HomeMy WebLinkAboutIR 7513 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 7513
INFORMAL
26 , 1991
46t fORT4 To the Mayor and Members of the City Council
LONE STAR GAS COMPANY'S REQUEST TO INCREASE
LOCAL GAS RATES - FILED FEBRUARY 6, 1991
EXP Subject:
On February 6, 1991 , Lone Star Gas Company filed a Statement of
Intent to change the rates charged for natural gas service in
Fort Worth and eighteen other cities in its Fort Worth
Distribution System. The effective date for the new rates is
March 14, 1991 , thirty-five (35) days after filing.
Under Texas state law, all cities have "Original Jurisdiction"
over rates , service and operations of gas utilities . Secondary
or appellate jurisdiction for the utility after the City has
taken action in gas rate matters rests with the Railroad
Commission of Texas ("RRC") through the regulatory law embodied
in Article 1446e (1983) - the Gas Utility Regulatory Act
(hereinafter "GURA") .
Section 5 . 08 of the GURA provides that the regulatory authority
( i . e . the City Council ) can suspend the operation of the
increased rates for 90 days beyond the 35 days the rates would
ordinarily go into effect . The utility is permitted to place the
proposed rates into effect under bond 90 days from the date the
proposed rates would have gone into effect . The proposed rates
charged under the bond are refundable to gas customers in the
event the final rates , as a result of the appeal process , are
found to be lower than the proposed rates .
Other sections of the GURA provide that public hearings be held
and investigations of the need for the increase be conducted
before a decision is reached. The GURA provides that the city, as
regulator , can engage consultants to assist in its study and that
costs of the rate study be borne by the utility requesting the
increase.
There has been no change in basic gas rates in Fort Worth since
the present rates became effective in 1985 . In the last case
filed May 9, 1985, the City Council suspended the rate increase
and authorized the engagement of a consultant , William McMorries
and Associates, to analyze the rate increase request. On
September 24, 1985, the Council approved an increase recommended
by McMorries and Associates , which was smaller than the Company
had originally requested (M&C G-6439, Ordinance 9491) .
The City 's administrative staff is examining the Company's
current rate request . At the next City Council meeting,
scheduled for March 5 , 1991 , the City staff will provide for
City Council consideration a recommendation on the suspension of
the proposed rates , the engagement of a consultant and related
matters .
Avid or
City Manager
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS