Hendersonville adopts 2% Piedmont Natural Gas franchise fee; board adds yearly review language

HENDERSONVILLE, Tenn. — The Board of Mayor and Aldermen voted 9-4 on July 2025 to adopt a franchise agreement with Piedmont Natural Gas Co. that sets a 2% franchise fee and adds wording allowing the city to change the fee by ordinance, subject to approval by the Tennessee regulatory authority no more than once per year.

The vote came after city staff and Piedmont representatives updated revenue estimates used in the fiscal 2026 budget. City staff had earlier included $195,000 in franchise revenue based on initial figures; Piedmont recalculated that a 1% fee equals roughly $150,000, and staff told the board that $175,000 was currently accounted for in the draft budget. The board agreed to set the fee at 2% and asked staff to update the budget numbers accordingly.

Why it matters: The fee is a recurring operational revenue source the city can use for municipal services without raising property taxes. Alderman proponents said the modest 2% would help close a city revenue gap; opponents said charging for a utility many residents rely on for heating could harm lower-income households.

Discussion and amendments Board members debated a range of options after Alderman Collins moved to set the fee at 0% and after Alderman Martin proposed reducing the original 5% proposal. Alderman Martin later offered an amendment to set the fee at 2% and add language allowing the board to change the fee by ordinance, subject to Tennessee Utilities Commission approval no more than once per year; the board approved that amendment before the final vote.

Piedmont’s government-relations manager, Steven Francheskin, explained the company’s role and said Piedmont did not set the city's fee. "We don't determine the percentage — it's the city's decision," Francheskin said. He also said Piedmont could assist with petitioning the utilities commission should the city later seek a change in the fee.

Several aldermen raised equity and affordability concerns. Alderman Collins argued against adding a fee on a utility used for home heating, saying it could burden households in winter. Alderman Burgdorf and others supported some fee to provide operating revenue without raising property taxes; Alderman Burgdorf noted household impact estimates offered by colleagues that averaged about $1.51 per month at the board's proposed rate.

Vote and next steps The roll call read by staff recorded nine votes in favor — Aldermen Burgdorf, Skidmore, Ward, Martin, Sasse, Garza, Robertson, Evans and the mayor — and four opposed — Aldermen Dixon, Goodwin, Garton and Collins. The board directed staff to revise the fiscal 2026 budget revenue lines to reflect the 2% fee and to include the ordinance language permitting the fee amount to be changed by subsequent ordinance, subject to utilities commission approval no more than once a year.

The city attorney and Piedmont said the company could accommodate reasonable language changes, and staff said the budget would be updated with the revised revenue forecast before final adoption of the fiscal-year budget.

Ending: The ordinance passed on second reading; staff will present the updated revenue figures and the final ordinance language at the board’s next scheduled meeting if needed.