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First Vote on Burlington Franchise Fees

Mar 20, 2013

Burlington’s plan to create a pair of franchise fees has taken another step forward.

Burlington City Manager Jim Ferneau

The 3% fees are included in separate franchise agreements with Alliant Energy subsidiary, Interstate Light & Power, for gas and electric services.

The Burlington City Council has approved the first readings of the ordinances that set the terms for the new 25-year agreements.

City Manager Jim Ferneau says the new franchise agreements should receive final approval before the end of April.  He says the fees would start showing up on bills a couple months later.

“If all goes according to plan,” says Ferneau, “Alliant Energy has talked to us about trying to make sure they are in place and ready to start collecting after July 1.”

The franchise fees would replace a one-cent local option sales tax currently on utility bills.

The fees are expected to generate $800,000 annually with the money going directly to Burlington.

The money generated by the local option sales tax is pooled and distributed to participating cities and Des Moines County.

Burlington chose to implement the franchise fees so it could avoid a larger increase in the local property tax rate.

Residents could still call for a special election on the new franchise agreements.

Ferneau says doing so would require the filing of a petition with several hundred names within 20 days of final approval.