AUSTIN (KXAN) – Hundreds of people in a Southwest Austin neighborhood say they are being ripped off by Texas Community Propane, their propane provider.
Gas bills are at an all-time high, with some customers paying $1,200 a month. Two women are leading the fight. Larisa Bourgeois and Amanda Stanley have organized hundreds of people living in the master planned community, and are now collecting money to retain a high profile attorney to take on the gas company.
“It’s been outrageous,” said Stanley. “There’s been a lot of questions that we can’t get answered by the developer. We’ve gone to Texas Community Propane, as well, but we can’t seem to get anything so we are running into a dead end.”
Residents are not only upset about the cost, but what they call a “secret deal”.
A contract, they say, was not included in any of the residents closing papers, but still commits them to years of TCP, with little option. It’s a deal signed by the developer, Eric Willis, and the owner of TCP.
KXAN obtained a copy of the contract signed by Willis and Barton Prideaux, owner of Texas Community Propane. The contract is a 30 year, automatically renewing deal that not only dictates Belterra residents use propane, but that they only use Texas Community Propane. Should the community choose to sever ties, the contract reads that the gas company must also agree to walk away. That’s a scenario that doesn’t seem likely in a community planned to eventually have close to 2,000 homes.
The contract also holds residents to a “break fee”. That is, if a resident wants to convert their home to natural gas or electric, they must send a certified letter to TCP, and they must pay a fee between $950 and $1,500.
“I want to stay here I love the neighborhood. I love the schools. I want my kids to go to school here but this is definitely a hindrance,” Stanley said.
Barton Prideaux refused to speak with us on camera but did send an email statement, saying,
“The “break fee” is charged to partially cover loss of revenue regarding infrastructure already installed and ongoing ownership costs of that infrastructure. Although a customer may cease using propane, our company nevertheless has continuing obligations and costs related to owning the gas mains and services at that prior customer’s residence. Some of our ongoing obligations include “One Call” line locate costs, federal and state regulatory compliance costs (e.g., leak surveys, line surveillance, line patrolling), and 24/7 leak response and repair (gas line leaks occur despite not having an active customer). “
Prideaux did not answer follow up questions to that statement.
KXAN also tried several times to reach developer Eric Willis, but he has not responded to our many requests.
“It’s still a monopoly,” said Rep. Jason Isaac. “And we have those in Texas, but they’re regulated to the public utility commission.” Isaac was instrumental in passing regulation with Rep. Workman that places a cap on what propane companies can charge customers. TCP has been charging within the legal limits, but its prices are still considerably higher than what other gas companies are charging their customers.
Isaac says some communities have cited lower prices since the regulation took effect. “That hasn’t been the case here in Belterra,” Issac said. “There’s been a lot of concerns about their prices going up and their bills being extremely high.”
KXAN compared several customer bills and prices in the same month to three different propane companies that service large master planned communities.
In October, Direct Propane in Rough Hollow charged $2.10 a gallon. Alliant also charged $2.10 per gallon in the Rocky Creek neighborhood. The national average price for propane was $2.37 that month.
But according to bills provided by Belterra residents, the charge to them by Texas Community Propane was $2.59 per gallon, almost 50 cents more per gallon.
In the same month, we considered natural gas pricing in Highpointe, a nearby neighborhood with similar size homes. Their cost was only $43 total – about 20 percent of what propane customers are paying.
The Railroad Commission handles all complaints made against propane companies, and while they have received pricing complaints involving other companies, they say they have not received pricing complaints regarding TCP.
Some residents in Belterra are converting to 100% electric, while many others are collecting money to hire an attorney to fight TCP. New homes are currently being built in Belterra, and those are slated to have natural gas rather than propane. That has current propane customers there concerned their property value may decrease if a cheaper heat source is offered in newer homes right around the corner.
“I think that this is something that people have tried to tackle and they’ve given up because it’s hard,” Stanley said. “This is not something that is going to be an easy task.”
The current developer of Belterra contacted KXAN today; Crescent Communities says it does not have agreements with Texas Community Propane and provided us with this statement:
“As the new developer of the Belterra community, we have not participated in and do not have any revenue sharing agreement(s) with any current or potential energy providers, including Texas Community Propane, in the Austin area. We cannot comment on past developer arrangements that may have been established prior to Crescent Communties’ acquisition of Belterra in October 2013.”
KXAN will continue to follow this story as it develops.