HomeMy WebLinkAboutOrdinance 8096`~
ORDINANCE NO O O q Co
AN ORDINANCE SUSPENDIrdG THE RATE INCREASE PROPOSED
IN THE STATEMENT OF IN'TEiVT FILED BY LONE STAR GAS
COr^.,PANY ON APRIL 23 1980 FOR 120 DAYS BEYOND THE
Ir1TENDED EFFECTIVE DATE OF JUNE 2 1980 ADOPTIrdG
DECLARATIONS AND FINDINGS IN PREAMBLE PROVIDING
A SEVERABILITY CLAUSE AND PROVIDING Art EFFECTIVE
DATE
WHEREAS on April 23 1980 the Lone Star Gas Ccmpan_y
filed with the City Secretary of the City of Fort Worth a Statement
of Intent to Change Rates prerequisite to a proposed change in gas
rates to become effective June 2 1980 which change is estimated
by the Company to increase its adjusted total operating revenue in
the amount of $3 918 595 and
WHEREAS under Articles 1446c and 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 and rate of return within the municipal boundaries of
the City of Fort Worth and
WHEREAS it is a matter of public necessity that a
thorough investigation be conducted and a hearing held on such
requested major change in rates and
WHEREAS it is necessary that the proposed rate increase
intended to become effective on June 2 1980 be suspended as
authorized by Article 144bc R C S for 120 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
SECTION I
+That the rate increase of Lone Star Gas Company proposed
to become effective on June 2 1980 be and the same is hereby
suspended as authorized by Article 1446(c) (the. Public Utility
Regulatory Act) Revised Civil Statutes of Texas for 120 days
beyond such date on which the schedule of proposed rates would
otherwise have gone into effect that is until September 30 1980
~:~ ~~.
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 jursidiction such decision opinion
or judgment shall in no way impair the remaining portions sections
or parts of sections of this ordinance which said remaining
provisions shall be and remain in full force and effect
SECTION IV
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
~~
City Atto ney
ADOPTED ~-d-~y ~l n ~ q ~ ~? _ __
EFFECTIVE
l7''
Mayor a ~oun~~.l ~o~.~a~,s,na~at~.ora,
DATE REFERENCE SUBJECT Lone Star Gas Company's Request PAGE
NUMBER t0 Increase Rates in FOrt Worth iof 2
5/20/80 G-4549
On April 23 1980, Lone Star Gas Company filed its Statement of Intent to
Change Rates with Fort Worth and the sixteen other cities which comprise the
'Fort Worth Distribution System " The proposed effective date for the new
rates is June 2 1980 The Company's application requests new rates that would
produce an additional $3 92 million (9 98%) on test-year commercial and resi-
dential revenues of $39 28 million The rate schedule proposes a monthly basic
charge of $3 75 per residential customer and $7 00 per commercial customer
Additionally $2 5770 per Mcf for summer consumption and $2 827 per Mcf for
winter consumption Other miscellaneous service charges are proposed to be
increased as well
The City of Fort Worth has original jurisdiction over gas utilities operating
within its boundaries The timetable established by the Public Utility Regula-
tion Act (Art 1446c R C S ) must be complied with or the proposed rates will
go into effect automatically The Act provides that the requested rate increase
can be suspended for 120 days (September 30 1980) and if additional time is
required before a final determination is made the suspension period may be
ext<ended for an additional 30 days If no final determination is reached after
1.5`0 days the proposed rates are deemed to be approved The Act permits the use
and employment of consultants to assist the cities in their study and analysis
of the propriety and effect of the proposed rate increases and provides for
reimbursement to the cities for reasonable consultant and other regulatory
costs
The various courses of action available to the City Council were explained
in Informal Report No 3490 furnished the City Council May 6th and discu$sed
in the Pre-Council session on May 13 1980
Past exper-fence has demonstrated both the need for and efficiency of utilizing
consultants with expertise in these matters to analyze and make recommendations
on utility rate requests This the City has done in the most recent Lone Star
Gas rate cases The accounting firm of Touche Ross and Company has been the
firm used in the last several cases (gas gate rate case and electric-TESCO-
cases.) Assistant City Attorney Barry Wolf has been in contact with this firm
concerning the current Lone Star application and this firm has expressed a
willingness. to do the necessary technical analysis and work with the City in
this matter for a fee estimated not fio exceed $15 000 plus expenses
If the City Council concurs iri retaining a consultant it is anticipated that
that expertise will be utilized to analyze the request and report to the Council
Along with such report hearings could be scheduled at several Council meetings
to gather citizen input and Company comment on the proposed rate increase
Thereafter but prior to September 30. the Council could act on the proposed/
requested rate increase If the Company were dissatisfied with the action
taken it could. and undoubtedly would appeal such action to the Railroad
Commission in Austin
DATE REFERENCE SUBJECT Lone Star GaS Company's Request PAGE
NUMBER
to Increase Rates in Fort Worth
2 or 2
5/20/80 G-4549
An ordinance suspending the proposed rate increase for a period of 120 days
to facilitate the expert analysis report informed consideration hearings
and appropriate actions has been prepared and is appended
Recommendation
It is recommended
1That the City Council adopt the proposed ordinance suspending
implementation of the proposed rates for 120 days from June 2
to September 30 1980
2 That the City Council authorize the City Manager to engage the
firm of Touche Ross and Company to analyze the Lone Star Gas
Company rate increase at a fee not to exceed $15 OOOq ~.,J
RLH ms
Attachment
APPROVED BY '
CITY COUNCIL
MAY ~~ 1980
SUBMITTED FOR THE- .
CITY MANAGER'S I
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DISPOSITION BY COUN-Ik: p~ ~p~ (~~ ux~
y '~~RTa?CfSSED BY
OFFICE BY
f ^ APPROVED
ORIGINATING
DEPARTMENT HEAD: Arthur R Peterse~ ~ °~ ~ ^ OTHER (DESCRIBE)
`~' e~'h~1, ~ ~ ~9
CITY SECRETARY
FOR ADDITIONAL INFORMATION
CONTACT Arthur R Petersen, ext _ 7-623 DATE