The Lincoln City Council on Monday unanimously approved a 9.1 percent across-the-board rate hike for Lincoln Electric System customers.

The increase means that all classes of customers — from residential to big business — will get the same rate increase.

The LES Administrative Board had recommended a 10.1 percent variable rate hike to the council. Under such an increase different customer classes would have been affected differently.

Councilman Dan Marvin introduced an amendment for the 9.1 percent rate hike, as a compromise between the LES Board, the council and Mayor Chris Beutler, who was unhappy with earlier proposals, including one for 12 percent.

Marvin said the 9.1 percent increase would help cover the utility’s $9.3 million budget shortfall  and also help out residential customers this winter.

“I consider this to be a more interim step and I’m happy that you said you can make it work,” Marvin told LES Administrator and CEO Terry Bundy before the vote.

Earlier, Bundy said LES does not recommend across-the-board increases and instead uses  a cost-analysis approach in formulating its rate structure.

Under the 9.1 percent hike, a typical residential monthly bill will increase by $6.70, beginning Sept. 1.

If energy costs continue to escalate, ratepayers could get hit with a 3 to 6 percent increase in March, LES officials said.

Walter Canney, a former administrator of LES, told the council during the public hearing that he supported the 10.1 percent increase.

“It shouldn’t be measured in percentage. It should be measured in performance. It should be measured in rates,” Canney said.

Bob Caldwell, chair of the Lincoln Employers Coalition, said the group would not oppose either the 9.1 or 10.1 proposals. Instead, his group, made up of the city’s largest employers, wants better communication and predictability with LES management in dealing with future rate hikes.

Bundy told the Council that the 9.1 percent increase won’t affect the utility’s plans to add $33,000 to a voucher program this year to help low-income families and $100,000 next year.

Reach Algis J. Laukaitis at 402-473-7243 or alaukaitis@journalstar.com