Hammond council votes to hike natural gas franchise fee

Consumers of natural gas in Hammond will see a slight increase in their monthly bills starting in February, following City Council action Tuesday to approve a new contract with the gas provider, Atmos Energy.

The council unanimously agreed to increase from two percent to four percent the franchise fee that customers will be charged once Mayor Mayson Foster signs the city’s new 20-year contract with Atmos.

Foster said the annual franchise fee of $13.85 that natural gas customers now pay will be increased to $27.70. He said the franchise fee has no bearing on the price users pay for natural gas, which is set by the state.

The mayor said the city took in about $39,000 from the gas franchise fee in 2012 and that raising the fee will generate to about $78,000 a year.

Foster told the council that other franchise holders such as the suppliers of electricity and cable television service already pay the city a five percent franchise fee.

He noted that the city has been under contract with Atmos Energy and its predecessor for 20 years and when the contract expired early this year, the city had its first opportunity to increase the franchise fee.

In other matters, Foster told the council that sales tax receipts for November were $1.449 million, up nearly five percent for the same period last year. He said sales tax collections for 2013 are running slightly ahead of the budgeted amount.

Michelle Biermann-Treschwig, a certified public accountant associated with Kushner LaGraize, LLC, told the council that Hammond had earned a clean audit for the fiscal year that ended June 30. She said that the city has managed its finances very well.