HomeMy WebLinkAboutRes 2019-08-605 ACSC RRMRESOLUTION NO. Qof q -(,/9 -/,12!�_
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANNA,
TEXAS, APPROVING A NEGOTIATED SETTLEMENT BETWEEN
THE ATMOS CITIES STEERING COMMITTEE ("ACSC") AND
ATMOS ENERGY CORP., MID-TEX DIVISION REGARDING THE
COMPANY'S 2019 RATE REVIEW MECHANISM FILING;
DECLARING EXISTING RATES TO BE UNREASONABLE;
ADOPTING TARIFFS THAT REFLECT RATE ADJUSTMENTS
CONSISTENT WITH THE NEGOTIATED SETTLEMENT; FINDING
THE RATES TO BE SET BY THE ATTACHED SETTLEMENT
TARIFFS TO BE JUST AND REASONABLE AND IN THE PUBLIC
INTEREST; APPROVING AN ATTACHED EXHIBIT
ESTABLISHING A BENCHMARK FOR PENSIONS AND RETIREE
MEDICAL BENEFITS; APPROVING AN ATTACHED EXHIBIT
REGARDING AMORTIZATION OF REGULATORY LIABILITY;
REQUIRING THE COMPANY TO REIMBURSE ACSC'S
REASONABLE RATEMAKING EXPENSES; DETERMINING
THAT THIS RESOLUTION WAS PASSED IN ACCORDANCE
WITH THE REQUIREMENTS OF THE TEXAS OPEN MEETINGS
ACT; ADOPTING A SAVINGS CLAUSE; DECLARING AN
EFFECTIVE DATE; AND REQUIRING DELIVERY OF THIS
RESOLUTION TO THE COMPANY AND THE ACSC'S LEGAL
COUNSEL.
WHEREAS, the City of Anna, 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 and charges 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 new
Rate Review Mechanism ("RRM") tariff that allows for an expedited rate review process
by ACSC Cities as a substitute to the Gas Reliability Infrastructure Program ("GRIP")
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process instituted by the Legislature, and that 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 in a rate resolution in
2018; and
WHEREAS, on about April 1, 2019, Atmos Mid -Tex filed its 2019 RRM rate request
with ACSC Cities based on a test year ending December 31, 2018; and
WHEREAS, ACSC coordinated its review of the Atmos Mid -Tex 2019 RRM filing
through its Executive Committee, assisted by ACSC's attorneys and consultants, to
resolve issues identified in the Company's RRM filing; and
WHEREAS, the Executive Committee, as well as ACSC's counsel and
consultants, recommend that ACSC Cities approve an increase in base rates for Atmos
Mid -Tex of $35.4 million applicable to ACSC Cities; 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 settlement agreement establishes an amortization schedule for
regulatory liability (Exhibit C); and
WHEREAS, the RRM Tariff contemplates reimbursement of ACSC's reasonable
expenses associated with RRM applications;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF ANNA, TEXAS:
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Section 1. That the findings set forth in this Resolution are hereby in all things
approved.
Section 2. That, without prejudice to future litigation of any issue identified by
ACSC, the City Council finds that the settled amount of an increase in revenues of $35.4
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 2019 RRM filing, is in the public interest,
and is consistent with the City's authority under Section 103.001 of the Texas Utilities
Code.
Section 3. 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 $35.4 million from customers in ACSC Cities, over the amount allowed
under currently approved rates. Such tariffs are hereby adopted.
Section 4. 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.
Section 5. That amortization of regulatory liability shall be consistent with the
schedule found in attached Exhibit C attached hereto and incorporated herein.
Section 6. That Atmos Mid -Tex shall reimburse the reasonable ratemaking
expenses of the ACSC in processing the Company's 2019 RRM filing.
Section 7. That to the extent any resolution or ordinance previously adopted by
the Council is inconsistent with this Resolution, it is hereby repealed.
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Section 8. That the meeting at which this Resolution was approved was in all
things conducted in strict compliance with the Texas Open Meetings Act, Texas
Government Code, Chapter 551.
Section 9. That if any one or more sections or clauses of this Resolution is
adjudged to be unconstitutional or invalid, such judgment shall not affect, impair, or
invalidate the remaining provisions of this Resolution, and the remaining provisions of the
Resolution shall be interpreted as if the offending section or clause never existed.
Section 10. That consistent with the City Resolution that established the RRM
process, this Resolution shall become effective from and after its passage with rates
authorized by attached tariffs to be effective for bills rendered on or after October 1, 2019.
Section 11. That a copy of this Resolution 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 LJB Freeway, Suite 1862, Dallas, Texas 75240, and to
Geoffrey Gay, General Counsel to ACSC, at Lloyd Gosselink Rochelle & Townsend, P.C.,
816 Congress Avenue, Suite 1900, Austin, Texas 78701.
PASSED AND APPROVED this 2"ilk day of
pF AJVN,9
V Mayor Nate Pike
ATTEST: '%* �;�XPS,�`' APPROVED AS TO FORM:
City Secretary Carrie L. Smith City Attorney Clark McCoy
2557/3 U7897503
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2019.