Electricity Franchise Fee Is Unlawful Tax, Michigan Justices Say

East Lansing’s utility fee is a tax that was passed without voter approval in violation of the state constitution, the Michigan Supreme Court held Monday.

The franchise fee collected by the Lansing Board of Water and Light and remitted to the city meets the criteria established in Bolt v. City of Lansing on whether a charge is a tax, the opinion said. “Specifically, we conclude that the franchise fee functions as a tax because the fee was imposed for a general revenue-raising purpose, the fee was not proportionate to any costs the City incurred in LBWL providing electrical services, and ...