Contribution in Aid of Construction Changes

lcec-electric-poleOn May 19, 2016, the LCEC Board of Trustees approved several changes to the LCEC Contribution-in-Aid-of-Construction (CIAC) policy.

The policy defines how charges for the installation and extension of electric infrastructure to serve new development are implemented when projected revenues are less than costs.

Several customers, including the City of Cape Coral, provided feedback about LCEC’s policy leading LCEC staff to review the policy and consider changes.

After a comprehensive evaluation and consideration of the impact of various scenarios, the Board was presented with a recommended plan that was approved by the Florida Public Service Commission (FPSC) and will be implemented in July 2016.

The policy changes are designed to closely mirror the requirements of the state’s investor-owned utilities. In April, the City was informed that the policy changes were being presented to the LCEC Board at their May Board meeting.

So what do these changes mean for our members?

Each year, a handful of members are required to pay a CIAC fee based on their need for new electric infrastructure. While the original applicant is required to pay all CIAC charges, the new policy will allow a pro-rata fee for additional connections along the extension within three years of when the facilities are constructed and the original applicant will receive a credit.

A true-up provision is also being adopted. Within 12 months following the in-service date, an applicant that paid CIAC may request a review of the construction charges. If the actual cost is less than the estimate, the customer will receive a refund. If actual expenses were higher than the estimate, the customer will be billed the additional cost.

For more information about LCEC’s Contribution in Aid of Construction changes, contact us now.

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