R-06-05-11-13B1 - 5/11/2006RESOLUTION NO. R -06-05-11-13B1
RESOLUTION OF THE CITY OF ROUND ROCK, TEXAS ORDERING
ATMOS ENERGY, MID-TEX DIVISION TO SHOW CAUSE REGARDING
THE REASONABLENESS OF ITS EXISTING NATURAL GAS
DISTRIBUTION RATES WITHIN THE CITY; REQUIRING ATMOS
ENERGY, MID-TEX DIVISION, TO SUBMIT A RATE FILING PACKAGE
BASED ON A TEST YEAR ENDING DECEMBER 31, 2005; AUTHORIZING
THE CITY TO JOIN WITH OTHER CITIES KNOWN AS THE ATMOS
TEXAS MUNICIPALITIES ("ATM") TO DIRECT THE ACTIVITIES OF
LAWYERS AND CONSULTANTS; AUTHORIZING THE HIRING OF
ATTORNEYS AND CONSULTANTS; DIRECTING THAT SUCH FILING
SHALL BE MADE PRIOR TO MAY 31, 2006; REQUIRING
REIMBURSEMENT OF REASONABLE LEGAL AND CONSULTANT
EXPENSES; FINDING THAT THE MEETING COMPLIED WITH THE OPEN
MEETINGS ACT; MAKING OTHER FINDINGS AND PROVISIONS
RELATED TO THE SUBJECT; AND DECLARING AN EFFECTIVE DATE.
WHEREAS, the City is a regulatory authority under the Gas Utility
Regulatory Act ("GURA") and has original jurisdiction over the gas
utility rates of Atmos Energy, Mid -Tex Division ("Atmos"), and
WHEREAS, the City has the authority under §§ 103.001 and 104.151,
GURA, to initiate a proceeding to determine whether the existing rates
of a gas utility are unreasonable or in any way in violation of any
provision of law, and
WHEREAS, a different company, known as TXU Gas, had been the
natural gas distribution provider for the City until the system was
purchased by Atmos Energy Corporation in September 2004, and
WHEREAS, due to the acquisition by Atmos Energy Corporation there
is a need to determine if Atmos' rates are excessive, and
WHEREAS, Atmos should be required to show cause whether its rates
and its overall rate of return are reasonable, and
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WHEREAS, a coalition of cities known as Atmos Texas
Municipalities ("ATM") has been organized to review the reasonableness
of rates and services in the Mid-Tex region, and
WHEREAS, ATM was previously the Alliance of TXU Municipalities
and it operated as a coalition of cities for most of the last ten
years, and
WHEREAS, the City benefits from the expertise and the
efficiencies of ATM in reviewing the reasonableness of Atmos' rates and
services, and
WHEREAS, under GURA § 103.022 Atmos is required to reimburse the
reasonable rate case expenses of the ATM cities, Now Therefore
BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS
THAT,
Section 1. The findings set out in the preamble to this
resolution are hereby in all things approved and adopted.
Section 2. Atmos is hereby directed to show cause regarding the
reasonableness of its existing natural gas distribution rates within the
City. A rate filing package consistent with the rate filing package
ordinances of the Cities of Gatesville and Longview shall be filed by
May 31, 2006, based upon a test year ending on December 31, 2005.
Section 3. In the event that Atmos claims that it is entitled to
an increase in rates, Atmos shall provide public notice in a manner
which is consistent with the public notice ordinances for the Cities of
Leander, Greenville, Burnet, Corsicana, Manor, Bertram, Gatesville,
Longview and Denton.
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Section 4. The City shall participate with other cities in the
aforementioned proceedings as part of a coalition of cities known as
the Atmos Texas Municipalities ("ATM") and ATM shall select the experts
to work with special counsel.
Section 5. Atmos shall reimburse within thirty (30) days after
submission the City's reasonable monthly costs associated with the
City's activities related to the rate review or in related proceedings.
Section 6. Subject to the right to terminate employment at any
time, the City authorizes Jim Boyle, Alfred R. Herrera, and Daniel
Lawton to act as special counsel with regard to rate proceedings
involving Atmos before the City, the Railroad Commission of Texas or
any court of law.
Section 7. The City Secretary is hereby directed to send a true
and correct copy of this resolution to Mr. Richard Reis, Atmos Energy
Corporation, 5420 LBJ Freeway, Suite 1823, Dallas, Texas 75240-2601 and
to the ATM by sending a true and correct copy of this resolution to Mr.
Jim Finley, City Attorney for the City of Longview by fax to (903) 239-
5539.
The City Council hereby finds and declares that written notice of
the date, hour, place and subject of the meeting at which this
Resolution was adopted was posted and that such meeting was open to the
public as required by law at all times during which this Resolution and
the subject matter hereof were discussed, considered and formally acted
upon, all as required by the Open Meetings Act, Chapter 551, Texas
Government Code, as amended.
RESOLVED this llth day of May, 2006.
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A T ST:
e.A
E iTi W L, Mayor
City of Round Rock, Texas
CHRISTINE R. MARTINEZ, City secretary
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DATE: May 5, 2006
SUBJECT: City Council Meeting - May 11 2006
ITEM: 13.6.1. Consider a resolution directing Atmos Energy to show cause
regarding the reasonableness of its existing natural gas
distribution rates within the City of Round Rock.
Department: Administration
Staff Person: David Kautz, Assistant City Manager/CFO
Steve Sheets, City Attorney
Justification:
This resolution orders Atmos to file a complete rate filing package with the City
before May 31, 2006. The filing of such a rate filing package is necessary in order to
properly set rates. Atmos will follow the criteria set forth in the rate filing package
ordinances of the Cities of Gatesville and Longview. Similar show cause proceedings
have been initiated in Kentucky, Tennessee and in the City of Dallas.
Funding:
Cost: N/A
Source of funds: N/A
Outside Resources: Jim Boyle, Attorney
Background Information:
The Gas Utility Regulatory Act authorizes local regulatory authorities (municipalities)
to initiate rate proceedings in order to make a determination concerning the
reasonableness of existing rates.
Public Comment: N/A