Cliff Vancura/Durango Herald
Cliff Vancura/Durango Herald
The La Plata Electric Franchise fee is necessary to fund city programs without greatly cutting budget
The franchise fee is a charge of, on average, 4.67 percent of a user’s electric bill, exempt from city sales tax. The money, approximately $900,000 a year, will go toward the city’s general fund. The fee will only apply to those within city limits.
The franchise will exclusively grant the La Plata Electric Association use of the public rights-of-way to provide electric utility services. If the franchise fee passes, the agreement will be in effect for 20 years.
Because the money the city obtains from this fee will go into the general fund revenue, the gains will be spread out all across the board, from police services, special events, parks and recreation, street maintenance, municipal court and other public services. During the recession, the city had to cut back on its budget, and the $900,000 will help restore the original budget and help pay for the city’s services.
Supporters of the fee say without the budget’s restoration and the $900,000 added to the general fund revenue, Durango may have to start cutting costs, ranging from not as often street maintenance to even cutting personnel from the library or the police department.
Even though $900,000 will help the city pay for services, others think the fee is an aggressive tax on a necessity.
According to those who do not support the fee, over the last 10 years, the city budget has risen approximately 71.7 percent – not in accordance to the population increase.
Although the money from the fee would go into the general fund, residents already pay for electricity, as well as a 5 percent city sales tax. Critics of the fee believe it is a second sales tax hidden as a fee, and a way for the city to get more money and spend it through the general fund, so people are not sure where the money will go.
Because the recession hit so hard, and communities all over see the effects of it, the city would be able to improve public services throughout the entire town. Opponents trust the financial advisors who work for the city to rightly prioritize a budget that does not include the money from the fee, but over the course of 20 years, about $19 million worth of budget will have been cut.
Opponents also say the fee takes money out of the pockets of the poor. The fee will average approximately $4 a month, but because the city provides services, such as the trolley, that benefit the entire community, the fee may help keep the residents’ cost to a minimum or nonexistent for those services. The cost of about 13 cents per day will allow constant funding for services without putting any other service at risk.
Furthermore, the city hopes the money can help pay for remote alternative energy, such as solar panels. The opponents don’t disagree with the idea of the promotion of alternative energy, but believe that a franchise agreement is not necessary toward working the city’s way up to using more alternative energy.
On both sides of the argument, voters during this election should weigh the cost, benefits and motives.
On one hand, the money will go straight to the general fund, helping pay for necessary services and the wages of staff members working for the city or any of its services. On the other, it gives a monopoly to LPEA, which has no other competition in the area, and charges for a necessity.
Either way, the decision of the election in November will be in effect for 20 years. The last time the fee was put on the table, the majority, which voted not to approve the fee, won by 41 votes. The fee is necessary to the continuation of readily available resources and services as they are.
Elle Rathbun is the co-news editor of El Diablo, the Durango High School student newspaper. She is the daughter of Vicki Kuan and Paul Rathbun of Durango.