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More benefits of municipal utilities

September 18, 2011

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“A Municipal Buzz’’ (Sept. 10) described well the benefits of municipal utilities, especially in regard to the poor response of the for-profit utilities to Hurricane Irene. Unfortunately, the story touched briefly on three points in ways that may have confused some readers.

While the for-profit utilities pay property taxes, the muni utilities make payments in lieu of taxes, discount rates for municipal buildings, share equipment with the DPW, and otherwise financially benefit their towns, often much more than the property tax rate. Voters control the muni utility and its municipal contributions.

The private utilities discount their rates to low-income customers, but the muni utilities charge all households even lower rates.

Finally, the bills that would facilitate new munis require that they provide services (including efficiency and renewables) comparable to those of the for-profit utilities. The Legislature can add any further necessary standards.

In short, forming new municipal utilities will benefit consumers, the municipality, and public policy. The possibility of losing parts of their territories may even motivate the profit-driven utilities to improve their service.

Paul Chernick
Founder, Mass Alliance for Municipal Electric Choice

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