HomeMy WebLinkAbout14 0320 Council minutes294 The City Council met on March 20, 2014, at the Plainview Convention Center, 2902 W.
4 Street, Plainview, Texas. The agenda for this meeting was posted in City Hall at
11:15 a.m. on March 17, 2014. Mayor Wendell Dunlap presided. Councilmembers
present were: Charles Starnes - District 1, Cathy Waggoner- District 2, David Garcia -
District 3, V. O. Ortega- District 4, Susan Blackerby- District 5, Lionel Garcia - District 6
and Eric Hastey- District 7.
Staff members present were: Greg Ingham -City Manager, Sarianne Beversdorf-
Director of Finance, Jeffrey Snyder- Assistant City Manager, Isauro Gutierrez -
Information Technology Specialist, Rusty Powers -Fire Chief, Leslie Pearce -City
Attorney, Mike Gilliland- Director of Public Works, Ken Coughlin - Police Chief, and
Belinda Hinojosa -City Secretary.
News Media Present: Doug McDonough, Plainview Herald and Caleb Hatch,
Plainview Radio
Guests Present: Teressa King, Larry Williams and Kevin Carter
Mayor Dunlap led in the Invocation.
Mr. Ingham presented for consideration on first reading, Ordinance No. 14 -3608, an
Ordinance of the City Council of the City of Plainview, Texas, Approving a Negotiated
Settlement Agreement Between the Steering Committee of Cities Served By Atmos
West Texas ( "Cities ") And Atmos Energy Corp., West Texas Division Regarding the
Company's 2013 Statement of Intent to Increase Rates in all Cities Exercising Original
Jurisdiction; Declaring Existing Rates to be Unreasonable; Adopting Tariffs that Reflect
Rate Adjustments Consistent With the Negotiated Settlement and Finding the Rates to
be Set By the Tariffs Attached to the Settlement Agreement to be Just and Reasonable;
Approving a New Rate Review Mechanism; Requiring the Company to Reimburse
Cities' Reasonable Ratemaking Expenses; Repealing Conflicting Resolutions or
Ordinances; Determining that this Ordinance 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 Ordinance to the Company and the
Cities' Legal Counsel.
The City, along with other similarly situated cities served by Atmos Energy Corp., West
Texas Division is a member of the Steering Committee of Cities Served by Atmos West
Texas. On October 18, 2013, Atmos West Texas filed with the City a Statement of
Intent to increase natural gas rates in all cities exercising original jurisdiction in its West
Texas Division. The effective date was suspended by City resolution and extended
further by the Company to facilitate settlement discussions.
The Atmos West Texas Statement of Intent filing sought approximately $12 million in
increased revenues. The Company also proposed a revised Rate Review Mechanism
tariff. The City worked with the Steering Committee to analyze the schedules and
evidence offered by Atmos West Texas to support its request to increase rates.
The Ordinance and Settlement tariffs approve rates that will increase the Company's
revenues by $8.3 million on a system -wide basis, effective for bills rendered on or after
April 1, 2014. The monthly bill impact for the average residential customer will be a
$0.77 increase (about a 3.9% increase in the total bill). The Steering Committee's
City Council Minutes
March 20, 2014 Page 1 of 3
Executive Committee and its designated legal counsel and consultants recommend that
all Cities adopt the Ordinance approving the Settlement Agreement and implementing
the rate change.
The amount of the $8.3 million system -wide increase to be borne by West Texas Cities
is $2,566,678. The amount of the $8.3 million system wide increase to be borne by the
Amarillo group is $2,850,005 and the amount to be borne by Lubbock is $2,749,853.
We are moving toward system wide basis.
The RRM process is not new to Atmos West Texas. The Company and Cities
negotiated the original form of the RRM in 2008, and Cities approved adjustments to the
Company's rates under this mechanism in 2008, 2009, and 2010. The RRM process
was created collaboratively by the Company and the Cities as an alternative to the
legislatively authorized Gas Reliability Infrastructure Program ( "GRIP ") surcharge
process. GRIP, like the RRM, is an alternative form of expedited rate relief for utilities
(which avoids the long and costly process of a full rate filing). However, Cities strongly
oppose GRIP because it constitutes piecemeal ratemaking, does not allow any
reasonableness review, and does not allow participation by cities or recovery of cities'
rate case expenses. In short, GRIP unfairly raises customers' rates without any real
regulatory oversight. The Railroad Commission undertakes only an administrative
review of GRIP filings (instead of a full hearing) and the rate increases go into effect
without any material adjustments. The RRM process has historically allowed for a more
comprehensive rate review and annual adjustment as a substitute for GRIP filings.
Staff and the cities' counsel recommend approval of this Ordinance.
Mayor Dunlap asked for public comment. There was no public comment.
Councilmember Starnes moved to adopt Ordinance No., 14 -3608 on first reading. The
motion was duly seconded by Councilmember David Garcia.
Councilmember Hastey asked what the rate of increase was. He was advised that on a
residential customer the increase would be $0.77 or 3.9% on just base rate and
handling charge on ccf.
Councilmember Starnes asked if it requires all cities to approve such an ordinance. Mr.
Ingham stated if any city does not approve, then the city goes through the appeal
process on its own. The cities of Lubbock and Amarillo are signing off on it.
Councilmember Hastey asked how many times have we had rate increases in the last
five years. Mr. Ingham stated we have seen fairly consistent increases. We are seeing
an increase in their demand for services; they are requested to upgrade and improve
their system. We want to get back to the Rate Review Mechanisms process.
Mayor Dunlap noted that Councilmember Ortega has filed a conflict of interest
statement and will refrain from commenting or voting on the matter.
Mayor Dunlap asked for a vote on the matter. The motion carried with seven voting
"for" the motion and Councilmember Ortega abstaining.
City Council Minutes March 20, 2014 Page 2 of 3
295
296 The Council and staff reviewed the agenda for the City Council meeting of March 25,
2014.
There being no further business, Mayor Dunlap adjourned the meeting at 12:37 p.m.
Belinda Hinojosa
City Secretary
City Council Minutes
March 20, 2014 Page 3 of 3