KILLIAN – The Village of Killian may be pulling the plug on Entergy. The village is at odds with the energy company over the rate of its franchise fee according to Alderman Blaine LeMaire.
In January, the village adopted a long-term arrangement with most of the utility companies that operate within its boundaries to collect a five percent franchise fee from customers. Estimates expected the fee to generate $85,000 for the Killian budget.
A franchise fee is collected from the customer by their utility company and then paid to the municipality as a way for the utility to gain access to the right-of-way necessary for their infrastructure.
The new terms set forth by the village at the beginning of the year saw the franchise fee rise to its current rate from two percent.
And therein lies the rub.
The increase is out of line with franchise fees imposed by other municipalities said David Freese, an Entergy Louisiana spokesman, in a statement provided to the News.
“The Village is looking to increase franchise fees charged to local utilities, including Entergy Louisiana. We are willing to discuss with the Village leadership the option of modestly increasing fees while keeping them in line with fees paid by Entergy Louisiana to other municipalities,” Freese said.
For LeMaire, the question is one of fairness. He said the other utilities that operate within Killian have agreed to the new rate. Those companies include AT&T, Charter Communications, DEMCO, and Mo-Dad in addition to Entergy.
At the latest Board of Aldermen meeting, an update was provided to the community. LeMaire told the board the village had asked Entergy to prepare a list of assets and that the company had agreed to do so. Once that is complete, Killian may look to use DEMCO as its sole provider of energy.
“[Entergy] is not going to fight us anymore on it, they’re just going to go ahead and turn over an asset list to DEMCO,” he said at the meeting.
“The reason we’re looking hard at DEMCO, their rates are not that much different than Entergy, less than one percent different, but Entergy charges fuel adjustments every month and DEMCO does not,” Mayor Gillis Windham said during the meeting. “We think they’ll give us better service and they’ll work better with us on our franchise fee.
“Everybody is doing their due diligence, but nothing has been consummated at this point.”
LeMaire echoed Windham’s belief that DEMCO would provide better service due to their smaller size and more localized focus. He said he expects DEMCO to be able to respond more quickly in a time of need. He further noted that current Entergy customers could see a reduction in their bill due to the lack of fuel adjustments.
Freese says the opposite is likely to take place.
“[T]he village has indicated that it is exploring the option of DEMCO acquiring Entergy Louisiana’s customer base in Killian, which could ultimately raise Entergy’s current Killian customers’ rates by up to $250 per year,” his statement said. “Entergy Louisiana and DEMCO are regulated by the Louisiana Public Service Commission and transferring assets and service from one provider to another is a complicated and expensive undertaking, if it can even be done.”
Freese went on to say that Entergy is “eager to continue discussions with the mayor and village leadership so that, together, we can reach an agreement that is in the best interests of Killian residents,” though LeMaire indicated that negotiations have stalled.
In all, LeMaire estimates that only about ten percent of Killian’s energy customers are currently serviced by Entergy and of those he has spoken to, none have disapproved of the switch to DEMCO.
The next Killian Board of Aldermen meeting is scheduled for June 11 at 6:30 p.m.