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67 Although residential customers comprise the vast majority of utility users in Roseville, they will contribute <br />68 a smaller share of total franchise fee revenue compared to their share of city property tax payments as <br />69 shown in the table. <br />70 <br />Electric and Gas Percentage of <br />Utility Customers Franchise Fees <br />(Roseville)Paid <br />Residential88%40% <br />Non-Residential12%60% <br />Source: Xcel Energy Source: Xcel <br />CompanyEnergy <br />Company <br />Roseville Taxpayer Percentage of <br />CompositionProperty Tax <br />Paid <br />Residential57%54% <br />Non-Residential43%46% <br />Source: Ramsey Source: MN <br />County Assessor Department of <br />OfficeRevenue <br />State of Percentages of <br />Minnesota Taxpayer Property Tax <br />CompositionPaid <br />Residential64%62% <br />Non-Residential36%38% <br />Source: MN House Source: MN <br />ResearchHouse Research <br />71 <br />72 If implemented, the City Manager is proposing that the revenue from the franchise fees primarily be <br />73 allocated to the City of Roseville's Capital Funds to free up existing tax levy to help the City's <br />74 Operational Budget. At the November 10 City Council meeting, the City Manager presented a memo <br />75 regarding the use of franchise fees and the resulting impact on the proposed 2026 City Budget and <br />76 Levy. Since that meeting, staff has made minor modifications to the allocation of the franchise fees to <br />77 maximize the impact on the capital funds, but the overall impact is the same as presented on November <br />78 10. This information is contained in Attachment 9. <br />79 <br />80 To effectuate franchise fees, the City Council must first adopt the electric and gas utility franchise <br />81 agreement ordinances. Once those are passed, the City Council can then consider passing the <br />82 franchise fee ordinance. Since the 2026 budget and levy will have a public hearing on December 1 and <br />83 final approval on December 8, a decision on the use of franchise fees will need to be made soon. <br />84 <br />85 Policy Objectives <br />86 The implementation of franchise fees would provide an alternative revenue source to pay for right-of-way <br />87 infrastructure capital costs that would cover all properties in Roseville, including tax-exempt parcels. <br />88 <br />89 Equity Impact Summary <br />Page 3 of 4 <br />Qbhf!:9!pg!384 <br /> <br />