bill was going to come due. I always believe we should look for ways to save money and we always have. I think this council has proven that but that is what troubles me. We vote for increases but then we have to pay for it.” King said, “You know what, maybe we do not need to take cars home. Maybe we need to bring the cars back and park them at city hall and people do not need to be driving around in cars and putting gas in them.” Mayor Genshaw said, “you can certainly bring those motions forward councilman King.”
A second motion was made by MacCoy to adopt option three to address increases and Bradley second the motion. Bradley, Henderson, Holland, MacCoy voted yes, and King said it is a misjustice to raise rates and voted no. “I am completely against it,” King said. The new rates go into effect and will show on the February statements.
Oyster House Park- The Oyster House Park Underground Electric Conversion plan was presented which will convert the existing overhead electrical facility to underground. Completing the work will allow the removal of existing lines and poles which will aid in future maintenance and decrease outage times. The total cost of the project is $298,884.12 and would be funded through a Building Resilient Infrastructure and Communities (BRIC) grant. A FEMA program is designed to be proactive and reduce disaster risk. Barnes presented via telephone the grant opportunity which is a 75/25 percent matching grant, and the application process will be through the University of Delaware Institute for Public Administration GAP Team comprised of specialist in policy and grant applications. The local match would primarily be in-kind contributions. The request was approved by the council and the award announcement is expected in October.
Other business- The lease agreement with Brimming Horne Meadery was updated to include the installation of an outside patio space.
At a recent meeting the city approved a building subdivision located on Old Furnace Road and the raised pedestrian crossing and the engineering firm returned to council to request assistance in communication to DelDOT for reducing the speed from 50 to 35 mph on Old Furnace Road for the safety of pedestrians and vehicles exiting and entering the development.
The city of Seaford will hold municipal elections on Saturday, April 24 at city hall. There are two council member seats which are three-year terms and the position of mayor for a two-year term. Mayor Genshaw announced he is not seeking re-election. Councilman MacCoy filed for mayor.
