Oak Creek Town Board works on revised electric bill law
April 26, 2011
If you go
What: Oak Creek Town Board meeting
When: 7 p.m. Thursday
Where: Oak Creek Town Hall, 129 Nancy Crawford Blvd.
Agenda: The board will, among other items, review a liquor license renewal for The Oak Restaurant, hear a recommendation of a bid award for the water tank project, discuss an oil and gas lease proposal from Hunter Land Services, award a contract for town information technology support and discuss an increase in monthly trash rates.
April 14, 2011: Oak Creek Town Board repeals electric bill ordinance
April 13, 2011: Fairness, legality of Oak Creek ordinance being questioned
Steamboat Springs — Oak Creek's Ordinance 609 was repealed at an April 14 Town Board meeting after a heated debate.
But from that debate, Town Trustee Wendy Gustafson garnered several suggestions around which to frame a proposed replacement ordinance.
Ordinance 609 allowed the town to place liens on properties with unpaid electric bills so they could collect, as taxes, losses from the town-owned electricity operation.
The ordinance passed March 24, but after an outcry from local landlords who opposed being held liable for electric bills in their tenant's name, the ordinance was repealed before it went into effect.
Gustafson brought a draft of a new proposed ordinance to a Town Board work session Thursday.
"It's probably a better ordinance," Gustafson said about the proposal made at Thursday's work session. "It's maybe a little stricter than the last ordinance. It's a little more comprehensive. It talks a lot more about due dates and timelines. But it puts all the utilities on the same footing, and I'm great with that."
The town already places liens on properties with unpaid water and sewer bills, both of which are fixed monthly rates.
The new proposal, which will be reviewed by town attorney Bob Weiss, still allows the town to place property liens as a last resort in the event of outstanding electricity bills.
However, when a new tenant moves into a property, the bill would automatically be in the landlord's name. The landlord could sign a waiver to put it in the tenant's name, but after 30 days of nonpayment, it would return to the landlord's name. The landlord could then pay it, remedy the situation or disconnect power from the property. After 60 days of nonpayment, the town would disconnect the power.
"My gut feeling is it's a lot better than 609," Trustee Bernie Gagne said at the work session.
Still, he and others had reservations about putting electricity in the landlord's name when the tenants have total control over the size of the bill.
Among those affected by the electric bill ordinance is Chan Zwanzig, who rents out his former kayak factory in Oak Creek to Elevation Wellness Center, a commercial medical marijuana grow operation that uses a significant amount of electricity.
Zwanzig said he could be exposed to tens of thousands of dollars of liability if his tenants did not pay bills and he was left responsible through a property lien.
He plans to watch with interest where the town goes with the replacement ordinance.
"I don't know what they're going to do," he said. "And if what they do places property owners in a liability situation for something they had no choice or knowledge of, that's wrong."
Gustafson said the aim of the ordinance is to protect the town.
At the end of 2010, Oak Creek had $15,000 in electric bills in arrears, and to Gustafson, that's a large sum from any perspective.
"No one of us would want to walk away from $15,000," she said.
Outstanding bills are sent to a collection agency, which results in a return of 40 percent of the bills. Gustafson said she thinks there is a better way to protect the town from losses, though it might mean some adjustments.
"We can do it legally without putting undue burden on anybody," she said. "For the landlords in town, they're going to have to change the way they do business, and we can work with them on their current leases."
— To reach Nicole Inglis, call 970-871-4204 or email ninglis@SteamboatToday.com