HomeMy WebLinkAboutOrdinance 18107-05-2008 ORDINANCE NO. 18107-05-2008
AN ORDINANCE AMENDING ORDINANCE NO. 10692, AS
PREVIOUSLY AMENDED (THE GRANT OF A FRANCHISE TO
ATMOS ENERGY CORPORATION, MID-TEX DIVISION,
SUCCESSOR IN INTEREST TO TXU GAS COMPANY AND
LONE STAR GAS COMPANY), BY INCREASING THE
FRANCHISE FEE PAYABLE BY ATMOS ENERGY
CORPORATION, MID-TEX DIVISION, FOR USE OF PUBLIC
RIGHTS-OF-WAY IN THE CITY OF FORT WORTH; AND
FURTHER PROVIDING THAT THIS ORDINANCE IS
CUMULATIVE; PROVIDING A SEVERABILITY CLAUSE;
FINDING AND DETERMINING THAT THE MEETING AT
WHICH THIS ORDINANCE IS ADOPTED IS OPEN TO THE
PUBLIC AS REQUIRED BY LAW; PROVIDING FOR
PUBLICATION; PROVIDING AN EFFECTIVE DATE; AND
PROVIDING FOR ACCEPTANCE BY ATMOS ENERGY
CORPORATION,MID-TEX DIVISION.
WHEREAS, on October 9, 1990 the City Council adopted Ordinance No. 10692,
an ordinance granting Lone Star Gas Company (now Atmos Energy Corporation, Mid-
Tex Division) ("Atmos" or "Company") a franchise for a period of twenty-five (25)
years to use the public rights-of-way within the City of Fort Worth (the "City") for the
purpose of laying, maintaining, using, and operating a system of pipelines for the
provision of natural gas to residential, commercial, and industrial customers located in
the City, as previously amended by Ordinance No. 15275, adopted by the City Council
on October 8, 2002 (collectively, the "Franchise"); and
WHEREAS, Section 13(d)(1) of the Franchise provides that if Atmos agrees to
pay another municipality a franchise fee calculated in a manner that, if applied to the
City, would result in a higher franchise fee, the City is entitled to that higher franchise
fee; and
WHEREAS, Atmos and various Texas municipalities, excluding the City, have
been involved in that certain rate case styled GUD No. 9672; and
WHEREAS, the City has been notified that Atmos has settled or intends to settle
that certain rate case styled GUD No. 9672 that allows the municipal parties in that case
to charge Atmos a franchise fee in an amount up to five percent (5%) of Atmos's gross
revenues, as verified in a letter dated February 15, 2008 from Atmos to counsel for the
Atmos Cities Steering Committee, of which the City is a member; and
WHEREAS, pursuant to Section 13(d)(1) of the Franchise, the City wishes to
increase the franchise fee payable pursuant to the Franchise from four percent (4%) to
five percent(5%)of the Gross Revenues received by Atmos; and
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Amendment No.2 to Ordinance No. 10692,as Previously Amended
Atmos Gas Franchise
WHEREAS, it is appropriate to amend the Franchise to reflect this change;
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF
THE CITY OF FORT WORTH,TEXAS: THAT
I.
Effective May 1, 2008, Section 13(a) of the Franchise is deleted in its entirety and
replaced with the following:
SECTION 13.
(a) Franchise Fee.
In consideration for the rights and privileges herein granted,
Company, its successors and assigns, shall pay to the City during the term
of this franchise a franchise fee equal to five percent (5%) of the Gross
Revenues, as defined in subsection(b) below, received by Company.
II.
In all respects, except as specifically and expressly amended by this Ordinance,
the Franchise shall remain in full force and effect according to its terms until the
Franchise expires or otherwise terminates in accordance with the provisions of the
Franchise.
III.
The sections, paragraphs, sentences, clauses, and phrases of this Ordinance are
severable. If any portion of this Ordinance is declared illegal or unconstitutional by the
valid final judgment or decree of any court of competent jurisdiction, such illegality or
unconstitutionality shall not affect the legality and enforceability of any of the remaining
portions of this Ordinance.
IV.
It is hereby officially found and determined that the meeting at which this
Ordinance is passed is open to the public as required by law and that public notice of the
time,place,and purpose of such meeting was given as required.
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Amendment No.2 to Ordinance No. 10692,as Previously Amended
Atmos Gas Franchise
V.
In accordance with and as required by Section 2 of Chapter XXV of the City's
Charter, the City Secretary is hereby directed to publish this Ordinance in its entirety
once each week for four (4) consecutive weeks within a period of thirty (30) days
following adoption by the City Council in the official newspaper of the City.
VI.
This Ordinance shall be in full force and effect following (i) its adoption and (ii)
its publication in accordance with Section 5. Within thirty (30) calendar days following
adoption of this Ordinance, Company shall file with the City Secretary written
acceptance of this Ordinance in substantially the following form:
To the Honorable Mayor and City Council:
Atmos Energy Corporation, Mid-Tex Division ("Atmos"), acting by and
through the undersigned authorized officer, hereby accepts in all respects,
on this the 27th day of May, 2008, Ordinance No. 18107-05-2008
amending the current gas franchise between the City and Atmos, and the
same shall constitute and be a binding contractual obligation of Atmos to
the City.
Atmos Energy Corporation, Mid-Tex Division
By:
Name:
Title:
ADOPTED:May 27, 2008 G-16155
Date M&C Number
EFFECTIVE DATE:
APPROVED AS TO FORM AND LEGALITY:
Peter Vaky
Assistant Clry Attorney
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Amendment No.2 to Ordinance No. 10692,as Previously Amended
Atmos Gas Franchise
City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 5/27/2008 - Ord. No. 18107-05-2008
DATE: Tuesday, May 27, 2008
LOG NAME: 13ATMOS REFERENCE NO.: **G-16155
SUBJECT:
Adopt Ordinance Amending Atmos Energy Franchise Ordinance No. 10692, as Previously
Amended, by Increasing Franchise Fee Amounts from Four Percent to Five Percent to
Generate Additional Revenues
RECOMMENDATION:
It is recommended that the City Council adopt the attached ordinance amending the Atmos Energy
Franchise Ordinance No. 10692 as previously amended (the Franchise) by increasing the franchise fee
amount from four percent to five percent of Atmos' gross revenues.
DISCUSSION:
The City's Franchise with Atmos allows Atmos to use public rights-of-way within the City for the provision,
distribution and transportation of natural gas to customers located in the City of Fort Worth. In return, the
Franchise requires Atmos to pay the City a franchise fee of four percent of Atmos' resulting gross revenues.
The current-year budget for Atmos franchise fees is $6,740,626.
In a rate case between Atmos, and various other Texas municipalities excluding the City, styled GUD No.
9672, Atmos agreed to pay those municipalities a franchise fee equal to five percent of Atmos' gross
revenues. Section 13(d)(1) of the City's Franchise provides that if Atmos agrees to pay a higher franchise
fee in another city, the City of Fort Worth is also entitled to receive that higher fee. Increasing the franchise
fee from four percent to five percent will generate additional revenues of approximately $1.7 million on an
annual basis.
FISCAL INFORMATION/CERTIFICATION:
The Finance Director certifies that the Revenue Office of the Finance Department will be responsible for the
collection of fees due under this agreement.
TO Fund/Account/Centers FROM Fu nd/Accou nt/C enters
GG01 421322 0134010 $0.00
Submitted for City Manager's Office b Karen Montgomery (6222)
Originating Department Head: Lena Ellis (8517)
Additional Information Contact: Danny Reed (6145)
Logname: 13ATMOS Page 1 of 1