Ephrata Borough residents will not see their real estate taxes increase next year, it was announced at the council's workshop meeting Monday.
Ephrata's preliminary 2009 budget, which council will vote on at its meeting Monday, will hold the millage rate at 1.88.
That's the good news.
The bad news is that, while most borough expenses will keep pace with projected revenues, electric rates will rise about 40 percent.
Because of nationwide regulation caps coming off in January, the borough's cost to purchase power will go from $7.8 million to $15.1 million, with overall expenses rising from $12.4 million to $20.2 million.
For borough users, that could translate into an average increase of 41.5 percent, or $437 per year. Electric revenues will rise from $13.7 million to $18.9 million.
The rate hike will go into effect Feb. 1.
The borough buys its electricity wholesale and resells it to residents. Profits are funneled back into the borough for capital projects and to help keep taxes down.
In past years, the borough has made up deficits by transferring 10 percent of sales into the general fund from the electric fund.
In 2009, council will cut that figure back to 7.74 percent.
In February, when its current contract expires with Texas-based Reliant Power, Ephrata will buy power from American Municipal Power of Ohio.
The borough also hopes to enter into a 50-year contract with AMP Ohio that will allow it to own actual generation capacity at four power plants now being built by AMP-Ohio; three hydroelectric plants along the Ohio River and a coal-fired plant being built in Ohio.
Currently, state law does not allow Pennsylvania boroughs to share in such capacity, but municipal leaders across the state, including Ephrata, are hoping to get Harrisburg to change that restriction.
Ephrata is one of 36 Pennsylvania boroughs designated as a municipal power supplier, meaning it purchases electrical power wholesale and sells it retail to its residents, then puts the proceeds back into the community. Twenty-seven of those 36 boroughs, including Ephrata, are members of AMP-Ohio.
The $38.9 million spending plan also includes a $36 per year, or 15 percent, sewage rate hike for the average customer.
Trash-hauling costs for borough residents will go up 5.3 percent to $10.80 and the recycling fee will increase 16.25 percent, to $7.80.
In other business discussed at Monday's non-voting meeting, council discussed hiring a new police officer. If approved next week, Eric Zimmerman could be hired, rounding out the borough's force of 31 sworn officers.
Councilwoman Mary Schurr questioned the wisdom of bringing on a new officer at this time.
She reminded council that next year a new police chief is expected to come on board, and may not feel the need for the added manpower.
Councilman Victor Richard, who heads the public safety committee, told Schurr he had considered the same thing.
"But this is a good candidate and I don't think we should miss the opportunity," he said.
Acting police Chief Thomas Shumaker told Schurr that Zimmerman is filling a vacancy, and that "we are not adding staff." He also told Schurr that if the new chief desires to cut back manpower, he can do so "through attrition." Shumaker said there are several officers eligible for retirement next year.
The council will vote on Zimmerman next week.
Also to be voted on are the promotions of officers Tony Russell and David Shupp to the rank of sergeant. Both men are "seasoned officers," Shumaker said. Russell has 22 years on the force and Shupp has 17 years.
E-mail: lalexander@lnpnews.com