09-28-18-Ordinance-Denying Atmos Rate Increase-09/17/2018ORDINANCE NO. 09-28-16
ORDINANCE BY THE CITY OF SANGER, TEXAS ("CITY")
DENYING A PROPOSED INCREASE SOUGHT BY ATMOS
ENERGY-MIDTEX DIVISION IN CONNECTION WITH THE
RATE INCREASE FILING IT MADE ON ABOUT DUNE 1, 2018;
APPROVING AN ALTERNATIVE INCREASE IN RATES,
DIRECTING ATMOS TO FILE CONFORMING TARIFFS AND
TO REIMBURSE THE CITY'S RATE CASE EXPENSES;
MAKING OTHER FINDINGS AND PROVISIONS RELATED TO
THE SUBJECT; FINDING THAT THE MEETING COMPLIES
WITH THE OPEN MEETINGS ACT; AND DECLARING AN
EFFECTIVE DATE.
WHEREAS, Atmos Energy ("Atmos Energy," "Atmos," or "Company") filed a
Statement of Intent with the City on or about June 1, 2018, to increase its annual revenue
by approximately $4.5 million in the cities known as Atmos Texas Municipalities
("ATM"), which equates to an increase in annual revenue of approximately 8.0 percent,
and is the equivalent of an increase of about $46.0 million on a system -wide basis; and
WHEREAS, the City is a regulatory authority under the Gas Utility Regulatory
Act ("GURA") and under Chapter 104, 6103.001 et seq. of GURA has exclusive original
jurisdiction over Atmos's rates, operations, and services within the municipality; and
WHEREAS, in order to maximize the efficient use of resources and expertise in
reviewing, analyzing and investigating Atmos's rate request and its changes in tariffs it is
prudent to coordinate the City's efforts with a coalition of similarly situated
municipalities; and
WHEREAS, the City, in matters regarding applications by Atmos to change
rates, has in the past joined with other local regulatory authorities to form an alliance of
cities known as Atmos Texas Municipalities ("ATM"), and hereby continues its
participation in ATM; and
Atmos MidTex 2018 Statement oflntent
Final Action
WHEREAS, Atmos's rate request consists of a voluminous amount of
information including Atmoss rate -filing package, exhibits, schedules, and workpapers;
and
WHEREAS, Atmos's rate application is the Company's first general rate case
since about 2012, and follows annual increases approved under the now -expired tariff
known as the "Rate Review Mechanism" ("RRM"); and
WHEREAS, Atmos proposed July 6, 2018, as the effective date for its requested
increase in rates; and
WHEREAS, the City previously suspended Atmos' proposed effective fi•om July
6, 2018, to October 4, 2018; and
WHEREAS, the City, exercising its duties as a local regulatory authority with
regard to Atmos' rates, services, and operations, through ATM engaged the law firm of
Herrera Law & Associates as Special Counsel and rate experts from the consulting firms
of the Garrett Group, LLC, GDS and Associates, Inc., and J. Randall Woolridge, Ph.D, to
review Atmos' rate filing package; and
WHEREAS, Atmos failed to establish the need for an increase of about $46
million and the specific rates Atmos proposed; and
WHEREAS, merits at most an increase of about $12.81 million, which is
approximately an increase of $1.25 million in the ATM cities, and the specific rates set
forth in Exhibit A to this Ordinance, and made a part of this Ordinance as if fully set out
in its body; and
WHEREAS, Atmos failed to establish the reasonableness of its proposed rate
design; and
WHEREAS, a reasonable rate design is as set forth in Exhibit A;
2of6
Atmos MidTex 2018 Statement of Intent
Final Action
WHEREAS, Atmos failed to establish the reasonableness of its proposed cost of
capital, including Atmos' proposed capital structure; and
WHEREAS, a reasonable cost of capital and capital structure is as set forth in
Exhibit A to this Ordinance; and
WHEREAS, pursuant to Gas Utility Regulatory Act § 103.022, cities have a
statutory right to recover their reasonable rate case expenses.
NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF SANGER, TEXAS THAT:
Section 1. The findings set out in the preamble are in all things approved and
incorporated herein as if fully set forth.
Section 2. Atmos failed to establish that its requested increase in revenue of about
$46 million, and its proposed changes in rates as set forth in its Statement of Intent
submitted to the City on about June 1, 2018, result in just and reasonable rates, and are
therefore, hereby DENIED.
Section 3. An increase of about $12.81 million as shown in Exhibit A, and as
detailed in Exhibit B to this Ordinance, each of which is hereby incorporated by
reference, and the rates shown below, are hereby APPROVED, to wit:
Approved
Increase in Annual Revenue (System Wide — MidTex Division)
$12807858
, ,
Customer Class/Rate
APPROVED RATE
Rate R - Residential
Customer Charge per month
$ l T89
Consumption Charge (per CCF)
$0.16052
Rate C "Commercial
3 of 6
Atrnos MidTex 2018 Statement of Intent
Final Action
Customer Charge per
month
$37.85
Consumption Charge
(per CCF)
$0A0081
Rate I & T — Indus.
& Transp.
Customer Charge per
month
$619.85
Consumption Chrg - First 1,500 MMBTU
$0.3655
Consumption Chrg - Next 3,500 MMBTU
$0.2908
Consumption Chrg - Over 5,000 MMBTU
$0.0761
Section 4. Arate-case-expense surcharge ("RCE Surcharge") as shown below to
allow Atmos to recover the City's rate case expenses is hereby APPROVED, said
surcharge per class to be in effect for a period of five (5) years:
Rate Class
RCE Surchar e
Residential
$0.00030 per ccf
Commercial
$0.00011 per ccf
Industrial & Transportation
$0.0001 per MMbtu
Section 5. Atmos is hereby ordered to submit to the City a report detailing the rate -
case expenses recovered through the RCE Surcharges, said report to be filed by October
1 of each year until full recovery of the rate case expenses and in no event is Atmos
permitted to recover in excess of the rate case expenses approved by this Ordinance.
Section 6. Atmos' requested return on equity of 10.50% and its proposed capital
structure of 60.18% equity and 39.82% long-term debt, are hereby DENIED.
Section 7. A return on equity of 9.80%; a cost of long-term debt of 5.45%; and a cost
of short-term debt of 1.68%, are hereby APPROVED.
Section 8. A capital structure of 53.81% equity; 38.98% long -team debt; and 7.21%
short-term debt, yielding a weighted cost of capital of 7.5189%, are hereby
APPROVED.
Atmos MidTex 2018 Statement oflntent
Final Action
Section 9. Atmos is hereby ordered to reimburse the City's rate case expenses
incurred as a member of the Atmos Texas Municipalities ("ATM") through August 31,
2018, as set forth in Exhibit B, by no later than thirty (30) days from the effective date of
this Ordinance.
Section 10. Atmos is hereby ordered to reimburse the City's rate case expenses
incurred after August 31, 2018, for the City's reasonable costs associated with the City's
continued activities related to this rate review or related to proceedings involving Atmos
in proceedings before the City or any ATM city, the Railroad Commission of Texas, or
any court of law, and that Atmos shall do so on a monthly basis and within 30 days after
submission of the City's invoices to Atmos.
Section 11. Atmos is directed to submit to the City a set of tariffs modified to
correspond to the rates approved by this Ordinance and that it do so by no later than
fifteen (15) calendar days after the effective date of this Ordinance, said submittal to be
accompanied by an affidavit from an officer of Atmos Energy attesting that the rates
presented in the modified tariffs are in accordance with the rates approved by this
Ordinance.
Section 12. The City shall continue its participation in a coalition of cities known as
the Atmos Texas Municipalities ("ATM"), and authorizes intervention in proceedings
related to Atmos' Statement of Intent before the Railroad Commission of Texas and
related proceedings in courts of law that may have an impact on rates within the City; and
Section 13. Subject to the right to terminate employment at any time, the City
continues its engagement of and authorizes the law firm of Herrera Law & Associates,
PLLC to act as Special Counsel with regard to rate proceedings involving Atmos before
the City, the Railroad Commission of Texas, or any court of law, and to retain such
experts as may be reasonably necessary for review of Atmos's rate application in such
proceedings and subject to approval by the steering committee of the ATM.
5 of 6
Atmos MidTex 2018 Statement of Intent
Final Action
Section 14. Any relief not expressly granted or approved by this Ordinance is
expressly denied.
Section 15. A copy of this Ordinance shall be sent to Mr. Alfred R. Herrera, Herrera
Law & Associates, PLLC, 816 Congress Ave., Suite 950, Austin, Texas 78701, and a
courtesy copy to Atmos's local representative.
Section 16. Atmos shall implement the rates approved by this Ordinance beginning
October 4, 2018, for service rendered on and after that date.
Section 17. To the extent of an inconsistency between this Ordinance and a prior
ordinance or resolution related to Atmos' rates, this Ordinance governs and supersedes all
prior ordinances or resolutions related to Atmos' rates.
Section 18. 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 19. This Ordinance shall become effective from and after its passage.
PASSED AND APPROVED this 17th day of September, 2018.
ATTEST:OF
'''1,
City Sec e , Cheryl Price
Thomas E. Muir
Atmos MidTex 2018 Statement oflntent
Final Action
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Legal Notices � Legal Notices
Request for Proposals
Career and Technology Welding Booths/Tables —
RFP No. 2018.10.03
October 3, 20IS at 11:00 AM (CST)
Vendors are Invited to submit competitive sealed pro-
posals to the Sanger Independent School District for the
category listed above. RFPs vriil be received a[ fi01 Elm
Street, Sanger, Texas 76266 until 11:00am (CST) Oc-
tober 3, 2018. At that time, all qualifying RFPs will be
publicly opened in the Administration Building at the ad-
dress listed above. Bid packets may be examined at the
office of the CFO at the address given above and may
also be requested at the same address, or call L.Fisher
at (940) 456.7438. The District reserves the right to reject
any and/or all RFPs or any part thereof and to waive any
formalities.
NOTICE OF PUBLIC HEARING
TO DISCUSS SANGER ISD'S
State Financial Accountability Rating
Sanger ISD will hold a public meeting
at S:OOpm, on October 08, 2018
in the DCSEC Conference Room
at 601 Elm Street, Sanger, Texas 76266.
The purpose of this hearing is to discuss
Sanger ISD's rating on the
state's financial accountability system.
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ORDINANCE #09-24-18
AN ORDINANCE OF THE CITY OF SANGER, DENTON
COUNTY, TEXAS, (BUDGET AMENDMENT 2) AMEND-
ING ORDINANCE 909-29-17, WHICH WILL AMEND
THE BUDGET FOR THE 2017-2018 FISCAL YEAR
AND AUTHORIZING AMENDED EXPENDITURES AS
PROVIDED; PROVIDING FOR THE REPEAL OF ALL
ORDINANCES IN CONFLICT; PROVIDING FOR PUBLI-
CATION; PROVIDING FOR ASEVERABILITY CLAUSE;
AND PROVIDING FOR AN EFFECTIVE DATE.
ORDINANCE #09-25-18
AN ORDINANCE OF THE CITY OF SANGER, DENTON
COUNTY, TEXAS, LEVYING A TAX RATE FOR THE
GENERAL GOVERNMENT FOR THE FISCAL YEAR
2018-2019 AND PROVIDING FOR AN EFFECTIVE
DATE.
ORDINANCE #09-26-18
AN ORDINANCE OF THE CITY OF SANGER, DEMON
COUNTY, TEXAS, ADOPTING THE BUDGET PROVID-
ING FOR THE APPROPRIATION OF FUNDS FOR OP-
ERATING AND CAPITAL EXPENDITURES FOR THE
FISCAL YEAR BEGINNING OCTOBER 1, 2018 AND
ENDING SEPTEMBER 30, 2019, PROVIDING FOR THE
INTRA AND INTER DEPARTMENT AND FUND TRANS-
FERS, PROVIDING FOR UNEXPECTED REVENUES
SUCH AS GRANTS, DONATIONS, AND INSURANCE
PflOCEEDS, PROVIDING FOR AN EFFECTIVE DATE,
AND PROVIDING FOR APPROVAL OF THE INVEST-
MENT POLICY,
ORDINANCE #09.27-18
AN ORDINANCE OF THE CITY OF SANGER, DENTON
COUNTY, TEXAS, APPROVING THE 2018 TAX ROLLS
AND PROVIDING AND EFFECTIVE DATE.
ORDINANCE NO. 09-28-18
ORDINANCE BY THE CITY OF SANGER, TEXAS
(`CITY") DENYING A PROPOSED INCREASE SOUGHT
BV ATMOS ENERGY-MIDTEX DIVISION IN CONNEC-
TION WITH THE RATE INCREASE FILING IT MADE
ON ABOUT JUNE 1, 2018; APPROVING AN ALTERNA-
TIVE INCREASE IN RATES; DIRECTING ATMOS TO
FILE CONFORMING TARIFFS AND TO REIMBURSE
THE CITY'S RATE CASE EXPENSES; MAKING OTH-
ER FINDINGS AND PROVISIONS RELATED TO THE
SUBJECT; FINDING THAT THE MEETING COMPLIES
WITH THE OPEN MEETINGS ACT; AND DECLARING
AN EFFECTIVE DATE.
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Self Storage
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Boats, RVs,
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