0896ORDINANCE NO. 896 OffICIAL RECORD
AN ORDINANCE OF THE CITY OF SOUTHLAKE, TEXAS, DENYING
THE REQUEST OF ATMOS ENERGY CORP., MID-TEX DIVISION,
FOR AN ANNUAL GAS RELIABILITY INFRASTRUCTURE PROGRAM
(GRIP) RATE INCREASE IN THIS MUNICIPALITY, AS A PART OF
THE COMPANY'S STATEWIDE GAS UTILITY DISTRIBUTION
SYSTEM; APPROVING COOPERATION WITH OTHER CITIES
WITHIN THE ATMOS ENERGY CORP., MID-TEX DIVISION
DISTRIBUTION SYSTEM AS PART OF THE ATMOS CITIES
STEERING COMMITTEE (ACSC); AUTHORIZING ACSC TO HIRE
LEGAL AND CONSULTING SERVICES AND TO NEGOTIATE WITH
THE COMPANY AND DIRECT ANY NECESSARY LITIGATION;
AUTHORIZING INTERVENTION AS PART OF ACSC IN ANY APPEAL
OF THE CITY'S ACTION TO THE RAILROAD COMMISSION;
PROVIDING A REQUIREMENT FOR A PROMPT REIMBURSEMENT
OF COSTS INCURRED BY THE CITY; FINDING THAT THE MEETING
AT WHICH THIS ORDINANCE IS PASSED IS OPEN TO THE PUBLIC
AS REQUIRED BY LAW; AND PROVIDING FOR NOTICE OF THIS
ORDINANCE TO ATMOS ENERGY CORP., MID-TEX DIVISION.
WHEREAS, on or about March 30, 2006, Atmos Energy Corp., Mid -Tex Division, (the
"Company") filed with the City a request for an annual gas reliability infrastructure program
("GRIP") rate increase for customers on the Company's statewide gas utility system to be
effective May 30, 2006; and
WHEREAS, the City has exclusive original jurisdiction to evaluate the Company's
request as it pertains to the distribution facilities located within the City, pursuant to Texas
Utilities Code §§ 102.001(b) and 103.001; and
WHEREAS, it is reasonable for the City to cooperate with other cities in a coalition of
cities in opposition to the Company's filing at the Railroad Commission ("Commission"), said
coalition being known as Atmos Cities Steering Committee ("ACSC"), in any appeal of the
cities' actions to the Commission; and
WHEREAS, the Gas Utility Regulatory Act ("GURA") grants local regulatory authorities
the right to intervene in rate proceedings filed at the Railroad Commission; and
WHEREAS, the Texas Utilities Code § 103.022 provides that costs incurred by the City
in ratemaking activities are to be reimbursed by the regulated utility; and
WHEREAS, counsel for ACSC, upon review of the Company's filing and upon
consultation with various consultants, recommends finding that the Company's proposal is
unjustified and unreasonable; and
1668\15\ord060531 Model Ordinance Denying I
WHEREAS, the Company has publicly stated that it will receive substantial profit in
2005 and that its expenses are substantially below those on which the GUD No. 9400 rates it is
charging were based; and
WHEREAS, the Company's GRIP request fails to account for growth in numbers of
customers, thereby undercounting the revenues it will receive from its proposed GRIP rate
increase; and
WHEREAS, the Company's GRIP request fails to recognize that GUD No. 9400 rates
included profit based on TXU Corporation's capital structure rather than Atmos Energy Corp.'s
current capital structure, which justifies a lower rate of return; and
WHEREAS, under the provisions of § 104.301 of GURA, the interim rate adjustment is
subject to true -up in a general rate case filed within five years of the effective date of the interim
rate surcharge; and
WHEREAS, the Company has, on May 31, 2006, filed a Statement of Intent to increase
its distribution rates on a system -wide basis, using calendar year ending December 31, 2005, as
its test year; and
WHEREAS, the capital investment made by Atmos during 2005 will be reviewed in the
Statement of Intent filing, making the 2005 GRIP filing superfluous, duplicative, and
unnecessary;
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
OF SOUTHLAKE, TEXAS:
SECTION 1. That the Company's GRIP rate increase request is found to be
unreasonable, superfluous, duplicative, and unnecessary, and is therefore denied in all respects.
SECTION 2. That the City is authorized to cooperate with other Cities within the
Company's Distribution System that have formed ACSC to hire and direct legal counsel and
consultants, negotiate with the Company, make recommendations to the City regarding
reasonable rates, and to direct any necessary litigation associated with an appeal of a rate
ordinance and the rate case filed at the Commission.
SECTION 3. That the costs incurred by the City in reviewing the Company's GRIP
request shall be promptly reimbursed by the Company.
SECTION 4. That the City is authorized to intervene in any appeal of the City's action
filed at the Commission and any related litigation, and to participate in any such appeal or
litigation as a member of ACSC.
SECTION 5. This Ordinance shall become effective immediately from and after its
passage, as the law and charter in such cases provide.
1668\ 1 5\ord06O531 Model Ordinance Denying 2
SECTION 6. That 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.
SECTION 7. A copy of this ordinance, constituting final action on the Company's
application, be forwarded to the following:
Richard T. Reis
Atmos Energy Corporation
5420 LBJ Freeway, Suite 1800
Dallas, Texas 75240
Lloyd Gosselink Blevins Rochelle & Townsend
c/o Geoffrey Gay
P.O. Box 1725
Austin, Texas 78767-1725.
DULY PASSED and approved by the City Council of the City of �Q� , Texas,
on this the ab t, day of (i I yt , 2006.
PP •
ATTEST: ,. �at4 i t1',�,��%,
1/� (n/ `,o�. •Rs of :Sy1 \N � ♦/
APP OVED AS TO FO 1:
City Attorney
v
DULY PASSED and approved by the City Council of the City of LSajjfijg4 ¢) , Texas, on this
the _day of �, 2006.
APPROVED:
APP OVED AS TO F RM:
City Attorney
i/
...............................
.`�rurrrrrrp��
ATTEST: ��. SpU..... °�'�•,,��,,
o, A
-�• Cr
•
1668\15\ord060531 Model Ordinance Denying
INVOICE
Star -Telegram
400 W. 7TH STREET
102
RECEIVED
Customer ID: CIT57
Invoice Number: 272617501
FORT WORTH, TX 76
Invoice Date:
7/21/06
(817)390-7761
Federal Tax ID 22-3148254
— 8 2006
Terms:
Net due in 21 days
AUG
Due Date:
7/31/06
Bill To:
PO Number:
NO PO
CITY OF SOUTHLAKE OFFICE
OF
CITY
SECRETARY
Order Number:
27261750
1400 MAIN ST
STE 440
Sales Rep:
073
SOUTHLAKE, TX 76092-7604
Description:
CITY OF SOUTHLA
Publication Date:
7/21/06
Attn Attn: ACCOUNTS PAYABLE
Description Location Col Depth
Linage MU ` ``
Rate Amount
CITY OF SOUTHLAKE ORDINANCE NO I3580 1 70
76 LINE
$0.81 S61.56
THE STATE OF TEXAS
County of Tarrant
Before me, a Notary Public in and for said County
for the Star -Telegram, published by the Star-Telegr
depose and say that the attached clipping of an
LEGAL DEPT. STAR TELEGRAM
(817) 390-7320
Net Amount: $61.56
CHRISTY L. HOLLAND
•, • Rrc '
�F7c*5
MY COMMISSION EXPIRES
.P
!
July 31, 2008
y`
1G
,SSEDN AND AP-
ersona appeared Lisa Wesselman, Bid and Legal Coordinator
at° DAY HIS THE
I, i Ta nt County, Texas; and who, after being duly sworn, did
EGtJ DURRING CITY
ish din the above na ed paper on the listed dates: BIDS &
:OUNCIL MEETING:
4YOR: Andy
Jambsganss
'TEST: Lon Farwell,
:ity Secretary
1
J'q(' J,n'/�✓I"
SUBSCRIBED AND SWORN TO BEFORE ME, THIS Tuesday, July 25,
Notary
Thank You For Your Payment
----------------------------------
Remit To: Star -Telegram Customer ID:
P.O. BOX 901051 Customer Name:
FORT WORTH, TX 76101-2051 Invoice Number:
Invoice Amount:
PO Number:
Amount Enclosed:
CIT57
CITY OF SOUTHLAKE
272617501
$61.56
NO PO
INVOICE Draft Only
Star-Telegram Customer ID: CIT57
400 W.7TH STREET RECEIVED Invoice Number: 271568601
FORT WORTH,TX 76102
(817)390-7761 Invoice Date: 6/23/06
Federal Tax ID 22-3148254 JUL 1 0 2006 Terms: Net due in 21 days
Due Date: 6/30/06
Bill To: PO Number: NO PO
CITY OF SOUTHLAKE OFFICE OF CITY SECRETARY
1400 MAIN ST Order Number: 27156860
STE 440 Sales Rep: 073
SOUTHLAKE, TX 76092-7604 Description: CITY OF SOUTHLA
Attn Attn: ACCOUNTS PAYABLE Publication Date: 6/23/06
Description Location Col Depth Linage MU Rate Amount
CITY OF SOUTHLAKE Notice is he Cp113580 TFX 1 90 90 LINE $0.81 $72.90
OF S UTHLAKE Qj�{I, ioN. ro EE�LL+'N'
)84,
��y 1 Cittyy Coungcill of A I UTY
G INFRA-
NSa City of Southlake, STRUCTURE Pit Net Amount: $72.90
Texas, that a public GRAM (GRIPJ.111
hearing will be held INCREASE IN HI
on July 18, 2006, at MUNICIPALITY,ASTH AE
5:00 p.M. or.immedi- PART OF
ately following the COMPANY S Work Session, during STATEWIDE GAS
the Regular City UTILITY DISTRIBU-
Councill meeting to be TION SYSTEM; AP-
held in the City PROVING COOPER-
Council Chambers of ATION WITH OTHER
Town Hall,1400 Main CITIES WITHIN THE
Street, Southlake, ATMOS ENERGY
Texas.Purpose of the CORP. MID-TEX
public hearing is to DIVISIbN DISTRI-
consider the second BUTTON SYSTEM AS
reading of the fol- PART OF T CITIES
lowingg ordinance: MOS
ORDINA8N966E NO. STEERING
ACSC;
TH ppICITY • r SC TO HIRIELEGAL'
SOI D1LAK T - AND CONSULTING
AS, DDENYI 'TM SERVICES AND TO ppQ.:%~•.,
REQUEST AT- NEGOTIATE WITH rtt CHRISTY L.HOLLAND
MOS ENERGY THE COMPANY AND �• •'*: MY COMMISSION EXPIRES
DIRECT ANY NEC- �:•
ESSARY LITIGA- s E" July 31,2008
TION' AUTHORIZ- "'''4,p.,,,,•
THE STATE OF TEXAS ING INTERVENTION �.
AS PART OF ACSC
County of Tarrant IN ANY APPEAL OF
TOETHIEYRAIILROAD
COMMISSION;
Before me, a Notary Public in and for said Cc PR- DING
FORA day personally appeared Lisa Wesselman, Bid and Legal Coordinator
for the Star Telegram, published by the Star-T PROMPT RE OF orth 'n Tarrant County,Te as;and who, after being duly sworn,did
depose and say that the attached clipping c BY THE
THE INCURRED
CiTv'' as p ulished in the above'amed paper on the listed dates: BIDS&
LEGAL DEPT. STAR TLEGRAM FINDING THAT THE
MEETING AT WHICH
(817) 390-7320 THIS ORDINANCE IS
PASSED IS OPEN TO r I I
THE PUBLIC AS
REQUIRED BY LAW'
FOR NOTTICEIDI ONF , _A_A
THIS
O ATMOS ORDINANCE
SUBSCRIBED AND SWORN TO BEFORE ME,THIS CORP. MID-TEXT 2006.
DIVISIbN.
City of Southlakedi/././...‘,--d
Lon Farwell ,)
City Secretary
Thank You For Your Payment
Remit To: Star-Telegram Customer ID: CIT57
P.O. BOX 901051 Customer Name: CITY OF SOUTHLAKE
FORT WORTH, TX 76101-2051 Invoice Number: 271568601
Invoice Amount: $72.90
PO Number: NO PO
Amount Enclosed: $ � � ��� ��� ����1