HomeMy WebLinkAboutResolution 4658-08-2016 A Resolution
NO. 4658-08-2016
SUSPENDING THE PROCEDURAL SCHEDULE SET FORTH IN RESOLUTION
4619-04-2016 FOR THE SHOW CAUSE PROCEEDING OF ONCOR ELECTRIC
DELIVERY COMPANY, LLC; REAFFIRMING ALL OTHER ASPECTS OF SUCH
RESOLUTION; NOTING COMPLIANCE WITH OPEN MEETINGS ACT; AND
REQUIRING NOTICE OF PASSAGE
WHEREAS, the City of Fort Worth is a regulatory authority under the Public Utility Regulatory
Act ("PURA") and has original jurisdiction over the rates of Oncor Electric Delivery Company, LLC
("Oncor")to determine if such rates are just and reasonable; and
WHEREAS, Sections 33.021, 36.003, and 36.151 of PURA empower a regulatory authority, on
its own motion or on a complaint by any affected person, to determine whether the existing rates of any
public utility for any service are unreasonable or in any way in violation of any provision of law, and
upon such determination, to determine the just and reasonable rates; and
WHEREAS, the City of Fort Worth had and continues to have reason to believe that Oncor is
over-earning and its rates are excessive; and
WHEREAS, the City of Fort Worth is a member of the Steering Committee of Cities Served by
Oncor; and
WHEREAS, the Executive Committee of the Steering Committee of Cities Served by Oncor
recommended that cities pass a resolution requiring Oncor to show cause why its transmission and
distribution rates should not be reduced; and
WHEREAS, on April 19, 2016, the City Council of the City of Fort Worth, acting on its own
motion, adopted Resolution 4619- 04-2016, exercising its authority under Sections 33.021, 36.003 and
36.151 of PURA and instituting a show cause proceeding for Oncor and ordaining procedural matters
related thereto (the "Show Cause Resolution"); and
WHEREAS, recent and on-going developments regarding the ownership and organizational
structure of Oncor will impact the tax status of certain revenues and associated pass-through charges
that form a portion of Oncor's rates; and
WHEREAS, the City Council finds it advisable and in the public interest to suspend the
procedural schedule set forth in the Show Cause Resolution until Oncor's ownership and organizational
issues have been resolved.
ORT WO iRa iHi
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF FORT WORTH, TEXAS:
SECTION 1. That the procedural schedule established in Resolution 4619- 04-2016 is hereby
suspended until further notice.
SECTION 2. That when Oncor's ownership and organizational issues have been resolved or
near resolution, the City Council may enter an order setting a revised procedural schedule for the filing
of Oncor's initial information, requests for information from the City's designated representatives and
responses thereto, City's designated representatives' analysis of Oncor's filing and information, and
Oncor's rebuttal; for the holding of a public hearing; and for other procedural matters as needed.
SECTION 3. That all other aspects of Resolution 4619- 04-2016, including, but not limited to,
the designation of representatives, consultants, and legal counsel, are hereby reaffirmed.
SECTION 4. That it is hereby officially found and determined that the meeting at which this
resolution was passed was open to the public as required by law, and that public notice of the time,
place, and purpose of said meeting was given all as required by Section 551.041, Texas Government
Code.
SECTION 5. That, following adoption, a copy of this Resolution shall be sent to E. Allen Nye,
Jr., Senior Vice President, General Counsel and Secretary, Oncor Electric Delivery Company, LLC,
1616 Woodall Rodgers Freeway, Dallas, Texas 75202, and to Geoffrey Gay, General Counsel to the
Steering Committee of Cities Served by Oncor, at Lloyd Gosselink Rochelle & Townsend, P.C., P.O.
Box 1725, Austin, Texas 78767-1725.
Adopted this 9" day of August 2016.
Price,
APPROVED AS TO FORM
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City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 8/9/2016 - Resolution No. 4658-08-2016
DATE: Tuesday, August 9, 2016 REFERENCE NO.: **G-18794
LOG NAME: 21 SUSPEND ONCOR SHOW CAUSE SCHEDULE
SUBJECT:
Adopt Resolution Suspending Procedural Schedule Set Forth in Resolution 4619-04-2016 for Show Cause
Proceeding Regarding the Rates of Oncor Electric Delivery Company, LLC (ALL COUNCIL DISTRICTS)
RECOMMENDATION:
It is recommended that the City Council adopt the attached resolution to suspend the procedural schedule
that was set forth in Resolution 4619-04-2016 for the show cause proceeding regarding the rates of Oncor
Electric Delivery Company, LLC.
DISCUSSION:
The purpose of this Mayor and Council Communication (M&C) is to suspend the procedural schedule that
was initially established for the show cause proceeding regarding the rates of Oncor Electric Delivery, LLC
("Oncor"), which was instituted on April 19, 2016.
Resolution 4619-04-2016, which instituted the show cause proceeding, requires Oncor to file
documentation with the City Council by September 1, 2016 to justify its current rates. A key issue in that
proceeding is the recovery of income tax liability costs, which are currently passed through to ratepayers
but that could be eliminated as the result of bankruptcy-related restructuring of Oncor. At the time
Resolution 4619-04-2016 was approved, both the bankruptcy court and the Texas Public Utility
Commission had approved that restructuring.
Following the adoption of the resolution, the business deal calling for wholesale restructuring of Oncor fell
apart. However, the lead investor behind the proposal is still diligently pursuing that option. Because the
issues that led to the show-cause proceeding being instituted still exist, Staff recommends that the
proceeding be kept in place; however, to allow time for the question of Oncor's future organizational
structure going forward to be resolved, Staff recommends that the procedural schedule be
suspended. Adoption of the attached resolution would suspend the show-cause proceeding until further
notice.
Note - Informal Report 9783, which was presented to the City Council the week before the show-cause
resolution, more fully explains the structural and tax issues that gave rise to the show-cause proceeding. A
copy of that Informal Report (IR) is attached for ease of reference.
This M&C does not request approval of a contract with a business entity.
FISCAL INFORMATION / CERTIFICATION:
The Director of Finance certifies that this action will have no material effect on City Funds.
FUND IDENTIFIERS (FIDs):
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CERTIFICATIONS:
Submitted for City Manager's Office by: Jay Chapa (5804)
Originating Department Head: Steve Cooke (5134)
Additional Information Contact: Steve Cooke (5134)
Logname: 21 SUSPEND ONCOR SHOW CAUSE SCHEDULE Page 2 of 2