Town council voted to keep the municipality's collection rate on electricity bills at 19 per cent for 2013 during its regular meeting on Sept. 24.
The franchise fee agreement with FortisAlberta comes up for renewal each year. A franchise fee is calculated off each consumer's electricity usage and sent to them as a line item of their electricity bill. The maximum fee is 20 per cent.
“It's basically a form of taxation,” said Rick Binnendyk, Penhold's chief administrative officer. The fee is charged to recover costs for things like street lighting and use of the town's rights-of-way.
Binnendyk's recommendation to council was to stay at 19 per cent. This is in part because of a proposed distribution rate hike of five per cent that Fortis has applied for with the Alberta Utilities Commission.
“That's a zero per cent change from the previous year,” he said.
Coun. Danielle Klooster suggested taking a look at changing the fee.
“When was the last time we actually raised the franchise fee?” she asked. Later she floated the idea of putting it up to 19.1 per cent.
Coun. Chad Hoffman asked what other towns charge. Mayor Dennis Cooper responded that many other towns charge around 19-20 per cent.
Innisfail town council set the 2013 Fortis franchise fee at eight per cent during their Sept. 24 meeting.
The projected revenue for Penhold based on a 19 per cent rate is $146,132.
Cooper said as more people move to Penhold that amount will increase.
Klooster and Hoffman voted against a motion to keep the franchise fee at 19 per cent. The mayor and councillors Kathy Sitter, April Jones and Wendy Dodman voted in favour of retaining the same rate. Coun. Heather Klein was absent from the meeting.
