EcoMotion Solar Saves Santa Monica Big Money
For the past ten years, EcoMotion has managed the award-winning Solar Santa Monica program for the City. Just last week, we learned that our work will result in a quarter million dollar of tax savings for the City of Santa Monica every year for as long as its water treatment plant is in operation.
This past year, EcoMotion’s Senior Solar Specialist, Michael Ware, was analyzing the electricity use and costs of Santa Monica’s municipal facilities. One of these was the Santa Monica Water Treatment Plant located just outside the City border, in the City of Los Angeles. Santa Monica pays Los Angeles Department of Water and Power for the electricity used at the plant; an annual bill of approximately $2 million.
Michael requested to review past utility bills for the plant so that he could analyze the cost and assess rates. This service is standard for EcoMotion’s solar clients as it allows a specialist to discover errors in billing and help determine the best paths to more efficient energy use. As Michael reviewed this plant’s utility bill, he noticed that there was a line for “City of Los Angeles Utility Tax,” 12.5% of the total bill. Yearly, this tax was costing Santa Monica over $250,000.
Michael knew that it did not make sense for a city to be charged this tax since government agencies are typically exempt from city tax. He looked up the Los Angeles statute and confirmed that “A typical example of this type of exemption [from the city tax] would be a Federal, State or local government agency.” He then informed the Cities of Santa Monica and Los Angeles that he believed Santa Monica was being improperly taxed. Since the tax had been charged in this way for many years, it was difficult to convince officials that it was incorrect. Michael, however, persevered and continued asking questions until they were answered.
This year, the Los Angeles Department of Water and Power informed Santa Monica that it is indeed exempt from this tax. It issued Santa Monica a check for $119,000, a partial refund for some of the taxes already paid. Going forward, the City of Santa Monica will be saving over $250,000 per year! Michael’s keen analysis and determination resulted in huge savings.