Minneapolis will hold forums over the next month for people to weigh in on a proposed increase to the city’s franchise fee, which would cost the average homeowner an additional $7 per year.

Mayor Betsy Hodges’ proposed 2018 budget, subject to City Council approval in December, will raise the fee the city charges to Xcel Energy and CenterPoint Energy for the privilege of operating in the city. That fee is passed directly to customers.

The fee increase would raise about $2 million for the city to spend on climate and energy initiatives, such as energy conservation outreach and subsidizing home energy assessments, among other possibilities.

Right now, residential customers pay a 4.5 percent franchise fee on their utility bill, commercial customers pay 5 percent and industrial customers pay 3 percent. Under the proposal, the fees would all rise by half a percentage point.

The increase would raise the annual cost to the average homeowner by $7, to $71. For the average commercial customer, the cost would go up by $86 to $961. However, larger buildings use more energy and pay more in franchise fees, so the impact on customers would vary, the city said.

The first feedback session will be for residential customers at 6 p.m. Nov. 16 at the Minneapolis Urban League, 2100 Plymouth Av. N. The second will be for business and nonprofit customers at 10 a.m. Nov. 27 at City Hall. The City Council will hear a presentation on the proposal Nov. 27 and hold a public hearing Dec. 4 at 1:30 p.m. .


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