AGENDA CAPTION:
Title
Receive an update on the City’s expanded Utility Payment Assistance Program; and provide direction to the City Manager, or her designee.
Body
Meeting date: October 7, 2026
Department: City Manager’s Office and Finance-Utility Billing & Payment
Amount & Source of Funding
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Account or Project Number (C = CIP funds): 21006322-54115; 22006335-54115; 21000000-22355
Funds Available: Yes
Account Name: Energy Assistance
Fiscal Note:
Prior Council Action: October 15, 2024 - City Council recommended criteria for use in the utility payment assistance request for proposal (RFP). February 18, 2025 - City Council was provided with the results of the utility payment assistance RFP. April 15, 2025 - City Council approved a contract amendment with Community Action Inc., of Central Texas and new contracts with Business Community Lenders of Texas, Communities in Schools of Central Texas, and Salvation Army and authorized one year renewal period to administer the City’s Utility Payment Assistance. May 19, 2026 - City Council provided direction to staff to waive late charges and reconnection and new connection fees for customers receiving utility payment assistance through the City’s program. Council direction was also given to consider utility payment assistance for a current bill and 30 or 60 days of arrears or two instances of payment assistance.
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Background Information:
The City of San Marcos Utility Payment Assistance Program provides payment assistance to San Marcos Utilities rate payers and residents funded through SMTX Utilities funds and donations. The presentation provides an update of the program, highlighting utilization and trends from May 2025 to August 2026, and outlines staff recommendations on additional program enhancements aimed at increasing access and support to residents.
Through intentional discussions and analyses, the Utility Payment Assistance Program has undergone a redesign over fiscal years 2025 and 2026, increasing the direct payment assistance to over $250,000 across both fiscal years. Below is a summary of the meeting dates and topics discussed:
• August 20, 2024 - City Council received a budget presentation that included an overview of the utility payment assistance application process and the types of utility assistance available for residents.
• September 3, 2024 - City Council received a presentation that included utility payment plans, disconnect process, and improving utility payment assistance.
• October 15, 2024 - City Council received a presentation regarding utility billing penalties, reconnect fees, utility payment assistance, and recommended criteria for the utility payment assistance program request for proposal (RFP).
• November 18, 2024 - City Council was provided with a follow-up memorandum with responses from the October 15, 2024, meeting.
• February 18, 2025 - City Council received a presentation regarding utility billing penalties, the RFP results (open from December to January), reconnect fees, donated utility assistance funds, Municipal Utility Lien (Ordinance No. 2025-06), and resource navigation. The direction from City Council regarding the RFP results was to award all agencies based on agency scoring, responses, and preparation of the proposals. An administrative fee of up to ten percent will be awarded to each agency from City funds; the donated funds will be used for direct utility payment assistance.
• March 24, 2025 - City Council received a memorandum to the responses from the February 18, 2025 work session on Utility Payment Assistance. Through a collaborative process with the agencies, a universal application has been created to clarify and expand eligibility that will be incorporated with the agency’s internal application process. This will include emergencies and financial hardships throughout the current fiscal year.
• April 15, 2025 - City Council approved the contract amendment with Community Action Inc., of Central Texas and entering new contracts with Business Community Lenders of Texas, Communities in Schools of Central Texas, and Salvation army, and authorized one year renewal period to administer the City’s Utility Payment Assistance.
• August 12, 2025 - Memorandums of Agreement (MOUs) were signed with Bluebonnet Energy Cooperative, Centerpoint Energy, and Pedernales Energy Cooperative to begin issuing utility payment assistance for shared customers utilizing donation funding available after April 1, 2025.
• May 19, 2026 - City Council received an update on the program via a presentation, providing direction on the waiving of fees and what is considered an instance of payment assistance.
Council Committee, Board/Commission Action:
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Alternatives:
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Recommendation:
Staff recommends approval of proposed changes to the Utility Payment Assistance Program.