G-03-05-22-10A1 - 5/22/2003ORDINANCE NO. l - 03 /0/91
AN ORDINANCE SUBSTITUTING AND REPLACING ORDINANCE
NO. G -01-11-20-12C1; RELATING TO ELECTRIC FRANCHISE FEE
PAYMENTS AS CALCULATED AND PAID UNDER TEXAS UTILITY
CODE, §33.008 FOR EXISTING FRANCHISEES; AND IMPOSING A
STATUTORY CHARGE PURSUANT TO TEXAS TAX CODE
SEC. 181.025(c); CONTAINING FINDINGS AND OTHER PROVISIONS
RELATING TO THE FOREGOING SUBJECT; PROVIDING AN
EFFECTIVE DATE; AND DECLARING AN EMERGENCY.
WHEREAS, the City of Round Rock ("City") on August 13, 1963,
by Ordinance, entered in a franchise ("Franchise") with Texas Power
& Light Company ("Franchisee") which granted them the right to use
the public rights-of-way to deliver electricity in the City
("Franchise Ordinance"); and
WHEREAS, the City by Ordinance No. G -93-05-27-9D dated May
27, 1993, amended the aforesaid Franchise Ordinance; and
WHEREAS, Section 5 of the Franchise provides that the City
may collect a 4% gross receipts franchise fee from the electric
utility Franchisee for use of the public rights-of-way in the City
and the City has collected such a fee since the Franchise was
entered into; and
WHEREAS, Texas Power & Light Company, which subsequently
changed its name to Texas Utilities Electric and then to ONCOR
Electric Delivery Company (sometimes referred to herein as "Oncor")
is an "electric utility" as defined in the Texas Utility Code; and
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WHEREAS, Texas Utility Code § 33.008(a) provides that, "a
municipality may impose on an electric utility, transmission and
distribution utility . . . or electric cooperative that provides
distribution service within the municipality a reasonable charge as
specified in Subsection (b) for the use of a municipal street,
alley, or public way to deliver electricity to a retail customer.";
and
WHEREAS, Texas Utility Code § 33.008(b) provides that if "a
municipality collected a charge or fee for a franchise to use a
municipal street, alley, or public way before . [December 31,
2001], the municipality, after . . [December 31, 2001] is
entitled to collect from each electric utility, transmission and
distribution utility,. . or electric cooperative that uses the
municipality's streets, alleys, or public ways to provide
distribution service a charge based on each kilowatt hour of
electricity delivered by the utility to each retail customer whose
consuming facility's point of delivery is located within the
municipality's boundaries and
WHEREAS, Texas Utility Code §'33.008(b) further provides that
the "charge imposed shall be equal to the total electric franchise
fee revenue due the municipality from electric utilities . . . for
calendar year 1998 divided by the total kilowatt hours delivered
. during 1998 by the . . . electric utility to retail customers whose
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consuming facilities' points of delivery were located within the
municipality's boundaries." ("KWH Charge"); and
WHEREAS, § 33.008(b) further provides the "compensation a
municipality may collect from each electric utility, transmission
and distribution utility . . or electric cooperative providing
distribution service shall be equal to the charge per kilowatt hour
determined for 1998 multiplied times the number of kilowatt hours
delivered within the municipality's boundaries."; and
WHEREAS,-Texas Tax Code § 182.025 (a) authorizes the City to
make a reasonable charge upon an electric utility, such as Oncor,
and which includes an electric cooperative, pursuant to Texas
Utility Code Section 41.005, such as Pedernales Electric
Cooperative, Inc, and/or an transmission and distribution utility
which uses the rights-of-ways in the City in the course of it's
business; and
WHEREAS, the Texas Tax Code § 182.025 (c) establishes that
such charge may not exceed the charge allowed in the Utility Code
§ 33.008, which is to be equal to the franchise fee charged as of
1998; and
WHEREAS, the City Council finds and determines that the City
did collect a franchise fee before December 31, 2001 and desires to
impose and collect the charge authorized in the Texas Utility Code
§ 33.008 from.the electric utility, transmission and distribution
utility . . . or electric cooperative in the City; Now Therefore
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF ROUND ROCK,
TEXAS THAT:
1.. The findings contained in the preamble of this Ordinance
are.determined to be true and correct and are hereby adopted; and
that this Ordinance shall substitute and replace Ordinance No.
G -01-11-.20-12C1, as finally adopted on November 20, 2001.
2. Pursuant to Texas Tax Code Section 182.025, and Utility
Code § 33.008(a) and § 33.008(b), the City imposes on any electric
utility, transmission and distribution utility, or electric
cooperative that provides distribution service within the
municipalities' boundaries, a statutory charge at the maximum rate
allowed by the Texas Tax Code § 182.025 (a) and (c), which is 4% of
the gross receipts, as set out in the Franchise, or KWH charge as
authorized by Texas Utility Code § 33.008, as applicable. Such
charge shall be paid annually as is provided for in the Franchise.
3 Upon. payment of the charge, the electric utility,
transmission and distribution utility, or electric cooperative
shall also file a report with the City evidencing the kilowatt
.hours delivered or gross receipts within the City, as applicable,
during the applicable period, and other reasonable information as
requested in writing by the City to verify the accuracy of that
Report.
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4. Violations of Ordinance. It shall be a violation of this
Ordinance for the electric utility, transmission and distribution
utility . . . or electric cooperative to knowingly make a material
misrepresentation of any information required to be reported under
this ordinance.
5.
Severability. If any section, subsection, sentence,
clause, phrase, or portion of this ordinance is for any reason held
invalid or unconstitutional by any court or administrative agency
of competent jurisdiction, such•portion shall be deemed a separate,
distinct, and independent provision and such holding shall not
affect the validity of the remaining portions thereof.
6. .Effective date. This Ordinance shall take effect
immediately upon its final passage, with the KWH charge beginning
to accrue as of 12:01 AM on the day following the effective date.
The City Council hereby finds and declares that written notice
of the date, hour, place and.subject of the meeting at which this
Ordinance was adopted was posted and that such meeting was open to
the public as required by law at all times during which this
Ordinance 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.
READ and APPROVED on first reading this the
day of
, 2003.
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READ, APPROVED and ADOPTED on second reading this the
Znd
day of
ATTEST:
R
, 2003.
LL, Mayor
City of Round Rock, Texas
CHRISTINE R. MARTINEZ, City Secr ary
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DATE: May 15, 2003
SUBJECT: City Council Meeting — May 22, 2003
ITEM: *10.A.1.
Resource:
History:
Consider an ordinance imposing a statutory charge on electric
utilities pursuant to the Texas Tax Code and calculated and paid
pursuant to the Texas Utility Code. (Second Reading)
David Kautz, Assistant City Manager
Steve Sheets, City Attorney
The Texas tax code permits cities to impose a fee on any electric utility
that uses the public right of way in the City as compensation for that use.
While the City's current ordinance refers to TXU, now Oncor, and
generally to "electric utilities", changing the ordinance to refer to Oncor
and to all electric "transmission and distribution utilities" clarifies the
City's authority for unilaterally imposing the fee on any type of electric
utility, whether it is an investor owned utility, electric cooperative or
municipal that uses City rights of way.
Funding:
Cost: N/A
Source of funds: N/A
Outside Resources: N/A
Impact:/Benefit: Provides added clarity to the existing City ordinance.
Public Comment: N/A
Sponsor: N/A