AGENDA CAPTION:
Title
Receive a Staff presentation and hold a Public Hearing to receive comments for or against Ordinance 2025-39, amending the rates for the Electric Utility Services in accordance with Section 86.177 of the San Marcos City Code; including procedural provisions; and declaring an effective date; and consider approval of Ordinance 2025-39 on the first of two readings.
Body
Meeting date: September 2, 2025
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
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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 multiple meetings during the summer and received presentations on the estimated revenues and major cost drivers of the electric system. The CUAB voted to recommend a 4.4% effective rate adjustment to electric rates for Fiscal Year 2026. The recommended increase will cost an estimated $5.06 per month for the average residential user.
There are several cost drivers that necessitate the rate adjustment, including conducting a pole replacement study at a cost of $300 thousand, upgrading customer software for utility billing at a cost of $235 thousand, an increase of $326 thousand in debt service from the fiscal year 2025 certificates of obligation issuance, and adding an position at $167 thousand.
Council Committee, Board/Commission Action:
The Citizen Utility Advisory Board held multiple meetings and voted to recommend a minimum 4.4% 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.