AGENDA CAPTION:
Title
Receive a staff presentation and hold a Public Hearing to receive comments for or against Ordinance 2024-42, amending the rates for Electric Utility Services in accordance with Section 86.177 of the San Marcos Code of Ordinances; including procedural provisions; and declaring an effective date; and consider approval of Ordinance 2024-42, on the first of two readings.
Body
Meeting date: September 3, 2024
Department: Utilities and Finance
Amount & Source of Funding
Funds Required: N/A
Account Number: N/A
Funds Available: N/A
Account Name: N/A
Fiscal Note:
Prior Council Action: N/A
City Council Strategic Initiative: [Please select from the dropdown menu below]
Public Safety, Core Services & Fiscal Excellence
Choose an item.
Choose an item.
Comprehensive Plan Element (s): [Please select the Plan element(s) and Goal # from dropdown menu below]
☐ Economic Development - Choose an item.
☐ Environment & Resource Protection - Choose an item.
☐ Land Use - Choose an item.
☐ Neighborhoods & Housing - Choose an item.
☐ Parks, Public Spaces & Facilities - Choose an item.
☐ Transportation - Choose an item.
☒ Core Services
☐ Not Applicable
Master Plan: [Please select the corresponding Master Plan from the dropdown menu below (if applicable)]
Choose an item.
Background Information:
The City conducts an annual electric rate study and the results are reviewed by staff and the Citizens Utility Advisory Board (CUAB). The CUAB held a meeting on July 25, 2024, and received a presentation on the estimated revenues and major cost drivers of the electric system. During the meeting, the CUAB voted to recommend a 5.5% effective rate adjustment to electric rates for fiscal year 2025. The recommended increase will cost an estimated $6.97 per month for the average residential user.
There are several cost drivers that necessitate the rate adjustment, including replacing four large pieces of equipment (bucket truck, gas monitors and test stand, warehouse forklift, and a heavy duty lift) at a cost of $612 thousand, an increase of $441 thousand in debt service from the fiscal year 2024 certificates of obligation issuance, and adding an position at $153 thousand. The position is to be split between Electric and Water-Wastewater Utilities.
Council Committee, Board/Commission Action:
On July 25, 2024, the Citizen Utility Advisory Board held a meeting and voted to recommend a minimum 5.5% effective rate adjustment for electric.
Alternatives:
N/A
Recommendation:
City Council approve the ordinance amending electric rates as recommended by the Citizen Utility Advisory Board.