Council seeks to revive franchise fee

About 2 ½ months after plans for a special election to decide the fate of a five percent franchise fee on electric and gas bills for Marshalltown residents were scrapped, the issue came back up for discussion during Monday night’s city council meeting when it was pulled from the consent agenda.

Councilor Gary Thompson requested that three agenda items to set public hearings on proposed ordinance amendments to establish electric and gas franchise fees along with a related revenue purpose statement be pulled from the consent agenda, and he yielded the floor to Mark Eaton, who had requested that he pull the item, to speak on the matter.

Eaton said he was “dismayed” that the franchise fee was on the consent agenda and that setting a public hearing should be considered a debatable item.

“I think it shows the public a lot about what you care about,” he said. “I think this is gonna negatively impact the community. I think it shouldn’t happen. I think it should be on the ballot in November, and therefore there’s no call for a public hearing. And it’s going to negatively impact the poor, small businesses and nonprofits. They cannot avoid paying this franchise fee. Businesses will pass it through in the cost of their goods sold.”

He also worried that the revenue generated from the fees would be misused and spent on new developments rather than reconstruction and repairs of current infrastructure. As it stands now, if the council votes to approve the franchise fee, it would go into effect unless a petition with at least 249 signatures is generated to force a special election, and Eaton said he would “get 500” to ensure it would be put to a vote.

“While I’m getting that petition, I think I’ll get a petition to move that all the Local Option Sales Tax goes to debt relief,” Eaton said.

Another resident, Doris Kinnick, told the council she was also disappointed to see the franchise fee back on the agenda and worried it would negatively impact everyone in the community, especially those on the lower end of the socioeconomic spectrum.

A series of motions to move forward with setting a public hearing for the June 12 meeting carried 6-1, with Al Hoop opposed to each of them. Thompson then clarified that while he was against the franchise fee, he wanted a public hearing to happen so that more citizens could have their voices heard.

According to City Clerk Alicia Hunter, if a second reading is approved June 26 and a third reading on July 10, the fee would be implemented on Oct. 1 unless there is a petition for a special election. The drafted revenue purpose statement would allocate a minimum of 12 percent of the fees would be used for property tax relief, nine percent for the repair, remediation, restoration, cleanup, replacement and improvement of existing public improvements and other publicly owned property, buildings, and facilities, nine percent for public safety, including the equipping of fire, police, emergency services, sanitation, street and civil defense departments and the remaining 70 percent for the construction, reconstruction, or repair of streets, highways, bridges, sidewalks, pedestrian underpasses and overpasses, street lighting fixtures, and public grounds, and the acquisition of real estate needed for such purposes.

Back in March, the Secretary of State, through the Marshall County Auditor’s Office, determined the city could not call a special election on a franchise fee, as a special election could only be held through a petition with the signatures of at least 10 percent of the number of voters in the most recent city election held in November of 2021.


Contact Robert Maharry at 641-753-6611 ext. 255 or rmaharry@timesrepublican.com.


Today's breaking news and more in your inbox

I'm interested in (please check all that apply)
Are you a paying subscriber to the newspaper? *

Starting at $4.38/week.

Subscribe Today