SPECIAL MEETING

August 5, 1971

A special meeting of City Council was held on Thursday, August 5, 1971 at 7:00 P.M. with Mayor Carroll presiding. Members present were Messrs Biggs, Coyle, Hayes, Holmes, Holpp, Legates, Muir and Walls.

HOUSE BILL 544

The recently enacted legislation proposed by the State Legislature under the House Bill 544, imposes a tax on various utilities in the State of Delaware, one of which is electricity generated by the City of Dover. This bill imposes a 5% tax on these utilities and was signed into law effective August 1, 1971. The Utility Committee met on Monday, August 2, 1971 to consider this bill and the effect it would have on the City of Dover Electric System. Under this bill, the rules and regulations governing this tax concerning the City would be administered by the Director of Finance, State of Delaware. Mr. James, Acting City Manager, has been in contact with this State Department, and through a conversation with Mr. Benson of the State Department of Revenue, has been able to find out that the electric power that is purchased by the City from Delmarva Power & Light, will not be subject to this tax until the present contract expires with DP & L, which is June 30, 1972. The only tax imposed on the City at this time will be for the electricity that is generated by our system and sold directly to our customers. The bulk of the power purchased from DP & L is sold directly to the Air Base and General Foods, so the Committee has recommended that their rates not be adjusted at this time since there will be no tax imposed on this purchased power according to Mr. Benson. Mr. Rodriguez, City Solicitor, expressed his views on this bill, and stated that he felt the bill was hastily written and of contested there might be a few loop-holes in this bill that could be of benefit to the City of Dover. He would like to take a further look at this and talk to some of the other municipalities for their reaction on this matter. The Utility Committee had recommended at its meeting of August 1, 1971 that an acrossed-the-board rate increase of 1 1/4 mills per KWH be imposed on all electric customers to cover the tax, but since no tax will be paid on the purchased power, the Committee has now recommends that a rate increase of 1½ mills per KWH be imposed on all electric customers, except Dover Air Force Base and General Foods. On motion of Mr. Hayes, seconded by Mr. Legates, Council by unanimous roll call vote approved raising of the electric rates 1½ mills per KWH for all customers except General Foods and Dover Air Force Base, in accordance with the conditions set forth in the conversation with Mr. Benson, as outlined in the letter presented this meeting to Council by Acting City Manager James. It was further directed that a copy of this letter with these conditions be sent immediately to Mr. Benson at the Department of Revenue, requesting an immediate reply plus a written copy of the rules and regulations governing the tax imposed under House Bill 544.

On motion of Mr. Coyle, seconded by Mr. Muir, Council by unanimous roll call vote directed that a statement be placed on all electric bills effected by this rate increase, stating that the increase in the electric rate is due to the Utility Tax imposed by the State of Delaware effective August 1, 1971.

EXHAUST EMISSION TESTS

A request has been received from the Delaware Tuberculosis and Health Society requesting permission to place a van in the parking lot adjacent to City Hall on August 20, 1971. This van will be used to test auto exhaust emissions. There will be no charge for this service and is being done under the sponsorship of the Delaware Tuberculosis and Health Society. On motion of Mr. Legates, seconded by Mr. Walls, Council by unanimous vote approved the request of the Delaware TB & Health Society, pending approval of the location of the van by the City Manager and Chief of Police.

Council adjourned at 8:10 P.M.

Jay R. Dougherty

City Clerk

All orders, ordinances and resolutions adopted by Council at its meeting of August 5, 1971 are hereby approved.

August 6, 1971                                                                                    Crawford J. Carroll Mayor