Title
title
A Presentation by Mark Pruitt of the Illinois Community Choice Aggregation Network on Village Franchise Accounts and Infrastructure Maintenance Fee
..end
Introduction
overview
Village Staff and consultant Mark Pruitt from the Illinois Community Choice Action Network will present to the Board on changing electrical “franchise” accounts from bill credits to cash payments.
end
body
Recommended Action
Staff recommend the Board provide Staff direction to bring back an Ordinance which will convert the Village’s franchise accounts from bill credits to an infrastructure maintenance fee.
Prior Board Action
There is no prior Board action associated with this item.
Background
The Village of Oak Park has multiple accounts serviced by Commonwealth Edison (ComEd), which are considered “Franchise Accounts.” Franchise Account crediting is intended to compensate municipalities for the use of public rights of way and easements in the operation of the ComEd distribution system. Municipalities receive on-bill credits or cash payments equal to the value of the credits issued over the prior 12 months.
Currently, the Village has five accounts that receive bill credits, resulting in a $0 balance monthly. The value of the credits is recovered through a fee on electric bills paid by Village residents and businesses.
The five franchise accounts are:
• Village Hall
• Public Works
• Fire Station 1
• South Fire Station
• Augusta Fire Station
The benefit of receiving bill credits is that the energy costs of the five buildings will always be $0, even as energy prices increase. The challenge of this system is that the Village does not see a financial benefit or return on investment for energy efficiency and renewable energy improvements to those buildings.
In lieu of the bill credits, the Village has the option to convert the credits to cash payments. Under the cash payment system, the Village will pay for energy costs at the five facilities. The cash payments would likely cover energy usage for the facilities, and investments in energy efficiency would reap a financial benefit. Savings could be reinvested into energy efficiency improvements for Village facilities.
Because the cash payments are based on the previous 12 months of credit value, now is a good time to consider conversion, as ComEd raised electric rates in June 2025. Should the economic benefits change in the future, the Village has the opportunity to revisit this change and revert to bill credits.
Timing Considerations
Cash payments are based on credit values for the previous 12 months. Adopting the ordinance soon will lock the Village in to higher rates which began in 2025. Implementation requires lead time with ComEd.
Financial Impact
Passing an Ordinance would require the Village to pay electric bills on the five franchise properties. Village staff will prepare the necessary budget amendments to cover the cost of the electricity bills from the Public Works budget. Passing the Ordinance will also result in cash payments for the credits. These cash payments should be larger than the electrical costs. Staff will determine a way to track the credits and expenses related to electricity use and energy efficiency improvements.
Operations Impact
There is no operating impact associated with this item. The item aligns with the department’s core service delivery. Staff approximately 20 hours preparing this item and the consultant.
DEI Impact
There is no DEI impact associated with this item.
Community Input
There has been no community input given in relation to this item.
Staff Recommendation
Provide Staff direction to bring back an Ordinance which will convert the Village’s franchise accounts from bill credits to an infrastructure maintenance fee.
Advantages:
• Cash payments will create revenue that will more than cover the increased cost of paying the electric bills on the five facilities.
• Improvements in energy efficiency and investments in renewable energy will see a return on investment for the Village.
Disadvantages:
• The Village would need to pay for the energy used at Village facilities. This will require a budget amendment for FY26 and an increase in the budget item for future years.
• For an 18-month period, Village residents will pay both the credit and fee surcharges on their accounts. For the average residential account, this will total $2.65 per monthly bill.
Alternatives
Alternative 1:
The Board can choose not to direct staff to bring back the Ordinance and maintain bill credits.
Advantages:
• No further action is required.
• The five Village facilities that participate will continue to have a monthly bill of $0.
Disadvantages:
• Energy efficiency upgrades at these five facilities will have no financial benefit or return on investment.
Anticipated Future Actions
If directed, Staff will return with the Ordinance for adoption by the Village Board
Prepared By: Lindsey Roland Nieratka, Chief Sustainability Officer
Reviewed By: Jack Malec, Assistant to the Village Manager
Approved By: Kevin J. Jackson, Village Manager
Attachment(s):
1. Presentation, Mark Pruitt