By Andrew Walsh
awalsh@wbcowqel.com
The proposed contract renewal with Efficiency Smart received a great deal of scrutiny Tuesday night at the Galion City Council meeting.
Law Director Thomas Palmer presented the two changes to the contract that had been of primary concern which were the automatic renewal clause and the lack of a “rate cap”. The automatic renewal clause has been removed and a contract rate of $1.40 per megawatt hour has been set as a means of providing Galion with a safeguard in terms of cost.
As discussions went in it became clear that the sticking point was not necessarily to do with contract specifics, but whether to renew the contract at all. The city still owes $354,000 in deferred payments from the first contract, and there was some reticence toward adding a new contract, which is set to be $439,000 over three years.
The initial contract was also for three years, but Galion had the option to defer half of the payments to a second three year cycle (which it did). If this new contract is accepted, they would have the option to defer 25 percent to a secondary three-year cycle.
A further wrinkle in the discussions was the subject of a potential rebate for Galion, having been a member of the initial contract, of $71,800, if they renew by March 31. That money could go toward paying down the old bill, be applied to the new bill, or be used toward energy efficiency projects in the City.
A motion was put forth to suspend the rules so as to have the contract renewal passed in time for this deadline, but was handily defeated.
Mayor Tom O’Leary raised the point that any monies needed to be paid toward the old contract are already obligated and really have little bearing on whether to renew or not. The numbers need to be viewed as separate entities, and the question seems to be if contracting with Efficiency Smart is pulling its weight.
Chamber of Commerce spokesman Joe Kleinknecht was of the opinion that this is money well spent.
“I think you’re taking a whale of a gamble on $71,000,” Kleinknecht said.
He further added that improvements made to the city in hardware and efficiency over the initial three-year contract are estimated at $6 million (lifetime).
Kristen Wilder of Efficiency Smart reported that Galion saved $421,000 in each of the three years of the initial contract. She was also questioned about some of the ongoing projects that Efficiency Smart has going with local businesses, including Covert Manufacturing and the YMCA. She reported that if the contract was not renewed work on those projects would cease.
O’Leary further added further perspective by comparing the size of the contract with the size of the city’s electricity bill during the same time frame. He roughly estimated $36 million in a three-year span and holding that up to the $439,000.
“The cost of not trying to become more efficient might be that $36 million becoming $40 million,” O’Leary said.
While the motion to suspend the rules failed to pass the issue as emergency legislation, the ordinance did pass its second reading. Council inquired of AMP if there was any way to get the March 31 deadline moved back, to which the AMP rep said she could try, but could not make any promises. At the end of the regular Council meeting, President Carl Watt established a special meeting for 6:30 p.m., March 28, to give council the opportunity to pass this legislation, if it so chooses, in time for the rebate.
Terry Gribble of the YMCA made is annual presentation about the running of Heise Park pool. The pool will be open from June 3 to Aug. 16, which amounts to an additional week over last year’s operation. The cost to the city has gone up $.50 per hour over last year to $94.50 per hour. This is due largely to increases in the minimum wage, but represents a lower increase than the $1 per that the YMCA raised rates last term. Pool pass prices will remain the same.
O’Leary brought forth the administration’s intention to take a serious look at repaving Portland Way South as early as this year. The dismal state of the street has not gone unnoticed, and with the paving project taking place on Portland Way North, the City might have cheaper access to some vital equipment than would normally be the case. O’Leary admitted it might be a big hit to take on this year, but it could present itself as an opportunity to spend a little extra money now with an eye toward saving money down the road.