FALCONER – The case for and against the annexation of the Jamestown Board of Public Utilities Dow St. Substation was delivered Monday night during a joint public hearing at Falconer Central School that lasted over three hours.
The substation is owned by the BPU and sits on a four-acre piece of property inFalconer / Town of Ellicott, but would fall within the border of the city of Jamestown should the annexation take place.
The hearing was hosted by the Jamestown City Council, the Falconer Village Board, and the Ellicott Town Board and included a presentation from the BPU as to why the annexation was being pursued, featured arguments from legal council for both sides as to why the annexation should or should not take place, and also saw 29 members of the public offer their thoughts on the issue with none speaking in favor of the annexation.
During his presentation, BPU General Manager David Leathers told the audience that the annexation would help provide increased financial stability for the BPU because it would save an estimated $160,000 annually in tax payments.
“The BPU has faced substantial financial challenges over the past several years that have eroded net income, strained cash on hand, and caused concerns about the ability to adequately invest in critical capitol improvements,” Leathers said as part of his presentation. “The challenging New York State electrical market, coupled with the relatively stagnant economy of this area, means that the BPU must continuously find creative solutions to reduce its costs to minimize or avoid rate increases for all its customers, who again live not just in the city but also in Ellicott, Falconer and Celoron.”
Following Leathers, Attorney Kathy Bennet from Bond, Schoeneck, & King, who is serving as legal council for the city and BPU in the annexation effort, outlined the evidence in favor of the annexation, saying it meets all the legal requirements under state law and is in the overall public interest of the the affected communities.
“Stabilizing utility rates and services will encourage business development. Electric service received by customers will not change. The annexation will reduce the BPU’s tax liability, thereby reducing its operating costs and directly improving profitability and cash on hand. Since the BPU will have more resources available, it will be able to reinvest the needed capitol and infrastructure requirements and ensure continued reliable service,” Bennet said.
To counter Bennet’s claims, the legal council for the village of Falconer and Town of Ellicott, Attorney Pietra Zaffram with Harris Beach PLLC, provided a presentation that countered much of what Bennet had presented. They also brought in a former employee with the state Public Service Commission, Frank Radigan, who said that reducing the BPU bottom line by $160,000 would actually have little to no impact on future electric rates.
“After looking through their financial records and [2010 and 2015] rate cases, I conclude that they wouldn’t save a lot of money if property taxes were eliminated, and I don’t see any reason that the rates would dramatically increase because they’ve stayed stable or decreased a little over time on a historic basis,” Radigan said.
Following the presentation, the public was provided an opportunity to address the issue, with Falconer Superintendent Stephen Penhollow telling the city of Jamestown he understands their financial challenges, but doesn’t think they should try and solve them by shifting those challenges to their neighbors.
“I have no problem with the city seeking to find other ways to increase revenue. No problem whatsoever. I applaud you in those efforts,” Penhollow said, adding, “But when you’re sources of revenue are coming from our revenue sources, that is not what neighbors do and that is not how neighbors treat other neighbors and I find a bit of concern with that.”
If the annexation were to take place, the Falconer School District, Ellicott, Falconer and the County. would miss out on a total of $320,000 in annual tax payments from the BPU. In addition, the city of Jamestown and the Jamestown Public School District would each get nearly $80,000 from the BPU in the form of a payment in lieu of taxes. As a result, the net savings for the BPU would be $160,000 each year.
Another member of the audience, Jamestown Resident Chris Gardner, called the annexation effort a low-point in the city’s history.
“What we’re basically looking at here is more desperation from our city government to scrape together revenue… Obviously the legality of this, according to [Zaffram’s] presentation, clearly shows that that within any judicial setting the Town of Ellicott and Village of Falconer would easily win. We’re talking about the ‘Dow Street’ substation, not the ‘Tiffany Avenue’ Substation,” Garnder said, alluding to the actual border between the city and the village. “It’s absurd and it’s just a low point.”
Tempers flared at several points during the three-hour meeting, most notably when Bennet stated the annexation was in the public’s interest, partly because the property would fall under the jurisdiction of the professional Jamestown Fire Department, rather than the volunteer firefighters in Falconer. Many in the audience took exception to the volunteers being made out to be less qualified or even incapable of responding to a fire at the property.
Falconer Mayor Jim Rensel said he was pleased with the turnout, and is hoping members of the Jamestown City Council will seriously consider the long-term impact of an annexation.
“A lot of people are upset and in our opinion it’s a tax shift that will have a very significant effect on our budget,” Rensel told WRFA following the meeting. “We feel we have a pretty good case but I wish it would just stop right here with the city council. I firmly believe when I say this that I believe there are people on the city council who are against this, but I don’t think they are encouraged to speak freely, let’s put it that way.”
The hearing was required in order for the three involved government bodies to act on the annexation, which will take place within the next 90 days. Should any of the bodies vote against the annexation, the matter will then have to be settled in state appellate court.