Fayette County school board joins with other districts to oppose proposed KU rate increase

Fayette County Public Schools central offices at 701 East Main Street, Lexington.
Fayette County Public Schools central offices at 701 East Main Street, Lexington. Herald-Leader

The Fayette County school board is joining with other school districts to oppose a proposed Kentucky Utilities electricity rate increase.

In December, the board approved paying as much as $4,125 to the Kentucky School Boards Association to represent the district's interests in Public Service Commission hearings.

According to board documents, KU announced Nov. 26 that it would ask for an approximate 9.6 percent rate increase. The rate of increase would differ for each rate structure, and school districts could see up to an 18 percent increase in their electricity bills.

Had these rates been in effect for all of fiscal year 2014, Fayette's school district would have spent more than $850,000 more in electricity.

The Kentucky School Boards Association is representing other school districts as well, district chief operating officer Mary Wright said.

"It makes more sense for districts to present a united position rather than submitting individual comments," she said.

The Public Service Commission suspended implementation of the proposed rates until July 1 to review the request and to allow parties to voice their concerns.

"Several millions of dollars," are at stake in 84 districts, said Brad Hughes, spokesman for the Kentucky School Boards Association.

In the past, KSBA has been able to intervene in rate cases on behalf of school districts because of funding from the Council for Better Education. This year, the funding is unavailable, and KSBA is asking the districts to help defray the costs, board documents said.

KSBA's intervention in the past has provided districts with the ability to keep schools on the much more favorable All-Electric School rate, which saves Fayette County more than $150,000 annually in addition to providing funding for the School Energy Managers Program. KSBA says that its involvement in previous cases has lowered the rate of increase as much as 30 percent.

KSBA is asking each of the 84 districts to pay an amount proportional to the number of schools in the district.

The association is asking that each school board approve a maximum amount that would be representative of what the cost would be if only half of the districts agree to participate. The amount for Fayette County would be $4,125. If all districts participate, the amount would be lowered to $2,750.

Liz Pratt, a spokeswoman for KU, said in response, "We are making significant investments to continue providing safe, reliable service to our customers, and the investments we're seeking to recover in this rate case represent our commitment to prudently plan for Kentucky's energy future while continuing to keep rates among the lowest in the nation."

"Requesting base rate adjustments is not a decision made lightly, and we don't go before the Kentucky Public Service Commission with requests to recover our costs unless it's absolutely necessary," she said.