New, lower tiers for electric discounts nearly ready

Council may approve new tiers April 18

Three new tiers of incentives could soon be in place for Lansdale businesses looking to invest in themselves and score savings on their electric rates.

“It encourages investment in facilities, in employees, and helps: when you look at their electric bill over that time, it’s a nice little savings,” said councilman Jason Van Dame.

Lansdale’s economic development incentive was first passed in 2010 with several tiers of discounts available to businesses who spent above certain thresholds and hired or kept certain numbers of employees, on the electricity they buy from the borough’s Electric Department. Since last summer council’s Economic Development Committee, of which Van Dame is chairman, has discussed whether and how to lower those thresholds, and new tiers could be approved as soon as April 18.

Those talks have led to a proposal the EDC and Administration and Finance committees have been refining since January and are now recommending that council consider: two new, lower tiers to the bottom of the current table, and one new higher one. Under the new incentive, a business that invests $50,000 and keeps or creates five full time or equivalent employees would be eligible for a five percent discount on their electricity purchased from the borough for two years. The next new tier would allow those who make a $250,000 investment in a borough business and meet the same five employee threshold to claim a five percent discount for three years.

A third new tier would be added at the top of the current chart: any business that invests $4 million to $10 million would be eligible for a ten percent discount over ten years, and Van Dame said one of the town’s most visible projects in recent years fell just short of qualifying for that.

“The (North Penn) YMCA and their recent investment in their property was about a $12 million investment. Because they don’t quite reach the highest threshold of full time employees, they are eligible for a seven percent discount for seven years,” he said.

If the YMCA applied for the appropriate incentive and was approved by council, the net result would be a savings of roughly $172,000 on their electric bills over the seven year period — “it is real numbers,” Van Dame said.

Businesses will not be able to apply for discounts retroactive to electric bills they have already paid, according to Van Dame and council President Denton Burnell, but a business that has completed a large project since the electric incentive was last updated in 2014 and that fall under the new, lower tiers can apply for a discount to be applied to their electric bills going forward.

“What the borough is getting out of their electric usage is also important to the borough. It’s a good problem, and we’re excited to be bringing these new tiers for the lower investment thresholds,” Van Dame said.

Lansdale’s borough council next meets at 7 p.m. on April 18 at the borough municipal building, 1 Vine St.