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Home My WebLink AboutItem 14 WAIT - AtmosAction History (UTC-06:00) Submit by Kim Dobecka 9/3/2025 4:58:59 PM (Agenda Memo Submitted) Approve by Jennifer Hibbs 9/4/2025 3:45:18 PM (Submitting Department Head Approval) • Changed wording in recommendation and added formatted resolution. TAB • The task was assigned to Jennifer Hibbs 9/3/2025 4:59:00 PM • Tara Brooks reassigned the task to Tara Brooks 9/3/2025 7:16:58 PM • Tara Brooks reassigned the task to Jennifer Hibbs 9/3/2025 7:35:20 PM • Tara Brooks reassigned the task to Tara Brooks 9/3/2025 7:41:41 PM • Tara Brooks reassigned the task to Jennifer Hibbs 9/3/2025 7:42:29 PM • Tara Brooks reassigned the task to Tara Brooks 9/4/2025 11:24:52 AM • Tara Brooks reassigned the task to Jennifer Hibbs 9/4/2025 11:27:15 AM 0 Added resolution Approve by Tara Brooks 9/4/2025 11:07:01 PM (CSO Approval/Format Res and Ord) • The task was assigned to Tara Brooks 9/4/2025 3:45:19 PM Submit by Kim Dobecka 9/5/2025 8:51:19 AM (CMO Changes/Update) • The task was assigned to Michelle Gambaro, Kim Dobecka 9/4/2025 11:07:02 PM • Kim Dobecka assigned the task to Kim Dobecka 9/5/2025 8:41:09 AM Approve by Jennifer Hibbs 9/5/2025 1:04:25 PM (Jennifer Hibbs Changes/Approval) • The task was assigned to Jennifer Hibbs 9/5/2025 8:51:19 AM Approve by Jennifer Hibbs 9/5/2025 4:08:46 PM (Bruno Rumbelow Changes/Approval) • The task was assigned to Bruno Rumbelow 9/5/2025 1:04:25 PM • Tara Brooks reassigned the task to Jennifer Hibbs 9/5/2025 3:52:48 PM Submit by Tara Brooks 9/10/2025 8:09:05 AM (CSO Final Check) • The task was assigned to Tara Brooks 9/5/2025 4:08:46 PM MEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: BRUNO RUMBELOW, CITY MANAGER MEETING DATE: SEPTEMBER 16, 2025 SUBJECT: APPROVAL OF A RATE REVIEW MECHANISM SETTLEMENT WITH ATMOS ENERGY RECOMMENDATION: City Council to consider a resolution approving a settlement agreement with Atmos Energy associated with the 2025 Rate Review Mechanism (RRM) filing. FUNDING SOURCE: BACKGROUND: The City, along with 181 other Mid -Texas cities served by Atmos Energy Corporation, Mid -Tex Division ("Atmos Mid -Tex" or "Company"), is a member of the Atmos Cities Steering Committee ("ACSC"). In 2007, ACSC and Atmos Mid -Tex settled a rate application filed by the Company pursuant to Section 104.301 of the Texas Utilities Code for an interim rate adjustment commonly referred to as a GRIP filing (arising out of the Gas Reliability Infrastructure Program legislation). That settlement created a substitute rate review process, referred to as Rate Review Mechanism ("RRM"), as a substitute for future filings under the GRIP statute. Since 2007, there have been several modifications to the original RRM Tariff. The most recent iteration of an RRM Tariff was reflected in an ordinance adopted by ACSC members in 2018. On or about April 1, 2025, the Company filed a rate request pursuant to the RRM Tariff adopted by ACSC members. The Company claimed that its cost -of -service in a test year ending December 31, 2024, entitled it to additional system -wide revenues of $245.2 million. Application of the standards set forth in ACSC's RRM Tariff reduces the Company's request to $225.6 million, $163.5 million of which would be applicable to ACSC members. After reviewing the filing and conducting discovery, ACSC's consultants concluded that the system -wide deficiency under the RRM regime should be $185.6 million instead of the claimed $245.2 million. After several settlement meetings, the parties have agreed to settle the case for $205.6 million. This is a reduction of $20 million to the Company's initial request. This includes payment of ACSC's settlement related expenses. The Effective Date for new rates is October 1, 2025. ACSC was represented in the settlement by it's Board which consists of representatives from 18 member cities. The impact of the settlement on average residential rates is an increase of $7.83 on a monthly basis, or 9.27%. The increase for average commercial usage will be $25.73 or 6.56%. While residents outside municipal limits must pay rates governed by GRIP, there are some cities served by Atmos Mid -Tex that chose to remain under GRIP rather than adopt RRM. Additionally, the City of Dallas adopted a variation of RRM which is referred to as DARR. When new rates become effective on October 1, 2025, ACSC residents will maintain an economic monthly advantage over GRIP and DARR rates. Comparison to Other Mid -Tex Rates (Residential) Average Bill Compared to RRM Cities RRM Cities: $54.68 - DARR: $58.57 $3.89 ATM Cities: $57.39 $2.71 The City Council Utilities Committee has been briefed on this settlement and staff recommends approval. Submitting JENNIFER HIBBS, ASSISTANT CITY MANAGER Department* Agenda Section Next Approval (Not None Counting Finance) Bryan Beck, Public Works Director Chris Smith, Parks & Recreation Director Darrell Brown, Fire Chief Erica Marohnic, Director of Planning Services Garin Giacomarro, Director of Economic Development Jeff Strawn, Chief Financial Officer Mike Hamlin, Police Chief P.W. McCallum, CVB Director Rachel Black, HR Director Robert Singletary, Golf Director Tessa Allberg, Chief Information Officer Leigh Kapsos, Library Director Lance Wright, Purchasing Coordinator Larry Gray, Building Official Require Finance Yes No Approval * Attachment Other Description Attachments Does this agenda Yes No memo require a resolution? (?) Attached resolution RES 2025-Attachment 1.pdf 683.02KB RES 2025- Attachment 2.pdf 583.13KB RES 2025- Atmos.docx 34.17KB Does this agenda Yes No memo require an ordinance? Submitters Notes: