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Gainesville law cuts fees paid by utility companies

Change brings city into compliance with state law

POSTED: December 25, 2012 11:59 p.m.

The Gainesville City Council will likely pass an ordinance Thursday amending the licensing, permitting and business regulations for the use of city right-of-ways.

According to city officials, a new state law was passed this year decreasing what local governments could charge telecommunications companies for the use of their right-of-ways.

Currently, the state allows for a maximum 5 percent franchise fee, but the new regulations will drop that to 3 percent of what those companies collect from local users.

The city must pass the ordinance before the end of the year if its wishes to continue to charge the fee to companies like AT&T, Charter and Comcast.

“It upgrades the language in our ordinance whereby we can charge a franchise fee for the utility companies ... that use the right-of-way to provide a service to your citizens,” Bob Hamrick, a city councilman, said. “This, of course, is just a continuation.”

Right now, the city does charge the maximum of 5 percent for the use of those right-of-ways.

The reduction, according to Councilman George Wangemann, could cost the city between $40,000 and $50,000 in revenues.

“Our revenues are going to be down because we’re moving from a 5 percent level to a 3 percent level,” Wangemann said. “So, we’ll be down in that area, but it probably won’t significantly affect our budget.”

The first reading of the ordinance was passed Dec. 13, and the called meeting, scheduled for Dec. 27 at 9 a.m. in the city manager’s conference room in room 303 of the administration building, is to vote on the second and final reading before the end-of-the-year deadline.

Customers of the telecommunication companies could see a slight decrease in their bill, officials said, and the drop in revenues is not a major concern for the city.

“I don’t think they’ll be any repercussions from it,” Wangemann said. “Customers should be happy with it because they’ll pay just a little bit less and the city will lose a little bit of revenue, but it won’t be significant.”

Wangemann said he expects the ordinance to pass unanimously.

“I’ll say that will pass because that will affect our revenues,” he said. “I’ll anticipate that’ll probably pass unanimously — that’s my best guess anyway.”

The ordinance is the only topic on Thursday’s agenda.


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