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October 7, 2011 - City of Mission ORDINANCE NO. 3693

ORDINANCE NO. 3693

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF MISSION, TEXAS (“CITY”) APPROVING A NEGOTIATED RESOLUTION BETWEEN THE CITIES SERVED BY TEXAS GAS SERVICE (“CITIES”) AND TEXAS GAS SERVICE (“TGS” OR “THE COMPANY”) REGARDING THE COMPANY’S APRIL 28, 2011 COST OF SERVICE ADJUSTMENT (“COSA”) FILING; DECLARING EXISTING RATES TO BE UNREASONABLE; ADOPTING TARIFFS THAT REFLECT RATE ADJUSTMENTS CONSISTENT WITH THE NEGOTIATED SETTLEMENT AND FINDING THE RATES TO BE SET BY THE ATTACHED TARIFFS TO BE JUST AND REASONABLE; PROVIDING FOR THE RECOVERY OF THE CITIES’ AND TGS’ REASONABLE AND NECESSARY RATE CASE EXPENSES; ADOPTING A SAVINGS CLAUSE; DETERMINING THAT THIS ORDINANCE WAS PASSED IN ACCORDANCE WITH THE REQUIREMENTS OF THE TEXAS OPEN MEETINGS ACT; DECLARING AN EFFECTIVE DATE; REPEALING ANY PRIOR ORDINANCES INCONSISTENT WITH THIS ORDINANCE AND REQUIRING DELIVERY OF THIS ORDINANCE TO THE COMPANY AND CITIES’ LEGAL COUNCEL.

WHEREAS, the City of Mission, Texas (“City”) is a gas utility customer of Texas Gas Service (“TGS” or “the Company”), and a regulatory authority with an interest in the rates and charges of TGS; and

WHEREAS, the City is a member of the Cites Served by Texas Gas Service (“Cities”), a coalition of similarly situated cities served by TGS that have joined together to facilitate the review and response to natural gas issues affecting rates charged in TGS’ service area; and

WHEREAS, pursuant to the terms of the agreement settling TGS’ 2009 Statement of Intent to increase rates, Cities and TGS worked collaboratively to develop the COSA tariff that allows for an expedited comprehensive rate review process controlled in a three-year experiment; and

WHEREAS, the City took action in 2009 to approve a Settlement Agreement with TOS resolving the Company’s 2009 rate case and authorizing the COSA tariff; and

WHEREAS, the 2009 Settlement Agreement contemplates reimbursement of Cities’ reasonable expenses associated with COSA applications; and

WHEREAS, on or about April 28, 2011, TGS filed with the City a COSA tariff seeking to increase natural gas rates to all customers residing in the City; and

WHEREAS, Cities coordinated their review of TGS’ COSA filing and designated attorneys and consultants to resolve issues in the Company’s COSA filing; and

WHEREAS, the Company has filed evidence that existing rates are unreasonable and should be changed; and

WHEREAS, independent analysis by Cities’ rate expert concluded that TGS is able to justify a slight increase over current rates; and

WHEREAS, TGS agreed to reduce its request by $72,000 in addition to the $293,572 reduction associated with the application of rate caps; and

WHEREAS, the Cities’ attorneys and consultant recommend that Cities’ members approve the attached rate tariffs (“Attachment A” to this Ordinance); and

WHEREAS, the attached tariffs implementing new rates are consistent with the negotiated reached by Cities and are just, reasonable, and in the public interest; and

 

WHEREAS, the negotiated resolution of the Company’s COSA filing and the resulting rates are, as a whole, in the public interest; and

WHEREAS, the effective date of new COSA rates is to be August 1, 2011 pursuant to the COSA tariff previously adopted by the Cities.

NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF MISSION, TEXAS:

Section 1. That the City Council finds that the existing rates for natural gas service provided by TGS are unreasonable and the new tariffs, which are attached hereto and incorporated herein as Attachment A, are just and reasonable and are hereby adopted.

Section 2. The TGS shall reimburse the reasonable ratemaking expenses of the Cities in processing the Company’s rate application.

Section 3. That to the extent any resolution or ordinance previously adopted by the Council is inconsistent with this Ordinance, it is hereby repealed.

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 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 6. That this Ordinance shall become effective from and after its passage.

Section 7. That a copy of this Ordinance shall be sent to TGS, care of Dean LaFever, Director, at 5602 East Grimes Road, Harlingen, Texas 78550-1783, and to Geoffrey Gay, General Counsel to Cities, at Lloyd Gosselink Rochelle & Townsend, P.C., P.O. Box 1725, Austin, Texas 78767-1725

PASSED AND APPROVED this 26th day of September, 2011.

Norberto Salinas, Mayor

ATTEST: Anna Carrillo, City Secretary

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