The Lincoln City Council approved a 5 percent increase to Lincoln Electric System rates — slightly less than the 5.5 percent increase the public utility requested.

The increase was approved 5-2, with councilmen Jonathan Cook and Dan Marvin voting no. The new rates will be effective March 1.

Two groups representing businesses sought a smaller increase: The Lincoln Independent Business Association pushed for a 4 percent hike and the Lincoln Employers Coalition sought a 4.5 percent increase.

Councilman Jon Camp proposed the 5 percent rate increase, saying it would be up to LES to figure out where to adjust its budget to make up for the difference. Of the 5.5 percent increase LES requested, 3 percent was to cover increased power costs, 1 percent was to rebuild the public utility’s rate stabilization fund, 1 percent for an adverse court decision on rail rates and .5 percent was to pay for sustainable energy programs.

Camp and other council members were bothered by the fact that LES didn’t have a specific plan for how it would spend $1 million for a new conservation program. Camp suggested LES “beg, borrow and steal” energy-saving ideas from other utilities.

Cook failed to convince the council to approve a one-year delay of an increase in the $400 fee to connect new construction up to electricity — similar to the council’s one-year freeze on impact fees. Instead, the council approved Camp’s motion to freeze the fee at $400 rather than increase it to $540.

Cook said it isn’t fair to make ratepayers subsidize the actual connection costs, which he said is $680.

The four Republicans on the council approved Camp’s motion, with the three Democrats voting “no.”

Marvin and Cook were irritated by the sudden impulse to cut the rate increase even though late last year the council approved an uncontroversial LES budget that called for the 5.5 percent rate hike. Cook said the council was bowing to business groups that are “essentially saying, ‘Don’t fund the budget that you passed and we didn’t complain about two months ago.”

“It’s a little frustrating,” Cook said.

But the council members who supported a smaller rate increase said why have a separate rate increase hearing and vote if they’re not allowed to consider public input and vote accordingly.

“Why’d we have the hearing last week? Why are we voting today?” Councilman John Spatz asked Cook.

Councilwoman Robin Eschliman was similarly perturbed, saying, “I resent being told that I can’t listen to what people say in a public hearing. What did we have one for?”

Councilman Ken Svoboda joined the chorus, saying Cook and Marvin were insinuating the council was kowtowing to the two business groups — even though they didn’t give them exactly what they asked for. Svoboda said he heard from many people over the weekend urging rate relief.

Marvin is worried the vote to underfund the LES budget could jeopardize LES’s favorable bond ratings.

“I think that’s a dangerous thing to do,” he said.

The three Democrats on the council — Cook, Marvin and Doug Emery — voted against Camp’s amendment to lower the rate increase to 5 percent, but on the final vote on rates, Emery voted “yes.”

Reach Deena Winter at 473-2642 or dwinter@journalstar.com.