Local Franchise Tax or Fees Explained

Local governments typically charge private utility companies for the use of public rights-of-way. This fee functions to offset the company's expense, as allowed by law.

What is it?

It is a legislatively mandated method of compensating municipalities for the use of public rights-of-way by telecommunications providers. Prior to opening to competitive market, this issue was accomplished by a mutual agreement between the municipality and the utility. It is a flat rate per access line.

Who gets the money?

Local municipalities

Also known as:

  • Local License Fee
  • State Communications Service Tax
  • Franchise Fee
  • Franchise Tax
  • Business and Occupation Tax