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Home My WebLink About19-3697 ordWOW ORDINANCE NO.19-3697 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PLAINVIEW, TEXAS, APPROVING A NEGOTIATED SETTLEMENT BETWEEN THE EXECUTIVE COMMITTEE OF CITIES SERVED BY ATMOS WEST TEXAS ("CITIES") AND ATMOS ENERGY CORP., WEST TEXAS 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 CITIES' REASONABLE RATEMAKING EXPENSES; 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. WHEREAS, the City of Plainview, Texas ("City") is a gas utility customer of Atmos Energy Corp., West Texas Division ("Atmos West Texas" or "Company"), and a regulatory authority with an interest in the rates and charges of Atmos West Texas; and WHEREAS, the City is a member of Cities Served by Atmos West Texas ("Cities"), a coalition of similarly -situated cities served by Atmos West Texas that have joined together to facilitate the review of, and response to, natural gas issues affecting rates charged in the Atmos West Texas service area; and WHEREAS, Cities and the Company worked collaboratively to develop a new Rate Review Mechanism ("RRM") tariff that allows for an expedited rate review process by Cities as a substitute to the Gas Reliability Infrastructure Program ("GRIP") process instituted by the we Legislature, and that will establish rates for Cities based on the system -wide cost of serving the Atmos West Texas service area; and WHEREAS, the RRM tariff was adopted by the City in a rate ordinance in 2018; and WHEREAS, on about April 1, 2019, Atmos West Texas filed its 2019 RRM rate request with Cities based on a test year ending December 31, 2018, and filed an errata on April 26, 2019; and WHEREAS, Cities coordinated its review of the Atmos West Texas 2019 RRM filing through its Executive Committee, assisted by Cities' attorneys and consultants, to resolve issues identified in the Company's RRM filing; and WHEREAS, the Executive Committee, as well as Cities' counsel and consultants, recommends that Cities approve an increase in base rates for Atmos West Texas of $4.7 million for Cities' members; and WHEREAS, the attached tariffs (Exhibit A) implementing new rates are consistent with the recommendation of the Cities' Executive Committee, are agreed to by the Company, and are just, reasonable, and in the public interest; and WHEREAS, the Exhibit A rate tariffs incorporate the federal income tax rates that became effective January 1, 2019; 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 Cities' reasonable expenses associated with RRM applications; 2 291 PLAINVIEW, TEXAS: Section 1. That the findings set forth in this Ordinance are hereby in all things approved. Section 2. That, without prejudice to future litigation of any issue identified by Cities, the City Council finds that the settled amount of an increase in revenues of $11.1 million on a system- wide basis, and $4.7 million increase for Cities, represents a comprehensive settlement of gas utility rate issues affecting the rates, operations, and services offered by Atmos West Texas within the municipal limits arising from Atmos West Texas' 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 West Texas are unreasonable. The new tariffs attached hereto and incorporated herein as Exhibit A, are just and reasonable, and are designed to allow Atmos West Texas to recover annually an additional $11.1 million in revenue on a system -wide basis, and $4.7 million from customers in 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 West Texas' 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 Exhibit C, attached hereto and incorporated herein. Section 6. That Atmos West Texas shall reimburse the reasonable ratemaking expenses of the Cities 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 Ordinance, it is hereby repealed. I 292 Section 8. That the meeting at which this Ordinance 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 Ordinance is adjudged to be unconstitutional or invalid, such judgment shall not affect, impair, or invalidate the remaining provisions of this Ordinance, and the remaining provisions of the Ordinance shall be interpreted as if the offending section or clause never existed. Section 10. That consistent with the City Ordinance that established the RRM process, this Ordinance 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 Ordinance shall be sent to Atmos West Texas, care of Philip Littlejohn, Vice President of Rates and Regulatory Affairs, West Texas Division, 6606 66th Street, Lubbock, Texas 79424, and Geoffrey Gay, General Counsel to Cities, at Lloyd Gosselink Rochelle & Townsend, P.C., 816 Congress Avenue, Suite 1900, Austin, Texas 78701. PASSED AND APPROVED on first reading this 27th day of August, 2019. PASSED AND APPROVED on second reading this loth day of September, 2019. ATTEST: Belinda Hinkqsi, City Secretary 2142/16n892336 Wendell Dunlap, Mayor APPROVED AS TO FORM: Ma ew Wade, City Attorney 0 W, EXHIBIT A WEST TEXAS DIVISION ATMOS ENERGY CORPORATION RATE SCHEDULE: I RESIDENTIAL GAS SERVICE I APPLICABLE TO: I WEST TEXAS CITIES SERVICE AREA — Inside City Limits (ICL) I I EFFECTIVE DATE: I Bills Rendered on and after 10/0112019 Availability This schedule is applicable to general use by Residential customers for heating, cooking, refrigeration, water heating and other similar type uses. This schedule is not available for service to premises with an alternative supply of natural gas. Monthly Rate Charge Amount Customer Charge $16.80 Consumption Charge $ 0.23158 per Ccf The West Texas Division Gas Cost Adjustment Rider applies to this schedule. The West Texas Division Weather Normalization Adjustment Rider applies to this schedule. The West Texas Division Rider TAX applies to this schedule. The West Texas Division Rider FF applies to this schedule. The West Texas Division Rider RRM applies to this schedule. Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s). ORDINANCE PAGE 5 OF 12 WA EXHIBIT A WEST TEXAS DIVISION ATMOS ENERGY CORPORATION RATE SCHEDULE: COMMERCIAL GAS SERVICE APPLICABLE TO: WEST TEXAS CITIES SERVICE AREA — Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 10/01/2019 Availability This schedule is applicable to Commercial customers, including hospitals and churches, for heating, cooking, refrigeration, water heating and other similar type uses. This schedule is not available for service to premises with an alternative supply of natural gas. Monthly Rate Charge Amount Customer Charge $ 47.00 Consumption Charge $ 0.14656 per Ccf The West Texas Division Gas Cost Adjustment Rider applies to this schedule. The West Texas Division Weather Normalization Adjustment Rider applies to this schedule. The West Texas Division Rider TAX applies to this schedule. The West Texas Division Rider FF applies to this schedule. The West Texas Division Rider RRM applies to this schedule. Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s). ORDINANCE PAGE 6 OF 12 295 EXHIBIT A WEST TEXAS DIVISION ATMOS ENERGY CORPORATION RATE SCHEDULE: INDUSTRIAL GAS SERVICE APPLICABLE TO: WEST TEXAS CITIES SERVICE AREA — Inside City Limits (ICL) EFFECTIVE DATE. Bills Rendered on and after 10/0112019 Availability This schedule is applicable to the sales to any industrial or commercial customer whose predominant use of natural gas is other than space heating, cooking, water heating or other similar type uses. Service under this schedule is available to eligible customers following execution of a contract specifying the maximum hourly load. This schedule is not available for service to premises with an alternative supply of natural gas. Monthly Rate Charge Amount Customer Charge $ 460.75 Consumption Charge $ 0.09494 per Ccf The West Texas Division Gas Cost Adjustment Rider applies to this schedule. The West Texas Division Rider TAX applies to this schedule. The West Texas Division Rider FF applies to this schedule. The West Texas Division Rider RRM applies to this schedule. Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s). ORDINANCE PAGE 7 OF 12 CI0 EXHIBIT A WEST TEXAS DIVISION ATMOS ENERGY CORPORATION RATE SCHEDULE: PUBLIC AUTHORITY GAS SERVICE APPLICABLE TO: WEST TEXAS CITIES SERVICE AREA — Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 10/01/2019 Availability This schedule is applicable to general use by Public Authority type customers, including public schools, for heating, cooking, refrigeration, water heating and other similar type uses. This schedule is not available for service to premises with an alternative supply of natural gas. Monthly Rate Charge Amount Customer Charge $132.25 Consumption Charge $ 0.12761 per Ccf The West Texas Division Gas Cost Adjustment Rider applies to this schedule. The West Texas Division Weather Normalization Adjustment Rider applies to this schedule. The West Texas Division Rider TAX applies to this schedule. The West Texas Division Rider FF applies to this schedule. The West Texas Division Rider RRM applies to this schedule. Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s). ORDINANCE PAGE 8 OF 12 297 EXHIBIT A WEST TEXAS DIVISION ATMOS ENERGY CORPORATION RATE SCHEDULE: I TRANSPORTATION SERVICE APPLICABLE TO: I WEST TEXAS CITIES SERVICE AREA — Inside City Limits (ICL) I EFFECTIVE DATE: I Bills Rendered on and after 10/01/2019 1 1 Application Applicable, in the event that Company has entered into a Transportation Agreement, to a customer directly connected to the Atmos Energy Corp., West Texas Division Distribution System for the transportation of all natural gas supplied by Customer or Customer's agent at one Point of Delivery for use in Customer's facility with an estimated annual usage greater than 100,000 Ccf per meter. Type of Service Where service of the type desired by Customer is not already available at the Point of Delivery, additional charges and special contract arrangements between Company and Customer may be required prior to service being furnished. Monthly Rate Customer's bill will be calculated by adding the following Customer and Ccf charges to the amounts and quantities due under the riders listed below: Charge Amount Customer Charge per Meter $ 460.75 per month Consumption Charge $ 0.09494 per Ccf Upstream Transportation Cost Recovery: The customer is responsible for all upstream transportation costs. Retention Adjustment: Plus a quantity of gas equal to the Company's most recently calculated financial L&U percentage for the twelve months ended September multiplied by the gas received into Atmos Energy Corporation's West Texas Division for transportation to the customer. Franchise Fee Adjustment: Plus an amount for franchise fees calculated in accordance with Rider FF. Rider FF is only applicable to customers inside the corporate limits of any incorporated municipality. Tax Adjustment: Plus an amount for tax calculated in accordance with Rider TAX. Surcharges: Plus an amount for surcharges calculated in accordance with the applicable rider(s). Miscellaneous Charges: Plus an amount for miscellaneous charges calculated in accordance with the applicable rider(s). The West Texas Division Rider RRM applies to this schedule. Conversions: Units may be converted from Ccf to Mcf or Mmbtu as necessary to comply with the underlying transportation agreement. EXHIBIT A WEST TEXAS DIVISION ATMOS ENERGY CORPORATION RATE SCHEDULE: TRANSPORTATION SERVICE APPLICABLE TO: WEST TEXAS CITIES SERVICE AREA — Inside City Limits (ICL) EFFECTIVE DATE: Bills Rendered on and after 10/01/2019 Imbalance Fees All fees charged to Customer under this Rate Schedule will be charged based on the quantities determined under the applicable Transportation Agreement and quantities will not be aggregated for any Customer with multiple Transportation Agreements for the purposes of such fees. Monthly Imbalance Fees Customer shall pay Company a monthly imbalance fee at the end of each month as defined in the applicable Transportation Agreement, Curtailment Overpull Fee Upon notification by Company of an event of curtailment or interruption of Customer's deliveries, Customer will, for each MMBtu delivered in excess of the stated level of curtailment or interruption, pay Company 200% of the "Index" price reported for the month of delivery in Inside FERC's Gas Market Report under the heading "West Texas Waha". Replacement Index In the event the "Index" price reported for the month of delivery in Inside FERC's Gas Market Report under the heading "West Texas Waha" is no longer published, Company will calculate the applicable imbalance fees utilizing a daily price index recognized as authoritative by the natural gas industry and most closely approximating the applicable index. Agreement A transportation agreement is required. Notice Service hereunder and the rates for services provided are subject to the orders of regulatory bodies having jurisdiction and to the Company's Tariff for Gas Service. Special Conditions In order to receive transportation service under this tariff, customer must have the type of meter, instrumentation, and communication required by Company. Customer must pay Company all costs associated with the acquisition and installation of the required equipment. ORDINANCE PAGE 10 OF 12 EXHIBIT B �J NJ Q x 00- W a Q W � o � Z LL N 0 to �at1� i�mm U to U W W a OTC(iWZ W so IL9WW W. wa: o �a 12 Q� 1-0 uj o 3Wa E W cm OI) cq o 81 t0 to M 10�. ��pp aMD Q CMD t+l q N O N p 89 008 col N N r N r M 1 w IfA N aR w OMI p3 N V. gco 9 co aR g 9 � g ago !N fA FA tH co SO 0 co a N aw to to 0 se Ra R N trM n0 N o n 00 tad o in ao co A N r N r N w en to to U 0 E m c CG J c �r iv t^y a e U J (0j n a) (L x Q is 0 .2 c c� myOcU ccuiL W a }QQj is N 9 V m m C E WJ � Q' ... i' o� O L c �' gm yH O m a lL Q a Q OIL O 1- I- 1- F- rN V)-w H tDt- toWOrNM V't0 r r r r r r ORDINANCE PAGE 11 OF 12 r cq N �I Sao EXHIBIT C m h. 1�m10^ CNrr047f a0 O�h. tOtq�NNrLo ��pp `a'rmrSOO 1A O ItlOm tDCicog P QP.r40Dr mN Lo ID w OfN 61Mf0 Wtim �y r1AmtDYt��OD tD Mr � j _ mTl� INN Ar(br r(OOS � } Ci V) G E O O 9 CD t7 01 V� O N m_ h M ED V % ( r h N � cdd(lr0OmC' �f'M� �OffOQ��yyQ/1�QtVOf1�ON M M M In I A M N N N N r r r r W�Q1.. o V Ui a -- Z Np -ufr r r r r r �gp nDaOOuU trOtrOrtOtOrCDrtO<rCtrOr tOfOmNtrOyt�0�t4��1��PftteL=tttrO 'yR ppO p p9 (uQJ it _IOr r rr r I,n t0 {0 tt! t!'> t0 10 10 10 10 t[} 10 10 {A to La (V O H Q Q Up E OW d► } Ww� to mml�'p+h+m�pavMNrr ofmmh.maf of MN�y r�p rmr pp—p m C W pO m 4y) O �p coppMON WOp �mr CfMt00 ttOQ P.r mrlOmNt[lOfNmOlM� Offer p�CO(DliC/vZ0;06( l+f�O! to Mr i� ND. Nnrmr rm0,90 t vlogN8 v M pW 3 N Cal 3 E`er pI�pp��c°p�p�o�yy��cSu°iyr��iccR��pMaov_v��n i9of figin ItSTVeo rWf0QNNWT.ef-�Off+d N C7 co N N N N r cNa O _ ~� ca<� 1- LNu � 4Uorm m u� c H �oNW a, 0o000cc pp N N N N N N N N N N N N N N N N N N N N N N N co Z r CD �Z Jr rNMQ�OmPmW �rsN--�� rOOrNNNNNNNN N ORDINANCE PAGE 12 OF 12