HomeMy WebLinkAboutRes 05-04 Suspending the Proposal by Atmos Energy to Implement Interim Grip Rate AdjustmentsTOWN OF WESTLAKE
RESOLUTION NO. 05-04
A RESOLUTION OF THE BOARD OF ALDERMEN OF THE TOWN OF
WESTLAKE, TEXAS, SUSPENDING THE PROPOSAL BY ATMOS ENERGY
CORP. TO IMPLEMENT INTERIM GRIP RATE ADJUSTMENTS FOR GAS
UTILITY INVESTMENT IN 2003; AUTHORIZING PARTICIPATION WITH
OTHER CITIES SERVED BY ATMOS ENERGY CORP., MID-TEX DIVISION,
IN A REVIEW AND INQUIRY INTO THE BASIS AND REASONABLENESS OF
THE PROPOSED RATE ADJUSTMENTS; AUTHORIZING INTERVENTION IN
ADMINISTRATIVE AND COURT PROCEEDINGS INVOLVING THE
PROPOSED GRIP RATE ADJUSTMENTS; DESIGNATING A
REPRESENTATIVE OF THE TOWN TO SERVE ON A STEERING
COMMITTEE; AND REQUIRING REIMBURSEMENT OF REASONABLE
LEGAL AND CONSULTANT EXPENSES.
WHEREAS, the Town of Westlake, Texas ("Town") is a gas utility
customer of Atmos Energy Corp., Mid -Tex Division, ("Atmos Mid -Tex" or "the
Company") and a regulatory authority with an interest in the rates and charges of Atmos
Mid -Tex, and
WHEREAS, Atmos Mid -Tex made flings with the Town and the
Railroad Commission of Texas ("Railroad Commission") in December, 2004, proposing
to implement interim rate adjustments ("GRIP Rate Increases") pursuant to Texas
Utilities Code § 104.301 on all customers served by Atmos Mid -Tex, and
WHEREAS, Atmos Energy Corporation has reported a twenty percent -
increase in profits for its fiscal year ended September 30, 2004, and projects further
increases in profits in 2005; and
WHEREAS, in May, 2004, the Railroad Commission entered its Final Order
in GUD No. 9400 authorizing a rate increase that will produce additional annual revenues
of $11.5 million for Atmos Mid -Tex; and
WHEREAS, Atmos Mid -Tex has projected that it will experience annual
cost savings of at least $40 million over the costs included in rates approved in GUD No.
9400 and said savings are likely to greatly exceed the annual revenue requirement
associated with any reasonable increases in invested capital that form the basis of the
proposed GRIP rate increases; and
WHEREAS, ratepayers of Atmos Mid -Tex, including the Town and its
residents, will be adversely impacted by the proposed GRIP Rate Increases, and
WHEREAS, the Town and its residents could benefit from coordination
with other cities served by Atmos Mid -Tex ("Cities") in a review of the reasonableness of
the proposed GRIP Rate Increases and joint participation in any proceedings at the
Railroad Commission related to the proposed GRIP Rate Increases; and
WHEREAS, the reasonable costs associated with the participation of Cities
in this rate proceedings are reimbursable from Atmos Mid -Tex.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF ALDERMEN OF
THE TOWN OF WESTLAKE, TEXAS:
SECTION 1: The February 15, 2005, effective date of the GRIP Rate
Increases proposed by Atmos Mid -Tex is hereby suspended to permit adequate time to
review the proposed increases, analyze all necessary information, and take appropriate
action related to the proposed increases.
SECTION 2: The Town is authorized to cooperate with other Cities to
create and participate in a Steering Committee to hire and direct legal counsel and.
consultants, to negotiate with the Company, to make recommendations to the Town
regarding the proposed GRIP Rate Increases, and to direct any administrative
proceedings or litigation associated with the proposed GRIP Rate Increases.
SECTION 3: The Town is authorized to intervene in any administrative
proceedings or litigation associated with the proposed GRIP Rate Increases, including
GUD No. 9560, the Company's proposed GRIP Rate Increase for its pipeline system
filed at the Railroad Commission.
SECTION 4: The Town hereby designates Town Attorney L. Stanton Lowry
as a representative to a Cities' Steering Committee that shall direct the efforts of counsel
and consultants.
SECTION 5: Atmos Mid -Tex shall promptly reimburse the Town's
reasonable costs associated with the Town's activities related to the proposed GRIP Rate
Increases.
PASSED AND APPROVED ON THIS 24" DAY OF JANUARY 2005.
ATTEST:
Scott Brad -fey, Mayor
Trent O. Pe , wn Manager