FRANCHISE FEE: Supreme Court Appeal Denied

The city of Des Moines will have to find a way to pay back its residents for unlawful collection of franchise fees.

Monday morning the U.S. Supreme Court started its new term and the high court announced it will not hear arguments on an appeal from the city of Des Moines.

A lawsuit was filed by Des Moines resident Lisa Kragnes over fees charged on utility bills. The lawsuit claimed a franchise fee charged by the city was illegal because it was being added to the general fund and not being used to pay for regulation of gas and electric utilities – its stated purpose.

In March, the Iowa Supreme Court ruled the city must refund a portion of the fees it collects on residents’ utility bills. In July, the city appealed the case to the U.S. Supreme Court. 

The U.S. Supreme Court’s decision means the case returns to a Polk County district court where the details on the refunds, totaling nearly $40 million, will be worked out.