Edina Changes Utility Franchise Fee Structure
The City of Edina will implement a new utility franchise fee structure starting January 1, shifting from a flat monthly rate to a percentage-based system.
Under the current system, all residential customers pay a flat fee of $3.55 per month for both gas and electricity. The new structure will charge customers 4 percent of their monthly utility bill, making fees proportional to energy usage.
City officials said the percentage-based approach creates a more equitable system while giving residents opportunities to reduce their fees through energy efficiency measures. Residents can lower their franchise fees by installing LED lighting or upgrading to more efficient HVAC systems during equipment replacements.
Revenue from the franchise fees will fund community projects including sustainability initiatives, pedestrian and cyclist safety improvements, street lighting and road reconstruction. Earlier this year, the city council directed staff to raise franchise fees rather than taxes to generate an additional $1 million annually for street reconstruction projects.
The change aims to make utility costs more equitable while generating additional revenue for public improvements throughout the city.
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Implementation of New Utility Franchise Fee Structure
The city of Edina is changing its utility franchise fee structure for residential customers from a flat rate of $355 per month to 4% of the monthly utility bill, effective January 1st. This shift is motivated by a desire for greater equity, allowing customers to influence their fees through energy conservation, and to secure additional funding for community projects like sustainability, safer streets, and road reconstruction. The City Council previously directed this change as a preferred funding mechanism over taxes for street reconstruction.
The shift to a percentage-based fee means customers will pay in proportion to how much energy they use, which is a more equitable approach.
That gives the residents those opportunities to reduce the fees. And that's what council really liked about this change from a flat rate to a percentage-based fee.
Source document
[0:00] [Music]
[0:05] To make utility costs more equitable and
[0:08] to generate more revenue for public
[0:10] improvements, the city of Edina is
[0:13] changing its utility franchise fee
[0:15] structure. Right now, all residential
[0:18] customers pay a flat fee of $355
[0:22] per month for both gas and electricity.
[0:25] But starting on January 1st, that fee
[0:28] will change to 4% of your monthly
[0:31] utility bill. The shift to a
[0:33] percentage-based fee means customers
[0:35] will pay in proportion to how much
[0:38] energy they use, which is a more
[0:40] equitable approach.
[0:41] Yeah, with the new 4% fee, residents
[0:43] really have the ability to impact those
[0:45] fees by doing some small changes in
[0:47] their homes. They can do LED lighting or
[0:50] take advantage of more efficient systems
[0:52] and HVAC systems when they have major
[0:54] equipment replacements at their home.
[0:56] That gives the residents those
[0:57] opportunities to reduce the fees. And
[0:59] that's what council really liked about
[1:01] this change from a flat rate to a
[1:03] percentage-based fee. Revenue from these
[1:05] fees will help fund important community
[1:08] projects, including sustainability
[1:10] initiatives, safer streets for
[1:12] pedestrians and cyclists, street
[1:15] lighting, and road reconstruction.
[1:18] Earlier this year, the city council
[1:20] directed staff to raise franchise fees
[1:23] rather than taxes to fund an additional
[1:26] $1 million per year for street
[1:28] reconstruction. destruction.
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Utility Franchise Fee Structure Change in Edina
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