KYLE MURPHYStaff Writer

Christmas came earlier for Tullahoma Utilities Authority’s (TUA) LightTube customers as they will be seeing their next internet bill read $0.00 thanks to a waiver approved by the board of directors.

In its April meeting, TUA Brian Skelton presented to the TUA Board of Directors the item to consider the approval of a complimentary internet services for existing LightTube customers for the upcoming May bill. According to memo sent to the board from Skelton, LightTube has been providing internet, television and telephone services since July 2008, as part of the initial beta testing, and first billed customers in January 2009.

“LightTube financials are strong, largely driven by our internet service to more than 4,000 locations,” Skelton said. “As a way to say ‘thank you’ to our existing LightTube internet customers, I am proposing a ‘Christmas in May’ for those existing internet customers (residential and commercial) by providing free internet on their May 10, 2024 LightTube bill.”

Skelton said this will reduce TUA’s income by approximately $283,000, but he added the utilities authority will still have a healthy net income for the year, noting that the fiber department has been doing well, and reserves have been continuing to grow.

According to Skelton, despite lowering the price on the two fastest speeds earlier this fiscal year, internet revenue is projected to exceed budget estimates in FY24. Issuing customer credits in May as a waiver would help slow down the growth in reserves before the end of the fiscal year on June 30. He added by not by reducing the rates further, TUA would not have to turn around in a few years to increase them again.

“I think it would be a nice gesture to our customers,” Skelton said.

 He also clarified that this will be a one-time proposal, and not something to be planned annually, as well as the offer will not include VPNs (virtual private networks), point to point, transport services or dark fiber services.

“Given the competitive landscape and our commitment to providing exceptional service to our customers, I feel that this is an appropriate thank you to those customers,” Skelton said. “I believe that the long-term benefits in terms of customer satisfaction, loyalty and competitive advantage outweigh the short-term expenses.”

For residential customers, they will seeing savings between $50 and $75 in the month of May; for commercial customers, savings start at $50 but can reach into the thousands, depending on their service plan.

When opened to discussion, board member Patty Deen thanked Skelton for explaining his reasoning for not reducing the rate, and asked if he thought this was the best use of the funds to lower the reserves. Skelton said while LightTube is making some money through TV, they lose about 5% of TV customers per month. He said he appreciated the board for allowing TUA to increase the rates for TV because he didn’t want their internet customers to subsidize TV.

“I appreciated the board allowing us to raise rates on TV because I don’t want our internet customers subsidizing TV,” Skelton said. “You should pay the cost of TV, so our customers are paying for TV, we’re not making much money off it.”

Board member Jimmy Blanks asked Skelton if there was a metric that is used against TUA if their reserves are too high. Skelton said there isn’t, and reassured that TUA’s reserves are doing well because TUA is in a position to loan the electric department $2.5 million for the new automated metering infrastructure (AMI) project.

“We’ve been very fortunate in the way we have structured things and taken care of our finances,” Skelton said. “I think this is a good gesture. And next year, if we’re doing well again, the board might want to consider doing this again.”

TUA Board liaison and Mayor Ray Knowis said the complimentary service is much better than reducing the bill by a little bit.

“If I see a zero (on the bill) I say thank you,” Knowis said.

With no further discussion, the board approved the motion to giving the complimentary internet service waiver for existing LightTube customers on the May 10 bill.