Why Now is the Time to ACT on KUB

Amy Rawe | July 25, 2020 | Energy Justice, Tennessee, Utilities
Take action in Knoxville at ACTonKUB.org/action.

We all can relate to the feeling of dread when we receive our latest utility bill and wonder, “Is this right? Am I actually using this much electricity, or water, or gas? I thought I did a decent job of trying to use less this month so I could save money.” 

These are valid questions, so let’s break down why, no matter how hard we Knoxvillians try to conserve, we’re still paying large fees on our monthly utility bills regardless of how much electricity, water, or gas we use. Let’s also take a look at how, with a potential vote this fall, you could help change the structures in place that have led Knoxvillians to face unaffordable utility bills that force too many residents to choose between putting food on the table or keeping the lights on. 

CONTACT KNOXVILLE CITY COUNCILMEMBERS AND ASK THEM TO SUPPORT THE ACT ON KUB CHARTER AMENDMENT

Unjustified, Regressive Fixed Fees Weigh Heavily on Many Customers

Every month, Knoxville residents pay our local power company, KUB (Knoxville Utilities Board), for utilities. Services provided by KUB include electric, gas, water, and wastewater. If you’re a KUB customer, you’ll find up to $85 in mandatory fixed fees, or basic service charges, you are required to pay each month. That’s $85 before you even use a drop of water or a single unit of electricity or gas.

Breaking those basic service charges out, KUB customers pay a set fee of $20.50 for electricity, $10.90 for gas, $18 for water, and $35.90 for wastewater.  

If you’re wondering whether this is just the norm for similar-sized utility providers, know that it’s not. KUB’s fixed fee for electricity alone is 50-90% higher than most of their peer utilities serving the largest cities in the Tennessee Valley Authority (TVA) service territory, including Memphis, Chattanooga, and Huntsville. Why is that?

For one thing, in 2010, KUB started a damaging trend of increasing basic service charges on customers’ bills on what appeared to be unjustified grounds, rather than being based on facts, data, and utility industry best-practices. For example, the basic service charge for electricity has more than tripled, from $6.09 in 2010 to $20.50 today. This negligent rate-making that severely impacts low-income, fixed-income, and single-resident customers prompted groups in Knoxville, including us at SACE, to launch the ‘Freeze the Fees’ campaign in early 2019, which thanks to the thousands of Knoxvillians who spoke out in opposition of unjustified fixed fees, prompted KUB to temporarily halt fee increases on customers’ bills.

This was a win for Knoxvillians, but the fact remained that the fee freeze was temporary, agreed to for only at least two years. There is no guarantee KUB will not impose future fixed fee increases on customers’ bills that aren’t grounded in industry best practices. 

Shouldn’t KUB customers be aware of why their utility bill fixed fees are increasing? And shouldn’t the KUB Board of Commissioners, who approve increases to fixed fees, be held accountable to being transparent about the process for determining these fees?

‘ACT on KUB’ Charter Amendment Proposes Basic Reforms

We believe so, which is why SACE is part of a grassroots coalition of several Knoxville-based non-profit organizations, community leaders, elected officials, and candidates* proposing the ‘ACT on KUB’ initiative that would enact basic reforms to KUB through an amendment to Knoxville’s City Charter. 

ACT stands for Accountability, Cost-Savings, and Transparency, which would be realized through our proposed charter amendment that would shorten the lengthy terms of  KUB’s Board of Commissioners—who oversee the utility rates and fees—and revise the process of their election to ensure the community is better represented and connected to our publicly-owned utility. 

Currently, the City Charter establishes that KUB commissioners serve seven-year terms, with a limit of two terms, for a total of up to 14 years. Seven-year terms are longer than the terms for utility board members of any of the other five largest cities in the TVA service territory, which range from 3- to 5-year terms, and are longer than terms of TVA board members (5 years), the Governor (4 years), and even the President of the United States (4 years). The excessively long terms for KUB board members currently authorized by the charter hinder accountability to the people KUB is meant to serve.

In addition, the City Charter currently authorizes the KUB board to self-select new board members by screening applicants and advancing only its preferred candidates to be considered for nomination by the mayor. We think that if the mayor were to receive all applications for board membership without the board’s initial screening process, it would allow a broader slate of community members to be considered for nomination.

Why Should These Reforms Be Accomplished By A Charter Amendment?

A charter amendment is the right vehicle for these reforms for two reasons:

  1. Board terms are established in the charter and changing them would have to take place in the charter
  2. Placing the reforms in the charter would help ensure that they continue to benefit Knoxvillians for years to come

KUB was established by the City Charter and is ultimately governed by the charter. The charter clearly states that for the KUB Board of Commissioners, “The term of office shall be for a period of seven (7) years and no commissioner shall be elected or serve for more than two (2) such terms, or a maximum of fourteen (14) years […]”  Since this is in the charter, it cannot be trumped by any act of the Board, City Council, or the Mayor. To shorten Board members’ terms it must come in the form of a charter amendment to be binding.

In response to the ACT on KUB proposed amendment changes, KUB and Mayor Kincannon have offered some voluntary commitments to address issues identified by the campaign—however, they are limited in both their scope and their permanency. Because the Mayor’s resolution is only an Executive Action and not a lasting City Charter amendment, there is no guarantee that her commitments would be continued after she is no longer in office. Unless changes are made to the City Charter, as the ‘ACT on KUB’ amendment proposes, there’s no lasting guarantee that KUB will be held accountable to serving Knoxvillians as fairly as possible.

[See more on why a charter amendment is necessary in this Knoxville News Sentinel Op-Ed: Fixed fees, makeup of KUB Board at heart of proposed amendment | Opinion]

The bottom line is that Knoxville needs City Council to step up and ensure proper oversight over our publicly-owned utility and show that they can operate independently of the Mayor to do what’s right to bring lasting changes proposed in the ‘ACT on KUB’ charter amendment to Knoxvillians. Anything less than that, such as the resolution Mayor Kincannon is suggesting, would be only a temporary change, allowing future KUB Board members or Mayoral administrations to easily undo the reforms. When that happens, Knoxville residents will once again be left paying the price.

Ultimately, when it comes to this very narrow and focused set of proposed reforms, there is virtually no reason why Knoxvillians shouldn’t be given the peace of mind and assurance that placing these common-sense reforms in the charter would provide.

What Needs to Happen To Enact the ‘ACT on KUB’ Amendment?

In order for the changes recommended in the ACT on KUB proposed amendment to take effect, the amendment needs to be placed on the November 3 ballot for Knoxville voters to approve as a change to the City Charter.

However, in order for Knoxville voters to have the chance to vote on the amendment on November 3rd, the Knoxville City Council must first pass the proposed amendment at their July 28 and August 11 meetings in order to allow it to be included on this fall’s ballot.

How You Can Help

If you, too, are ready to bring more Accountability, Cost-Savings, and Transparency to KUB, now is the time to ask City Councilmembers to support ACT on KUB’s proposed charter amendment, so Knoxville city voters can decide whether or not to approve it this November.

As ACT on KUB coalition member Reverend Calvin Taylor Skinner, Co-Founder and Convener of One Knox Legacy Coalition said during a virtual town hall held to discuss the amendment,

“This is an issue that resonates with a lot of people, not just people in a particular income bracket. The issue of rates and transparency really transcends class and economics…And we know the power is with the people.” 

It’s up to us to take a stand for Accountability, Cost-savings, and Transparency from KUB. As Reverend Skinner said, the power of this campaign really IS with the people.

CONTACT KNOXVILLE CITY COUNCILMEMBERS AND ASK THEM TO SUPPORT THE ACT ON KUB CHARTER AMENDMENT

*Supporters of the ACT on KUB proposed charter amendment include: 

  • One Knox Legacy Coalition
  • Appalachian Voices
  • Community Voices’ Affordable Utilities Council
  • Sierra Club – Harvey Broome Group
  • Statewide Organizing for Community Empowerment (SOCM)
  • Tennessee American Promise
  • Southern Alliance for Clean Energy
  • Renee Hoyos, Candidate for U.S. House
  • Matthew Park, Candidate for State House District 15
  • Seema Singh, Knoxville City Councilmember
  • Amelia Parker, Knoxville City Councilmember
  • Lauren Rider, Knoxville City Councilmember

#ACTonKUB

Amy Rawe
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