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HomeMy WebLinkAboutOrdinance 11363f ~ ORDINANCE NO. AN ORDINANCE AMENDING THE EXISTING FRANCHISE BETWEEN THE CITY OF FORT WORTH, TEXAS, AND TEXAS UTILITIES ELECTRIC COMPANY TO PROVIDE FOR A DIFFERENT CONSIDERATION; PROVIDING FOR PUBLICATION; PROVIDING AN EFFECTIVE DATE; PROVIDING FOR ACCEPTANCE BY TEXAS UTILITIES ELECTRIC COMPANY; PROVIDING FOR A TERMINATION DATE; AND FINDING AND DETERMINING THAT THE MEETING AT WHICH THIS ORDINANCE IS PASSED IS OPEN TO THE PUBLIC AS REQUIRED BY LAW. WHEREAS, Texas Utilities Electric Company, (hereinafter called "TU Electric") is engaged in the business of providing electric utility service within the City of Fort Worth, Texas, (hereinafter called the "City") and is using the public streets, alleys, grounds and rights-of-way within the City for that purpose under the terms of a franchise heretofore granted by the City, the said existing franchise being that certain contract dated August 21, 1972 (City Secretary Contract No. 7230), and amended by certain agreements dated June 22, 1992 (City Secretary Contract No. 19240), October 15, 1992 (City Secretary Contract No. 19395), January 19, 1993 (City Secretary Contract No. 19726), and April 13, 1993 (City Secretary Contract No. 19727); and WHEREAS, TU Electric has, pursuant to said franchise, been paying to the City a sum equal to three percent (3$) of its gross receipts from the retail sale of electric power and energy within the City for the rights and privileges set forth in said franchise and, in addition thereto, has reimbursed the City for its ratemaking expenses pursuant to Section 24 of the Public Utility Regulatory Act; and WHEREAS, the City and TU Electric desire to amend said franchise to provide for a different consideration to consist of a sum equal to four percent (4$) of its gross receipts from the retail sale of electric power and energy within the City, which different consideration includes, among other things, TU Electric's obligation to reimburse the City for portions of certain ratemaking and other regulatory expenses to be incurred by the City involving the regulation of TU Electric (as hereinafter provided); NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH, TEXAS: SECTION 1. The consideration payable by TU Electric for the rights and privileges granted to TU Electric by the said franchise is hereby changed to be four percent (4~) of its gross receipts from the retail sale of electric power and energy within the City, said changed percentage to be applied to said gross receipts beginning on June 1, 1993, and being payable as specified in said franchise and based upon the same time periods as specified in said franchise and being payment for the said. rights and privileges during the period specified in said franchise, said payment being in lieu of and shall be accepted as payment for all of TU Electric's obligations to pay municipal charges, fees,. rentals, wire taxes, inspection fees, easement taxes, franchise taxes, certain -2- regulatory expenses (as hereinafter provided) under Section 24 of the Public Utility Regulatory Act or any similar or successor law, or other charges and taxes of every kind, except ad valorem taxes, sales and use taxes, special taxes and assessments for public improvements and portions of certain expenses incurred by the City in general rate cases initiated by TU Electric as hereinafter provided. Except as otherwise provided in Sections 2, 3, 4 and 5 hereof, the City and TU Electric hereby agree that the payments made under Section 1 hereof shall be made by TU Electric and received by the City in lieu of and as full payment for any obligation which TU Electric has to reimburse the City for expenses incurred by the City in ratemaking or regulatory proceedings involving TU Electric, whether initiated by the City, by TU Electric, or otherwise. SECTION 2. TU Electric shall make a one-time adjustment to the payment due on September 1S, 1993, under the said franchise for the purpose of making the changed consideration as specified in Section 1 hereof effective on June 1, 1993, without altering the payment dates specified in said franchise, the amount of said adjustment being calculated as follows: (a) TU Electric shall determine its gross receipts from the retail sale of electric power and energy within the City during the month of June 1993; (b) the said June 1993 gross receipts shall be multiplied by 1~ (0.01); and (c) the amount of said adjustment shall be added to the said payment due on -3- September 15, 1993, determined in accordance with~the provisions of said franchise as was in effect prior to this amendment. SECTION 3. Notwithstanding anything to the contrary in Section 1 hereof, if TU Electric files general rate cases and the City incurs cumulative expenses, otherwise reimbursable by TU Electric under Section 24 of the Public Utility Regulatory Act or a similar or successor law, in excess of $4 million, then in such event, TU Electric shall reimburse all of the expenses incurred by the City in connection with all general rate cases filed during the period ended fifteen (15) years from the effective date hereof in excess of said $4 million. Such reimbursement of the City by TU Electric shall commence after the City incurs cumulative expenses in excess of $4 million in general rate cases and shall be made at the times and in the manner provided in Section 24 of the Public Utility Regulatory Act or a similar or successor law. The term "general rate case" as used in this Ordinance means a rate case initiated by TU Electric in which it seeks to increase its rates charged to a substantial number of its customer classes in the City and elsewhere in its system and in which TU Electric's overall revenues are determined in setting such rates and includes any appeals and judicial review of orders regarding such rate cases. City agrees to exercise reasonable best efforts, considering the facts and circumstances, to keep its. expenses on average to under $1,000,000 per general rate case. -4- SECTION 4. Notwithstanding the provisions of Section 3 hereof, in the event that the largest city, by population, served by TU Electric incurs cumulative expenses in connection with general rate cases filed by TU Electric during the .next fifteen (15) years in excess of $4 million and TU Electric reimburses said city such excess, then, in that event, TU Electric will reimburse the City of Fort Worth its reasonable expenses actually incurred that are otherwise reimbursable under Section 24 of the Public Utility Regulatory Act, Article 1446 c, V.A.T.S. (the "PURA") or a similar or successor law, in an amount calculated in accordance with the following formula: A = [(B - $4,000,000)- B] x C where: A = The amount reimbursable to the City of Fort Worth under this franchise. B =The total amount of expenses incurred by the largest city, by population, served by TU Electric during the next 15 years in connection with general rate cases filed by TU Electric, which expenses would be reimbursable under Section 24 of the PURA or a similar or successor law except for the terms of said city's franchise, but excluding all such expenses incurred in connection with Public Utility Commission of Texas Dockets Nos. 9300 and 11735; and C = The total amount of expenses incurred by the City of Fort Worth, during next 15 years, in connection with general rate -5- cases filed by TU Electric, which expenses would be reimbursable under Section 24 of the PURA or a similar or successor law except for the terms of this franchise, but excluding all such expenses incurred in connection with Public Utility Commission of Texas Dockets Nos. 9300 and 11735. Such reimbursement of the City by TU Electric shall commence after the largest city, by population, served by TU Electric incurs cumulative expenses in excess of $4 million in general rate cases and shall be made at the times and in the manner provided in Section 24 of the Public Utility Regulatory Act or a similar or successor law. The provisions of Section 4 hereof shall apply until the City of Fort Worth incurs cumulative expenses in excess of $4 million in general rate cases and the provisions of Section 3 hereof shall then apply. SECTION 5. Notwithstanding the provisions of Sections 1, 3 and 4 hereof, TU Electric will continue to reimburse the City's expenses, if any, in connection with the appeal and any remand of Public Utility Commission of Texas Docket No. 9300 that are otherwise reimbursable under Section 24 of the Public Utility Regulatory Act, and will continue to reimburse the City's expenses, if any, in connection with Public Utility Commission of Texas Docket No. 11735 that are otherwise reimbursable under Section 24 of the Public Utility Regulatory Act to the extent that said expenses are incurred through the entry of the last action by the Public Utility Commission of Texas (i.e, the said Commission's order overruling -6- ,. the last motion for rehearing) in said Docket No. 11735; the City hereby agrees that any expenses incurred in connection with said Docket No. 11735 that the City incurs on appeal of said order will be the City's sole responsibility and further agrees -- in the events that the City is a participant in the joint intervention of cities managed by the Steering Committee of TU Electric Service Area Cities intervening in Docket No. 11735, that the City decides to continue to participate with the Steering Committee in such appeal of said order, and TU Electric is required to reimburse said Steering Committee for expenses under Section 24 of the Public Utility Regulatory Act that are incurred on appeal of said order in Docket No. 11735 -•- to reimburse TU Electric the City's share of reimbursable expenses related to said appeal and owed by TU Electric to said Steering Committee determined by the methodology chosen by the said Steering Committee (the City to notify TU Electric of the method so chosen by the Steering Committee prior to the submission of an invoice by the Steering Committee for the payment by TU Electric of said reimbursable expenses related to said appeal). Any reimbursement of the City by TU Electric under Section 5 hereof shall be made at the times and in the manner provided in Section 24 of the Public Utility Regulatory Act or a similar or successor law. The City and TU Electric hereby further agree that any expenses incurred by the City in connection with Docket No. 11735 on appeal of the last action by the Public Utility Commission (i.e. the Commission's final order overruling the last motion for rehearing) will not be considered expenses that were -7- h incurred by the City in a general rate case for purposes of determining the City's eligibility for reimbursement from TU Electric under the provisions of Sections 1, 3, and 4 hereof. SECTION 6. The City Council declares and TU Electric agrees that the sections, paragraphs, sentences, clauses and phrases of this ordinance are severable, and, if any section, paragraph, sentence, clause or phrase of'this ordinance shall be declared invalid by the final and valid judgment of a court of competent jurisdiction, such invalidity shall not affect any of the remaining sections, paragraphs, sentences, clauses or phrases of this ordinance, since the same would have been enacted by the City Council without such invalid section., paragraph, sentence, clause or phrase. -The City Council further declares and TU Electric agrees that if any of the provisions in Sections 1, 2, 3, 4 or 5 hereof concerning TU Electric's reimbursement of certain ratemaking expenses of the City are held unconstitutional, void or unenforceable for any reason by a court of competent jurisdiction, then, in that event, the reimbursement of the City's ratemaking expenses shall continue to be made as provided in Section 24 of the Public Utility Regulatory Act or a similar or successor law, and such unconstitutionality, voidness or unenforceability shall not affect the validity of any other provisions of this ordinance nor the amount of the franchise fees which TU Electric is required to pay the City hereunder. -8- SECTION 7. TU Electric agrees to make available for audit by the City TU Electric's records reflecting amounts of its gross receipts from the sale of electrical energy within the corporate limits of the City, the basis for TU Electric's franchise payments to the City, and the basis for TU Electric's franchise payments to other municipalities. The City's right to audit TU Electric under the provisions of Section 7 hereof shall be in addition to the City's rights to audit TU Electric under provisions of the Public Utility Regulatory Act and the City Charter and Section 7 hereof shall not be deemed to limit those additional audit rights. SECTION 8. A. TU Electric agrees to set goals for contracts to be entered with qualified Fort Worth minorities, women and other residents to provide goods, equipment and services to TU Electric. B. TU Electric agrees to set goals for supervisory and mid- management jobs to be made available by TU Electric to qualified Fort Worth minorities, women and residents. To this end, TU Electric agrees to faithfully adhere to all applicable federal, state and city rules and regulations pertaining to non- discrimination, equal employment and affirmative action. C. During the term hereof,. TU Electric agrees to share information developed in paragraphs A and B above upon request of the City of Fort Worth. -9- d h. SECTION 9. The City Secretary of the City of Fort Worth is hereby directed to publish this Ordinance in its entirety once a week for four (4) consecutive weeks within a period of thirty (30) days after its passage in the official newspaper of the City, as required by Section 2 of Chapter XXV of the City Charter of the City of Fort Worth, Texas. SECTION 10. This Ordinance shall take effect from and after its passage, publication and TU Electric's acceptance. TU Electric shall, within fifteen (15) days from the passage of this Ordinance, file its written acceptance of this Ordinance with the Office of the City Secretary in substantially the following form: To the Honorable Mayor, and City Council: Texas Utilities Electric Company (TU Electric), acting by and through the undersigned authorized officer, hereby accepts, on this ~ day of~~~, 1993, Ordinance No. // 3~3 amending the Curren franchise between the City and TU Eiectri.c. Further, in recognition of the fact that the current franchise between the City and TU Electric terminates prior to the expiration of fifteen (15) years from the effective date of said amendment, TU Electric hereby agrees to negotiate in good faith with the City for a new franchise to be effective on or before the termination of the current franchise and to include in said new franchise a provision that will give the City the full benefit of the fifteen (15) year period provided for in Section 3 of said amendment. TEXAS UTILITIES ELECTRIC COMPANY By: S for Vice-Presi. nt -10- ., SECTION 11. The said existing franchise shall terminate on June 30, 1993, provided that, despite said termination, TU Electric shall nevertheless make the payment due thereunder on September 15, 1993, as adjusted as provided herein, said payment being for the rights and privileges granted by the said franchise ordinance during the period from April 1, 1993, through June 30, 1993. SECTION 12. In all respects, except as specifically and expressly amended by this Ordinance, the said existing franchise shall remain in full force and effect according to its terms until said franchise ordinance terminates as provided herein. SECTION 13. It is hereby officially found and determined that the meeting at which this Ordinance is passed is open to the public as required by law and that public notice of the time, place and purpose of said meeting was given as required. ADOPTED by the City Council of the City of Fort Worth, Texas, this ~1 day of J ''~ `~ , 1993 . ,~~.Z '•s' '`~x~r ~~ ~~ ~°` '~ ~ + ^' ~* ATTEST: ~. µ;a: ~' rr~~ ,, ity Secr a' ~~ ..~. , s ry ,4 -11- :.. APPROVED AS TO FORM. AND LEGALITY: City Attorney Date : ~- ~- 7-- °~ -- q ~ ADOPTED : ~ `7 , ~ EFFECTIVE : '7~v~ ~ , f cj Cf -12- M4$fER fllE 1 AyCOUNTING 2 TRANSPOR7ATION~PUBUG WORKSa ~~ OV Fo~ ~~~ ,~,~ ~ ~ +~ ~..,~.,r„~_ _~ Texas~~~~f ~~~~ N•(ER A01~1i NIS1RATi0 f1 + ~» ~~~~~`'~~~ l ~~p,.~ 1 1~layor c~n,d C;oun~l C'~-mmunzcat~m 01/19/93 C-13671 12TUEC loft SUBJECT I AMENDMENT TO FRANCHISE AGREEMENT WITH TU ELECTRIC (CITY SECRETARY CONTRACT RECOMMENDATION: 1 ~~ It is recommended that the City Council authorize the City Manager to execute the attached amendment to the franchise agreement between the City of Fort Worth and TU Electric (City Secretary Contract No. 1230). DISCUSSION: The current term of the franchise agreement between the City of Fort Worth and TU Electric is due to expiire on March 21, 1993. The franchise agreement provides that; unless written notice is given by either party to the other party not-less than sixty days before March 21, then the franchise agreement shall be automatically renewed for an additional period of ten years. The City and TU Electric are currently in negotiations concerning certain elements of the franchise agreement:. These negotiations will not be completed on or before the sixtieth day prior to March 21, 1993. Therefore, to delay the initiation of the sixty- day period, and to allow the parties additional time to negotiate in good faith. the City and TU Electric have agreed to amend the franchise agreement to provide that the current term of the franchise agreement, instead of ending on March 21, 1993, will not expire until June 21, 1993. Further, the sixty-day notice of termination period-will not begin until sixty days prior to June 21, 1993. In addition, TU Electrir_ has agreed that, should the City of Fort Worth allow automatic renewal of the existing franchise, effective June 21, 1993, that, if TU Electric should enter into a franchise iNith another municipality in which it agrees to pay a franchise fee greater than the three percent which it pays the City of Fort Worth under its current franchise, then TU Electric's franchise fee paid to Fort Worth shall be increased to that proportionately higher rate of TU Electric's gross receipts within the City of Fort Worth. Finally, TU Electric will agree by this amendment to make available for audit by the City its accounts and records reflecting the amounts of and the basis for the computation of, its gross receipts from the sale of electrical energy within Fort Worth, as well as its accounts and records pertaining to payments by TU Electric"'to other municipalities for the purpose of verifying the appropriateness of the franchise fee under the renewed franchise. ~+. o,...,~ _~ _ City of Fort Worth, Texas Mayor and Council Communication ~~ 01/19/93 REFE EN E NUMBE C-13671 M 12TUEC 2 of 2 SUBJECT AMENDMENT TO FRANCHISE AGREEMENT WITH TU ELECTRIC (CITY SECRETARY CONTRACT N0. 7230 FISCAL INFORMATION/CERTIFICATION: This City Council action does not require the expenditure of City funds. WA:b lj ~ '1 f. t ' (-.. Su tte or C ty Manager s FUND ACCOUNT CENTER AMOUNT ITY ECRETARY Office by: ~ to APPROVED Charles Boswell s5oo L r g nat ng Departoent He CITY COUNCI 1993 Wade Adkins 7623 rom ~j~ 19 For Additional Infortwtioa ~~ e~~tJ f th Contact: e City ~ecretsiy o City of Fort Worth. Texas Wade Adkins 7623 ~~ Pr:rno~t nr rocvrl>^ na^.o.