HomeMy WebLinkAboutOrdinance 7667 ORDINANCE NO. 7 t06
AN ORDINANCE AUTHORIZING A DECEMBER GAS COST
ADJUSTMENT OF 35.88 CENTS PER MCF AND PROVIDING
FOR AN EFFECTIVE DATE
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
FORT WORTH.
SECTION 1.
That the City Council of the City of Fort Worth, Texas,
in the exercise of its sound legislative discretion finds the
following facts to be established:
a. That rates for natural gas consumed within the City
of Fort Worth were set under Ordinance No. 7401 at levels calculated
to produce revenue achieving a 7 1/2% rate of return on Lone Star
Gas Company's Fair Value Rate Base for its Fort Worth Distribution
System;
b. That a completed review of Lone Star Gas Company's
Fcr t Worth Distribution System operations for the twelve (12)
month period ending June 30, 1977, warrants the conclusion that
rates under Ordinance No. 7401 were some of the highest if not the
highest in the Fort Worth Distribution System which embraces some
16 cities, towns and villages in addition to the City of Fort Worth
and that such rates enabled the system to achieve a rate of return
in excess of 7 1/2% on an Adjusted Value Rate Base;
C. That the disparity between the return of 7 1/2/0
intended by the rates under Ordinance No. 7401 and the return, in
fact, achieved is due, in part, to computations of revenue require-
ments anticipated in establishing those rates utilizing gas costs
set at 4.78�4_ per Mcf higher than the per Mcf gas cost base
recognized by Ordinance No. 7401;
d. That the gas cost adjustment proposed for December 1977
by Lone Star Gas Company, recalculated under the terms of Ordinance
No. 7401 utilizing the base cost of gas established in GUD No. 588
(72.29¢ per Mcf) and disallowing the 5¢ per Mcf surcharge authorized
by the Texas Railroad Commission in GUD No. 683, would be 39.61¢
per Mcf as compared to the November GCA, calculated in like manner,
of 35.88¢ per Mcf, a proposed increase of 3.73¢ per Mcf;
e. That the denial of such proposed 3.73¢ per Mcf increase
above the November level of 35.88¢ per Mcf would be more than offset
by the 4.78¢ per Mcf disparity noted between rates set by Ordinance
No. 7401 and rates necessary to achieve the rate of return authorized
by Ordinance No. 7401 as reasonable, just and fair; and
f. That under Ordinance No. 7401 the City Council may, in
its sound discretion regulate the burner-tip rate by taking action
to "suspend, modify or defer" all or a portion of proposed monthly
gas cost adjustments as reported and prior to their effective date,
all as specified in said Ordinance and as such regulation may be
deemed reasonably necessary for the protection of the general public
as the same is specifically recognized by Ordinance No. 5299.
SECTION 2.
That a reasonable, just and fair rate for natural gas
within the City of Fort Worth will be achieved by hereby setting
the gas cost adjustment for December 1977 at 35.88 cents per
Mcf under and pursuant to the provisions of Ordinance No. 7401.
SECTION 3.
That this ordinance shall 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:
:;re
City Attorney
ADOPTED .