HomeMy WebLinkAboutOrdinance 15037ORDINANCE NO. 0~~
AN ORDINANCE SUSPENDING, UNTIL THE EARLIER OF JULY 4,
2002 OR THE EFFECTIVENESS OF A RATE ORDER ADOPTED BY
THE CITY COUNCIL, IMPLEMENTATION OF THE RATE SCHEDULE
PROPOSED BY TXU GAS DISTRIBUTION, AS REFLECTED IN THE
"STATEMENT OF INTENT TO CHANGE RATES" FILED BY TXU GAS
DISTRIBUTION ON MARCH 1, 2002; ESTABLISHING RATES TO BE
CHARGED BY TXU GAS DISTRIBUTION DURING THE PERIOD OF
SUSPENSION, ADOPTING DECLARATIONS AND FINDINGS IN
PREAMBLE, PROVIDING A SEVERABILITY CLAUSE; AND
PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, on March 1, 2002, TXU Gas Distribution ("TXU Gas"), a division of TXU
Gas Company (formerly Lone Star Gas Company), filed with the City Secretary a "Statement of
Intent to Change Rates" ("Rate Filing") under which higher rates charged by TXU Gas would go
into effect m the City on Apn15, 2002, and
WHEREAS, the rates proposed m TXU Gas's Rate Filing with the City would result in
approximately an 5.36% increase m gas rates imposed by TXU Gas in the City of Fort Worth and
approximately $3 9 million m additional revenue for TXU Gas, and
WHEREAS, pursuant to Chapters 103 and 104 of the Texas Utilities Code, the City is
required to (i) analyze TXU Gas's Rate Filing; (ii) conduct a public hearing m order to determine
the propriety of the proposed rate increase; and (iii) make a reasonable determination of TXU
Gas's rate base, expenses, investment and rate of return in the City; and
WHEREAS, m order to have time to analyze the Rate Filing thoroughly prior to the
public hearing on this matter, rt is necessary that the City suspend implementation of TXU Gas's
proposed rate schedule from April 5, 2002 until July 4, 2002, as specifically allowed by and in
accordance with Section 104 107 of the Texas Utilities Code; and
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WHEREAS, the Crty has previously delivered to TXU Gas a written statement of the
City's reasons for rts suspending implementation of TXU Gas's proposed rate schedule,
NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF FORT WORTH, TEXAS THAT:
SECTION 1
Implementation of the rate schedule outlined m TXU Gas's March 1, 2002 Rate Filing
with the City is hereby suspended until July 4, 2002 pending a public hearing on the merits, a
determination by the City Council as to the propriety of the Rate Filing and the adoption of a rate
order by the City Council that establishes the rates that TXU Gas may charge m the City Until
July 4, 2002 or the date that a rate order adopted by the Crty Council is served on TXU Gas,
whichever is earlier, TXU Gas shall charge the same rates m the Crty as those that were in effect
on March 1, 2002
SECTION 2.
All of the declarations and findings contained m the preamble of this Ordinance are made
apart hereof and shall be fully effective as part of the ordained subject matter of this Ordinance
CF.(''TT(1N 't
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
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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 4.
This Ordinance shall take effect and be m full force and effect from and after the date of
its adoption. The Crty Secretary is hereby directed to deliver a certified copy of this Ordinance to
TXLT Gas.
AND IT IS SO ORDAINED.
ADOPTED AND EFFECTIVE dJ~ l ~~ ~D a
APPROVED AS TO FORM AND LEGALITY:
By~
Peter Vaky
Assistant CrtyaaAttorney
M&C ~. ~ VS~~
City of Fort Worth, Texas
Mayor and Council Communication
DATE REFERENCE NUMBER LOG NAME PAGE
3/26/02 G-13566 02TXU 1 of 2
SUBJECT ADOPT AN ORDINANCE SUSPENDING THE RATE SCHEDULE FILED BY TEXAS
UTILITIES GAS DISTRIBUTION WITH THE CITY OF FORT WORTH AND A
RESOLUTION AUTHORIZING PARTICIPATION IN NORTH TEXAS METROPLEX
DISTRIBUTION SYSTEM CONSORTIUM OF CITIES
RECOMMENDATION
It is recommended that the City Council
1 Adopt the attached ordinance suspending the implementation of a rate schedule filed with the City
of Fort Worth by Texas Utilities Gas (TXU Gas) Distribution on March 1, 2002 until July 4, 2002 or
the effectiveness of a rate order adopted by the City Council, whichever is earlier; and
2. Adopt the attached resolution authorizing participation by the City in the North Texas Metroplex
Distribution System Consortium of Cities (Consortium) in analyzing and assessing TXU's proposed
rate schedule
DISCUSSION
On March 1, 2002, TXU Gas Distribution, a division of TXU Gas Company, filed with the City of Fort
Worth a Statement of Intent to Change Rates in the City and the one hundred and six other area
municipalities which comprise what TXU Gas calls its "North Texas Metroplex Distribution System"
The proposed rates are approximately 8 01 % higher than the rates that are currently in effect and would
produce approximately $34 million per year in additional revenue for TXU Gas TXU Gas has proposed
to implement the new rates on April 5, 2002
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 for not longer than 90 days from the date proposed by the gas utility for implementation of
the new rates 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 an order that
establishes the rates that TXU Gas may charge in the City This order must, of course, comply with
and be based on rate computation standards that are established by state laws and regulations
City staff recommends that the City join the Consortium for assistance in reviewing TXU Gas's rate
filing and to advise the City Council with regard to the rate order that it eventually will have to adopt.
The Consortium will utilize utility rate professional services to help provide this assistance Pursuant to
State law, municipalities, as regulatory authorities, may retain consultants and other professionals to
advise, represent and assist them in any litigation or ratemaking proceeding, and any gas utility in a
ratemaking proceeding must reimburse the cities for the reasonable costs of these services It is
anticipated that TXU Gas will directly pay for these services upon submission of an invoice by the
Consortium
City of Fort Worth, Texas
Mayor and Council Communication
DATE
3/26/02 REFERENCE NUMBER
G-13566 LOG NAME
02TXU PAGE
2 of 2
SUBJECT ADOPT AN ORDINANCE SUSPENDING THE RATE SCHEDULE FILED BY TEXAS
UTILITIES GAS DISTRIBUTION WITH THE CITY OF FORT WORTH AND A
RESOLUTION AUTHORIZING PARTICIPATION IN NORTH TEXAS METROPLEX
DISTRIBUTION SYSTEM CONSORTIUM OF CITIES
FISCAL INFORMATION/CERTIFICATION
The Finance Director certifies that this action will have no material effect on City funds.
CB n
Submitted for City Manager's FUND ACCOUNT CENTER AMOUNT CITY SECRETARY
Office by: (to)
Charles Boswell 8511
Originating Department Head:
Charles Boswell 8511 (from) APPROVED 03/26/02
ORD.# 15037
Additional Information Contact: RESOLUTION NO.2820
Danny Reed 6145