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MAJOR GENERAL FUND REVENUES <br /> <br />FRANCHISE FEES <br /> <br />Cable Franchise <br />Prior to the passage of State Bill AB2987, Federal and State laws allowed cities to grant <br />franchises to cable companies to use the public right -of-way to install and provide video <br />service. The cable company, in turn, applied for a permit to install the video facilities. The <br />permit also allowed for maintenance work once the installation was complete. Under the <br />current franchise agreement, the cable company pays San Leandro an annual franchise <br />fee of 5% of gross revenues, in quarterly installments. State Bill AB 2987 allows <br />companies to apply for statewide cable television franchises, and the new bill maintains <br />the City’s franchise fee. In addition to the franchise fee, the bill allows the City to receive <br />an additional fee of 1% of the gross revenue for Publ ic, Educational and Government <br />(PEG) purposes. The PEG funds are captured in a special revenue fund 180. <br /> <br />Electric and Gas Franchises <br />These franchise fees (ultimately paid by the consumer) are variable fees based on gross <br />receipts for the sale of electricity or gas within the City, and is the greater of these two <br />calculations: <br /> <br />1. Electric or Gas Franchise Ordinance: 2% of gross receipts attributable to miles of <br />line operated; or <br />2. 1937 Act Computations: gross receipts within the City multiplied by 1%. <br /> <br />Electric and Gas franchise fees are paid into the General Fund. Electric and gas franchise <br />payments are based on two methods of calculating gross receipts. The electric and gas <br />company must complete both calculations, and the payment made is the greater amount. <br />In addition, the Public Utilities Commission (PUC) approved a franchise fee surcharge <br />since Pacific, Gas and Electric (PG&E) no longer handles all energy service, and to <br />prevent cities from losing franchise revenue generated by third parties. The surcharge is <br />an estimate of the amount of revenues generated by third parties multiplied by the <br />franchise fee rate. <br /> <br />Refuse and Recycling Franchises <br />The City has Franchise Fee Agreements primarily with companies such as Alameda <br />County Industries (ACI), Waste Management, Oro Loma, and others for refuse, green <br />waste, solid waste and recycling collection within the City limits. The Fee calculation <br />includes complex calculations based on a variety of bases such as per ton or percent of <br />gross receipts between 10% and 12%. These rates may be adjusted annually by CPI. <br /> <br />60 <br />82