WEST DULUTH, Minn. (From the Duluth News Tribune) -- Employees of the Verso Paper Co. in West Duluth again implored city council members Monday night to reconsider their decision last month to triple a local electric franchise fee it charges.

The proposed franchise fee would add a projected $540,000 to the mill's annual operating expenses, and Dawn Polaski, a 30-year employee of the plant, warned that the unanticipated cost could put the operation and the approximately 250 jobs it provides at risk. If the paper mill is forced to close, she noted that Duluth and the surrounding region would be deprived of more than $100 million in annual positive economic impact.

Karen Turnboom, a 20-year employee of the plant, said Verso is still waiting for a promised 5 percent cut in its electric rates to kick in, adding to the sting of the higher franchise fees Duluth now aims to collect. Those proposed lower rates were authorized by the Minnesota State Legislature to protect vulnerable industries, such as mining and papermaking, identified as "energy intensive trade exposed," but they have been delayed in the face of public opposition.

Calling for relief, Turnboom said Verso pays "a significantly higher rate than residential customers." Electricity accounts for about 15 percent of Verso's total production costs in an industry where it faces stiff global competition.

Turnboom said that in addition to providing local jobs, the mill has drawn for more than $6 million in capital investments in recent years.

"I urge you to reconsider the city franchise fee," she said.

Speaking on Verso's behalf as well, Guy Priley said the company was being asked to bear a disproportionate share of the financial burden. He said the mill alone would account for about one-quarter of the $3.3 million in franchise fees the city of Duluth proposes to collect.

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Mayor Emily Larson has defended the proposed 3 percent franchise fee as consistent with those charged by other cities, saying that most charge 3 to 7 percent of energy revenues. She also noted that the 1 percent fee Duluth currently collects has not been increased in about 20 years.

Duluth charges Minnesota Power a franchise fee for its use of city right-of-ways and for the ability to serve the city. The utility, in turn, has the authority to pass that cost through directly to its customers.

But Priley said many other cities cap the maximum fee a large electric customer can be charged or offer reduced fees for consumption above a certain threshold. He said Verso is seeking simply fair, not preferential treatment.

The Verso workers' pleas appear to be gaining at least some traction with 2nd District City Councilor Joel Sipress, who voted in support of the franchise fee increase.

He thanked Verso staff for sharing their concerns with the Council and said: "I did have opportunity to visit the paper mill last week and had a good conversation with Mr. Priley there and also with the mill manager, John Bastian. I'm looking forward to those conversations continuing."

Meanwhile, 5th District Councilor Jay Fosle, who voted against the fee hike, asked council members to recognize the high stakes involved in their decision.

"Jobs are the number one priority in any city. That's what keeps the ball rolling and keeps the money going around," Fosle said. "So I'm just asking councilors to possibly reconsider their votes when we get around to budget time in December on the franchise fee."