ShawneeDispatch.com

The Shawnee City Council likely will look into extending franchise fees to residential electric and natural gas customers as part of its 2009 budget discussions.

It's a good idea for the Council and city staff to consider all potential revenue streams. After all, a lower-than-expected increase in property values will put pressure on what is expected to be another tight budget.

Franchise fees already are charged on such services as cable television and telephones. Shawnee businesses also pay franchise fees on electric and natural gas services.

Since the 1980s, however, franchise fees have not been charged on "essential" services provided to Shawnee residents. The Council, at the time, decided to stop charging the fees as a tradeoff for voter passage of a half-cent city sales tax.

The potential revenue for the city, depending on the extent of the fee charged, could easily infuse city coffers with more than $1 million, officials say.

But in its discussions, it is important for the Council to be honest with the city's residents about the franchise fee.

In the purest sense, it is a fee charged to a utility for its use of public right of way in delivering its services. The reality, though, is a franchise fee is another tax on consumers.

The fee is a portion of a utility's bill, typically 3 to 5 percent, passed on directly by the utility to the consumer. On a $100 monthly gas bill, that's an additional $3 to $6 the consumer will have to cough up. Over a year's time, that's $36 to $72 on the same monthly bill. Double that amount if the monthly electric bill is $100.

We'll leave the decision to the Council whether it wants to pursue franchise fees on residential customers. But we do so with this reminder: If it looks like a duck, swims like a duck and quacks like a duck, it's a duck. Call it what you will, but the franchise fee is just another way to say "tax."