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Big day for GM in Lordstown with launch of Cruze
Don't extend tax breaks for wealthiest, Obama says in Cleveland
Third defendant in KSU beating death gets 1 year in prison
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Akron man, 28, found dead after fall from vehicle
Police: Ohio man allowed wife to be eaten by maggots
Young's Hotel to be torn down; private developer to build hotel, retail complex on Akron site
'Food Feuds' to weigh in this week on Akron burgers, Barberton chicken
Tinted windows lead to police chase, crash in Akron
Two Akron men charged after attempted break-in at Green home
Teen boy in Ohio charged with sexually assaulting 6 girls
OSU players realize loss to Miami would destroy national title dreams
Chicago man charged in electronics theft from truck in Green
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Gridlocks: Week 3
The330:
Kanakaredes says she’ll have ‘CSI’ memories to treasure
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Monday’s Tribe lineup
First Bell - On Education:
Report is filed on bus incident
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PAWS Pet of the Week: Meet Autumn!
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Scott believes Cavs can still win
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No. 1 UA secures 2-0 win over No. 3 Wake Forest
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Around the MAC–Week 1
Akron Docs in Haiti:
Orphans in Fondwa
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‘The Shoe’ is Open for Business
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Endangering U.S. Troops To Regain Power?
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Losing Common Ground
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Free Glenmoor Gathering Tickets
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From the White House – New Federal Approach to Hiring
Mayor says increase necessary to recoup fees that were never assessed
By Gina Mace
Special to the Beacon Journal
POSTED: 12:58 p.m. EDT, Oct 08, 2009
CUYAHOGA FALLS: A $3.7 million mistake means Falls electricity customers will pay higher fees — some as much as double — for up to 18 months beginning with their current bills.
Unlike past increases that were publicized well in advance, customers learned of the fee change only when they opened October bills.
Mayor Don Robart said the charge is necessary to recoup fees that should have been charged to customers since late 2007.
''Nobody is paying for more than what they've used,'' Robart said. ''Nobody is losing any money.''
The charge in question is the power cost factor (PCF) — the difference between the cost to the city for buying electricity and the price charged to customers. Each customer's PCF is determined by the amount of electricity they use.
The fee can change monthly.
The problem, Service Director Valerie Wax Carr said, began with a deal the city made late in 2007 to purchase electricity from J Aron under a five-year guaranteed contract.
It was a good deal for the city, Carr said. Customers received a 25 percent decrease in their costs per kilowatt hour (from 8 cents to 6 cents). Had the city waited two months to make the buy, the electricity would have cost nearly 50 percent more.
Unlike most electricity deals that use a payment schedule, J Aron required that their bill be paid in advance.
''Unfortunately, the money paid up front by the city was not rolled back into the PCF rate,'' Carr said in an e-mail exchange Wednesday.
Robart said an employee in the Electric Department, whom he declined to name, made the mistake.
The department caught the undercharge this past July, Robart said. Someone decided to raise the PCF to the proper rate without reconciling the undercharges and without notifying the mayor or anyone else in the administration.
''Electric caught it and tried to reconcile it on their own,'' Robart said.
Carr said the $3.7 million mistake and the attempted correction were discovered in July after an internal audit.
''Due to this error, the PCF rate passed on to the customers was incorrect and lower, which needs to be recovered,'' Carr said.
Customers are angry that the city chose to double the fee without advanced notice.
Carol Heaton of 25th Street has lived in the Falls for more than 40 years and works at Roberts Middle School. She said it doesn't seem fair to throw customers what amounts to a rate increase without notice.
''We were blindsided,'' she said. ''They're creating a hardship in raising power costs 25 to 30 percent. That's a lot. Too many people are out of work. People are losing their homes.''
Heaton paid a PCF of $6.58 in July and $7.93 in August. For September, the PCF is $11.67 — more than one-fourth of her $41 bill.
At least her bill is relatively low, Heaton said. She is concerned for larger families — like her daughter's and son-in-law's, with five children — that have significantly higher electric bills. Molly Bradley and her family paid a PCF of $14.97 on the July bill of $184.18 . This month, the PCF is nearly $56 on a bill of $305.
''Just stretch [the repayments] out over a three- or four-year period so people can afford it,'' Heaton said. ''I don't think that's too much to ask.''
Carr said her office is willing to work with anyone for whom the increase creates a hardship.
''We thought it would be 18 months, but I think it's going to be closer to 12 months that you'll see an increase,'' Carr said Monday during the City Council meeting.
Robart said the loss in fees has nothing to do with last week's request of salary concessions from the city's six unions to help balance the 2010 budget.
''The electric fund has the healthiest balance of all our funds,'' he said.
One or more employees will be disciplined for the error, Robart said.
''People need to know, it's not like somebody stole something or lost something,'' he said. ''This is money that should have been paid by the customers but wasn't paid.''
CUYAHOGA FALLS: A $3.7 million mistake means Falls electricity customers will pay higher fees — some as much as double — for up to 18 months beginning with their current bills.
Unlike past increases that were publicized well in advance, customers learned of the fee change only when they opened October bills.
Mayor Don Robart said the charge is necessary to recoup fees that should have been charged to customers since late 2007.
''Nobody is paying for more than what they've used,'' Robart said. ''Nobody is losing any money.''
The charge in question is the power cost factor (PCF) — the difference between the cost to the city for buying electricity and the price charged to customers. Each customer's PCF is determined by the amount of electricity they use.
The fee can change monthly.
The problem, Service Director Valerie Wax Carr said, began with a deal the city made late in 2007 to purchase electricity from J Aron under a five-year guaranteed contract.
It was a good deal for the city, Carr said. Customers received a 25 percent decrease in their costs per kilowatt hour (from 8 cents to 6 cents). Had the city waited two months to make the buy, the electricity would have cost nearly 50 percent more.
Unlike most electricity deals that use a payment schedule, J Aron required that their bill be paid in advance.
''Unfortunately, the money paid up front by the city was not rolled back into the PCF rate,'' Carr said in an e-mail exchange Wednesday.
Robart said an employee in the Electric Department, whom he declined to name, made the mistake.
The department caught the undercharge this past July, Robart said. Someone decided to raise the PCF to the proper rate without reconciling the undercharges and without notifying the mayor or anyone else in the administration.
''Electric caught it and tried to reconcile it on their own,'' Robart said.
Carr said the $3.7 million mistake and the attempted correction were discovered in July after an internal audit.
''Due to this error, the PCF rate passed on to the customers was incorrect and lower, which needs to be recovered,'' Carr said.
Customers are angry that the city chose to double the fee without advanced notice.
Carol Heaton of 25th Street has lived in the Falls for more than 40 years and works at Roberts Middle School. She said it doesn't seem fair to throw customers what amounts to a rate increase without notice.
''We were blindsided,'' she said. ''They're creating a hardship in raising power costs 25 to 30 percent. That's a lot. Too many people are out of work. People are losing their homes.''
Heaton paid a PCF of $6.58 in July and $7.93 in August. For September, the PCF is $11.67 — more than one-fourth of her $41 bill.
At least her bill is relatively low, Heaton said. She is concerned for larger families — like her daughter's and son-in-law's, with five children — that have significantly higher electric bills. Molly Bradley and her family paid a PCF of $14.97 on the July bill of $184.18 . This month, the PCF is nearly $56 on a bill of $305.
''Just stretch [the repayments] out over a three- or four-year period so people can afford it,'' Heaton said. ''I don't think that's too much to ask.''
Carr said her office is willing to work with anyone for whom the increase creates a hardship.
''We thought it would be 18 months, but I think it's going to be closer to 12 months that you'll see an increase,'' Carr said Monday during the City Council meeting.
Robart said the loss in fees has nothing to do with last week's request of salary concessions from the city's six unions to help balance the 2010 budget.
''The electric fund has the healthiest balance of all our funds,'' he said.
One or more employees will be disciplined for the error, Robart said.
''People need to know, it's not like somebody stole something or lost something,'' he said. ''This is money that should have been paid by the customers but wasn't paid.''
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