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Home My WebLink AboutOrdinance 10801ORDINANCE NO. < ~~~! AN ORDINANCE SUSPENDING THE RATE INCREASE PROPOSED IN THE STATEMENT OF INTENT FILED BY LONE STAR GAS COMPANY ON FEBRUARY 6, 1991, FOR 90 DAYS BEYOND THE INTENDED EFFECTIVE DATE OF MARCH 14, 1991; ADOPTING DECLARATIONS AND FINDINGS IN PREAMBLE; PROVIDING A SEVERABILITY CLAUSE; PROVIDING FOR ENGROSSMENT AND ENROLLMENT; AND PROVIDING AN EFFECTIVE DATE. `- WHEREAS, on February 6, 1991, the Lone Star Gas Company filed with the City Secretary of the City of Fort Worth a "Statement of Intent to Change Rates" as a prerequisite to a proposed change in gas rates to become effective March 14, 1991, which change is estimated by the Company to increase its adjusted total operating revenue in the amount of $2,610,154; and WHEREAS, under Article 1446e, Gas Utilities Regulatory Act, and Article 6050 et. seq. R.C.S., the City Council of the City of Fort Worth is charged with the duty of making a "reasonable determination of rate base, expenses, investment anti rate or return within the municipal boundaries," of the City of Fort Worth; and WHEREAS, it is necessary that the proposed rate increase intended to become effective on March 14, 1991, be suspended as authorized by Article 1446e, R.C.S., for 90 days beyond the date on which the schedule of proposed rates would go into effect; NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH, TEXAS: O~FtC~At RECORD t EXHIBIT "A" C{~~ ~~~s,~~G~~~~~ ~? ,~, ~ r, t R. SECTION I. That the rate increase of Lone Star Gas Company proposed to become effective on March 14, 1991, be and the same is hereby suspended as authorized by Article 1446e (the Gas Utility Regulatory Act), Revised Civil Statutes of Texas, for 90 days beyond such date on which the schedule of proposed rates would otherwise have gone into effect, that is until June 12, 1991. SECTION II. That all of the declarations and findings contained in the preamble of this ordinance are made a part hereof and shall be fully effective as part of the ordained subject matter of this ordinance. SECTION III. Should any portion, section or part of a section of this ordinance be declared invalid, inoperative or void for any reason by a court of competent jurisdiction, such decision, opinion or judgment shall in no way impair the remaining portions, sections or parts of sections of this ordinance, which said remaining pro- visions shall be and remain in full force and effect. SECTION IV. The City Secretary of the City of Fort Worth is hereby directed to engross and enroll this ordinance by copying the caption and Sections I and V in the minutes of the City Council and by filing the ordinance in the ordinance records of the City. ~~F ~~ ~~~~~~pR~ C1 ~pR~~, ~. 2 ~~' f a ~ 1 SECTION V. That this ordinance shall take effect and be in full force and effect from and after the date of its passage, and it is so ordained. APPROVED AS TO FORM AND LEGALITY: ~pUry ity Attorney r Date: 3~^~S'' X11 C} ADOPTED : _ ~ ~ ~ / / EFFECTIVE : ~~~ ~~~ ~~~~ S~CR~`f ~iR~ fT. ~OR~N, 1D(. ,. 3 MA,~ifER FIE.E E ``/~L1~ U~ JL O/l ~ ~®Y ~~~ JL ~i./~/'IJL~ ACC O!1;J? ING-?_ //~/7// /7/J YRAfiSFCRTRTeC,i/fl;~~i,: %\\Yd/~~~~®~ ~~i1 /1 ~®~ /~ ~~~1/ ~®~1~11) ~I1~1111 /11 /I ~IV11 X11 ~~l/ ~~I) ®~T-71 N.e7ER ACf~+IP.15?R,~P~;itt ~a / n LA 6~/.1 ~/ (~Q. /j RECOMMENDATION: It is recommended: 1. That the City Council implementation of Lone for 90 days from March ENGAGE CONSULTANT adopt an ordinance (Exhibit "A") suspending Star Gas Company's proposed change in gas rates 14, 1991, to June 12, 1991. 2. That the City Council authorize the City Manager to engage the firm of McMorries and Associates to analyze the Lone Star Gas Company rate increase request,. at a fee not to exceed $26,000; and 3. That the City Council adopt the attached supplemental appropriations ordinance increasing the appropriation in the General Fund GGO1, Non- Departmental - Consultant Fees, Center No. 0905503, by $26,000.00 and decreasing the Unreserved, Undesignated General Fund fund balance by the same amount.. DISCUSSION: On February 6, 1991, Lone Star Gas Company filed its "Statement of Intent to Change Rates" with Fort Worth and the eighteen other cities which comprise the "Fort Worth Distribution System." The proposed effective date for the new rates is March 14, 1991, thirty-five days after filing. The Company's application requests new rates that would produce an additional $2.610 million, an increase of 3.85% within Fort Worth, on test-year commercial and residential revenues of $67.821 million. The City of Fort Worth has "Original Jurisdiction" over gas utilities operating within its boundaries. The timetable established by the Gas Utility Regulatory Act (G.U.R.A. - Art. 1446e, R.C.S.) must be .complied with ,or the proposed rates will automatically go into effect on the 35th day after filing. The G.U.R.A. provides that the requested rate increase can be suspended for 90 days (from March 14, 1991, to June 12, 1991). If no final det.ermi,natio;n is reached after 90 days, the proposed rates are deemed to be approved and can be placed into effect under bond. The Act permits the use and employment of consultants to assist the City in its study and analysis of the ;propriety and effect of the proposed rate increase. The G.U.R.A. also provides for reimbursement from the Company to the City for reasonable consultant and ,other regulatory costs. Background information was provided to the City Council in Informal Report No. 7513 on February 26, 1991. The Department of Law has been in contact with representatives of McMorries and Associates, located in Amarillo, concerning this rate request. The firm has indicated its willingness to perform the technical analysis of the need for the increase and of the propriety of the request so that the City may act on the Company's request within the 90-day suspension ;period. T,he McMorries firm has proposed a fee for its services in an amount not to exceed $26,000. The firm has been the City's consultant in several cases in past 0 DATE REFERENCE SUBJECT SUSPENSION OF LONE STAR GAS PAGE NUMBER COMPANY'S REQUEST TO INCREASE ITS RATES for 2 3=5-91 G-9065 ... ~,,..T ..,...~.. ..... ....r..,....-..T,,,.. T,. DATE REFERENCE NUMBER suB~ECrSUSPENSION OF LONE STAR GAS PAGE 3-5-91 G-9065 COMPANY'S REQUEST TO INCREASE ITS RATES 2 of 2 ENGAGE CONSULTANT years, including the last gas case in 1985, and has performed very satisfactorily. This firm is a long-established utility rate consultant and represents primarily cities and governmental entities before the Public Utility Commission and Railroad Commission. If City Council concurs in retaining a consultant, as it has in the past, the consultant's expertise will be utilized to analyze the request and report to the Council. Along with such report, hearings will be scheduled at several Council meetings to gather citizen input and Company comment on the proposed rate increase. Thereafter, but prior to June 12, 1991, the Council could take action on the proposed/requested rate increase. If the Company is not satisfied with actions taken by the Council, the Company may appeal to the Railroad Commission in Austin. An ordinance suspending the proposed rate increase for a period of 90 days to allow expert analysis, report, hearings and appropriate actions has been prepared and is attached hereto as Exhibit "A". A supplemental appropriation ordinance is also attached increasing the appropriation in Non-Departmental - Consultant Fees by $26,000.00 and decreasing the General Fund fund balance to provide funds to engage McMorries and Associates. These costs will later be reimbursed by Lone Star Gas Company. FINANCING: Upon adoption of the attached supplemental appropriation ordinance, sufficient funds will be available in General Fund GGO1, Non-Departmental, Center No. 0905503, Consultant Fees. The expenditure will be made from Account No. 531200 The balance in the General Fund Unreserved, Undesignated fund balance after this transfer will be $27,036,706.00. MG:z 12GASINC I~PPPO~~p ~~ ~~fi l\ ~ iJSi ~~ City ~eazetaty of the City of tort Worth, Texntl SUBMITTED FOR THE CITY MANAGER'S Mike Groomer 6140 DISPOSITION BY COUNCIL: PROCESSED BY OFFICE BY ^ APPROVED ORIGINATING ~~1 Wade Adkin'S 7623 ^ OTHER (DESCRIBE) . DEPARTMENT HEAD• CITY SECRETARY FOR ADDITIONAL INFORMATION Wade Adkins 7623 dopted Ordinance No./~ ~ CONTACT DATE Adapted Qrdir?anc~ ~~~ l~ ~-