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Council OKs first reading to raise electric franchise fee by 1 percentage point to 4%
Summary
Staff recommended raising the town's electric franchise fee from 3% to 4% to offset rising street-light costs; council approved the first reading and asked staff to provide more data about lighting cost increases and to coordinate timing with neighboring systems.
Councilors considered a municipal services agreement with Duke Energy and a proposed increase in the town's electric franchise fee from 3% to 4%.
Staff recommended the 1-percentage-point increase to generate approximately $20,000 in additional annual revenue (staff estimated current franchise revenue near $60,000 and noted street-light costs around $51,000). The administrator said some neighboring municipalities were at higher rates and that the town could still adjust the fee within the 10-year contract with a 120-day notice period.
Councilors voted to approve the first reading; staff will seek additional detail on the projected street-light cost increase, the timing of Duke Energy's rate changes, and whether to time the town's contract change with a nearby utility (referred to as Lockart) so increases take effect together. The administrator advised the change would raise customer bills slightly, but staff characterized the per-customer annual impact as modest.
Next steps: staff will gather more detailed cost information from Duke Energy and return with those figures before the second reading, which must be completed before the October 1 effective date requested by the utility.
