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Item 9A Memo1l 1 I • : \ � 1l March 18, 2011 TO: Billy Campbell, City Manager FROM: Sharen Elam, Director of Finance Ext. 1713 SUBJECT: Resolution No. 03 -037, Suspending the Effective Date of TXU Gas Distribution's Requested Rate Changes to Permit the City Time to Study the Request and to Establish Reasonable Rates; Approving Cooperation with other Cities within the TXU Gas Distribution System to Create a Steering Committee to Hire Legal and Consulting Services Action Requested: Approve Resolution No. 03 -037 Background Information: On May 23, 2003, TXU Gas Distribution Company filed a Statement of Intent to change gas rates in all municipalities within the TXU Gas Distribution System. The Resolution accomplishes the following objectives: 1. It suspends the effective date of proposed new rates for the maximum period allowed by law. However, it does not specifically identify the end of the suspension period because it is anticipated that TXU and Cities will reach an agreement on procedural issues that will cause TXU to move its effective date to increase the amount of time the Railroad Commission has to process the case. 2. It commits the city to cooperation with other similarly situated cities to a joint review of the Company filing, the sharing of consultants and to joint participation at the Railroad Commission. 3. It authorizes intervention at the Railroad Commission. Pipeline issues and rates have historically been under the exclusive jurisdiction of the Railroad Commission and TXU plans to file simultaneously with the Cities and the Commission because the Company plans to consolidate the Pipeline and Distribution systems under a single set of rates. Financial Considerations: It is not anticipated that there will be any assessment or monetary encumbrance for participating Cities. Rate case expenses of Cities will be reimbursed by TXU and adequate funds appear to be available from old Lone Star Gas ratemaking funds (maintained at the City of Arlington) to cover initial costs until reimbursement is arranged. Citizen Input/ Board Review: None required Legal Review: Resolution reviewed by City Attorney Alternatives: Approve Resolution No. 03 -037 as presented or modify Supporting Documents: Resolution No. 03 -037 TXU Gas Distribution Executive Summary (Hard Copy) Staff Recommendation: Approval of Resolution No. 03 -037