LPEA franchise agreement includes a nasty surprise

Have you ever taken a bite of a seemingly bland dish of food and the spicy pepper unsuspectingly hits the back of your throat? So it is with the city of Durango’s franchise agreement with LPEA, on which some city residents will vote on April 3. A seemingly harmless document packs a nasty punch.

On the surface, the agreement seems straightforward. A rational person assumes the agreement is necessary to receive electrical service. Trusting voters may imprudently check “yes,” their civic duty done. A prudent voter takes another bite.

I’ve done that and found the agreement includes a 4.67 percent city fee. The fee is double taxed with local sales taxes, increasing my bill by 9.9 percent. Now that’s some spicy sauce, and ill-timed considering the state of the economy.

I take another bite, asking some questions: Is this fee really a tax? Sure smells and tastes like one to me. What do I get for this fee? Nothing, the voters give LPEA a monopoly. Surely, the city evaluated the impact of LPEA’s service to the community and required the franchise fee? No formal evaluation, the fees go toward general operations along with the 3 percent sales tax on your bill. Surely LPEA pays this fee? No way, there it is right on my electric bill. Well, certainly LPEA needs this agreement to provide electric service? Not a chance, they keep the lights on everywhere else without any franchises.

Will my rates increase if this if voted down? Quite the contrary, LPEA rates are determined by the “cost to serve” and this fee directly increases those costs and your electric bill.

Read your ballot carefully and ask yourself: Did the city disclose the purpose, intent, time frame and financial impact in the ballot? What will I get for approving this 20-year agreement? Do I want to impose this fee on friends, neighbors and local businesses that are struggling financially, many of whom are unable to vote because they do not own real estate? Is it fair that renters don’t have a vote but landlords do?

Paul Broderick


Editor’s note: Paul Broderick is a Durango city councilor.

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