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Finance director: franchise revenues from pole attachments are general-fund receipts; committee asks rate-study review
Summary
Finance Director Cynthia Sne told the advisory committee that franchise revenues from pole attachments historically flow to the general fund because the city owns the right-of-way; committee members asked that revenue scenarios be considered in the upcoming rate study to test whether any portion should offset utility revenue requirements.
Committee members raised questions about a recently updated ordinance (bill 2086) that modernizes franchise rules for pole attachments, conduit usage and city-owned cable. Staff explained the ordinance would allow the city to collect new or clarified fees for attachments and conduit use.
Cynthia Sne, the city's finance director, told the committee: "It is appropriate for any revenue generated from that to go to the general fund." She explained that franchise and land-lease revenues historically have been treated as general-fund receipts because the city owns the right-of-way, while utility operating revenues and charges are recorded in enterprise funds.
Committee members pushed back that the utility funds pay crews, maintenance and capital associated with poles and asked whether some portion of new attachment revenue should be recognized as utility-related income and considered in the rate-study models. Staff and finance staff said administration and historical accounting practice have routed such franchise receipts to the general fund, but acknowledged the committee could request that the rate-study scope model scenarios showing the potential impact of treating some revenues as offsets to utility revenue requirements.
No formal motion was made; committee members asked staff to include consideration of the franchise-fee revenue question in the rate-study scoping and to provide clearer figures and historic data so the committee can assess materiality.
