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HomeMy WebLinkAboutItem 08 - TXU Gas Rate FilingITEM # MEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: ROGER NELSON, CITY MANAGER MEETING DATE: MARCH 19, 2002 SUBJECT: TXU GAS RATE FILING RECOMMENDATION: City Council consider approval of a resolution suspending the effective date of the TXU Gas Distribution Company's proposed rate increase, to authorize participation in the steering committee, and to authorize participation in an independent analysis of the rate case through the retention of legal counsel and rate case consultants. FUNDING SOURCE: It should be noted that all the costs associated with the analysis are reimbursable by TXU to the City of Grapevine at the end of the case as provided by state law. There will be no immediate impact to franchise fee collection. BACKGROUND: On March 1, 2002, the TXU Gas Distribution Company filed a request for authority to increase the rates charged for natural gas service in the North Texas Metroplex Distribution System. These systems include 107 municipalities throughout the DFW metro area (see attached list). Specifically, the proposed new rates would increase current rates by almost $34 million in the North Texas Metroplex Distribution System. The rate increase will impact each of the effected cities differently, but they will all see changes in the rates of each class of service. The City of Grapevine's average increase is outlined below: City Residential Percent Increase Commercial Percent Increase Industrial Percent Increase Total Amount Percent Increase Grapevine $428,218 11.60% $183,212 6.50% $64,002 20.60% $675,432 9.81% The average increase is comparable to the cities in our immediate Northeast Tarrant County area. March 13, 2002 (4:48PM) The attached resolution authorizes the City to participate jointly with other cities on the " Steering Committee in the distribution system, to independently analyze the gas rate filing as well as to suspend the effective date of the increase for ninety days. Staff recommends approval of the resolution. 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U A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS AUTHORIZING A STEERING COMMITTEE OF AFFECTED CITIES TO RETAIN LEGAL COUNSEL AND RATE CASE CONSULTANTS; AUTHORIZING THE CITIES TO INTERVENE IN RELATED DOCKETS BEFOE THE TEXAS RAILROAD COMMISSION; AND SUSPENDING THE PROPOSED TARIFF AND SCHEDULE OF RATES OF TXU GAS DISTRIBUTION COMPANY AND PROVIDING AN EFFECTIVE DATE WHEREAS, TXU Gas Distribution Company, (hereinafter called "TXU Gas"), on March 1, 2002, filed a Statement of Intent to Change Rates with individual cities for an increase in rates; and WHEREAS, the municipality of Grapevine, Texas, (hereinafter called "City") is a regulatory authority having a statutory duty to participate in such proceedings and whose citizens will be substantially affected by the rates established as a result of such proceedings; and WHEREAS, the City is entitled to be reimbursed for its reasonable expenses, pursuant to the Texas Gas Utilities Regulatory Act; and WHEREAS, a steering committee of distribution system cities has been formed to facilitate and coordinate the participation of cities in the service area of TXU Gas in these rate proceedings; and WHEREAS, after having considered information from TXU Gas, it is the opinion of the City Council that the proposed Schedule of Rates should be suspended for a period of ninety (90) days from the effective date stated in TXU Gas' Statement of Intent or other documentation, as initially filed or hereafter revised, for further study, investigation, presentation of evidence and public hearing; and WHEREAS, it is in the public interest to join with other cities to review such filing and present evidence as may be appropriate before the Texas Railroad Commission, all as directed by the steering committee of affected cities. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS: Section 1. That the City Council of the City of Grapevine, Texas, authorizes the City Manager, or his designee to represent the City on the Steering Committee of I affected cities (hereinafter called "Steering Committee") and authorizes the Steering Committee of which the City is a participating member, to retain legal counsel and counsel and engage rate case consultants, and to intervene on behalf of the City in related dockets and appeals. Section 2. That in order to allow the City sufficient time to analyze and prepare for the hearing and decision on any requested rates, the City Council hereby suspends the operation of the proposed tariffs and Schedule of Rates, which would otherwise go into effect for a period of ninety (90) days from the effective date stated in the TXU Gas Statement of Intent, or other documentation, as initially filed or hereafter revised, i.e., suspension until midnight, July 3, 2002, and for such additional period of time as may be necessary and authorized by law. During such period of suspension, the rates in force shall be those rates in effect when the suspended schedule was first filed and shall continue in force until finally approved, modified or denied by the City Council. Section 3. That the City should join with other participating cities to review such filing and cause to be prepared a report and recommend a rate ordinance for the consideration of all participating cities and to intervene before the Texas Railroad Commission, subject to the right to terminate such participation at any time by written notice and to act independently in the exercise of local regulatory authority. Section 4. That the City Secretary shall cause copies of this resolution to be sent to the TXU Gas representative: and to: Autry Warren Rate Manager, TXU Gas Distribution 1601 Bryan Street Dallas, Texas 75201-3402 Stan Lowry City Attorney P.O. Box 95104 Grapevine, Texas 76099 for forwarding to the Steering Committee. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS on this the 19th day of March, 2002. RES. NO. 2 itt ATTEST: "" • royAl &*-* if -•I [ ff•0-1-.4k in m