The Edina City Council reviewed two options for increasing franchise fees during a work session Wednesday, with both proposals designed to generate approximately $4 million annually for street reconstruction and other municipal priorities.

Option 1 would maintain the current flat fee structure while increasing residential fees from $3.55 to $4.40 per month per utility and doubling commercial rates. Option 2 would adopt a 4% percentage-based model for all customers, with fees varying based on energy consumption. Both options represent a $1.3 million increase from the current $2.7 million collected annually.

The franchise fees fund the city's PAX Fund for pedestrian and cyclist safety, the CASS Fund for conservation and sustainability, and street lighting. Under either proposal, the additional revenue would support street reconstruction projects, potentially reducing the burden on the general tax levy by $1 million annually.

Contract lobbyist Katie Sun of Messer Lee Kramer provided an update on key legislative priorities, including the Vernon Avenue Bridge Highway 100 project bonding request and Tax Increment Financing legislation for developments at 72nd and France and 70th and France. The bonding bill faces uncertainty with the House targeting $700 million and the Senate considering $1.3 billion.

The council will bring the franchise fee discussion to a full council meeting May 6 for a final decision. If approved, the regulatory process must be completed by July to implement new rates by January 2026.