City Attorney Mike McMahanChattanooga natural gas users will see their gas bills go up about $23 a year after a state authority ruled this week that the city can charge the gas distributor a franchise fee.
A 30-year-old agreement between Chattanooga and Chattanooga Gas Co. was renegotiated last year and changed from a flat rate to a percentage of gas sales. The new agreement will bring in more money for the city than the former fee.
Under the old agreement, the fee was included in customer’s bill. The new fee will be broken out on bills and passed along to consumers, officials said.
Chattanooga Gas Co. officials have said the average residential customer’s gas bill will rise by about $1.87 a month.
City Attorney Mike McMahan said the fee becomes effective July 1.