Council To Consider Franchise Fee Increase

Oskaloosa City Council

Oskaloosa City Council

Oskaloosa, Iowa – The Oskaloosa City Council gaveled into session Monday evening, where the Council set the first public hearing for a proposed franchise fee increase. August 18th was set as the time for the first reading, and for the public hearing.

A franchise fee is the fee for consumed natural gas and electricity, and is collected monthly on commercial, residential and industry MidAmerican ratepayers.

Currently, the franchise fee in Oskaloosa is set at 3%, which equates to roughly $400,000 per year for the city of Oskaloosa. The increase by 2% would add approximately an additional $290,000 per year to the city budget. That budget has been stretched recently with financial commitments to Forest Cemetery, Stephens Memorial Animal Shelter and the Mahaska County YMCA.

City leaders see the increase in the fee as a necessary step to offset expected property-tax revenue declines from a legislative maneuver. Those revenue losses will start kicking in for the fiscal year 2017 until 2024, and could add up to an approximate $500,000 per year loss for the city.

The council members set the public hearing on the proposed franchise fee changes for August 18, 2014. Also proposed was a revenue purpose statement, which would outline how the city plans to utilize the funds raised from the increase of the franchise fee. The council says they want to utilize those funds for public safety, and to offset the cuts in funding due to property tax reform.

The next scheduled meeting for the Oskaloosa City Council is August 18th, 2014.

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