Louisville Mayor Greg Fischer’s proposed franchise fee on natural gas could have a significant impact on the Jefferson County Public School system, district officials told WFPL.
If a fee is approved by the Metro Council at Thursday’s meeting, the school district may see an additional cost of nearly $120,000 per year, according to a statement from the district’s chief financial officer, Cordelia Hardin.
Currently the JCPS natural gas budget is $3.9 million. Those funds go to gas service to more than 150 school facilities across the city.
The question now is if the increased utility burden from a franchise fee on the school district will trickle down to heightened property taxes, which the school board can vote on in the fall. Council Republicans have suggested the fee will hit residents in their utility bills and be passed through the JCPS property tax.
JCPS board member Linda Duncan said she doesn’t envision seeking to raise property taxes due to the LG&E fee increase alone. She added the extra utility cost is something she believes the district will gladly “absorb” but “it is certainly something to talk about.”
In 2013, the school board elected to raise property taxes by 1.4 percent.
At the time, Council President, Jim King, D-10, said residents “deserve a break” and used the JCPS tax hike as a justification for the council to reject any city property tax increase.
“We believe in letting economic activity and new jobs drive tax receipts—not higher rates,” King said last August.
Now King is co-sponsoring an ordinance that recommends a 2 percent LG&E fee increase, which is seen as a compromise to the mayor proposed 3 percent hike.
A 2 percent raise in LG&E natural gas rates would have an annual impact on the school district to the tune of roughly $73,000 annually.
Council members are expected to vote on the franchise fee this evening.