Range franchise fee back on hold

A franchise fee agreement between Range Communications and the City of Sundance will be staying on hold until November to allow time for the council to consider the cooperative’s request for an exemption that would recognize its financial contribution to the city by only collecting the fee for half the time the agreement is active.

Chief Government Relations Officer Jason Hendricks attended the meeting to speak for a second time with council members prior to the third and final reading of the ordinance enacting a franchise fee with Range.

Franchise fees were officially instituted with the majority of utility companies that operate within the City of Sundance at last month’s meeting. Utilities including Sundance Cable Television, Visionary Communication and Powder River Energy have entered into agreements that allow “rental” of city rights-of-way in exchange for 2% of gross operating revenue within city limits.

However, a final reading was needed for the city’s agreement with Range, after the cooperative questioned wording that speaks to how it may recoup those fees from its members.

The new law on right-of-way franchise fees stated that those fees shall, “Be passed through to customers unless otherwise agreed.” However, Hendricks told the council, according to Wyoming law passed in 2020 it is now default for that fee to be passed through.

The wording of Range’s agreement was changed to remove this line.

“If that’s the version you want to pass tonight, that’s fine with us,” Hendricks said of the updated version.

However, Hendricks also reminded the council of the amount of money the cooperative generates for the city. This, he claimed, includes property tax, sales tax and a 3% increase to property values when fiber is available.

On that basis, he provided the council with an alternative contract that would offer Range a five-year exemption from paying the franchise fee in recognition of these contributions. This would see Range only pay the fee for five of the ten years for which the agreement is active.

Range feels it is justified in making this request and does not believe it is discriminatory against the other utility companies who have been asked to enter into agreements because none of those other utilities have installed fiber throughout the city.

Council Member Joe Wilson brought up an issue that troubled the council at last month’s meeting: how exactly will Range plan to collect the money to pay the franchise fee? Will the cost be “socialized” across the entire customer base, or collected directly from customers in Sundance?

Wilson said that he doesn’t disagree with Range’s claim it has put “a lot of money” into infrastructure in Sundance, but said he would like at least some kind of assurance that the cost will be socialized if the council agrees to the exemption. Hendricks responded that he cannot speak for his board on this matter, but suspects there will be reluctance to bind a future board in such a way.

This is particularly true, he said, because there is no way to guarantee that changes to the law over the next five years won’t impact such a decision.

“I won’t be able to make that commitment tonight just because things do change,” he said, agreeing to take the matter to his board.

The third reading of the agreement was tabled until November due to Hendricks not being available to attend October’s meeting.