Newberry City Council discussed a Commercial Economic Electric Rate Proposal at their meeting Tuesday that would benefit new businesses coming into the City of Newberry – more specifically, a potential grocery store.

If approved, this Economic Development Rider would feed off of a recent policy being discussed by Newberry County Council that would give property tax incentives to grocery stores that locate within Newberry County.

“Tonight is about talking through the plan to see if it would make a good fit to partner with the county’s policy,” City Manager Matt DeWitt said.

Available only at the City’s option, Utility Director Tim Baker said, the Commercial Economic Development Rider would be for nonresidential establishments receiving electric service from the city under the commercial customers monthly rate.

While the Rider would not specifically be for grocery stores, Baker said they would fit the criteria of the Rider by having at least 250 kW at one metering point.

“If there’s another ‘big box’ store that also would qualify, I think it would be worth exploring that too,” Baker said on why the policy didn’t solely refer to grocery stores.

Also mentioned in the proposed Rider is that the customer must also make new capital investment of one million dollars and must occur following City Council’s approval for service under this Rider.

This Rider would not be available to a new customer which results from a change in ownership of an existing establishment, Baker said. However, if a change in ownership occurs after the customer contracts for service under the Rider, the successor customer may be allowed to fulfill the balance of the contract and continue the schedule of credits.

Those meeting the above qualifications and having gained approval from City Council after applying would be eligible for the following credits to the electric portion of their bill, including the Basic Facilities, Demand Charge, Energy Charge, or minimum bill, but excluding Wholesale Power Cost Adjustments:

  • Months 1-24: 20 percent
  • Months 25-48: 15 percent
  • Months 49-72: 10 percent
  • Months 73-96: five percent

No credits would be received following month 96. Baker said the first two years of a new business were critical and he felt the 20 percent incentive on the customer’s bill would be an advantage to new customers.

The Rider also proposes closing funds, meaning each customer may also apply for assistance with the payment of basic infrastructure costs including, but not limited to: water and sewer tap fees, signage, paving, parking lot lighting or other infrastructure costs.

Closing funds may be reimbursed based on one dollar per $100 in capital spending with a cap of $25,000 per project. Baker said if a customer is requesting closing funds, that must be requested as part of the Commercial Economic Development Rider application along with a brief description of how the funds will be used.

“The customer will receive a commitment letter if approved,” Baker said.

Customers must also provide documentation when submitting for reimbursement. Baker mentioned that depending on the city’s annual budget funding for economic development, that they could probably do approximately three projects per year with the $25,000 cap.

Mayor Foster Senn asked Baker if existing business completed renovations that surpassed one million dollars if they would be eligible to apply for the Rider. Baker said while the chances were not as likely, that if the business added an additional 250 kW to their existing usage from the renovations, that they would be eligible for the incentive. However, the discount would only apply to the new utility load that the city would be serving.

Senn said the city was in need of an additional grocery store and while they had met with Retail Strategies and had also tried their hand at getting Ingles to come into the city, he hoped this proposed incentive would bring new business to the area.

This item will be up for a vote by City Council at their next meeting on Tuesday, November 10.