Tri States Public Radio Staff
Replacement for Local Option Sales Tax
Thu February 21, 2013
Keokuk Mayor Proposing Franchise Fee
Keokuk’s mayor says the time has come for his city to implement a utility tax.
Tom Marion used his fourth State of the City address to propose a 3% franchise fee on gas and electric services.
The fee would replace a 1% local option sales tax currently in place.
Marion says the sales tax system harms Keokuk because the city collects more revenue from the tax than it receives.
He says the benefit of a franchise fee is that Keokuk would keep all the money it collects.
Marion says the franchise fee could less the impact of Governor Terry Branstad’s plan to reduce commercial property taxes.
He announced the proposal before discussing it with the Keokuk City Council. If the panel approves, he says the franchise fee could be implemented within six months.
Lost Revenue for County, Other Cities