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San Marcos Stormwater Squeeze: Council Hikes Utility Fees on Local Businesses and Parking Lots

On September 15, 2026, the San Marcos City Council voted 5 to 2 to approve Ordinance 2026-41, raising stormwater utility rates by 5.8 percent and disproportionately penalizing property owners.
San Marcos Stormwater Squeeze: Council Hikes Utility Fees on Local Businesses and Parking Lots — San Marcos Local Government Audit
YDHLGE Municipal Audit Summary Card • San Marcos, TX
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You work hard to keep your local business running, but now the city wants to tax the very rain that falls on your parking lot. In San Marcos, the city council has found a way to turn every square foot of your parking lot or driveway into a cash register for the municipal treasury. It is a regulatory fee squeeze that targets private property owners who dare to pave their land.

On September 15, 2026, the San Marcos City Council voted 5 to 2 to approve Ordinance 2026-41, raising stormwater utility rates by 5.8 percent. As highlighted in the Citizen Portal Coverage, these fees are calculated using Equivalent Residential Units (ERUs) based on impervious ground area. This means local businesses, churches, and schools with large paved parking lots are hit with the heaviest financial penalties, making it even costlier to operate in Hays County.

This fee hike is not just a nominal adjustment; it represents an ongoing squeeze on local enterprise. According to the Govly Meeting Summary, the council pushed the rate hike forward despite the heavy burdens it places on local commerce. By shifting the tax burden onto necessary infrastructure like parking lots, the city is directly penalizing economic activity and property development.

This form of utility extraction matches a broader pattern of local governments weaponizing administrative fees to bypass state-level property tax limits. The Institute for Justice: Texas Legislators End Abusive Zoning Practice has documented how cities use administrative codes and zoning structures to penalize private businesses. Whether through forced amortization or extractive utility fees, local officials repeatedly use their regulatory authority to restrict property rights and make earning an honest living more difficult.

San Marcos business owners must stand up to this latest stormwater squeeze. When the city starts charging you more just for having a paved surface, it is a direct assault on private property and local enterprise. We must hold the five council members who voted for Ordinance 2026-41 accountable and demand a return to fiscal restraint.

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