HomeMy WebLinkAboutOrdinances (O-22-2214)-09/06/2022ORDINANCE 0-22-2214
AN ORDINANCE OF THE CITY OF COLLEYVILLE, TEXAS, APPROVING
A NEGOTIATED SETTLEMENT BETWEEN THE ATMOS CITIES
STEERING COMMITTEE (�'ACSC") AND ATMOS ENERGY CORP., MID-
TEX DIVISION REGARDING THE COMPANY'S 2022 RATE REVIEW
MECHANISM FILING; ADOPTING TARIFFS THAT REFLECT RATE
ADJUSTMENTS CONSISTENT WITH THE NEGOTIATED SETTLEMENT;
ESTABLISHING A BENCHMARK FOR PENSIONS AND RETIREE
MEDICAL BENEFITS; APPROVING AMORTIZATION OF REGULATORY
LIABILITY; REQUIRING THE COMPANY TO REIMBURSE ACSC'S
REASONABLE RATEMAKING EXPENSES; ADOPTING A SAVINGS
CLAUSE AND DECLARING AN EFFECTIVE DATE
WHEREAS, the City of Colleyville, Texas ("City") is a gas utility customer
of Atmos Energy Corp., Mid -Tex Division ("Atmos Mid -Tex" or
"Company"), and a regulatory authority with an interest in the
rates, charges, and services of Atmos Mid -Tex; and
WHEREAS, the City is a member of the Atmos Cities Steering Committee
("ACSC"), a coalition of similarly -situated cities served by
Atmos Mid -Tex ("ACSC Cities") that have joined together to
facilitate the review of, and response to, natural gas issues
affecting rates charged in the Atmos Mid -Tex service area; and
WHEREAS, ACSC and the Company worked collaboratively to develop a
Rate Review Mechanism ("RRM") tariff which allows for an
expedited rate review process by ACSC Cities as a substitute
to the Gas Reliability Infrastructure Program ("GRIP") process
instituted by the Legislature, and will establish rates for the
ACSC Cities based on the system -wide cost of serving the
Atmos Mid -Tex Division; and
WHEREAS, the current RRM tariff was adopted by the City by Resolution
R-18-4306 in 2018; and
WHEREAS, on about April 1, 2022, Atmos Mid -Tex filed its 2022 RRM rate
request with ACSC Cities based on a test year ending
December 31, 2021; and
WHEREAS, ACSC coordinated its review of the Atmos Mid -Tex 2022 RRM
filing through its Executive Committee, assisted by ACSC's
attorneys and consultants, to resolve issues identified in the
Company's RRM filing; and
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WHEREAS, the Executive Committee, as well as ACSC's counsel and
consultants, recommend ACSC Cities approve an increase in
base rates for Atmos Mid -Tex of $115 million applicable to
ACSC Cities with an Effective Date of October 1, 2022; and
WHEREAS, ACSC agrees Atmos plant -in-service is reasonable; and
WHEREAS, with the exception of approved plant -in-service, ACSC is not
foreclosed from future reasonableness evaluation of costs
associated with incidents related to gas leaks; and
WHEREAS, the attached tariffs (Exhibit A) implementing new rates are
consistent with the recommendation of the ACSC Executive
Committee, are agreed to by the Company, and are just,
reasonable, and in the public interest; and
WHEREAS, the settlement agreement sets a new benchmark for pensions
and retiree medical benefits (Exhibit B); and
WHEREAS, the RRM Tariff contemplates reimbursement of ACSC's
reasonable expenses associated with RRM applications;
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF COLLEYVILLE, TEXAS:
Sec. 1 THAT the findings set forth in this Ordinance are hereby in all
things approved.
Sec.2 THAT without prejudice to future litigation of any issue
identified by ACSC, the City Council finds the settled amount
of an increase in revenues of $115 million for ACSC Cities
represents a comprehensive settlement of gas utility rate
issues affecting the rates, operations, and services offered by
Atmos Mid -Tex within the municipal limits arising from Atmos
Mid-Tex's 2022 RRM filing, is in the public interest, and is
consistent with the City's authority under Section 103.001 of
the Texas Utilities Code.
Sec. 3 THAT despite finding Atmos Mid-Tex's plant -in-service to be
reasonable, ACSC is not foreclosed in future cases from
evaluating the reasonableness of costs associated with
incidents involving leaks of natural gas.
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Sec. 4 THAT the existing rates for natural gas service provided by
Atmos Mid -Tex are unreasonable. The new tariffs attached
hereto and incorporated herein as Exhibit A, are just and
reasonable, and are designed to allow Atmos Mid -Tex to
recover annually an additional $115 million from customers in
ACSC Cities, over the amount allowed under currently
approved rates. Such tariffs are hereby adopted.
Sec. 5 THAT the ratemaking treatment for pensions and retiree
medical benefits in Atmos Mid-Tex's next RRM filing shall be as
set forth on Exhibit B, attached hereto and incorporated herein.
Sec.6 THAT Atmos Mid -Tex shall reimburse the reasonable
ratemaking expenses of the ACSC in processing the Company's
2022 RRM filing.
Sec. 7 THAT to the extent any resolution or ordinance previously
adopted by the Council is inconsistent with this ordinance, it is
hereby repealed.
Sec. 8 THAT if any section, paragraph, subdivision, clause, phrase or
provision of this ordinance shall be judged invalid or
unconstitutional, the same shall not affect the validity of this
ordinance as a whole or any portion thereof other than that
portion so decided to be invalid or unconstitutional.
Sec. 9 THAT this ordinance shall take effect immediately from and
after its passage with rates authorized by attached tariffs to be
effective for bills rendered on or after October 1, 2022.
Sec. 10 THAT a copy of this ordinance shall be sent to Atmos Mid -Tex,
care of Chris Felan, Vice President of Rates and Regulatory
Affairs Mid -Tex Division, Atmos Energy Corporation, 5420 LB]
Freeway, Suite 1862, Dallas, Texas 75240, and to Thomas
Brocato, General Counsel to ACSC, at Lloyd Gosselink Rochelle
& Townsend, P.C., 816 Congress Avenue, Suite 1900, Austin,
Texas 78701.
AND IT IS SO ORDERED.
The first reading and public hearing being conducted on the 16th day of
August 2022.
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The second reading and public hearing being conducted on the 6th day of
September 2022.
PASSED AND APPROVED BY A VOTE OF 7 AYES, 0 NAYS, ON THIS THE 6T"
DAY OF SEPTEMBER 2022.
Mayor Bobby Lindamood Aye Mayor Pro Tem Kathy Wheat Aye
Brandi Elder, Place 1 Aye George Bond, Place 2 Aye
George Dodson, Place 4 Aye Chuck Kelley, Place 5 Aye
Callie Rigney, Place 6 Aye
ATTEST:
Angela Larson
Assistant City Secretary
APPROVED AS TO FORM:
Whitt Wyatt
City Attorney
CITY OF COLLEYVILLE
Bobby Lindamood
Mayor