City council still divided on how to spend $50M of CPS windfall

Staff plan to credit CPS Energy customers would give $31 to average resident, but more than $100K to largest users

SAN ANTONIO – With power meters spinning faster and costing more when they do, the City of San Antonio is expecting $75 million extra dollars to hit its coffers this year.

But there’s still no consensus on how to spend it.

The hot temperatures and higher natural gas costs have been pushing up power bills, which increases CPS Energy revenues in turn and the amount the utility passes on to the city. While city staff has proposed giving $50 million back to CPS customers -- primarily through bill credits averaging $31 for residential customers -- city council members haven’t all signed on to the idea.

At a budget work session on Tuesday, several council members supported sending money back to CPS customers, though there was plenty of discussion over the details of “who” and “how.”

And while ideas raised during the initial council budget presentation to use the money on domestic violence services or infrastructure appeared to take a back seat, District 1 Councilman Mario Bravo continued to push for an alternative plan to use the money on programs like home weatherization instead, hoping to better prepare the city for future extreme weather.

“I don’t want to be back here having this conversation the next summer and the next summer and the next summer, saying, ‘Well, what do we do? We could give everybody $30 back after we kicked them in the teeth with their bills,’” Bravo said.

The city owns CPS Energy and takes 14 percent of its revenues as payment in lieu of taxes. Originally budgeting for $361 million in FY 2022, the city now projects it will collect $436 million from CPS Energy revenues by the end of September -- a $75 million increase.

City staff have recommended spreading $25 million of that surplus money between the Edwards Aquifer Protection Program, sidewalks, and obtaining a warehouse to store equipment for emergencies.

Of the remaining $50 million, city staff recommended putting $5 million into an assistance program for low-income ratepayers and divvying up the rest of the $45 million among all CPS Energy customers -- residential and commercial -- as a one-time credit on the October bills.

The credits would be calculated based on 13.2% to 13.4% of their July bills, creating a wide array of possible credits.

The average residential customer with a $230 bill in July would get $31 back. Meanwhile, the 40 commercial customers in the “super large power service” classification with bills averaging $752,211 would get back $100,281 on average.

City staff's proposal for using $45 million in unexpected revenue involves giving credits to CPS Energy customers based on their July bills. (City of San Antonio)
City staff's proposal for using $45 million in unexpected revenue involves giving credits to CPS Energy customers based on their July bills. (City of San Antonio)

“We shouldn’t really be rewarding this behavior. Individuals who used more electricity and did not conserve energy over the summer would be rewarded with a higher rebate, and I think that is one of the fundamental problems here,” said District 2 Councilman Jalen McKee-Rodriguez.

McKee-Rodriguez also said his constituents had found the $31 average rebate for residents “laughable,” and he criticized that it would not be available as direct assistance, just a bill credit.

District 9 Councilman John Courage is proposing an alternative rebate plan that would pay $75 to CPS Energy residential customers inside the city, cutting out customers from the rest of the county.

“I have a hard time giving San Antonio revenue dollars to businesses or individuals outside of the city of San Antonio. I just can’t justify that myself,” he said.

Courage’s plan would also exclude San Antonio business customers, too, with which neighboring District 10 Councilman Clayton Perry disagreed.

“Businesses are ratepayers also. They have suffered just as much as residential customers,” Perry said.

While Courage proposed sending customers the money without the help of CPS Energy, McKee-Rodriguez asked about the possibility of limiting the rebates to smaller businesses. The city’s legal team, though, said that would lead to legal implications and suggested holding off until the council’s executive session.

District 7 Councilwoman Ana Sandoval has put forward a separate plan to take a portion of the CPS revenue -- approximately $8 milion to $10 million -- and use it for a dedicated resiliency, energy efficiency and sustainability fund.

Sandoval doesn’t plan on dipping into the current surplus, though, noting in her comments Tuesday, “I think it’s really hard once you once you tell the public that you’re going to give them some money to say you’re not going to give them that money anymore.”

Mayor Ron Nirenberg said the council will discuss the issue again before it votes on the budget on Sep. 15, though it was unclear when that may be.

About the Authors

Garrett Brnger is a reporter with KSAT 12.

William Caldera has been at KSAT since 2003. He covers a wide range of stories including breaking news, weather, general assignments and sports.

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