Sylvan Lake Town Council keep utility rates the same for gas and electricity

Council defeated the motion to increase the ATCO gas rate at the Oct. 15 meeting

Sylvan Lake Town Council chose not to raise the ATCO franchise fee at the most recent meeting of council.

It was suggested by administration to raise the franchise fee for the natural gas supplier to 30 per cent, a three per cent increase.

According to a report to council, a three per cent increase would be a difference of a little more than $107,00.

Revenue collected through the utility franchise fees is used to offset the Town’s operating budget, specifically to be used for future capital budgets.

Town Council was given a list of franchise fee rates for other communities around the province.

In particular, administration picked out a few communities from Central Alberta they felt comparable to Sylvan Lake, including Red Deer.

The City of Red Deer has an ATCO franchise rate set at 35 per cent.

Coun. Jas Payne said it isn’t fair to compare Sylvan Lake to Red Deer in this instance.

“When I look at comparable towns I think of Innisfail, Rocky Mountain House, Lacombe… It isn’t fair to compare us to Red Deer, because we aren’t Red Deer, we are about an eighth the size of them,” Payne said.

Innisfail has a rate of 27 per cent, Blackfalds’ is set at 35 per cent and Rocky Mountain House has theirs set at 30 per cent.

Payne, as well as a few other councillors, expressed his distaste in the proposed increase in the franchise fee. He said it wasn’t fair to the residents.

“It just feels like we are taking away from their pockets, and I can’t support it,” Payne said.

Sylvan Lake Mayor Sean McIntyre was also against a raise in the fee, saying it didn’t feel right.

He did recognize the 2020 budget may be affected by maintaining the status quo.

“At this time administration knows more about the 2020 budget than we do, and a difference of $100,000 may have a big affect. I think we will need to look at budget time to find another way to make that up,” McIntyre said.

The Town of Sylvan Lake raised its ATCO Gas franchise fee to 27 per cent this time last year. The fee was set at 23 per cent before that.

The vote was split four to three in favour of maintaining the same rate. Councillors Payne, Megan Chernoff Hanson, Graham Parsons and Mayor McIntyre were in favour of keeping the ATCO Gas rate the same.

Also during the Oct. 15 meeting, Council chose to maintain the current franchise fee for Fortis Alberta.

The rate for the electricity provider is set at 15 per cent. The franchise fee for Fortis Alberta was raised for the 2019 fiscal year from the previous 12 per cent.

Franchise fees are charged to the utility companies by municipalities to grant the exclusive right and access to distribute their commodity within the municipal boundary. This is then put on to the bills of utility customers and is shown on bills as a separate charge.

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