Establishing a franchise fee for natural gas would be unpopular but may be the only proposal on the table to provide a stable funding source for maintaining the present level of public safety services, meaning avoiding layoffs from the fire department and/or police department.
The general fund levy is set at the maximum allowed by law, $8.10 property tax per $1,000 of assessed valuation. The general fund pays for public safety, parks and recreation, city hall operation (except for some administrative fees for city hall operation assessed to non-general fund departments), the library and the cemetery. All of these departments receive other revenue through fees, grants and donations.
All of these departments have been reduced to bare bones budgets. Any further cuts would have significant negative impact on what just about everybody in the community regards as valuable services by conscientious employees.
Fees for water, sewer and trash service can be set at however much is needed to pay for those services but this revenue cannot be used for general fund purposes. Road use funds from the state cannot be used for anything but street projects.
So the situation is that every department is operating on bare bones budgets, the public is strongly opposed to reduction in general fund services, the reserves are being spent down to about nothing and the only known new source of revenue for the general fund is (possibly) a franchise fee on natural gas.
The word "possibly" above refers to the fact that a franchise fee in Des Moines is under court challenge as an illegal tax. Unless there is a clear court decision in favor of allowing a franchise fee, then the city shouldn't consider it.
So, the city will have to try to find some other revenue source, one that is likely to be as unpopular as the suggested gas franchise fee.
City officials have been criticized by citizens as not communicating well with citizens and employees. There are incidents where this is true, but city officials cannot be accused of not communicating the need for new revenue to maintain public services (or how to eliminate expenses), at least not for over a year now.
Since about February of 2005, city officials have repeatedly and publicly begged for some practical solution to their dilemma, but the situation is much to icky to think about, isn't it?
Regarding, the possibility of a natural gas franchise, the specter of pending litigation makes it an unlikely solution, at least for sometime beyond the 2007/08 fiscal year. That's when very tough decisions will again face the city without the option of reserves to fall back on.