PRESENTER: Presenter
Dawn Schriewer, Chief Financial Officer
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SUBJECT: Title
Public Hearing and Approval of the First Reading of an Ordinance Amending Chapter 130, Article III, Sections 130-56, 130-57, and 130-58, Code of Ordinances of the City of New Braunfels, Texas Adjusting Electric Rates and Charges for Fiscal Year 2026; Providing for Adjustments of Electric Rates and Charges for Fiscal Year 2027; Resolving Other Matters Incident and Related Hereto; Repealing All Other Ordinances and Parts of Ordinances in Conflict Herewith; Containing a Savings Clause; and Providing an Effective Date
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DEPARTMENT: NBU
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COUNCIL DISTRICTS IMPACTED: All districts
BACKGROUND INFORMATION:
NBU staff is proposing electric rate changes designed to fund its Fiscal Year 2026 and Fiscal Year 2027 budget. NBU retained Raftelis Financial Consultants, Inc. to conduct a water, wastewater, and electric rate study and to validate forecasted revenue requirements. The revenue requirements identified are driven primarily from the need to build and maintain electric infrastructure to meet regulatory requirements and electric consumption needs.
Based on the rate study results, NBU recommends an average annual retail revenue increase of 4.7% for FY 2026 and 3.2% for FY 2027. The rate plan positions NBU to fund capital improvements with rate revenue (cash) rather than issuing debt for all capital improvements, which also aligns with NBU’s financial policies. The rate increases are not a response to ERCOT market prices or pass-through power supply and transmission costs.
On August 31, 2023, the NBU Board approved Resolution #2023-176 establishing the Community Advisory Panel (CAP). On October 26, 2023, the Board approved the CAP Bylaws and appointed (13) CAP members. The CAP was tasked with reviewing and providing feedback on certain NBU projects, including a Fiscal Year 2026-2027 Rate Study. The CAP held four (4) public meetings related to the Fiscal Year 2026-2027 Rate Study. During those meetings, the CAP discussed topics including (i) Identify Financial and Pricing Objectives; (ii) Identify Revenue Requirements and Growth Projections; (iii) Develop Rate Projections and Possible Rate Design Changes; and (iv) Assess Effectiveness in Addressing Financial and Pricing Objectives.
On May 29, 2025, the NBU Board of Trustees recommended changes to Chapter 130, Article III, Sections 130-56, 130-57, and 130-58 relating to electric rates and charges.
The presentation, updated ordinance, and board resolution are attached. The second reading of the proposed ordinance is scheduled for June 23, 2025, and, if approved, the proposed rates become effective on August 1, 2025.
PROPOSED CODE OF ORDINANCE CHANGES
NBU staff has included in the City Council backup materials a redline version of City of New Braunfels Code of Ordinances Chapters 130-56 - Electric rates, 130-57 - Power factor penalty, and 130-58 - Billing adjustments.
ISSUE:
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STRATEGIC PLAN REFERENCE:
☐Economic Mobility ☐Enhanced Connectivity ☐Community Identity
☐Organizational Excellence ☒Community Well-Being ☐N/A
FISCAL IMPACT:
N/A
Recommendation
RECOMMENDATION:
The New Braunfels Utilities Board of Trustees adopted a resolution on May 29, 2025, recommending the proposed amendments to the electric rate Ordinance. NBU Staff recommends approval of the ordinance.