Norwalk sets Jan. 16 hearing to adopt revenue purpose statement for proposed utility franchise fees

The Norwalk City Council on Jan. 2 voted to set a Jan. 16 public hearing on a revenue purpose statement that would authorize the city to include proposed electric and natural gas franchise fees in an upcoming ordinance.

Jean Kelly (staff member) told the council the revenue purpose statement is required before the council can adopt an ordinance imposing franchise fees. Staff described the measure as intended to be revenue neutral relative to the existing 1% local option sales tax the city currently collects. "Just that it will be a revenue neutral, at this point with the 1% because we won't be charging that in the lost," Jean said.

Staff explained that state and city code permit franchise fees up to 5%, though the proposal under discussion is for a 1% fee and that the council could set different allowable uses in the revenue purpose statement. Staff described likely allowable uses drawn from code language, such as property tax relief, energy conservation measures, mitigation projects and similar items, and said the city was proposing a narrower list of uses tied to property tax relief and related purposes.

Council members agreed to set the public hearing date; the motion to adopt the revenue purpose statement and set the hearing passed on a roll call vote of the members present.

The set hearing will allow the council to consider an ordinance that would formally impose franchise fees on utility bills and define permissible uses of those revenues. Staff warned that the list of allowable uses in the published revenue purpose statement should be set carefully because it determines permitted spending if the franchise fee ordinance is adopted.