Fernley council tables second reading of power district ordinance after heated debate over 1% franchise fee

Fernley — The City Council on Monday temporarily tabled the second reading of an ordinance to create the Fernley Power District, a municipal electric utility intended to serve the Victory Logistics District, after extended presentations by developers and questions from council members and residents.

Developers and their consultants told the council the district could generate “between a 126 and a $157,000,000 in the first six years” for the city’s general fund if the ordinance is adopted as written and the proposed 1% franchise fee is retained, Rick Nelson of Mark 4 said during his presentation. Nelson and other presenters argued that a low initial franchise fee is crucial to keep delivered power prices competitive and attract large industrial customers and data centers.

Supporters said the framework in the published ordinance would create predictable governance and pricing needed for long-term contracts. “This 1% rate is what keeps the district power price attractive and keeps Fernley attractive to these large customers,” Nelson said, adding the published structure has been available for public review for eight weeks.

Opponents on the council and members of the public pressed for more analysis and time. Councilwoman Zaberski said she was uncomfortable committing to the fee and board structure before the city’s contracted consultants finish parts of their review. “It feels a little premature to be making a decision on an ordinance before we’ve actually gotten the report back from our consultants,” she said. Other council members asked whether a stepped fee schedule or later adjustments could be used to protect the city’s long-term interests.

City Attorney Aaron Mortensen outlined options for the council, including adoption as published, adoption with amendments, or continuing the ordinance to a later meeting to review consultant findings. Project counsel and developer representatives warned that major amendments at this stage could make the ordinance vulnerable to legal challenge or cause potential investors to withdraw.

After discussion the council voted 3–1 in favor of a motion by Councilman Mendoza to table the ordinance until the city’s third-party consultant report is returned and the council can review a legal brief; Councilman Torres seconded the motion. The agenda minutes record the motion as carrying 3–1; the meeting did not record an amended ordinance vote.

What’s next: Council asked staff to provide a legal brief and to share relevant consultant materials when available. The item will return to the council for further action after that additional review. The ordinance remains published and available for public review.

Reporting note: The hearing included multiple technical and financial claims about projected revenues, franchise-rate modeling and contractual escalators; those figures were presented by developer representatives and are estimates contingent on contracts and future development, not final city income. The council also discussed the policy trade-offs between immediate revenue capture and maintaining price competitiveness to attract large customers.