Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, August 18, 1993 TAG: 9308180189
SECTION: VIRGINIA PAGE: A2 EDITION: METRO
SOURCE:
DATELINE: LENGTH: Medium
Roanoke Gas: "Rates for customers outside the city probably would increase. A fragmented system will increase operating costs which must be passed on to customers. You simply cannot operate two organizations as efficiently as one."
Roanoke: "If the city acquired gas company assets to serve city customers, it would have no intention of serving customers outside the city. Of course, under the current operating procedure, Roanoke Gas can increase gas rates any time they can get the approval of the State Corporation Commission."
Q. If I live in the city, what will this do to my gas rates?
Roanoke Gas: Roanoke "will be free to set your gas rates, without the approval of the State Corporation Commission. In our opinion the city will be forced to raise rates since the city will have additional costs."
Roanoke: "Under the city proposal, nothing would change except ownership. The city would buy the assets for fair market value, then seek to hire Roanoke Gas to operate the service. Gas customers would see no increase in gas rates or changes in service or gas employees. At the same time, this move would save up to $2 million, primarily because the city wouldn't have to pay state and federal income taxes. the savings could be used to reduce gas rates, reduce taxes, or enhance services such as police, fire and schools."
Q. How would the takeover affect my gas service?
Roanoke Gas: "The city has no contracts for gas supply. Therefore, the city can provide no assurance of a gas supply. The quality of the service the city may provide is open to question."
Roanoke: "No decision has been made for the city to acquire Roanoke Gas and such a decision would be many months away. The decision facing the Roanoke City Council on Monday is whether to keep open the option to acquire Roanoke Gas assets needed to serve the city. If Roanoke City Council doesn't vote to consider this option, Roanoke will forever lose the chance to purchase the assets and Roanoke Gas may never pay another cent to the city for using city streets for its gas lines. A positive vote by council does NOT authorize final purchase - it only keeps the option available."
Q. If I live in the city, how would the purchase affect my property tax rates?
Roanoke Gas: "If costs of acquiring and operating a gas distribution system increase. . . . Roanoke will have to pass costs along to the taxpayers in some form."
Roanoke: "If the city can save up to $2million per year by providing gas service within the city, those savings would be passed along to the citizens. The savings could be used to reduce gas rates, reduce real estate tax rates, or improve services. . . . A decision by City Council not to consider the option to purchase Roanoke Gas assets would result in a minimum loss of $30,000 annually, the small franchise fee paid by Roanoke Gas for the last 40 years, and a potential loss of over $2 million per year."
Q. If I work for Roanoke Gas Co., what will happen to my job?
A: Roanoke Gas: "Roanoke Gas Co. doesn't know what will happen to the jobs of its employees."
Roanoke: "The city knows and respects Roanoke Gas and the outstanding work of its employees. That's why the city has proposed that Roanoke Gas continue to run its operations in Roanoke, but allow the city to have ownership so that the citizens of Roanoke receive the $2 million in benefits. Because the city respects the employees of the gas company, the city agreed not to go public with any information until Roanoke Gas had fully informed its employees. Roanoke Gas took advantage of that position to secretly mount a massive propaganda campaign against the city, which as resulted in a great amount of misinformation."
\ Questions were addressed to city spokeswoman Michelle Bono and to Roanoke Gas public relations representative John Lambert.
by CNB