HomeMy WebLinkAboutRES 2005-004 RESOLUTION NO. 2005-04
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
GRAPEVINE, TEXAS SUSPENDING THE PROPOSAL BY
ATMOS ENERGY CORP. TO IMPLEMENT INTERIM GRIP
RATE ADJUSTMENTS FOR GAS UTILITY INVESTMENT
IN 2003; AUTHORIZING PARTICIPATION WITH OTHER
CITIES SERVED BY ATMOS ENERGY CORP., MID-
TEXAS DIVISION, IN A REVIEW AND INQUIRY INTO THE
BASIS AND REASONABLENESS OF THE PROPOSED
RATE ADJUSTMENTS; AUTHORIZING INTERVENTION IN
ADMINISTRATIVE AND COURT PROCEEDINGS INVOLV-
ING THE PROPOSED GRIP RATE ADJUSTMENTS;
DESIGNATING A REPRESENTATIVE OF THE CITY TO
SERVE ON A STEERING COMMITTEE; REQUIRING
REIMBURSEMENT OF REASONABLE LEGAL AND
CONSULTANT EXPENSES AND PROVIDING AN
EFFECTIVE DATE
WHEREAS, the City of Grapevine, Texas ("City") is a gas utility customer of
Atmos Energy Corp , Mid-Tex Division, ("Atmos Mid-Tex" or "the company") and a
regulatory authority with an interest in the rates and charges by Atmos Mid-Tex; and
WHEREAS, Atmos Mid-Tex made filings with the City and the Railroad
Commission of Texas ("Railroad Commission") in December, 2004, proposing to
implement interim rate adjustments ("GRIP Rate Increases") pursuant to Texas Utilities
Code 10.301 on all customers served by Atmos Mid-Tex; and
WHEREAS, Atmos Energy Corporation has reported a twenty percent increase
in profits for its fiscal year ended September 30, 2004 and projects further increases in
profits in 2005; and
WHEREAS, in May, 2004, the Railroad Commission entered its final order in
GUD No. 9400 authorizing a rate increase that will produce additional annual revenues
for Atmos Mid-Tex; and
WHEREAS, Atmos Mid-Tex has projected that it will experience annual cost
savings of at least $40 million over the costs included in rates approved in GUD No.
9400 and said savings are likely to greatly exceed the annual revenue requirement
associated with any reasonable increases in invested capital that for the basis of the
proposed GRIP rate increases; and
WHEREAS, ratepayers of Atmos Mid-Tex, including the City and its residents,
will he adversely impacted by the proposed GRIP rate increases; and
WHEREAS, the City and its residents could benefit from coordination with other
cities served by Atmos Mid-Tex ("Cities") in a review of the reasonableness of the
proposed GRIP rate increases and joint proceedings at the Railroad Commission
related to the proposed GRIP Rate Increases; and
WHEREAS, the reasonable costs associated with the participation of cities in this
rate proceeding are reimbursable from Atmos Mid-Tex.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF GRAPEVINE, TEXAS:
Section 1. That all matters stated in the above preamble are true and correct
and are incorporated herein as if copied in their entirety.
Section 2. That the February 15, 2005, effective date of the GRIP Rate
Increases proposed by Atmos Mid-Tex is hereby suspended to permit adequate time to
review the proposed increases, analyze all necessary information and take appropriate
action related to the proposed increases.
Section 3. That the City is authorized to cooperate with other cities to create
and participate in a Steering Committee to hire and direct legal counsel and consultants,
to negotiate with the company, to make recommendations to the City regarding the
proposed GRIP Rate Increases, and to direct any administrative proceedings or
litigation associated with the proposed GRIP Rate Increases.
Section 4. That the City is authorized to intervene in any administrative
proceedings or litigation associated with the proposed GRIP Rate Increases, including
GUD No. 9560, the Company's proposed GRIP rate increase filed at the Railroad
Commission.
Section 5. That the City Council authorizes the City Manager to designate a
staff member as a representative to the Cities' Steering Committee that shall direct the
efforts of counsel and consultants.
Section 6. That Atmos Mid-Tex shall promptly reimburse the City's reasonable
costs associated with the City's activities related to the proposed GRIP Rate Increases.
Section 7. That this resolution shall take effect from and after the date of its
passage.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
GRAPEVINE, TEXAS on this the 18th day of January, 2005.
RES. NO. 2005-04 2
APPROVED:
William D. Tate
Mayor
ATTEST:
Lin a Huff
City Secretary
APPROVED AS TO FORM:
John F. Boyle, Jr. /
City Attorney
RES. NO. 2005-04 3