Item 4HM E M O R A N D U M
April 24, 2018
To: Shana Yelverton, City Manager
From: Sharen Jackson, Chief Financial Officer
Subject: Resolution No. 18-018, Denying Oncor Electric Delivery
Company LLC requested rate change
Action
Requested: Approval of Resolution No. 18-018, denying Oncor Electric
Delivery Company LLC (“Oncor”) requested rate change.
Background
Information: The City, along with over 158 other cities served by Oncor is
a member of the Steering Committee of Cities Served by
Oncor (“OCSC”). OCSC has been in existence since the
late 1980s. It took on a formal structure in the early 1990s
when cities served by the former TXU gave up their statutory
right to rate case expense reimbursement in exchange for
higher franchise fee payments. Empowered by city
resolutions and funded by per capita assessments, OCSC
has been the primary public interest advocate before the
Public Utility Commission, the Courts, and the Legislature on
electric utility regulation matters for the last 30 years.
On April 5, 2018, Oncor filed with the City an application
seeking to increase distribution rates by over $19 million.
The resolution authorizes:
City to participate with the Steering Committee of
Cities Served by Oncor (OCSC) as a party in Oncor’s
Distribution Cost Recover Factor filing;
the hiring of legal counsel and consultants to review
the rate filing;
Oncor to reimburse Cities for reasonable rate case
expenses.
Financial
Considerations: Legal counsel and consultants approved by OCSC will
submit monthly invoices that will be forwarded to Oncor for
reimbursement.
Page 2 of 2
Strategic Link: B2: Collaborate with select partners to implement service
solutions
Citizen Input/
Board Review: None required
Legal Review: Lloyd Gosselink Rochelle & Townsend, P.C. prepared the
resolution.
Alternatives: Approve or deny resolution
Supporting
Documents: Resolution No. 18-018
Staff
Recommendation: Approval of Resolution No. 18-018
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RESOLUTION NO. 18-018
A RESOLUTION OF THE CITY OF SOUTHLAKE, TEXAS
FINDING THAT ONCOR ELECTRIC DELIVERY
COMPANY LLC’S APPLICATION FOR APPROVAL OF A
DISTRIBUTION COST RECOVERY FACTOR PURSUANT
TO 16 TEX. ADMIN. CODE § 25..243 TO INCREASE
DISTRIBUTION RATES WITHIN THE CITY SHOULD BE
DENIED; FINDING THAT THE CITY’S REASONABLE
RATE CASE EXPENSES SHALL BE REIMBURSED BY
THE COMPANY; FINDING THAT THE MEETING AT
WHICH THIS RESOLUTION IS PASSED IS OPEN TO THE
PUBLIC AS REQUIRED BY LAW; REQUIRING NOTICE
OF THIS RESOLUTION TO THE COMPANY AND LEGAL
COUNSEL.
WHEREAS, the City of Southlake, Texas (“City”) is an electric utility customer of Oncor
Electric Delivery Company LLC (“Oncor” or “Company”), and a regulatory authority with an
interest in the rates and charges of Oncor; and
WHEREAS, the City is a member of the Steering Committee of Cities Served by Oncor
(“OCSC”), a membership of similarly situated cities served by Oncor that have joined together to
efficiently and cost effectively review and respond to electric issues affecting rates charged in
Oncor’s service area; and
WHEREAS, on or about April 5, 2018 Oncor filed with the City an Application for
Approval of a Distribution Cost Recovery Factor (“DCRF”), PUC Docket No. 48231, seeking to
increase electric distribution rates by approximately $19,002,177; and
WHEREAS, all electric utility customers residing in the City will be impacted by this
ratemaking proceeding if it is granted; and
WHEREAS, Cities are coordinating its review of Oncor’s DCRF filing with designated
attorneys and consultants to resolve issues in the Company’s application; and
WHEREAS, Cities members and attorneys recommend that members deny the DCRF.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE C ITY
OF SOUTHLAKE, TEXAS:
Section 1. That the City is authorized to participate with Cities in PUC Docket No.
48231.
Section 2. That subject to the right to terminate employment at any time, the City of
hereby authorizes the hiring of the law firm of Lloyd Gosselink and consultants to negotiate with
the Company, make recommendations to the City regarding reasonable rates, and to direct any
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necessary administrative proceedings or court litigation associated with an appeal of this
application filed with the PUC.
Section 3. That the rates proposed by Oncor to be recovered through its DCRF
charged to customers located within the City limits, are hereby found to be unreasonable and
shall be denied.
Section 4. That the Company shall continue to charge its existing rates to customers
within the City.
Section 5. That the City’s reasonable rate case expenses shall be reimbursed in full
by Oncor within 30 days of presentation of an invoice to Oncor.
Section 6. That it is hereby officially found and determined that the meeting at which
this Resolution is passed is open to the public as required by law and the public notice of the
time, place, and purpose of said meeting was given as required.
Section 7. That a copy of this Resolution shall be sent to Stephen N. Ragland, 1616
Woodall Rodgers Freeway, Dallas, Texas 75202 and to Thomas Brocato, General Counsel to the
Cities, at Lloyd Gosselink Rochelle & Townsend, P.C., P.O. Box 1725, Austin, Texas 78767 -
1725.
PASSED AND APPROVED this __________ day of ___________________, 2018.
_________________________________
Mayor
ATTEST:
__________________________________
City Secretary
APPROVED AS TO FORM:
___________________________________
City Attorney