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San Marcos council approves first‑reading rate actions for garbage, electric, water and wastewater
Summary
Council approved first‑reading actions and rate adjustments for resource recovery (1%), electric (approx. 4.4% effective), and a proposed 10.4% water/wastewater increase; council cited rising contract and personnel costs and aimed to preserve fund balance and debt coverage.
The San Marcos City Council on Sept. 2 advanced a set of utility rate changes after staff presentations on solid waste (resource recovery), electric, and water/wastewater funds.
Resource recovery: Staff proposed a 1% increase in the residential resource recovery rate to cover operating costs and a growing refuse‑hauler contract. Staff said the fund would finish FY2025 with an estimated $3.7 million and that the FY2026 proposal would leave an excess fund balance set aside for a future resource‑recovery facility.
Electric utility: Staff and the Citizens Utility Advisory Board recommended an effective electric rate adjustment (roughly 4.4%), citing personnel costs, a new electrical engineering design supervisor position, a utility‑billing software upgrade (about $235,000), and new debt service obligations. Assistant director Brian Kennery said the design‑supervisor role is intended to reduce design times and, over time, lower consulting costs: “Over time, hopefully, we do plan on kind of decreasing some of the consultation that we do,” he said. Council approved the electric rate measure in a 6–2 vote with one member absent.
Water and wastewater: Staff recommended an effective 10.4% rate increase (water +10.8%, wastewater +9.7%) to cover rising operating costs, increased contractual charges (Alliance Regional Water Authority and treatment contracts), personnel costs and FY2026 debt service. A typical combined water‑and‑sewer residential bill example shown during the presentation rose from about $111 to $127 under the proposed change. Council approved the water/wastewater ordinance on first reading by a recorded 4–2 vote with one absence.
Officials said the increases are intended to preserve required debt‑service coverage ratios and fund balances. Staff also described transparency changes such as a proposed “community benefit fee” to itemize embedded charges (community assistance, roadway lighting, franchise fees) so customers can see what portions of rates fund non‑utility services.
What comes next: Each rate ordinance returns for a second public hearing and adoption vote on Sept. 16. Staff said they will provide final rate tables, bill‑impact examples and the specific language for the community benefit fee before the next hearing.
