ESCANABA — Escanaba residents could see a drop in their electric bill beginning next year, but how long the reduction will last is still unknown.

On Dec. 31, the energy waste reduction mandate established by Public Act 342 of 2016 will sunset. The mandate required energy producers to collect funds from customers to fund an energy waste reduction program, which in the city’s case, is managed by the Michigan Electric Cooperative Association (MECA).

According to Gerald Pirkola, Escanaba Electric Department Superintendent, the MECA program is highly inefficient, with about 60% of the city’s cost being used to pay for administrative expenses and the remaining 40% being used for rebates. However, the city has developed a surplus in its fund of about $393,000 and continues to collect between $20,000 and $22,000 per month from an added fee on electric bills.

“Those funds will likely have to be used for some sort of energy optimization,” said Pirkola of the unused money. “We can’t just use them for what we want, even though this law is sunsetting at the end of this year.”

While there is a new energy waste reduction programs currently being developed by the Michigan Public Power Association and the Michigan Municipal Electric Association called the “Clean Energy Program,” the costs associated with the new program aren’t yet clear. About half of all municipal utilities have committed to join the program with the remainder opting out.

No decisions have been made about joining the Clean Energy Program yet, but the city can join at any time.

Currently, the city’s electric ordinance requires the additional energy waste reduction fee — which is about 0.25 cents per kilowatt hour for residential customers and about 0.2 cents per kilowatt hour for commercial customers — to be collected until June 30, 2022. However, a change to the ordinance would eliminate the fee from power bills, at least until the city joins another energy waste reduction program.

“I don’t think it’s fair to the customers to keep collecting these funds,” said Pirkola.

The council agreed, unanimously voting to stop collecting the additional charges. The change would hinge on the city amending the electric ordinance — a process the council decided to move forward with Thursday — and would take effect after Dec. 31.

“If we don’t have to collect a half-million dollars crom citizens, I’d prefer not to,” said Council Member Peggy O’Connell.

In other business, the council

— Approved renewing a lease agreement with Escanaba Area Schools for the Al Ness Baseball Field for the 2022 through 2026 seasons.

— Approved closing Ludington Street for the annual Christmas Parade, which is scheduled for Dec. 3 at 7 p.m. The parade was cancelled in 2020 due to the COVID-19 pandemic.

— Held the first reading and public hearing for an ordinance changing the city’s zoning map to rezone parcels along Ludington Street to E3 – Central Commercial District. The second reading, public hearing and possible adoption were set for Nov. 4.

— Approved sending a letter of support joining the regional coalition for the American Rescue Plan Act Build Back Better Regional Challenge, a program funded by the federal Economic Development Agency. The city approved sending the letter as well as an application for grant funding through the program. The application includes a short list of projects to be considered for technical assistance, which includes things like engineering and project cost projection.

If the regional coalition is selected as a finalist, the city could become a recipient of an 80% funded, 20% city match grant for the projects to move forward after a second application phase in March. Included on the city’s application list will be streetscaping of Ludington Street, expanding the yacht harbor, and port infrastructure improvements to the Municipal Dock.

— Approved purchasing a Godwin six-inch bypass/dewatering/transfer pump from Xylem of Livonia, Mich. for the water treatment plant and sanitary sewer collection system in an amount not to exceed $78,254.36.

— Approved the purchase of a new bucket truck and a used bucket truck for the electric department from Utility Sales & Service. The total cost of the two trucks is $500,504.

— Approved moving forward with the evaluation of City Manager Patrick Jordan. Council members will return their evaluation worksheets to the city’s human resources department within a week to facilitate Jordan’s evaluation at the next meeting.