HomeMy WebLinkAboutPO 6869: SETTLEMENT OF THE PROPOSED RATE INCREASE OF TEXAS GAS SERVICE COMPANY P.O. No. 6869
05/27/2020 gt
ORDINANCE NO.
AN ORDINANCE BY THE CITY OF PORT ARTHUR, TEXAS ("CITY")
APPROVING THE SETTLEMENT OF THE PROPOSED RATE INCREASE OF
TEXAS GAS SERVICE COMPANY, A DIVISION OF ONE GAS, INC. TO
INCREASE RATES IN THE CENTRAL TEXAS SERVICE AREA,THE GULF COAST
SERVICE AREA, AND THE CITY OF BEAUMONT; 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, on or about December 20, 2019,Texas Gas Service Company, a Division
of ONE Gas, Inc. ("TGS" or the "Company") filed a Statement of Intent with the City of
Port Arthur ("City") and concurrently with the Railroad Commission of Texas ("RRC" or
"Commission") to increase gas rates within the Central Texas Service Area ("CTSA"), the
Gulf Coast Service Area ("GCSA") and the City of Beaumont by$17 million per year; and
WHEREAS,the Company revised its Statement of Intent on February 14, 2020, and
decreased its requested revenue increase to $15.7 million; and
WHEREAS,TGS's statement of intent includes a request to consolidate the Central
Texas, Gulf Coast, and City of Beaumont service areas into a single Central-Gulf Service
Area; and
WHEREAS, City has exclusive original jurisdiction over the rates, operations and
services of a gas utility in areas in the municipality pursuant to Tex. Util. Code §103.001;
and
WHEREAS, Gas Utility Regulatory Act § 103.021 requires a local regulatory
authority to make a reasonable determination of rate base, expenses, investment and
rate of return and retain the necessary personnel to determine reasonable rates; and
WHEREAS, the City's reasonable cost for regulatory expenses in ratemaking
proceedings shall be reimbursed by the gas utility under Gas Utility Regulatory Act §
103.022; and
WHEREAS, the City suspended the Company's proposed effective date by 90 days
to May 6, 2020, and the effective date was further extended by agreement of the parties
to June 5, 2020; and
WHEREAS, TGS, Commission Staff, and City groups representing similarly-situated
cities in TGS's service area participated in proceedings before the Railroad Commission of
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Texas and in a number of settlement discussions to resolve the rate case issues without
litigation; and
WHEREAS, TGS has agreed to settle the rate request at a rate increase level of
$10.3 million per year for the Central Texas Service Area,the Gulf Coast Service Area, and
the City of Beaumont; and
WHEREAS, the resulting settlement rates on a consolidated basis are listed below:
Consolidated CGSA Customer Charge Commodity Charge
Settlement Rates
Residential $16.00 $0.32626
Commercial $53.33 $0.12679
Commercial Transportation $265.33 $0.12679
Public Authority $81.70 $0.12549
Industrial Transportation $520.96 $0.12707
WHEREAS, the Lawton Law Firm has recommended approval of the Settlement
terms as a reasonable alternative to resolve the rate case issues without litigation.
NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PORT
ARTHUR, TEXAS:
Section 1. That the statement and findings set out in the preamble to this
Ordinance are hereby in all things approved and adopted.
Section 2. That the City of Port Arthur hereby approves rates and tariffs
consistent with the TGS proposed Settlement on a consolidated basis.
Section 3. That TGS shall reimburse the City, through the designated
representative of the Steering Committee, for the reasonable costs of attorney and
consultant fees and expenses related thereto, upon the presentation of invoices reviewed
by the Steering Committee.
Section 4. 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 5. That this ordinance shall become effective from and after its
passage.
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READ, ADOPTED AND APPROVED this day of , 2020 at
a Special Meeting of the City of Port Arthur, Texas by the following vote: AYES:
Mayor:
Council members:
NOES:
Thurman Bill Bartie, Mayor
ATTEST:
Sherri Bellard, City Secretary
APPROVED AS TO FORM:
Valecia' '. 1-f- IN,/Attorney
APPROVED FOR ADMINISTRATION:
Ronald Burton, City Manager
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