Some view it as a hidden tax; others as a user fee. No matter how you look at utility franchise fees, they come out of the pockets of residents and businesses.

Cochrane town council is considering a proposal to increase the franchise fee charged to Fortis Alberta for its electric distribution system by five per cent over three years. 

These franchise fees are clawback by the town from Cochrane residents and businesses and are commonly listed as a local access fee on your monthly power bill.

At the Oct. 15 council meeting, Katherine Van Keimpema, the town's senior manager of Corporate Services, brought forward a proposal that would see the current rate of 15 per cent increased by two per cent in 2020 and 1.5 per cent in both 2021 and 2022. For every one per cent rate increase, the town collects an additional $150,500. 

Should the increase be approved, power users will basically be paying $10.99 per month, calculated on a 640 kWh consumption in 30 days. That's a $1.29 increase from the current monthly charge of $9.70.

The increase would generate an additional $301,000 in revenue for the town in 2020. In 2019, $2.2 million is being collected.

Funds generated go towards town transportation services.

Council is giving notice of the proposal to residents and seeking feedback before making a decision. Little discussion occurred last night over the proposal. Town councillor Marni Fedeyko suggested the town explain how the funds are used in the notice being published in a local newspaper.

The town also claws back 20 per cent of the gross distribution fees from ATCO Gas for their infrastructure within town boundaries. In 2015, that rate was last adjusted downward to 20 per cent from 23 per cent. It can be increased to a maximum of 35 per cent. No change was recommended for this rate.

In 2018, the town collected $3.1 million in annual franchise fees from the two utility companies. The town can adjust rates annually within the framework of its separate franchise agreements with the two utility companies.