4:21pm

Wed August 14, 2013
Lexington/Richmond

Consumers Will Likely Pay Tax Increase Levied On Lexington Utilities

Beginning this fall, utility customers in Lexington can expect slightly higher bills. For months, Lexington’s Council has wrestled over the best way to pay for street lights.  Administrators say the property tax does not generate enough revenue for maintenance and new lights. 

Lexington's street lights are funded by property taxes and a franchise fee levied on utilities.
Lexington's street lights are funded by property taxes and a franchise fee levied on utilities.
Credit Stu Johnson / WEKU News

So, Council has opted for a one-percent increase in franchise fees.  The fee is levied on the providers of electricity and natural gas…who will likely pass that cost onto consumers.  Finance Commissioner Bill Omara says it will generate about four-million dollars a year.

“We feel the hybrid approach is a long term fix and it’s anticipated to keep the street light program in a healthy position for the foreseeable future,” said Omara.

For a household with electric and natural gas bills of 200-dollars, Omara says it would amount to a two dollar a month increase. 

“There are street lights that are used by all people and common areas such as main arteries, New Circle Road.  That type of thing and those would become the obligation of the general fund because they are seen as public safety issues.  The whole street light program is basically a public safety issue,” added Omara.

The higher fee becomes effective in October.  Omara says the property tax rate for street cleaning will also see a slight increase.