AUSTIN (KXAN) — Austin City Council has 100 items on its agenda Thursday. One of them is how much money you’ll pay on your energy bill starting next year.
Austin Energy base rate increase
Austin City Council passed a base rate increase Thursday night after nearly a year of heated back and forth about how much customers should pay.
The result: Your customer charge, a flat rate, and the amount you pay for the energy you use are both going up. The approved proposal will result in a $9 a month increase to the average customer’s bill.
The customer charge will go from the $10 a month you pay now, to $13 a month starting in March 2023. It will bump to $14 a month in 2024 and $15 a month in 2025.
The average customer will also pay roughly $6 a month more in how much they are charged in energy usage.
We know any rate increase affects our customers, who are dealing with rising costs just like our utility. With the new base rates, residential customers will continue to see some of the lowest bills in the state while paying closer to the cost of service. I appreciate City Council recognizing the need to protect customers from rate shock while improving the utility’s financial position to continue to meet our community’s needs and priorities in the long term. We believe this balanced approach will help our customers and our utility’s long-term financial health.
Jackie Sargent, Austin Energy’s general manager.
The proposal got just enough support to pass council with seven votes for the proposal.
Council Member Vanessa Fuentes did not support it. She wanted city council to look at a proposal brought forward by a group of community members that held the customer charge to $12 a month.
“I don’t think this is the right time. I understand it is our responsibility to ensure the financial stability of our utility but I believe there is a better way to do it and unfortunately that didn’t happen tonight,” Fuentes said.
Businesses will also see an increase in their customer charge. It varies depending on what kind of business they are.
The base rate, which the city looks at every five years, covers operation costs such as employees and equipment. Within that base rate discussion, the council looked at the teeter-totter effect between the customer charge, a flat cost you pay monthly, and how much the utility charges for the energy you use every month.
Matt Mitchell, an Austin Energy spokesperson, said with skyrocketing energy prices and inflation, the base rate increase is necessary to bridge the gap between cost of service and what customers are paying.
He also noted the most vulnerable Austin Energy customers, those enrolled in the utility’s Customer Assistance Program (CAP), are not subject to the customer charge but are impacted by the rate charged for usage.
Council already approved a pass-through rate increase in October. It upped customers’ monthly bills by an average of $15 a month. That rate generally covers the cost of buying and transporting energy.
Low Income Home Energy Assistance Program
In order to help Americans keep their bills low, the Biden Administration and the U.S. Department of Health and Human Services announced $4.5 billion last month to help lower heating costs for American families this winter. The low-income home energy assistance program will subsidize home heating costs, cover unpaid utility bills, and help families make cost-effective home energy repairs to lower their bills. You can find details online.
Bridge shelter units for the HEAL initiative
The council is likely to direct the city manager to keep the Northbridge shelter in operation for the Housing-focused Encampment Assistance Link (HEAL) initiative “until a comparable replacement is operational, and to identify strategies and funding options to maintain a minimum number of bridge shelter rooms.”
The bridge shelter is in north Austin on I-35.
According to agenda documents, the shelter is expected to be converted, resulting in the loss of 75 rooms for the HEAL initiative. The program transitions people experiencing homelessness to temporary housing with the goal of connecting them with resources and eventually permanent housing.
The council asked the city to come back to them with possible solutions to replace the rooms by no later than the middle of February.
How will your $350M in affordable housing bonds be spent
Austin voters approved a $350 million affordable housing bond in November — the largest housing bond in the city to date.
The council could direct the city manager to review current affordable housing practices such as ways to prioritize Continuum of Care (CoC) and permanent supportive housing units. Those units benefit people who previously experienced homelessness and provide incentives to property owners and managers.
The proposal asks the manager to work with affordable housing developers and service providers in the Homeless Response System to bring back any rule changes to the council, “including any action that Council needs to take, by April 1, 2023.”
Short-term rentals: Approved
It’s something the City of Austin has been trying to navigate for years: ensuring homes and apartments that would be suitable for housing in Austin don’t get turned into short-term rentals in the middle of a housing crisis.
City staff estimate between 9,000 and 11,000 of those rentals exist within city limits, but less than 2,000 of them are licensed through the city, as is required by law. Those numbers are from September.
The city has faced challenges citing people not paying the fee attached to that license.
The council voted to approve Thursday an item that directs the city manager to amend the city code to make it illegal under for someone to be paid directly or indirectly from those unlicensed short-term rental operators.
“Approve a resolution relating to regulating persons, including platforms and other corporations, who collect or receive a fee from unlicensed short-term rental operators,” the agenda says.
It also directs the city manager to make an online database of short-term rentals that are licensed by the city.
An amendment from Council Member José “Chito” Vela approved Thursday added that the city manager will be directed “to engage in a stakeholder process…and to research and evaluate existing and model ordinances, prior to presenting any proposed amendment to City Council for consideration” by March 23.
Brodie Oaks redevelopment: Approved
While Austin City Council finally approved zoning for the Statesman property on Lady Bird Lake, it did not make its way to the Brodie Oaks development on South Lamar and Highway 290.
The increasingly empty shopping center, which was home to Toys-R-Us, is in the early stages of becoming a small skyline in south Austin under the proposed plan.
“This is not the Statesman. We’re seeing this real active green space, we’re seeing the mixed-use, we’re seeing open areas, we have three parks,” Rich DePalma, who is on the parks board, said earlier this year.
The board signed off on the zoning changes.
The proposal is for nearly 40 acres, the entire footprint of the current mall area, including 1,700 residential units, an Imagine Austin activity center, three parks and a trailhead to the Barton Springs greenbelt, according to developers.
It will also include hotel rooms and retail spaces. The buildings will be capped at 275 feet tall.
“We anticipate somewhere around 200 units of affordable housing here, over 11 acres of public parkland,” Rebecca Leonard, the chief executive officer of Lionheart Places LLC, the developer, said.
Council approved on first reading Thursday the proposed planned unit development (PUD), but postponed a separate item that will look at amending a city subchapter of the Save Our Springs initiative relating to the property.
Two amendments added to, and approved, on first reading include:
- An Austin Energy substation will be evaluated so it doesn’t sit on parkland
- Council will discuss further who will pay for the Barton Creek Greenbelt trails and bring some funding options back to council
