Waukon City Council holds public hearing on Black Hills Energy franchise fee

by Bob Beach

During its regular meeting Monday, October 19, the Waukon City Council held a public hearing regarding a proposed ordinance to impose a three-percent franchise fee on natural gas customers within the City. Recently-appointed Councilwoman Christine Enyart expressed concern that it hasn’t been made clear to people that the proposed franchise fee is essentially a new tax that Black Hills Energy would be collecting on behalf of the City.
Waukon City Clerk Al Lyon said that the local option sales tax would be removed from gas bills within the City and replaced with the franchise fee, so the net increase for Black Hills customers would be two percent. Lyon estimated that the franchise fee would generate approximately $90,000 annually.
Mayor Loren Beneke said that the franchise fee is “an allowable revenue generator” and City Attorney Jim Garrett said that notice of the public hearing regarding the franchise fee, as well as a revenue purpose statement, had been published in the newspaper as required by law.
A representative from Black Hills Energy said that Black Hills Energy has no problem with the proposed ordinance, but would need around 90 days to get the franchise fee in place and begin collecting the additional funds from customers.
During regular business, the Council voted unanimously to approve the first reading of the ordinance to establish a three-percent franchise fee on natural gas customers within the City limits.
Also during regular business, City Attorney Garrett reported that a settlement agreement has been reached with the Bresnahan family regarding the City’s acquisition of land for a storm water retention basin. Garrett said that under the terms of the agreement, which the Council had already approved, the City would purchase the entire Bresnahan property for $560,000. Garrett suggested that the Council consider selling bonds in order to fund the land purchase. The Council agreed and directed Garrett to move forward with the bond sale.
Under department reports, Park, Recreation and Wellness Assistant Director Jeff Snitker reported that four contractors have been contacted for bids for gravel and rip-rap to complete the Five Bridges Trail project in the Waukon City Park. He also asked the Council to consider contributing additional funds to improve the valley trail. City Clerk Lyon reminded the Council that while the projects are “FEMA approved” he does not consider those funds to be guaranteed, as the full amount approved may or may not be reimbursed. The Council took no action on Snitker’s request.