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Waukee considers 2% utility franchise fee; city says households would still save on average
Summary
Waukee is weighing a proposed 2% franchise fee on natural gas and electric bills that would replace a 1% sales tax on those bills; a speaker at the meeting said the typical household would still save about $209 a year and the city would recapture roughly $1 million in lost revenue.
Waukee is considering a proposed 2% franchise fee on natural gas and electric bills that would replace the existing 1% sales tax on those same bills, an unidentified speaker said.
The speaker told the meeting the city expects the change to be a net increase of about one percentage point for utility customers because the 1% sales tax on utility bills would be removed when the franchise fee is imposed. "The franchise fee would have an impact of about $16 per year for the average Waukee home," the speaker said, adding that the sale of the city's gas utility to MidAmerican Energy—completed in October, the speaker said—has already lowered bills and that the typical household is still expected to save "as much as 20 to 25%," roughly $225 annually, leaving an estimated net savings of about $209 a year.
City finance implications were a central part of the presentation. The speaker said Waukee currently receives about 19% of the revenue generated by the 1% sales tax on utility bills and that a franchise fee would direct 100% of those collections to the city. The speaker described a revenue shortfall from the utility sale of "just shy of $1,000,000," and said the franchise fee revenue would help cover costs previously supported in part by utility receipts, including the gas division, public works and shared departments such as IT, finance, human resources and communications.
The speaker also outlined intended uses for the fee revenue, saying it would support hiring, resident communications and IT system safety. In comparing regional practice, the speaker said only four metro communities do not levy a franchise fee and that other metro communities have fees "somewhere between 15%," as stated at the meeting.
The speaker provided information resources listed in the transcript (walkie.org/franchisefee and communications@walkie.org) and said the ordinance's next reading is expected to appear on the council agenda for Monday, Dec. 15, at City Hall or by Zoom; the transcript also directed residents to waukee.org to sign up for agenda notifications. The transcript does not record a formal motion or vote on the fee during the recorded remarks.
Next steps: the council is scheduled to take up the ordinance for a formal reading on the date noted; the transcript did not record any final vote or adoption.
