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Adams finds extra cash for city in utility fee

Mayor-elect Charlie Hales might have some extra money to balance the city budget, under a proposed city ordinance that would raise an additional $3 million to $5 million a year from telephone utility license fees. Most of the money will come from CenturyLink, says Mary Beth Henry, manager of the city Office for Community Technology.

The proposed ordinance changing the city’s utility license fees comes up for City Council consideration on Thursday, Nov. 15, at 3 p.m.

Technically, the utility license fee for CenturyLink and Frontier will drop from the current 7 percent to 5 percent. However, more of those companies' revenue will be subject to the tax, which raises the added money, Henry says. Frontier has a small number of customers in Portland, so most of the burden falls on CenturyLink, the major provider of “land line” services in Oregon.

The city has been levying a 7 percent fee on CenturyLink and Frontier’s basic land-line service, while charging a 5 percent fee on gross revenues to 211 other telecomm companies.

A 2009 city audit concluded that was unfair, so the new ordinance equalizes treatment among the telecom providers, Henry says.

The new rates start in January, giving the city more money to pay for costs of a settlement with federal justice officials that will require more spending on police.

Utility license fees from telecomm utilities has dropped from more than $6 million in 1999 to $2.1 million estimated in 2012.

The city’s general fund gets 18 percent of its money from utility license and franchise fees, including fees on its own city water and sewer utility customers.