Starting Nov. 1, Kyle residents will see an increase in their electric bill due to a raise in the franchise fee paid by Pedernales Electric Cooperative (PEC) to the city.
Kyle City Council members voted unanimously Aug. 22 to increase PEC franchise free from 2.0 to 4.5 percent.
PEC pays the city a franchise fee for use of roads and public right-of-way in order to provide electric services.
The last increase negotiated was 10 years ago, said Jerry Hendrix, Kyle chief of staff.
All franchise fees are negotiated between a city and PEC, and whether it is an increase or a decrease, it gets passed on to the customer, J. Caroline Tinsley, PEC representative said.
The 4.5 percent is applied to all line-item charges including service availability charge, delivery charge, base power cost and transmission cost of service, Tinsley said via email.
PEC sent a letter to customers informing them of the increase in franchise fee around Aug. 30, she said.
When negotiating the franchise fee, the city considers road repair costs due to the heavy pressure placed by PEC vehicles, said David Wilson, Kyle city council member, District 4.
“Because they are not really a profit making entity, we try to be straight up, fair and work with them closely,” Wilson said.
The increase in franchise fee would bring the level to the amount charged in surrounding municipalities, Kyle Mayor Todd Webster said.
PEC has 45 agreements with cities across the region, including Buda and San Marcos.
Buda has a franchise agreement of 2 percent, according to documents provided by David Marino, Buda public information officer.
Webster said he knew there were some people upset about the increase.
“Based by the way it was presented to us, I didn’t pick up any concern at all from PEC,” Webster said.
Travis Mitchell, Kyle city council member, District 1, said council members were initially excited about the increase in franchise fee because it would increase funds for streets, sidewalks, and road infrastructure improvements.
“One of the biggest challenges is our sidewalks have not been properly maintained for the last 20 years. Trees have been uprooted, causing sidewalks to be misaligned,” Mitchell said.
He said the city needs to take a measured approach to maintenance.
“By ordinance, (sidewalk maintenance) it’s the homeowner’s responsibility,” Mitchell said. “The city is taking a proactive approach to share the burden with the homeowner.”
Mitchell added it was his goal to see the city eventually take over the “responsibility of sidewalks – period.”
The city has contracted with PolyLEVEL of Central Texas, which uses PolyLevel foam injection to raise and level sidewalks.
Mitchell said that the city has spent significantly less for sidewalk maintenance with the use of PolyLevel foam injection.
What was initial joy for the increase turned to frustration, Mitchell said, “because I didn’t realize Pedernales would cause the fee to be a direct pass on to the consumer … I felt a little bit misled.”
He said it was mistake for the council to approve the increase without a more in-depth discussion.
“We (city council) should have known better,” he said.
Mitchell said he is seeking ways to remedy the situation through either a budget amendment or a new ordinance.
“I’m not sure if I will be successful or not, but I’m going try,” he said.