ORANGE BEACH, Ala. — One of Mayor Tony Kennon’s campaign promises was fulfilled last week during a workshop discussing a Baldwin EMC surcharge that has left some residents upset.

In April of 1999 an ordinance requiring all utilities on private property be placed underground was passed by former Mayor Steve Russo and the city council.

Then, the following December, an ordinance requiring all utilities on public property be placed underground was also passed.

The ordinances resulted in a $5.25 charge added to customer's power bills.

Kennon said during his campaign citizens were asking for answers regarding the surcharge and the workshop was planned to educate residents, city council and even himself.

“When Baldwin EMC has a job that’s going underground, Baldwin EMC gives two estimates. One is an underground estimate and one is an overhead estimate,” Jody Taylor, vice president of Gulf Shores District of Baldwin EMC, said during the workshop. “The surcharge is the amount of the difference of the two.”

Taylor further explained city ordinances or policies mandate the desire to put lines underground and state law allows Baldwin EMC to recoup money through a surcharge. 

The plans to bury power lines led to the additional cost. Some residents aren’t happy the 10-year process has developed into a focus on Highway 182, commonly known as Beach Road.

“Everybody from the beach over is paying for what y’all are doing on the beach,” a concerned citizen directed at Taylor.  

“Council in the past envisioned for the entire city to go underground,” Taylor responded. “What the ordinance mandates us to do is not to put in any new overheads (power lines). Wherever you see us putting underground in the city of Orange Beach is because a new line was either needed, upgraded or added.”

“We want to make sure the projects we approve benefit everybody in Orange Beach,” Kennon said in an interview.

Taylor said no council has directed Baldwin EMC to target a specific area. However, a focus of new lines has been pushed to the beach front, and Kennon said it is because that is the busier, capital creating area of Orange Beach. 

“The expenditures are relative to where the revenue came from,” Kennon said. “It looks to me that it is a somewhat fair and equitable division of the revenues as far as what’s being done where.”

There have been 132 surcharge work orders completed with some still in the works and more planned for the future. 

So far, $7,238,980.42 has been used to fund the process, and Orange Beach residents have yet to pay $3,653,781.67. That debt grows daily as projects persist.

“Right now we have zero dollars in our surcharge bank account,” Kennon said. 

As a result, the city of Orange Beach is now requiring that all jobs costing more than $10,000 that would need a surcharge be approved by the council. 

Taylor said Baldwin EMC makes no restrictions on who pays them for their differential cost. However, since 1999 the city has made no payments for the specified cost. 

A plan for a 36-month payback, costing each customer the $5.25 surcharge per month, has been approved by Baldwin EMC and will require the charge to continue. However, the power company does anticipate the payback will take up to 48 months, as each month an average of $70,000 is collected from the surcharges. 

Residents and business owners in Gulf Shores see the same $5.25 surcharge on their bill every month.

Gulf Shores Public Works director Mark Acreman said the council began the charge to implement safety features for the city, as well as hurricane resilience. 

Street lights were funded greatly by the surcharge in the last few years, but it also helped supply the differential cost to put residential power lines underground. Neighborhoods on West Fairway and East Fairway have already been converted. Currently, the city is working to bury power lines on Clubhouse Drive, and Regency Road is set for a future conversion.

Acreman said the city’s conversion focus was on the residential areas that would most likely have damaged power lines, because of falling branches, after a storm.

He said Beach Road is not an option to have underground lines since the elevation is so low.