Franchise Fee Ordinance Amendment_Alliant EnergyMasterpiece on the Mississippi
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Franchise Fee Ordinance Amendment - Alliant Energy
DATE: January 16, 2014
Dubuque
band
AI- America City
1
2007 • 2012 • 2013
City Attorney Barry Lindahl is recommending an amendment to the City Franchise Fee
Ordinance.
In 1993, the City Council granted a utility franchise to Interstate Power Company, its
successors and assigns. Alliant Energy is the successor to Interstate Power Company.
The franchise ordinance provided that the City Council could impose a franchise fee not
to exceed 3% of the company's gross revenues from the sale of electricity in the city. In
2003, the City Council imposed a fee of 2% which was increased to 3% in 2010.
The franchise fee ordinances provided for a rebate to certain customers exempt from
sales tax on the sale of electricity. However, the ordinances did not establish a
procedure for requesting a rebate.
The attached ordinance repeals the former ordinance provisions relating to the rebate.
The proposed ordinance also requires that effective July 1, 2013, a request for a rebate
must be submitted to the City Manager in the City's fiscal year in which the customer
pays the franchise fee.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Mic ael C. Van Milligen
MCVM:sv
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
Teri Goodmann, Assistant City Manager
Jennifer Larson, Budget Director
2
THE CITY OF
DUB E MEMORANDUM
Masterpiece on the Mississippi
BARRY LINDAHL
CITY ATTORNEY
To: Michael C. Van Milligen
City Manager
DATE: January 15, 2014
RE: Franchise Fee Ordinance Amendment - Alliant Energy
In 1993, the City Council granted a utility franchise to Interstate Power Company, its
successors and assigns. Alliant Energy is the successor to Interstate Power Company.
The franchise ordinance provided that the City Council could impose a franchise fee not
to exceed 3% of the company's gross revenues from the sale of electricity in the city. In
2003, the City Council imposed a fee of 2% which was increased to 3% in 2010.
The franchise fee ordinances provided for a rebate to certain customers exempt from
sales tax on the sale of electricity. However, the ordinances did not establish a
procedure for requesting a rebate.
The attached ordinance repeals the former ordinance provisions relating to the rebate.
The proposed ordinance also requires that effective July 1, 2013, a request for a rebate
must be submitted to the City Manager in the City's fiscal year in which the customer
pays the franchise fee.
I recommend that the proposed ordinance be submitted to the City Council for
consideration.
A resolution setting a public hearing on the proposed ordinance is also attached.
BAL:tls
Attachment
cc: Ken TeKippe, Finance Director
F:\ USERS \tsteckle \Lindahl \Franchise Fee Rebate Requests From Tax Exempt Entitites\ MVM_ ProposedOrdinance _ElectricAlliant_011514.doc
OFFICE OF THE CITY ATTORNEY DUBUQUE, IOWA
SUITE 330, HARBOR VIEW PLACE, 300 MAIN STREET DUBUQUE, IA 52001 -6944
TELEPHONE (563) 583 -4113 / FAX (563) 583 -1040 / EMAIL balesq @cityofdubuque.org
ORDINANCE NO. 6 -14
REPEALING SECTION 3 OF ORDINANCE NO. 58 -03 PROVIDING FOR A REBATE
OF FRANCHISE FEES FOR EXEMPT SALES OF ELECTRICITY TO CUSTOMERS
OF INTERSTATE POWER COMPANY, ITS SUCCESSORS AND ASSIGNS, AND
ESTABLISHING A PROCEDURE FOR REQUESTING A REBATE OF SUCH FEES
Whereas, Ordinance No. 58 -93 granted to Interstate Power Company, its
successors and assigns (the Company) a franchise to maintain and operate an
electrical system in the City of Dubuque, Iowa; and
Whereas, Alliant Energy is the successor to Interstate Power Company; and
Whereas, Ordinance No. 58 -93 authorized the City Council to impose a franchise
fee not to exceed 3% of the gross revenue of the Company generated from the sale of
electricity within the city; and
Whereas, Ordinance No. 58 -03, as amended by Ordinance No. 75 -03, imposed
upon the Company a fee equal to 2% of the gross revenue generated from the sale of
electricity within the city and stated that certain sales were exempt from the fee and that
a procedure for the rebate of such exempt fees would be provided but did not establish
a procedure for requesting such rebates; and
Whereas, Ordinance No. 58 -03, as amended by Ordinance No. 7 -10, increased
the fee to 3% of the gross revenue generated from the sale of electricity within the city;
and
Whereas, certain customers of the Company did not request a rebate of such
fees until December of 2013; and
Whereas, the City Council of the City of Dubuque finds that the delay in
requesting a rebate is not a reasonable period of time and that it is not in the best
interests of the citizens of the City of Dubuque to honor such requests; and
Whereas, the City Council finds that a reasonable period of time in which to
request a rebate is in the fiscal year in which a customer pays such fees to the
Company.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
OF DUBUQUE, IOWA:
Section 1. Section 3 of Ordinance No. 58 -03 is hereby repealed.
Section 2. Ordinance No. 58 -03 is amended by adopting the following new
Section 3:
Section 3.
(1) Effective July 1, 2013, the fee imposed by Section 1
of Ordinance No. 58 -03, as amended by Ordinance No. 7 -10, shall
not apply to any sale of electricity by the Company that is exempt
under Iowa Code Section 423.3 from the tax imposed by Iowa
Code Section 423.2 and in computing the amount of the fee, the
Company shall not include such sales, unless it is impracticable to
so, in which event the City Manager shall provide a rebate of the
amount of the fee for such exempt sales of electricity to Company's
customers provided a written request is submitted by a customer to
the City Manager in the City's fiscal year (July 1 — June 30) in which
the customer pays such fees.
(2) Any rebate of franchise fees which may have been
available under any prior amendment or ordinance which was not
paid prior to July 1, 2013, is declared void and any claim for any
such rebate shall not be honored or paid by the city.
Passed, approved and adopted the 3rd day of Febru. ry, 2014.
Roy D. ol, Mayor
Attest:
Kevin. Firnstahl; City erk
F: \USERS \tsteckle \Lind ah I\ Ordinances \Franch ise Fee_Sec3Repea IOrd 58- 03_ElectricI PC_011414. docx
CITY OF DUBUQUE
OFFICIALNOTICE
Notice is hereby given
that the City Council of
the City of Dubuque
will hold a public hear-
ing on a proposed ordi-
nance, amending the
franchise fee ordinan-
ces under the City's
electric franchise with
Alliant Energy by
repealing Section 3 of
Ordinance No. 58-03
providing for a rebate
of franchise fees for
exempt sales of elec-
tricity to customers of
Interstate Power Com-
pany, its successors
and assigns, and es-
tablishing a procedure
for requesting a rebate
of such fees. Said pub
lic hearing will be held
at 6:30 p.m. in the City
Council Chambers, His-
toric Federal Building,
350 West 6th Street,
Dubuque, Iowa, on
Monday, February 3,
2014.
Copies of supporting
documents for the pub-
lic hearings are on file
in the City Clerk's Of-
fice and may be
viewed during normal
working hours.
Written comments re-
garding the above pub-
lic hearing may be sub-
mitted to the City
be-
fore on Clerk's Office time of time
fore ise At said public
bbliiicc
ac of interested
hearing. -e
and place all inteoarties
arard for
hearing and appor-
citlizearet given
oppor-
tunity to be heard meas-
or against hearing-
impaired _ ..,
ireu special assis-
tance i
dres* visual or npeeranns
ineedingr sil:13ersun:ii;livlitY
special accessibility
e as should contact office
tol.'at the (563) 589-"i11(3)(..)6678
at least:eting
Published coodneeyllofgian-
tYI 1 ea tmh(e58d631.?ib Y° hours
Pi given
prior
the 24th
on the 24th stall'
Jan-
uary, Kevin S. Firnstahl
it 1/24
City
STATE OF IOWA {SS:
DUBUQUE COUNTY
CERTIFICATION OF PUBLICATION
I, Suzanne Pike, a Billing Clerk for Woodward Communications, Inc., an Iowa
corporation, publisher of the Telegraph Herald,a newspaper of general circulation
published in the City of Dubuque, County of Dubuque and State of Iowa; hereby
certify that the attached notice was published in said newspaper on the following
dates: January 24, 2014, and for which the charge is $20.31.
Subscribed to before ine-,\a Notary Public in and for Dubuque County, Iowa,
this 74 day of`‘.. , 20
Notary Public in and for Dubuque County, Iowa.
MARY K. WESTERMEYER
Commission Number 154885
My Comm. Exp. FEB. 1, 2017
OFFICIAL •
PUBLICATION
ORDINANCE NO.6-14
REPEALING SECTION
3 OF ORDINANCE NO.
58-03 PROVIDING FOR wnereas, the City
A REBATE OF FRAN- Council finds that a
CHISE FEES FOR EX- reasonable period of
EMPT SALES OF time in which to re-
ELECTRICITY TO CUS- fiscal ay rais the STATE OF IOWA {SS.
TOMERS OF:INTER- fiscal year In which a
STATE POWER COM- customer pays ,such
PANY, ITS SUCCES- fees the Company. DUBUQUE COUNTY
SORS AND ASSIGNS, NOW, THEREFORE,
AND ESTABLISHING A I BE IT ORDAINED BY
PROCEDURE FOR RE- THE CITY COUNCIL
QUESTING A REBATE OF THE CITY OF DU-
OF SUCH FEES BUQUE,IOWA: '
Whereas, Ordinance ' Section 1.Section 3 of CERTIFICATION OF PUBLICATION
No.58-93'granted to In- Ordinance No.58-03 is
terstate Power Compa- hereby repealed.
ny, its successors and Section 2. Ordinance
assigns(the Company) No. 58-03 Is amended
a franchise to maintain by adopting the follow-
and operate an electri- ing new Section 3:
cal system In the City Section 3. • I, Suzanne Pike, a BillingClerk for Woodward Communications, Inc., an Iowa
of Dubuque,Iowa;and (1) Effective July 1,
Whereas,Allianz Ener- 12013, the fee Imposed corporation,publisher of the Telegraph Herald,a newspaper of general circulation
•gy is the successor to by Section' 1 of Ordl- 1P
Interstate Power Com- nance No. 58-03, as ; published in the Cityof Dubuque, Countyof Dubuque and State of Iowa; hereby
pany;and amended by Ordinance q q
Whereas, Ordinance 1 No. 7-10, shall not ap- certifythat the attached notice waspublished in said newspaper on the following
No. 58-93 authorized. I ply to'any sale of elec-
the
City Council to im- tricky by the Company I dates: February 07,2014, and for which the charge is $34.62.
pose a franchise fee that is exempt under
not to exceed 3% of Iowa Code Section
the gross revenue of 423.3 from the tax im- '
the Company generat- posed by Iowa Code
ed from the sale of Section 423.2 and in
electricity within the computing the amount
city;and of the fee,the Compa-
Whereas, Ordinance ny shall not Include
No.58-03,as amended such sales,unless it Is.;
by OrFinance No. 75- impracticable to so, in ' seriALFILLe
03, imposed upon the which event the City
CorniAny a fee equal Manager shall provide
i a rebate of the amount
to 2%of the gross rev- of the fee for such ex-
enue generated from empt sales of electrlci-
the sale of electricity ty to Company's cus-
within the city and tomers provided a
stated that certain r written request Is sub-
sales were exemptata matted Cityy a onatomer
ger in. Subscribed to before me, a Notary Public in and for Dubuque County, Iowa,
the fee and that a to the Manager in
procedure for the re- , the City's fiscal year.
bate of such exempt (July 1 -'June 30) in this 7 day o , 20 / Z .
fees would be provided ' which the customer
but did not establish a I pays such fees.
Fargocedure for request- (2)Any rebate of frau-
such rebates;and chlse flearse
s which may
ly
Whereas, Ordinance have been available ,
/
No.58-03,as amended under any • prior
by Ordinance No.7-10, amendment ,or ordi- ', ,
increased the fee to --nance which was not /
3% of the gross reve- paid prior to July 1,
nue generated from ,, 2013, is declared void otary Public in and for Dubuque County, Iowa.
the sale of electricity , and any claim for any
within the city;and i such rebate shall not
Whereas,certain cus- be honored or paid by
tomers of the Company the city.
did not request a re- Passed,approved and
bate of such fees until adopted the 3rd day of
December of 2013;and • February,2014., p"� MARY K,WE9TERMEYER
Whereas, the City , /s/Roy D.Buol,Mayor ; o� •P
Council of the City of Attest:/s/Kevin S. : Commission Number 154885
Dubuque finds that the Firnstahl,City Clerk My Comm. Exp. FEB. 1,2017
delay in requesting a Published officially in „W,
rebate is not a reason- the Telegraph Herald
able period of time and ' newspaper on the 7th
that it is not in the best . , day of February,2014.
interests of the citizens /s/Kevin S.Firnstahl,
of the City of Dubuque City Clerk I
to honor such re- lt 2/7
quests;and