Shenandoah city council denies electricity rate hike

August 23, 2018

The Shenandoah City Council on Wednesday denied Entergy’s proposed rate hike in the city.

The energy company, which serves several communities in Montgomery County, presented a notice of the increase to the council in May. In mid-June, a unanimously approved ordinance postponed the proposed effect date of the increase from June 19 to Sept. 17.

Entergy’s letter of intent detailed the company’s need for a system-wide revenue increase of $16.7 million, resulting in a potential hike of about $2.36 a month for each customer using at least 1,000 kWh.

The extension would have allowed the cities affected by the rate hike to investigate the price and propose changes to both Entergy and the Texas Public Utilities Commission.

Shenandoah staff members presented more than half a dozen reasons to the council as to why they should deny the rate increase, including benefits already given to the company by the Tax Cuts and Jobs Act, which lowered the corporate income tax from 35 to 21 percent, and the company’s failure to adequately show why the rate increase was needed.

“Entergy’s revenue requirement is overstated, as is shown in the discussion and issue summary table,” the report read.

Money matters

Following Shenandoah’s Aug. 10 and 11 budget workshops, city Finance Director Lisa Wasner presented changes to the council on the new budget’s proposed capital projects as the council starts to wind down the process before they consider approving it next month.

“We all sort of came to the table with our quote, unquote, ‘wish list,’ but that wish list would’ve gotten us pretty far out of round,” Mayor Ritch Wheeler said.

Members of the City Council discussed lowering the tax rate to $0.1799 per $100 of assessed home value — which would bring in about $12,000 less in tax revenue than the 2018 effective rate.

Council Member Charlie Bradt expressed concern with lowering the tax rate, saying the year-on-year reduction of the tax rate was beginning to level off.

“I think it would be a bad move to lower the tax rate lower than the effective rate,” Bradt said. “I think the city itself would be better served to keep the effective tax rate.”

Other council members cheered the effort to lower the tax rate for residents.

“I believe we should have a commitment to keep lowering the tax rate below the effective rate,” Council Member Byron Bevers said.

Wednesday night was one of the last times council will be able to discuss the budget in an open meeting — in order to get the approved effective tax rate to the Montgomery County Appraisal District by the Sept. 15 deadline, the city council must approve the budget at their next meeting on Sept. 5.


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