Franchise open house

Sheldon city councilman Brad Hindt and city manager Sam Kooiker talk to residents about the potential franchise agreement with MidAmerican Energy Co. during an open house on Wednesday, April 3.

SHELDON—The city of Sheldon continues to move forward with its plan to enter into a franchise agreement with MidAmerican Energy Co., which also would allow it to place a franchise fee on electric and natural gas services in the community.

When it meets at 4:30 p.m. Wednesday, April 17, the Sheldon City Council plans to review a draft ordinance for the agreement and set a public hearing and first reading of it for May 1.

Additionally, the council is going to consider approving and adopting a revenue purpose statement for the franchise fee revenues.

Should the fees be enacted, a majority of the fund generated would have to be used to support Sheldon’s emergency services.

Franchise fees serve as a revenue source for cities through an agreement reached with a community’s utility provider in which the company attaches an additional line item on a customer’s bill.

In exchange, the utility is granted the right of way in public areas and, with approval from the city council, can authorize the use of eminent domain on landowners. Other stipulations can be negotiated by both sides.

At a rate of 3 percent, a person with a $237 monthly bill would see an increase of $7.11 on their bill. MidAmerican also estimates the city could generate an additional $375,000 from citizens at that rate.

City accounts, public and private schools and Northwest Iowa Community College would be excluded from any such fee.

The measure has been met with vocal opposition from some residents who have accurately noted franchise fees are just another tax.

The city’s counter argument is its finances have been tight and if people would continue to have emergency services at their existing level in the community, it needs to find another revenue stream to help fund those departments.

In other business, the council will:

  • Provide an update on the H.C. Lane building. The city sent out a dangerous building notice to the owner and property manager of the downtown structure on Tuesday, April 9.
  • Listen to a presentation on service line warranties.
  • Authorize bid solicitation on Crossroad North business park.
  • Set a public hearing on a minimum assessment agreement with Maintainer Corporation of Iowa.