Apple Valley council approves 20-year electric franchise with Xcel Energy and a franchise-fee plan

The Apple Valley City Council on March 12 approved a 20-year electric franchise ordinance with Northern States Power (doing business as Xcel Energy) and a companion franchise-fee proposal covering a central portion of the city.

Matt, a city staff member, told the council the franchise grants Xcel Energy the right to operate in the public right-of-way in the company’s territory, requires restoration work after work in the right-of-way, and allows tree and shrub trimming with advance written notice to neighbors. The proposed franchise-fee structure would charge 3% of monthly revenues for residential and most commercial accounts; about 15 very large commercial accounts would pay a flat $75 per month. Staff estimated the Xcel portion of the city would generate about $40,000 a year in fees, and said the council had designated $1,000,000 of franchise-fee funds to support the pavement management program each year.

Council members moved to waive the second reading and adopt the ordinance and fee proposal; public testimony produced no speakers and the measures passed by voice vote.

Council clarified the $75 flat fee for the largest accounts is intended as a cap for those customers rather than a discount, and staff confirmed the fee would take effect only after the council passes the ordinance (it is not retroactive).

What’s next: Staff to publish the adopted ordinance, collect franchise-fee revenue once the agreement is in effect, and apply fees per council direction to pavement management and other council-designated priorities.