Vote #133

Gas Utility 

Better Accounting

The town has maintained that it makes money on selling gas since the system was built in the 1940's. I don't think so. If it ever did we certainly can't tell now because it is too hard to determine the real cost and expenses. If the town does make a profit using the money is highly restricted. But Alderman have in the past simply looked at the gross income and thought everything was fine.

In contrast, the town gets a 6% franchise fee on electric bills with no expenses and no particular restrictions on using these funds.

We can guarantee a 6% profit on gas and use those funds for any normal town use if we create a ROW fee as in the ordinance on the right. 

This would enable the two sources of income to be correctly compared, as well as help the utility set the correct fees for its actual expenses.

Gas Accounting Ordinance

ORDINANCE NO. _____ AN ORDINANCE AMENDING THE CODE OF ORDINANCES OF THE TOWN OF ABITA SPRINGS TO ESTABLISH AN ANNUAL PUBLIC RIGHT-OF-WAY USE, MAINTENANCE, AND WEAR FEE OF SIX PERCENT (6%) ON THE GROSS REVENUES OF THE MUNICIPAL GAS UTILITY SYSTEM; PROVIDING FOR FINDINGS, CALCULATION, ALLOCATION TO THE GENERAL FUND, SEVERABILITY, AND AN EFFECTIVE DATE.

WHEREAS, the Town of Abita Springs, Louisiana (the "Town") owns, operates, and maintains a municipal natural gas distribution utility system (the "Gas Utility") as a proprietary enterprise fund; and

WHEREAS, the Gas Utility utilizes, occupies, cuts, excavates, and places physical infrastructure beneath and within the public streets, rights-of-way, sidewalks, and municipal property owned and maintained by the Town's General Fund; and

WHEREAS, the ongoing physical presence, maintenance, expansion, and emergency repair of gas lines, mains, valves, and service connections impose continuous physical wear, structural degradation, pavement stress, and administrative oversight costs upon the Town’s public roadway network and rights-of-way; and

WHEREAS, the Town desires to establish a formal cost-recovery mechanism ensuring the Gas Utility provides just compensation to the General Fund for the physical occupancy, degradation, maintenance, and administrative cost of managing said public rights-of-way, consistent with guidelines of the Louisiana Legislative Auditor and state law; NOW,

THEREFORE, BE IT ORDAINED by the Mayor and Board of Aldermen of the Town of Abita Springs, Louisiana, in legal session convened, that:

SECTION I: ESTABLISHMENT OF RIGHT-OF-WAY USE AND WEAR FEE There is hereby established an annual Public Right-of-Way Use, Wear, and Maintenance Fee (the "ROW Fee") levied upon the gross operational revenues of the Town of Abita Springs Municipal Gas Utility System. The ROW Fee shall be set at a rate of six percent (6.0%) of the total gross monthly billings generated from the retail sale and distribution of natural gas to all residential, commercial, and industrial customers served by the Gas Utility.

SECTION II: PURPOSE AND JUSTIFICATION The revenues generated by the ROW Fee are explicitly dedicated as compensation to the Town's General Fund for: A. The physical occupancy and ongoing use of the Town’s public streets, rights-of-way, and municipal property by gas distribution infrastructure; B. Reimbursing the General Fund for public street degradation, pavement wear, and ongoing right-of-way surface maintenance resulting from utility cuts and underground pipeline infrastructure; and C. Offsetting shared municipal administrative overhead, street department labor, public safety monitoring, and right-of-way management services provided by the General Fund to the Gas Utility.

SECTION III: ACCOUNTING, TRANSFER, AND DEPOSIT The ROW Fee shall be calculated monthly by the Town Treasurer or Utility Billing Department as a line-item operational expense of the Gas Utility Enterprise Fund. On or before the twentieth (20th) day of each month, an amount equal to six percent (6.0%) of the preceding month’s gross gas sales revenues shall be transferred from the Gas Utility Enterprise Fund and deposited directly into the Town General Fund. 3. The ROW Fee shall be accounted for as an explicit operational cost of the Gas Utility and classified as a Right-of-Way Fee / General Fund Transfer revenue item within the General Fund budget.

SECTION IV: SEVERABILITY If any section, subsection, sentence, clause, phrase, or portion of this Ordinance is for any reason held invalid or unconstitutional by any court of competent jurisdiction, such portion shall be deemed a separate, distinct, and independent provision, and such holding shall not affect the validity of the remaining portions hereof.

SECTION V: REPEAL OF CONFLICTING ORDINANCES All ordinances, resolutions, or parts thereof in conflict herewith are hereby repealed to the extent of such conflict.

SECTION VI: EFFECTIVE DATE This Ordinance shall become effective immediately upon signature by the Mayor following final adoption by the Board of Aldermen, and the ROW Fee shall apply to the first full utility billing cycle following effective enactment.

Said Ordinance having been introduced on the _____ day of _______________, 2026. Notice of Public Hearing having been published on the _____ day of _______________, 2026. Public Hearing having been held on the _____ day of _______________, 2026. A motion was made by Alderman ____________________ and seconded by Alderman ____________________ to adopt the foregoing Ordinance. The vote thereon was as follows: YEAS: NAYS: ABSTAIN: ABSENT: PASSED AND ADOPTED this _____ day of _______________, 2026, at Abita Springs, St. Tammany Parish, Louisiana. Town Clerk Mayor, Town of Abita Springs