HomeMy WebLinkAbout2025-01-Resolution-Denying the Atmos Rate increase for December 16, 2024-01/06/2025 RESOLUTION NO 2025-01
RESOLUTION BY THE CITY OF SANGER, TEXAS ("CITY") DENYING THE
INCREASE IN RATES PROPOSED BY ATMOS ENERGY CORPORATION IN
ITS MID-TEX DIVISION FILED ON ABOUT DECEMBER 16, 2024,
AUTHORIZING INTERVENTION IN PROCEEDINGS RELATED TO ATMOS
ENERGY'S APPLICATION TO INCREASE RATES, AUTHORIZING SPECIAL
COUNSEL TO REPRESENT THE CITY IN MATTERS RELATED TO ATMOS
ENERGY'S PROPOSED INCREASE IN RATES, DIRECTING ATMOS TO
REIMBURSE RATE CASE EXPENSES, FINDING THAT THE MEETING
COMPLIES WITH THE OPEN MEETINGS ACT, MAKING OTHER FINDINGS
AND PROVISIONS RELATED TO THE SUBJECT, AND DECLARING AN
EFFECTIVE DATE
WHEREAS, Atmos Energy Corporation ("Atmos" or "Company") filed a
Statement of Intent with the City on about December 16,2024,to change its rate schedules
within the corporate limits of this mumcipality, specifically to increase its annual revenue
requirement by approximately $16 73 million, which represents an increase in base rates
of about 11 51%, excluding the cost of gas, and about 7 08%including the cost of gas, and
WHEREAS, the City is a regulatory authority under the Gas Utility Regulatory
Act ("GURA") and under Chapter 103, §103 001 et seq of GURA has exclusive origmal
jurisdiction over Atmos's rates, operations, and services within the municipality, and
WHEREAS,to maximize the efficient use of resources and expertise in reviewing,
analyzing and investigating Atmos's rate request and its changes in tariffs, the City joins
with other local regulatory authorities to form an alliance of cities known as the Atmos
Texas Municipalities ("ATM"), and
WHEREAS,Atmos's rate request consists of a voluminous amount of information
including Atmos's rate-filing package, exhibits, schedules, and workpapers, and
WHEREAS, Atmos's rate application is the Company's first general rate case
since about 2018, and follows six consecutive annual increases in rates pursuant to the
Interim Rate Adjustment("IRA")mechanism, also known as"GRIP"filings, and
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Atmos Energy—Mid-Tex—2024 Statement ofIntent
WHEREAS, Atmos proposed January 20, 2024, as the effective date for its
requested increase in rates, and
WHEREAS, the City will require the assistance of specialized legal counsel and
rate experts to review the ments of Atmos's application to increase rates, and
WHEREAS,Atmos's application fails to establish that its overall revenue request
resulted in no more than an amount that will permit Atmos a reasonable opportunity to earn
a reasonable return on the utility's invested capital used and useful in providing service to
the public in excess of its reasonable and necessary operating expenses, and
WHEREAS, Atmos's application fails to establish that its proposed rates are just
and reasonable, and
WHEREAS, Atmos may exercise its statutory right to appeal a City decision
regarding Atmos's request to increase rates to the Railroad Commission of Texas, and
WHEREAS,Atmos filed its Statement of Intent to increase its revenue and change
its rate with the City after it filed a substantially similar application with the Railroad
Commission of Texas, and the decision of the Railroad Commission of Texas will have a
direct impact on the City and its citizens who are customers of Atmos, and in order for the
City's participation to be meaningful, it is important that the City intervene in any such
proceedings at the Railroad Commission of Texas related to Atmos's application to
increase rates
NOW THEREFORE,BE IT RESOLVED 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's application fails to show that its proposed rates are just and
reasonable
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Atmos Energy—Mid-Tex—2024 Statement of Intent
Section 3 The City hereby DENIES Atmos's request to increase its revenue and
change its rates and in support of DENIAL finds that
A Atmos failed in its burden of proof to establish that its requested increase in
revenue or the changes set forth in its tariffs attached to Atmos's Statement of
Intent to change rates, results in just and reasonable rates,
B Atmos failed in its burden of proof to establish that adoption of its proposed
rate base, expenses, investment, return on equity, and other rate issues as
presented in Atmos's Statement of Intent to increase rates, result in just and
reasonable rates
Section 4 The City shall participate in a coalition of cities known as the Atmos Texas
Mumcipahties ("ATM"), and authorizes intervention in proceedings related to Atmos's
Statement of Intent before the Railroad Commission of Texas and related proceedings in
` courts of law, and
Section 5 The City hereby orders Atmos to reimburse the City's rate case expenses
consistent with the Gas Utility Regulatory Act and that Atmos shall do so on a monthly
basis and within 30 days after submission of the City's invoices for the City's reasonable
costs associated with the City's activities related to this rate review or related to
proceedings involving Atmos before the City, the Railroad Commission of Texas, or any
court of law
Section 6 Subject to the right to terminate employment at any time, the City retains
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 subject to approval by the steering committee of the
ATM
Section 7 The City,in coordination with the Atmos Steering Committee, shall review
the invoices of the lawyers and rate experts for reasonableness before submitting the
invoices to Atmos for reimbursement
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Atmos Energy—Mid-Tex—2024 Statement of Intent
Section 8. A copy of this resolution shall be sent to Mr. Alfred R. Herrera, Herrera
Law&Associates, PLLC, P.O. Box 302799, Austin,Texas 78703,and a courtesy copy to
Atmos's local representative.
Section 9. The meeting at which this resolution was approved was in all things
conducted in strict compliance with the Texas Open Meetings Act, Texas Government
Code, Chapter 551.
Section 10. This resolution shall become effective from and after its passage.
PASSED AND APPROVED this 6TH day of JANUARY,2025.
Thomas E. Muir, Mayor
ATTEST:
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Atmos Energy-Mid-Tex-2024 Statement of Intent