SIDNEY -- The Sidney City Council Tuesday turned down a proposal to increase electricity rates for city customers.

The council was scheduled to decide on the third reading of proposed rate increases. The proposal was for an increase in meter fees, and rates increasing over four years. The motion died for lack of a motion to pass.

In the previous city council meeting, Councilman Jeremy Lee asked what the fixed costs are for the Electricity Department. Assistant City Manager Josh Hanson provided an estimate in Tuesday night's meeting.

"Broken down, we kind of define our fixed costs as those that don't fluctuate due to the amount of energy that's being generated and sold. So I took that to be combined salaries and benefits, supplies such as gas, oil, safety equipment, tools; maintenance, meters, major equipment, transformers, IT and meter support systems and then our general bills. So, utilities, admin fees, general insurance on there as well. When we look at the overall fixed costs on our side of things if power went out and we're having to maintain, go out there and work on some things, we're looking at about 15 percent of our total expenditure, and this is for the month of July," Hanson said.

Councilman Rob Kuhns asked what the affect would be to implement a smaller rate increase. Electricity Superintendent Tom Mathine said the department would be really close.

"I think with generation being mostly paid off, I think we would be really close with our budget, if you guys decide to do no rate increase. So we would be looking at maybe breaking even, or still dipping into our reserves," Mathine said.

Councilman Lee asked Mathine what he meant by dipping into reserves: a million or a few hundred thousand. Mathine said a few hundred thousand.

Lee said his concern is the council was told the Electricity Department would "almost break even" after four years of rate increases. 

"What got me on some of this was we were asking for four; we asked JK to do a four. We'll almost break even after four (years). Now we're almost we'll break even if we do no increase. So the numbers just ... the numbers don't add up. I appreciate you guys doing all your hard work. For me, the numbers just don't add up. I feel like it's a tax increase without doing a tax increase," he said.

Lee said what he isn't seeing in the budget is how to take care of the department, noting the amount of turnover due to salaries. Mathine and Hanson said increasing meter fees from $20 to $27.50, and maintaining the present use rates would help.