The Lincoln City Council approved the fast-paced, $12.2 million conversion of city street lights to LED on a split, 4-2 vote Monday afternoon.
The conversion will be financed by internal borrowing from the city’s cash fund, repaid over a 12-year period, with a 2.5 percent interest rate.
Borrowing internally is less expensive than going to the market, said Jon Carlson, an aide to Mayor Chris Beutler.
Councilman Jon Camp unsuccessfully argued the city should convert the almost 27,000 remaining street lights to LED over five years, not 12 months, to take advantage of future technological improvements.
Spreading out the conversion will allow the city to look at future improvements and reductions in the price of the lights, Camp said.
But supporters of the 12-month conversion said the big advances and price reductions in LED lights have already occurred.
“We are not going to see improvements on a grand scale," said Frank Uhlarik, the city's environmental compliance and sustainability manager.
And by slowing down the conversion, the city would not get the energy savings that a total conversion would bring, supporters of the quick conversion said.
It's costing the city more than $20,000 in savings every week the project is delayed, said Peter Hinkel, with Schneider Electric.
“It really makes sense to move forward with this project,” he said.
Camp also said he doubted the validity of the suggested 20- to 25-year life span of LED lights. Most of the lights will be guaranteed for 10 years, but some studies indicate the lights will last more than 20 years, according to information provided the council.
But LED lights are so new you can’t bank on the projected 25-year life span, Camp said.
The council rejected Camp’s five-year conversion plan on a 4-2 vote, and that same split held for approving the contract with Schneider Electric to handle the conversion over 12 months at a guaranteed price of $12.2 million.
Under the contract, Schneider guarantees the installation price of $12.2 million and guarantees some specific savings. The energy and maintenance savings are computed the first year, but Schneider will reimburse the city for those unmet savings for the next 15 years.
Camp and Cyndi Lamm, both Republicans, voted for the five-year conversion amendment and against the 12-month contract. Leirion Gaylor Baird, Bennie Shobe, Jane Raybould and Carl Eskridge, all Democrats, voted against the five-year conversion and for the 12-month contract.
Camp said he wanted a longer conversion period and Lamm said she was opposed to the internal financing, borrowing money from the city’s cash funds through a 12-year loan.
Lamm and Camp pointed out the city could make more money by buying 10-year treasury notes, with 2.92 percent interest rates.
Borrowing, without a vote of the people, is “extremely troubling to me,” Lamm said. “I would certainly support an LED project. I can’t support it with internal borrowing,” she said.
Lamm said she had not found any governmental jurisdiction that has used internal borrowing for an energy service company contract, like this one.
The four supporting council members said the program would accelerate savings and do something good for the environment.
Councilman Roy Christensen, a Republican, was not at the meeting.
Hinkel and Carlson promised to work with the city if the new LED lights in residential areas turn out to be too bright or have too much glare.
Mary Quintero, a local resident, has pointed out in testimony at council meetings and in letters to the council that several cities have had to change new LED residential street lights in response to neighborhood complaints about the very bright, unforgiving LED lights.
In Phoenix, citizens compared the new LED lights to “flood lights at a prison,” she said.
And Baird, who drove around Lincoln looking at the current LED street lights, said there are areas, particularly in older neighborhoods, where the new lights were noticeably brighter than the current street lights.
In fact, the lights are so bright "you cannot look at them," she said. "You have to look away."