Rio Grande City commission approves 2% increase to Medina Electric franchise fee

The Rio Grande City commission voted to amend the city's franchise ordinance for Medina Electric Cooperative, approving a 2% increase to the franchise rate that the cooperative pays the city.

The change was presented as an update to ordinance 94-14-O-1, which the city attorney and staff said has not been adjusted since February 2004. Legal staff explained the franchise contains a clause requiring Medina Electric to apply any city-specific rate change across all municipalities it serves; the cooperative warned that the change would therefore be passed through to its customers. City staff told the commission that a one-cent increase would generate roughly $4,000 in revenue to the city, per a staff estimate cited at the meeting.

Commission discussion emphasized the clause's cross-jurisdictional effect and the small fiscal yield relative to potential customer impacts. Commissioners asked staff whether neighboring jurisdictions had signaled they would raise their rates; staff said no comprehensive outreach had been completed.

A motion to adopt staff and legal's recommendation to increase the rate by 2% was moved and seconded and carried by voice vote.

The ordinance amendment will be finalized in ordinance form and returned for any required follow-up steps.

Details recorded at the meeting indicated staff's estimate that a one-cent increase would yield about $4,000 annually; the commission chose a percentage increase rather than a per-cent increase.

The item was discussed on the record during the ordinance section of the meeting.