Item 4I - MemoSOUCITY
THLAI<E Item 41
MEMORANDUM
October 4, 2022
To: Shana Yelverton, City Manager
From: Daniel Cortez, Director of Economic Development & Tourism
Subject: Resolution No. 22-028, denying Oncor Electric Delivery Company's application
to increase system -wide transmission and distribution rates within the City of
Southlake.
Action
Requested: Approval of Resolution No. 22-028, denying Oncor Electric Delivery Company's
application to increase system -wide transmission and distribution rates within
the City of Southlake.
Background
Information: Cities have been advocating on behalf of electricity consumers for many years
— especially at the Public Utility Commission of Texas. One of the most
important municipal coalitions currently active in electric utility cases is the
Steering Committee of Cities Served by Oncor ("OCSC"), an organization of
more than 156 cities in north and central Texas with residents served by the
Oncor transmission and distribution utility.
The City of Southlake, along with those other 156 cities, is part of the OCSC.
The OCSC undertakes activities on behalf of its city members and their citizens
such as participation in rate cases, rulemakings, advocacy, and legislative
efforts that impact utility rates and costs.
On May 13, 2022, Oncor filed an application with cities retaining original
jurisdiction seeking to increase system -wide transmission and distribution rates
by about $251 million or approximately 4.5% over present revenues. Oncor's
request for approval is asking the City to approve an 11.2% increase in
residential rates and a 1.6% increase in street lighting rates. The impact of this
requested increase on an average residential customer using 1,300 kWh/month
would be about $6.02 per month.
In a prior City action, Oncor's rate request was suspended from taking effect for
90 days, the fullest extent permissible under the law. This time period has
permitted the City, through its participation with the OCSC, to determine that
the proposed rate increase is unreasonable.
The OCSC and its legal counsel recommend that all cities adopt this resolution
denying Oncor's application for approval to increase system -wide transmission
and distribution rates. Once the Resolution is adopted, Oncor will have 30 days
to appeal the decision to the Public Utility Commission of Texas where the
appeal will be consolidated with Oncor's filing (i.e. PUC Docket No. 53601)
currently pending at the Public Utility Commission. All cities with original
jurisdiction, such as Southlake, will need to adopt this resolution prior to
October 30, 2022.
Financial
Considerations: None
Strategic Link: This item is specifically linked to the City's Strategy Map through 132:
Collaborate with select partners to implement service solutions
Legal Review: Lloyd Gosselink Rochelle & Townsend, P.C. has reviewed this resolution and
recommends the City Council approve Resolution No. 22-028.
Alternatives: Deny Resolution No. 22-028, denying Oncor Electric Delivery Company's
application to increase system -wide transmission and distribution rates within
the City of Southlake.
Staff
Recommendation: Approval of Resolution No. 22-028, denying Oncor Electric Delivery Company's
application to increase system -wide transmission and distribution rates within
the City of Southlake.
Attachments: Resolution 22-028
Staff Contacts: Daniel Cortez (817) 748-8039
RESOLUTION NO. 22-028
A RESOLUTION OF THE CITY OF SOUTHLAKE, TEXAS FINDING
THAT ONCOR ELECTRIC DELIVERY COMPANY LLC'S ("ONCOR"
OR "COMPANY") APPLICATION TO CHANGE 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 ("Steering Committee"), a coalition 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 May 13, 2022, Oncor filed with the City an application to
increase system -wide transmission and distribution rates by $251 million or approximately
4.5% over present revenues. The Company asks the City to approve an 11.2% increase in
residential rates and a 1.6% increase in street lighting rates; and
WHEREAS, the Steering Committee is coordinating its review of Oncor's application
and working with the designated attorneys and consultants to resolve issues in the
Company's filing; and
WHEREAS, through review of the application, the Steering Committee's consultants
determined that Oncor's proposed rates are excessive; and
WHEREAS, the Steering Committee's members and attorneys recommend that
members deny the Application; and
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
SOUTHLAKE, TEXAS:
SECTION 1. That the rates proposed by Oncor to be recovered through its electric rates
charged to customers located within the City limits, are hereby found to be
unreasonable and shall be denied.
SECTION 2. That the Company shall continue to charge its existing rates to customers
within the City.
SECTION 3. That the City's reasonable rate case expenses shall be reimbursed in full by
Oncor within 30 days of the adoption of this Resolution.
SECTION 4. 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 5. That a copy of this Resolution shall be sent to Oncor, Care of Howard
Fisher, Oncor Electric Delivery Company, LLC, 1616 Woodall Rodgers
Freeway, Dallas, Texas 75202 and to Thomas Brocato, Counsel to the
Steering Committee, at Lloyd Gosselink Rochelle & Townsend, P.C., 816
Congress Ave., Suite 1900, Austin, TX 78701.
PASSED, APPROVED AND ADOPTED THIS 4TH DAY OF OCTOBER, 2022.
ATTEST:
Amy Shelley, TRMC
City Secretary
John Huffman, Mayor
APPROVED AS TO FORM:
City Attorney