CITY OF KATY, Texas (Covering Katy News) — Katy residents will pay 81 cents more per month for garbage and recycling service beginning Sept. 1, while the city is changing employee health insurance carriers after its existing provider proposed a renewal that would have increased annual benefits costs by more than $1 million had the city not worked to lower that price.
The Katy City Council approved both changes Aug. 10, confronting higher costs for two major city expenses. The garbage increase will raise the monthly residential rate from $16.85 to $17.66, while changing health insurers is projected to reduce what otherwise would have been a much larger increase in employee-benefit costs.
Trash rate increases 4.8%
Council approved a three-year extension of the city's solid waste and recycling agreement with Texas Pride Disposal. The company has provided the city's residential service since 2020.
The residential rate will increase 4.8%, from $16.85 to $17.66 per month, effective Sept. 1.
“The increase for citizens will be about 81 cents a month, and if you think about the price of fuel and the potential price of fuel, to have that rate locked in for the next year I think is a great thing for our citizens,” Council Member Paula Taylor said.
The agreement runs through Aug. 31, 2029, with the city retaining options for two additional one-year extensions. Future annual rate adjustments will be tied to changes in the Consumer Price Index for the Houston area.
Council members said other waste companies had approached the city as the Texas Pride contract neared expiration and discussed the company's rates compared with what other municipalities are paying.
Mayor William “Dusty” Thiele said the company's performance was an important factor in continuing the relationship.
“Texas Pride, I thank you for y'all's service that you've given us since y'all have taken over the trash service,” Thiele said. “Problems have gone away, and I think the city, and I know I do, really appreciate the work and service you've given to us.”
Despite the increase, Katy's new $17.66 monthly rate remains below what residents were paying when the city's previous garbage contract ended in 2020. Community Impact reported Katy residents were paying $17.87 per month under Republic Services at the time. Nearby Fulshear recently increased its residential rate from $16.90 to $17.72 per month.
Insurance renewal would have increased costs 22.75%
The larger financial increase facing the city involved health insurance for city employees.
Katy's current employee-benefits package costs approximately $4.63 million annually. Renewing the existing Blue Cross Blue Shield of Texas medical coverage, along with the city's other benefits, would have pushed the annual cost to approximately $5.68 million — an increase of about $1.05 million, or 22.75%.
Instead, council approved moving employee medical coverage from Blue Cross Blue Shield of Texas to Cigna beginning Oct. 1. Dental coverage will also move from Delta Dental to Cigna.
The Cigna package is projected to cost approximately $4.94 million annually after credits, about $309,000 more than the city's current benefits package. That represents a 6.68% increase instead of the 22.75% increase the city faced by renewing its existing coverage.
By changing carriers, Katy is projected to spend roughly $743,000 less next year than it would have under the renewal option.
The city's benefits broker, Brown & Brown, sought competitive bids and recommended Cigna. City documents say the change will reduce the financial impact while maintaining coverage through area provider networks for employees.
Council approved the insurance change without discussion.
Two increases, different impacts
The two decisions illustrate different ways higher costs are affecting Katy and its residents.
Garbage customers will see the increase directly, paying an additional 81 cents per month beginning in September. Employee benefits are also becoming more expensive, but the city's decision to change insurers substantially reduced the increase it otherwise faced.
Even after changing carriers, Katy's overall employee-benefits costs are projected to rise by about $309,000 annually. Without the change, the increase would have exceeded $1 million.
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