Johnston City Council approves first reading of 5 franchise fee for gas and electric bills

The Johnston City Council has taken a significant step by approving the first reading of a 5% franchise fee on gas and electric bills, aimed at bolstering funding for additional fire and police staff. Mayor Paula Dierenfeld articulated the city's need to adapt to new state laws limiting property tax growth, which has made it essential to find alternative revenue streams. The city had previously enacted a 1% franchise fee on utility bills, generating approximately $295,243 in revenue; the anticipated 5% fee is projected to raise nearly $1. 5 million annually. City Administrator Mike Pogge-Weaver added that this franchise fee would help reduce the tax burden on residents by ensuring that tax-exempt organizations, like Camp Dodge, contribute to city services.

The council's decision reflects a proactive approach to maintaining essential services amid fiscal constraints. The second reading of this ordinance will take place at the upcoming city council meeting on February 1st, with a potential third reading scheduled for February 18th. If approved, the franchise fees will be implemented on June 1st, 2025, marking a pivotal change in local revenue generation strategies. This initiative not only addresses immediate funding needs but also sets a precedent for future financial planning in Johnston.