HomeMy WebLinkAbout(0010) 2019.08 Ord Re Atmos RRM.PDFORDINANCE NO.
AN ORDINANCE APPROVING A NEGOTIATED SETTLEMENT
BETWEEN THE ATMOS CITIES STEERING COMMITTEE
("ACSC") AND ATMOS ENERGY CORP., MID-TEX DIVISION
(""COMPANY") REGARDING THE COMPANY'S 2019 RATE
REVIEW MECHANISM FILINGS; DECLARING EXISTING
RATES TO BE UNREASONABLE; ADOPTING TARIFFS THAT
REFLECT RATE ADJUSTMENTS CONSISTENT WITH THE
NEGOTIATED SETTLEMENT; FINDING THE RATES TO BE
SET BY THE SETTLEMENT TARIFFS TO BE JUST AND
REASONABLE AND IN THE PUBLIC INTEREST; APPROVING
AN ATTACHED EXHIBIT ESTABLIGHING A BENCHMARK
FOR PENSIONS AND RETIREE MEDICAL BENEFITS;
APPROVING AN ATTACHED EXHIBIT REGARDING
AMORTIZATION OF REGULATORY LIABILITY; REQUIRING
THE COMPANY TO REIMBURSE ACSC'S REASONABLE
RATEMAKING EXPENSES; DETERMINING THAT THIS
ORDINANCE WAS PASSED IN ACCORDANCE WITH THE
REQUIREMENTS OF THE TEXAS OPEN MEETINGS ACT;
ADOPTING A SAVINGS CLAUSE; DECLARING AN EFFECTIVE
DATE; AND REQUIRING DELIVERY OF THIS ORDINANCE TO
THE COMPANY AND THE ACSC'S LEGAL COUNSEL.
WHEREAS, the City of Fort Worth, Texas ("City") is a gas utility customer of the
Company, and a regulatory authority with an interest in the rates and charges of the Company;
and
WHEREAS, the City is a member of the ACSC, a coalition of similarly -situated cities
served by the Company ("ACSC Cities") that have joined together to facilitate the review of, and
response to, natural gas issues affecting rates charged in the Company service area; and
WHEREAS, ACSC and the Company worked collaboratively to develop a new Rate
Review Mechanism ("RRM") tariff that allows for an expedited rate review process by ACSC
Cities as a substitute to the Gas Reliability Infrastructure Program ("GRIP") process instituted by
the Legislature, and that will establish rates for the ACSC Cities based on the system -wide cost
of serving the Company; and
WHEREAS, on April 1, 2019, the Company filed its 2019 RRM rate request with the
ACSC Cities based on a test year ending December 31, 2018; and
Ordinance No. Page 1 of 4
WHEREAS, the ACSC coordinated its review of the Company's 2019 RRM filing
through its Executive Committee, assisted by ACSC's attorneys and consultants, to resolve
issues identified in the Company's RRM filing; and
WHEREAS, the ACSC Executive Committee, as well as the ACSC's counsel and
consultants, recommend that the ACSC Cities approve an increase in base rates for the Company
of $35.4 million applicable to ASCS Cities; and
WHEREAS, the attached tariffs (Exhibit A) implementing new rates are consistent with
the recommendation of the ACSC Executive Committee, are agreed to by the Company, and are
just, reasonable, and in the public interest; and
WHEREAS, the settlement agreement sets a new benchmark for pensions and retiree
medical benefits (Exhibit B); and
WHEREAS, the settlement agreement establishes an amortization schedule for regulatory
liability (Exhibit C); and
WHEREAS, the RRM Tariff contemplates reimbursement of the ACSC's reasonable
expenses associated with RRM applications;
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
OF FORT WORTH, TEXAS:
SECTION 1. That the findings set forth in this Ordinance are hereby in all things
approved.
SECTION 2. That, without prejudice to future litigation of any issue identified by the
ACSC, the City Council finds that the settled amount of an increase in revenues of $35.4 million
for ACSC Cities represents a comprehensive settlement of gas utility rate issues affecting the
rates, operations, and services offered by the Company within the municipal limits arising from
the Company's 2019 RRM filing is in the public interest and is consistent with the City's
authority under Section 103.001 of the Texas Utilities Code.
SECTION 3. That the existing rates for natural gas service provided by the Company are
unreasonable. The new tariffs attached hereto and incorporated herein as Exhibit A are just and
reasonable and are designed to allow the Company to recover annually an additional $35.4
million in revenue from customers in ACSC Cities over the amount allowed under currently
approved rates. Such tariffs are hereby adopted.
Ordinance No. Page 2 of 4
SECTION 4. That the ratemaking treatment for pensions and retiree medical benefits in
the Company's next RRM filing shall be as set forth on Exhibit B, attached hereto and
incorporated herein.
SECTION 5. That amortization of regulatory liability shall be consistent with the
schedule found in attached Exhibit C, attached hereto and incorporated herein.
SECTION 6. That the Company shall reimburse the reasonable ratemaking expenses of
the ACSC in processing the Company's 2019 RRM filing.
SECTION 7. That to the extent any resolution or ordinance previously adopted by the
City Council is inconsistent with this Ordinance, it is hereby repealed.
SECTION 8. That the meeting at which this Ordinance was approved was in all things
conducted in strict compliance with the Texas Open Meetings Act, Texas Government Code,
Chapter 551.
SECTION 9. That if any one or more sections or clauses of this Ordinance is adjudged to
be unconstitutional or invalid, such judgment shall not affect, impair, or invalidate the remaining
provisions of this Ordinance, and the remaining provisions of the Ordinance shall be interpreted
as if the offending section or clause never existed.
SECTION 10. That consistent with the City Ordinance that established the RRM
process, this Ordinance shall become effective from and after its passage with rates authorized
by attached tariffs to be effective for bills rendered on or after October 1, 2019.
SECTION 11. That a copy of this Ordinance shall be sent to the Company, care of Chris
Felan, Vice President of Rates and Regulatory Affairs Mid -Tex Division, Atmos Energy
Corporation, 5420 LJB Freeway, Suite 1862, Dallas, Texas 75240, and to Geoffrey Gay, General
Counsel to ACSC, at Lloyd Gosselink Rochelle & Townsend, P.C., 816 Congress Avenue,
Suite 1900, Austin, Texas 78701.
(signature page follows)
Ordinance No. Page 3 of 4
PASSED AND APPROVED this day of September, 2019.
Mayor
ATTEST:
Mary I Kayser, City Secretary
APPROVED AS TO FORM
Sarah Fullenwider, City Attorney
Ordinance No. Page 4 of 4