08-07-14-Resolution-Participating in Coalition Regulating Utility Rates-08/18/2014RESOLUTION NO. R#08-0 [-14
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF SANGER, TEXAS AUTHORIZING THE CITY'S
PARTICIPATON IN A COALITION OF SIMILARLY
SITUATED CITIES IN PROCEEDINGS BEFORE THE
RAILROAD COMMISSION OF TEXAS AND THE TEXAS
LEGISLATURE RELATED TO THE CITY'S AUTHORITY
TO EFFECTIVELY REVIEW AND REGULATE UTILITY
RATES; FINDING AND DETERMINING THAT THE
MEETING AT WHICH THIS RESOLUTION WAS PASSED
WAS IN ACCORDANCE WITH THE REQUIREMENTS OF
THE TEXAS OPEN MEETINGS ACT; MAKING OTHER
FINDINGS AND PROVISIONS RELATED TO THE
SUBJECT; AND DECLARING AN EFFECTIVE DATE.
WHEREAS, the City of Sanger, Texas, hereinafter referred to as "City," is a member of
Atmos Texas Municipalities ("ATM"); and,
WHEREAS, ATM has participated in utility ratemaking proceedings before the Railroad
Commission of Texas; and,
WHEREAS, ATM has participated in legislative proceedings before the Texas
Legislature; and,
WHEREAS, as recently as in the 83`d Regular Session of the Texas Legislature the
Legislature considered and rejected legislation that if enacted, would have negatively affected
municipalities' original jurisdiction to regulate a utility's rates, services, and operations in the
City; and,
WHEREAS, as recently as the 83`d Regular Session of the Texas Legislature in 2013, the
Legislature considered and rejected legislation that if enacted, would have negatively affected
municipalities' ability to undertake a meaningful evaluation of a utility's request to increase gas
rates and effectively challenge unreasonable rate increases; and,
WHEREAS, the Railroad Commission of Texas has initiated proceedings to adopt new
rules whose effect would be similar to the restrictions that the Legislature rejected in its 83`d
Regular Session; and,
ATM Railroad Commission Resolution
WHEREAS, the rules the Railroad Commission of Texas proposed would diminish, if
not altogether eliminate, Texas cities' original ratemaking jurisdiction over gas utilities and
cities' ability to meaningfully review a gas utility's request to increase its rates; and,
WHEREAS, the City supports ATM's and other similarly situated coalitions of cities'
opposition to proposed rules or laws that would diminish and/or eliminate municipalities' ability
to effectively regulate gas utility rates or to meaningfully participate in contested proceedings
before the Railroad Commission of Texas; and,
WHEREAS, as the Legislature noted in Section 101.002 of the Gas Utility Regulatory
Act, utilities are by definition monopolies in the areas they serve and as a result, the normal
forces of competition that regulate prices in a free enterprise society do not operate and therefore,
public agencies, including the City, regulate utility rates, operations, and services as a substitute
for competition; and,
WHEREAS, gas utilities continue to be monopolies whose rates are not governed by the
normal forces of competition; and,
WHEREAS, to provide fair, just, and reasonable rates and adequate and efficient
services, Section 103.001 of the Gas Utility Regulatory Act grants the City exclusive original
jurisdiction over the rates, operations, and services of a gas utility within the municipality; and,
WHEREAS, under Section 103.001 of the Gas Utility Regulatory Act passed by the
Texas Legislature into law, a municipality regulating a gas utility has the right to require gas
utilities to submit information as necessary for the municipality to make a reasonable
determination of the utility's actual rate base, expenses, investment, and rate of return for
providing its services and to retain personnel necessary to make the determination of reasonable
rates; and,
WHEREAS, under Section 103.022 of the Gas Utility Regulatory Act, a municipality
participating in or conducting a ratemaking proceeding may engage rate consultants,
accountants, auditors, attorneys, and engineers to fully evaluate a utility's request to change rates
and the gas utility in the ratemaking proceeding shall reimburse the municipality its reasonable
rate case expenses; and,
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ATM Railroad Commission Resolution
WHEREAS, in order to ensure the reasonableness of gas utility rates and ensure the
adequacy of gas utility service by preserving cities' right to effectively investigate and challenge
utility -proposed rate increases both before the City and before any state agency that is authorized
to regulate gas utilities' rates;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF SANGER9 TEXAS:
Section 1. That the findings set out in the preamble to this resolution are hereby in all things
approved and adopted.
Section 2. The City directs ATM to oppose rules or legislation that would:
• Eliminate or reduce the ability of incorporated municipalities to exercise their
statutorily guaranteed original jurisdiction over gas utility rates.
• Allow the approval of increases in rates without a complete and thorough
review of a utility's capital expenditures or operating expenses by cities
representing their ratepayers' interests.
• Eliminate, delay, or diminish the reimbursement of municipalities' reasonable
costs incurred while investigating and challenging utility rate proposals or that
would otherwise reduce municipalities' ability to participate in the rate -setting
process.
Section 3. The City directs ATM to support processes that:
• Uphold and enforce municipalities' original jurisdiction over gas utility
ratemaking.
• Preserve municipalities' ability to fiilly investigate and challenge gas utilities'
proposed changes to their rates and tariffs.
• Preserve municipalities' historical right to prompt reimbursement of reasonable
costs that the municipalities' incur while investigating and challenging gas
utilities' proposals to change their rates in all related proceedings, without any
onerous predicate requirements .
Section 4. The City authorizes the ATM Steering Committee to hire and direct its advocates in
these efforts before the Railroad Commission %J Texas and the Texas Legislature.
ATM Railroad Commission Resolution
Section 5. That a copy of this resolution shall be sent to Mr. Alfred R. Herrera, Herrera &
Boyle, PLLC, 816 Congress Avenue, Suite 1250, Austin, Texas 78701, in his role as Special
Counsel to ATM.
Section 6. That the meeting at which this resolution was adopted was in all things conducted in
strict compliance with the Texas Open Meetings Act, Texas Government Code Chapter 551.
Section 7. That this resolution shall become effective from and after its passage.
PASSED AND APPROVED this 18th day of August, 2014.
ATTEST:
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Tami Taber, City Secretary
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OF SA
• • • •C, omas E. Muir, Mayor
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ATM Railroad Commission Resolution