Was it really hidden?
Over at Peach Pundit, Rep. Earl Erhart has 'found' another 'hidden tax' in the franchise fee, and he's calling for immediate action. I'm not exactly following him on it though ...
The franchise fee is compensation from the utility companies for usage of city streets and roads, as well as existing lines and pipes, for carriage of their services (electricity, telephone, etc.). This fee, typically, is four percent of the total utility usage by the customers within the city limits. For a good many years, the Georgia Public Service Commission enabled the utility companies to recoup this money by including within its monthly bills. This ultimately means, as Erhart points out, that customers both inside and outside city limits pay these fees.
A few years back, the Association of County Commissioners of Georgia took issue with this and petitioned the PSC to revise the policy, related particularly to Georgia Power. What resulted was a smart compromise that requires a three-year phasing in of a new policy beginning in 2007 (in which nothing changed at all). Next year, Georgia Power must collect one percent of its franchise fee from city customers only, with the balance collected by everyone. In 2009, they must collect two percent from the city customers, with the rest of the tab picked up by everyone.
The ACCG estimates the average city customer will pay 77 cents more a month in 2009, while the non-city customer will save 93 cents a month.
The ruling from the PSC also added the transparency Erhart is clamoring for by adding any franchise fees onto one's bill as a line item for the first time, meaning customers now will know what they are paying and have more of a voice in how those monies are used.
Also, based on the fact that several companies like BellSouth have already moved to collect franchise fees from city customers only, while the cable companies have never sought additional fees from non-city customers, I don't see what he's all in arms about.
If anything, in the grand scheme of things, the issue should be that while there is a legitimate rationale for requiring compensation from the companies for the usage of the existing lines, focusing the criticism on 'taxing citizens' seems to be misguided. Erhart should directed his outrage toward the utility companies passing their fee to use our lines back onto us.
The franchise fee is compensation from the utility companies for usage of city streets and roads, as well as existing lines and pipes, for carriage of their services (electricity, telephone, etc.). This fee, typically, is four percent of the total utility usage by the customers within the city limits. For a good many years, the Georgia Public Service Commission enabled the utility companies to recoup this money by including within its monthly bills. This ultimately means, as Erhart points out, that customers both inside and outside city limits pay these fees.
A few years back, the Association of County Commissioners of Georgia took issue with this and petitioned the PSC to revise the policy, related particularly to Georgia Power. What resulted was a smart compromise that requires a three-year phasing in of a new policy beginning in 2007 (in which nothing changed at all). Next year, Georgia Power must collect one percent of its franchise fee from city customers only, with the balance collected by everyone. In 2009, they must collect two percent from the city customers, with the rest of the tab picked up by everyone.
The ACCG estimates the average city customer will pay 77 cents more a month in 2009, while the non-city customer will save 93 cents a month.
The ruling from the PSC also added the transparency Erhart is clamoring for by adding any franchise fees onto one's bill as a line item for the first time, meaning customers now will know what they are paying and have more of a voice in how those monies are used.
Also, based on the fact that several companies like BellSouth have already moved to collect franchise fees from city customers only, while the cable companies have never sought additional fees from non-city customers, I don't see what he's all in arms about.
If anything, in the grand scheme of things, the issue should be that while there is a legitimate rationale for requiring compensation from the companies for the usage of the existing lines, focusing the criticism on 'taxing citizens' seems to be misguided. Erhart should directed his outrage toward the utility companies passing their fee to use our lines back onto us.
posted by Jmac at 2:29 PM
1 Comments:
Good post though I don't see how this
"The ruling from the PSC also added the transparency Erhart is clamoring for by adding any franchise fees onto one's bill as a line item for the first time, meaning customers now will know what they are paying"
Necessarily means this:
"and have more of a voice in how those monies are used."
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