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<br />Item No: 7.B. <br />Meeting Date: August 23, 2010 <br />Type of Business: Council Business <br />Administrator Review: ____ <br /> <br />City of Mounds View Staff Report <br /> <br /> <br /> <br /> <br />To: Honorable Mayor and City Council <br />From: Mark Beer, Finance Director <br />Item Title/Subject: Public Hearing, Second Reading and Adoption of <br />Ordinance 849, an Ordinance Implementing a Franchise <br />Fee on Center Point Energy Natural Gas Operations <br />within the City of Mounds View <br /> <br />Attached is an ordinance to receive a 2nd reading and adoption at a public hearing. This <br />is a roll call vote. A notice of the Public Hearing was published in the August 12, 2010 <br />edition of the Sun Focus. <br /> <br />This ordinance continues the agreement with Center Point Energy under which Center <br />Point Energy will collect a franchise fee in the amount of 3.87% of Center Point’s natural <br />gas gross operating revenues for services within the City of Mounds View during the <br />year 2011. This is a 2% increase over 2010’s rate of 3.79%. Inflation numbers were <br />released by the Bureau of Labor Statistics on August 13th for the Minneapolis/Saint Paul <br />area and the 12 month rate was a 2.32% increase. The charter limits the fee increase <br />to 2% plus inflation or 5% whichever is less. The franchise fee could increase by 4.32% <br />if the Council desires to increase it more. (2% +2.32% = 4.32%) (3.79% x 1.0432 = <br />3.95%) <br /> <br />It has been the practice to include a sunset provision in the ordinance requiring it to be <br />re-enacted each year. Franchise fees collected under this agreement are minimal due <br />to Center Point Energy’s small customer base within the City of Mounds View. Staff <br />would request that a summary ordinance be published with the complete ordinance <br />available on-line and at City Hall. <br /> <br />Respectfully Submitted, <br /> <br /> <br /> <br />Mark Beer <br /> <br /> <br /> <br /> <br />