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Item No. 9D <br />Meeting Date: September 22, 2003 <br />Type of Business: Council Business <br /> <br />City of Mounds View Staff Report <br />To: Honorable Mayor and City Council <br />From: Charles Hansen, Finance Director <br />Item Title/Subject: Second Reading and Adoption of Ordinance 718 <br />Implementing a Franchise Fee on Xcel Energy <br />Electric and Natural Gas Operations within the <br />City of Mounds View for the Year 2004 <br /> <br />Attached is an ordinance to receive its second reading on Monday, September <br />22, 2003. The Public Hearing and first reading of the ordinance was on <br />September 8, 2003. <br /> <br />This ordinance continues the agreement with Xcel Energy under which Xcel <br />Energy will collect a franchise fee in the amount of 4% of Xcel’s electric and <br />natural gas gross operating revenues for services within the City of Mounds View <br />during the year 2004. <br /> <br />Ordinances 517 and 518 passed on October 13, 1992 originally enacted the <br />franchise agreement. They provide that the City may impose a franchise fee of <br />not more than 4% of Xcel’s gross operating revenues at any time during the 20- <br />year term of the franchise. The 20-year term runs from 1993 through 2012 and <br />the franchise fee was first collected in 1993. It has been the practice to include a <br />sunset provision in the ordinance that requires it to be re-enacted each year. <br /> <br />Franchise fees of $192,000 for the General Fund and $192,000 for the Street <br />Improvement Fund are included in the draft 2004 budget. Enactment of the <br />ordinance is essential to preserving this revenue source and balancing the 2004 <br />budget. <br /> <br />If approved by the City Council, the ordinance will then be published in the New <br />Brighton-Mounds View Bulletin and take effect 30 days after publication. <br /> <br />Respectfully Submitted, <br /> <br /> <br /> <br />Charles Hansen <br /> Reviewed by City Administrator: ______