Jordan Shelton never needs to check an answering machine when he gets home. He carries a cellular phone — his only phone — everywhere he goes.

“Now I can take my phone places,” said Shelton, 29, manager of Vermont Street BBQ. “It’s not stuck in the wall.

“There’s not even a cultural downside to it. You don’t get dirty looks for having a (cell) phone anymore, because everybody has one.”

Maybe not everybody. But City Finance Director Ed Mullins said enough Lawrence residents were using cell phones instead of traditional land lines that it was putting a dent in city coffers.

The city charges a “franchise fee” on traditional, local telephone use, a fee it can’t charge for cellular phones. And the city’s revenue from the fee is expected to drop 18 percent this year.

“I think it’s more than a trend,” Mullins said. “It’s a way of life for people now.”

It means, however, that the city will have to look elsewhere to replace the lost income.

How it works

The city collects franchise fees from the two companies that provide local telephone service, SBC Communications and Sunflower Broadband. The latter company is owned by The World Company, parent of the Journal-World.

The city charges 2 percent of the telephone companies’ gross receipts on local service. The companies pass those costs on to the customers, part of the reason Shelton changed to cellular phone service.

“I’m tired of paying all those stupid little fees,” he said.

Tony Cooley, Perry, orders tractor parts on his cell phone at the Douglas County Free Fair. City officials say that so many people have made the switch from traditional phones to their cell phones that it's cutting into city revenue obtained from franchise fees on standard phone lines. Cooley placed the call on Thursday prior to the antique tractor pull.

The fees are collected because phone companies place their lines in the city’s rights-of-way, mostly below ground. But cellular phone companies don’t use city rights-of-way for their towers, and are thus exempt from the charge.

“We’re not setting up franchise fees on the airwaves,” Mullins said.

Mullins said the move toward cellular phone usage was the best explanation for a dip in telephone franchise fee collections this year. The city collected $258,000 in the fees in 2002; Mullins said he expected the number to be closer to $210,000 this year, less than the $220,000 projected in the city budget.

Leading edge

The trend isn’t confined to Lawrence, though the city may be leading the way. Kim Gulley, a spokeswoman for the League of Kansas Municipalities, said it appeared other cities across the state were following suit, though she didn’t have exact numbers.

“Certainly areas like Lawrence that have larger younger populations and transient populations are going to see that dip first,” she said.

Travis Larson, a spokesman for the Cellular Telecommunications & Internet Assn. in Washington, D.C., said more than 7 million Americans now use only cellular phones. He didn’t have similar statistics for Kansas, but said there were 1.06 million cellular phones in use in the state in June 2002 — an 18 percent increase from the year before.

“Largely, the ‘cutting the cord’ trend has been popular with young adults, college-age and people out of college,” Larson said. “People who are moving a lot, between apartments and dormitories, find they need a wireless phone. It doesn’t make sense to pay for two phones.”

Where’s the money?

Gulley said the loss of franchise fees, though a relatively small part of city revenues, would be another hit to city budgets already suffering from a weak economy.

“Franchise fees really saved us this year, in a tough budget year, and the state taking away demand transfers,” she said. “If those (fees) dwindle, I don’t know where we’ll go.”

Larson said some cities are making up for the lost money by renting out public property for the placement of cellular phone towers — and in fact, Lawrence makes $37,000 a year by renting out space at three locations across the city. He did not know of any other move by local governments to profit from cellular phone usage.

“Boy,” he said. “I hope not.”

¢ 6News video: Increased use of cell phones decrease franchise fees

Officials expect the trend to continue.

“Yeah, I think you’ll see more of this,” Mullins said. “You look at all the former Bells, and they’re not doing very well.”

Which means, Gulley said, cities had better be prepared.

“The usage is changing,” she said. “That’s the market, that’s the economy. We can’t change that. We can plan for it and try to deal with it, but that’s the reality.”