HomeMy WebLinkAboutOrdinance 17631-07-2007ORDINANCE NO. 17631-07-2007
AN ORDINANCE SUSPENDING IlViPLEMENTATION OF THE RATE
ADJUSTMENTS PROPOSED BY ATMOS ENERGY CORP., NIID-TEX
DIVISION, AS REFLECTED IN THE "ANN[TAL GAS RELIABILITY
INFRASTRUCTURE RATE ADJUSTMENT" FILED BY ATMOS
ENERGY CORP., MID-TEX DIVISION ON MAY 31, 2007;
AUTHORIZING THE PARTICIPATION IN A STEERING COMIVHTTEE
OF OTHER CITIES ANALYZING SIIVIII.AR RATE ADJUSTMENT
FILINGS BY ATMOS ENERGY CORP., MID-TEX DIVISION AND THE
HIRING OF CONSULTANTS AND ATTORNEYS THEREWITH;
DIRECTING THAT ATMOS ENERGY CORP., NIID-TEX DIVISION
REIMBURSE THE CITY FOR ALL SUCH REASONABLE EXPENSES;
ADOPTING DECLARATIONS AND FINDINGS IN THE PREAMBLE;
PROVIDING A SEVERABILITY CLAUSE; PROVIDING FOR AN
EFFECTIVE DATE; AND DIRECTING THAT CERTIFIED COPIES OF
THIS ORDINANCE BE DELIVERED TO ATMOS ENERGY CORP., MID-
TEX DIVISION FOLLOWING ITS ADOPTION.
WHEREAS, on May 31, 2007 Atmos Energy Corp., Mid-Tex Division ("Atmos") filed
with the City Secretary an "Annual Gas Reliability Infrastructure Rate Adjustment" ("Rate
Adjustment Filing") pursuant to Section 104.301 of the Texas Utilities Code, under which
adjusted rates of Atmos would go into effect in the City on July 30, 2007; and
WI~REAS, the adjusted rates proposed in Atmos's Rate Adjustment Filing with the
City would result in an increase in gas prices charged by Atmos in the City; and
WHEREAS, under Texas law, the City has exclusive original jurisdiction over the rates,
operations and services of any gas utility operating within the City; and
WI~REAS, in order to have time to analyze the Rate Adjustment Filing thoroughly, it
is necessary that the City Council suspend implementation of Atmos's proposed rate adjustment
for a period of up to forty-five (45) days, as specifically allowed by and in accordance with
Section 104.301 of the Texas Utilities Code, until the earlier of September 13, 2007 or the date
on which City Council adopts fmal order or decision in response to the Rate Adjustment Filing;
NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF FORT WORTH, TEXAS THAT:
SECTION 1.
Implementation of the rate adjustments outlined in Atmos's May 31, 2007 Rate
Adjustment Filing with the City is hereby suspended for the lesser of (i) the maximum period
allowed by law, as specifically allowed by and in accordance with Section 104.301 of the Texas
Utilities Code, or (ii) the date on which the City Council adopts a fmal order or decision in
response to the Rate Adjustment Filing following a public hearing on the merits and a
determination by the City Council as to the propriety of the Rate Adjustment Filing. Until such
time, Atmos shall charge the same rates in the City as those that were in effect on May 31, 2007,
without the adjustments requested in the Rate Adjustment Filing.
SECTION 2.
The City Manager or his authorized designee is hereby authorized to cooperate with
other participating municipalities to participate in a steering committee to hire and direct legal
counsel and consultants to make recommendations to participating municipalities, including the
City, regarding the Rate Adjustment Filing and to direct any administrative proceedings or
litigation associated with the Rate Adjustment Filing, subject to the City's right to terminate
such participation at any time by written notice to the steering committee and to act
independently in the exercise of its regulatory authority.
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SECTION 3.
In accordance with Section 103.022(b) of the Texas Utilities Code, Atmos is hereby
directed to reimburse the City for all reasonable costs and expenses of any rate consultants,
accountants, auditors, attorneys and engineers retained by the City or a steering committee of
which the City is a member and incurred in the course of the City's and/or the steering
committee's review of Atmos's Rate Adjustment Filing.
SECTION 4.
All of the declarations and findings contained in the preamble of this Ordinance are made
apart hereof and shall be fully effective as part of the ordained subject matter of this Ordinance.
SECTION 5.
If any portion, section or part of a section of this Ordinance is subsequently declared
invalid, inoperative or void for any reason by a court of competent jurisdiction, the remaining
portions, sections or parts of sections of this Ordinance shall be and remain in full force and
effect and shall not in any way be impaired or affected by such decision, opinion or judgment.
SECTION 6.
This Ordinance shall take effect and be in full force and effect from and after the date of
its adoption. The Crty Secretary is hereby directed to deliver certified copies of this Ordinance
to Atmos Mid-Tex, care of Charles R. Yarbrough, II, at Atmos Energy Corporation, 5420 LBJ
Freeway, Suite 1800, Dallas, Texas 75240.
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AND IT IS SO ORDAINED.
ADOPTED AND EFFECTIVE: Juw 10.2007
APPROVED AS TO FORM AND LEGALITX:
By: .~iZ~__\~/ _
Peter Vaky
Assistant City Attorne
M&C: G-15766
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City of fort VI/orth, 7"exas
Mayor and Council Communication
----_ .
COUNCIL ACTION: Approved on 7/10/2007 -Ord. No. 17631-07-2007
DATE: Tuesday, July 10, 2007
LOG NAME: 03GRIP04 REFERENCE NO.: ~*G-15766
SUBJECT:
Adopt Ordinance Suspending Interim Rate Adjustments Proposed by Atmos Energy Corporation,
Mid-Tex Division and Retention of Consultants to Study Propriety of Proposed Rate Adjustment
RECOMMENDATION:
It is recommended that the City Council approve the attached Ordinance which:
1. Suspends the implementation of the Interim Rate Adjustments filed with the City by Atmos Energy
Corporation, Mid-Tex Division (Atmos) on May 31, 2007; and
2. Authorizes the City Manager to cooperate with other cities in the Atmos Cities Steering Committee to hire
and direct legal counsel and consultants, negotiate with Atmos, make recommendations to the City
regarding reasonable rates, and direct any administrative proceedings or litigation associated with the
Interim Rate Adjustments filed with the City or with the Railroad Commission.
DISCUSSION:
On May 31, 2007, Atmos filed with the City of Fort Worth ("City") the 2006 Gas Reliability Infrastructure
Program Rate (G.R.I.P) Adjustment. G.R.I.P. filings are adjustments to existing rates to allow a gas utility to
recover additional invested capital without considering increased revenues or decreased expenses that may
be associated with that investment. A utility may apply for these adjustments only if it has filed a rate case
in the last two years and it has new invested capital that is not considered in its present rates. Atmos
Energy filed its last rate case on May 31, 2006.
Under state law, the City has exclusive original jurisdiction over the rates, operations and services of any
gas utility operating in the City. When such a gas utility requests a rate increase that constitutes a major
change over the rates currently in effect, the City is required to conduct a public hearing in order to
determine the propriety of the proposed rates. In order to have sufficient time to analyze the rate filing, the
City is allowed to suspend the proposed rate schedule up to 45 days. During this suspension period, the
gas utility's current rates will continue in effect. Following the public hearing on this matter, the City Council
will be asked to adopt a final order or decision in the rate case.
Pursuant to state law the City, as a regulatory authority, may retain consultants and other professionals to
advise and represent the City and to assist the City in any litigation or ratemaking proceeding.
On May 16, 2006, the City Council authorized participation with other cities in the Atmos service area to
form a standing steering committee with the authority to act on behalf of its members in any proceeding
relating to gas utility regulation (M&C G-15202). This committee is known as the Atmos Cities Steering
Committee (ACSC). Member cities may opt out of any proposed rate case action.
City staff recommends that the City cooperate with ACSC to hire and direct legal counsel and consultants,
negotiate with Atmos, make recommendations to the City regarding reasonable rates and to direct any
Logname: 03GRIP04 Page 1 of 2
necessary litigation associated with the Interim Rate Adjustments filed with the City or with the Railroad
Commission. Expenses incurred will initially be paid by ACSC. ACSC will seek reimbursement of
reasonable rate case expenses from Atmos.
FISCAL INFORMATION/CERTIFICATION:
The Director of Fiscal Services certifies that this action will have no material effect on City Funds.
TO Fund/Account/Centers
FROM Fund/Account/Centers
Submitted for City Manager's Office bv:
Originating Department Head:
Additional Information Contact:
Karen Montgomery (6222)
Bridgette Garrett (8518)
Danny Reed (6145)
Logname: 03GRIP04 Page 2 of 2