During the proceedings of the Austin Energy electric rate case in 2012, a number of vocal out-of-city ratepayers served by the utility challenged the right of the City of Austin to transfer money from their rates to Austin’s city services. Out-of-city ratepayers represent about 13% of Austin Energy’s total customer base. Some individuals, along with some of the representatives of suburban city governments served by Austin Energy, have challenged Austin’s right to this transfer, calling it “taxation without representation.”
While these out-of-city ratepayers do indeed have “representation” through their ability to appeal to the Texas Public Utility Commission, other significant issues relevant to public policy include determining how common General Fund transfers are in Texas cities, how common General Fund transfers are to municipalities from out-of-city ratepayers in their jurisdictions, and if the rate of these transfers is too high.
This report was complied by Paul Robbins, a research-writer with experience in environment and consumer protection, under contract with Public Citizen of Texas. Valuable research was provided by Hillary Corgey with Public Citizen. The report link below is to Public Citizen’s Web site.