The Town of Rocky Mountain House will be bumping up franchise fees on electricity utilities in an effort to generate more revenue.
Franchise fees are revenue dollars generated from tariffs on utilities, which can be applied to taxable as well as any non-taxable properties in town, such as government buildings, churches and non-profits.
Assessments show around 23 per cent of non-residential properties in Rocky Mountain House are non-taxable.
In a presentation from Corporate Services Director Betty Quinlan, the current 30 per cent rate on gas provided by ATCO provided $694,019 in revenue for the Town. The forecast for 2025 shows revenue of $725,828 – a $31,809 increase.
The rate has been at 30 per cent since 2015.
Calculations show a 1 per cent increase in the ATCO rate would result in $24,194 of additional revenue and would be an increase of $6.19 per year for an average consumer.
As for electricity, the current franchise agreement with Fortis charges a rate of 15.3 per cent.
In 2024, the fee provided revenue of $898,885 to the Town. The forecast for 2025 is $934,970.
Deputy Mayor Ken Moesker motioned to keep the gas rate unchanged at 30 per cent, while Councillor Dale Shippelt inquired about making an increase somewhere.
“I don’t think we should stay stationary on this one,” says Shippelt. “It gives us revenue from non-tax paying properties. So I think that we should bump it.”
In her assessment, Quinlan said an increase to the Fortis rate would be more spread out between taxable and non-taxable properties, as each 1 per cent increase affects taxable properties by $74,000 per year and $23,000 for exempt properties.
The assessment shows a franchise fee increase would be less of an impact than a property tax increase.
During its Oct. 1 regular meeting, council passed a motion to increase the Fortis franchise fee by 1.5 per cent to a rate of 16.8 per cent.
Documents show other similar-sized communities such as Innisfail and Taber have higher rates at 17 per cent, while others such as Drayton Valley have rates as low as 10 per cent.
A budget assumption presentation during the Sept. 17 council meeting showed the Town would potentially be required to raise an additional $410,000 to balance the upcoming budget.
Council approved a motion to set aside Nov. 27-28 from 9 a.m. to 4:30 p.m. for budget meetings, presentations and discussions.
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