Streetlights: Private Property or a Public Utility?
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 Transportation Alert Issue 27 |
Can a City force a private company to sell its street lights to them? If the City of Englewood in Ohio has its way, it would appropriate street lights owned and operated by a private street light company. The City claims it could save more than $100,000 per year (2004 dollars) by appropriating the property for the public good and running the system itself. Miami Valley Lighting has a different point of view, claiming that the City has no right to take the property, business, and profits it has developed.
A favorable outcome for the city could entice other municipalities to follow suit in an effort to reduce their street light bill. Private enterprise is interested in the case too. If street lights are an essential service that can be appropriated for the public good, what else is at risk?
Here are the details and the status of the court decisions thus far. Miami Valley Lighting (MVL) has held long-standing contracts with the City to pay for, design, build, maintain, and energize 1,200 street lights, all of which are located in the city’s right of way. In 2004 the city commissioned a study to compare the cost of paying MVL to own and operate the system against the cost of having the city do the same.
After learning that the cost savings per year would exceed $100,000, the city declared itself a public utility provider and filed to appropriate MVL’s property.MVL objected, contesting that street lights are not a public utility and that the lights are personal, not real, property. Their property could not be appropriated, they claimed, because it did not meet the criteria of blight and was not part of a blighted area or slum. The two key issues that ended up being argued were:
a) Whether or not street lights can be considered a public utility and
b) The right of the City to appropriate street lights.
Thus far, the trial and appeals courts have sided with Miami Valley Lighting.
Street lights, the courts said, are not a public utility as defined by the state constitution. They are not an essential service or an integral part of the city’s electric system. And while they are beneficial to the public, they are not necessary to promote the public health, safety, and welfare. The City, therefore, had no right to appropriate MVL’s street lighting system.
The city intends to appeal the case to the state Supreme Court. There is no assurance that the court will hear it. Thus far, they have spent $140,000 arguing their interests.
To view the most recent April, 2009 court decision, check out this document.
While NYS laws governing street lights and utilities are different than in Ohio, the case demonstrates the lengths to which municipalities will go to reduce their street light bill. These costs are often the third or fourth highest in their budgets.
A favorable outcome for the city could entice other municipalities to follow suit in an effort to reduce their street light bill. Private enterprise is interested in the case too. If street lights are an essential service that can be appropriated for the public good, what else is at risk?
Here are the details and the status of the court decisions thus far. Miami Valley Lighting (MVL) has held long-standing contracts with the City to pay for, design, build, maintain, and energize 1,200 street lights, all of which are located in the city’s right of way. In 2004 the city commissioned a study to compare the cost of paying MVL to own and operate the system against the cost of having the city do the same.
After learning that the cost savings per year would exceed $100,000, the city declared itself a public utility provider and filed to appropriate MVL’s property.MVL objected, contesting that street lights are not a public utility and that the lights are personal, not real, property. Their property could not be appropriated, they claimed, because it did not meet the criteria of blight and was not part of a blighted area or slum. The two key issues that ended up being argued were:
a) Whether or not street lights can be considered a public utility and
b) The right of the City to appropriate street lights.
Thus far, the trial and appeals courts have sided with Miami Valley Lighting.
Street lights, the courts said, are not a public utility as defined by the state constitution. They are not an essential service or an integral part of the city’s electric system. And while they are beneficial to the public, they are not necessary to promote the public health, safety, and welfare. The City, therefore, had no right to appropriate MVL’s street lighting system.
The city intends to appeal the case to the state Supreme Court. There is no assurance that the court will hear it. Thus far, they have spent $140,000 arguing their interests.
To view the most recent April, 2009 court decision, check out this document.
While NYS laws governing street lights and utilities are different than in Ohio, the case demonstrates the lengths to which municipalities will go to reduce their street light bill. These costs are often the third or fourth highest in their budgets.
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