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HomeMy WebLinkAboutO-2371-1-05ORDINANCE NO. 2371-1-05 AN ORDINANCE OF THE CITY OF ALLEN, COLLIN COUNTY, TEXAS, FINDING THAT THE CURRENT RATES OF COSERV GAS LTD. ARE UNREASONABLE; APPROVING COSERV GAS LTD.'S REVISED AND UNCONTESTED TARIFFS; APPROVING A RATE PHASE-IN; AUTHORIZING OF DEFERRAL OF CARRYING CHARGES ON PLANT HELD FOR FUTURE USE; RECOGNIZING COSERV'S RIGHT TO SURCHARGE FOR FACILITY RELOCATION REQUIRED BY THE CITY; SETTING THE EFFECTIVE DATE OF NEW TARIFFS AS FEBRUARY 1, 2005; FINDING CITIES' RATE CASE EXPENSES REASONABLE; SEVERING THE DETERMINATION OF THE REASONABLENESS OF COSERV GAS LTD.'S RATE CASE EXPENSE FROM APPROVAL OF THE REVISED TARIFFS; RETAINING JURISDICTION OVER THE DETERMINATION OF THE REASONABLENESS OF COSERV GAS LTD.'S RATE CASE EXPENSE ISSUE UNTIL MARCH 1, 2005; ADOPTING A BASE RATE CASE MORATORIUM; FINDING THAT ANY RELIEF REQUESTED BY COSERV GAS LTD. NOT SPECIFICALLY GRANTED HEREIN IS DENIED; ADOPTING A MOST FAVORED NATIONS PROVISION; FINDING THAT THE MEETING AT WHICH THIS ORDINANCE IS PASSED IS OPEN TO THE PUBLIC AS REQUIRED BY LAW; PROVIDING FOR NOTICE OF THIS ORDINANCE TO COSERV GAS LTD.; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, on or about August 25, 2004, CoSery Gas Ltd. ("CoServ" or "Company"), filed with the City of Allen a Statement of Intent to change gas rates in all municipalities within the CoSery System effective October 1, 2004; and, WHEREAS, the City has exclusive original jurisdiction to evaluate the Company's Statement of Intent as it pertains to the distribution facilities located within the City, pursuant to Texas Utilities Code §§ 102.001(b) and 103.001; and, WHEREAS, the City suspended the effective date of CoServ's rate request until December 28, 2004 and CoSery extended the effective date of the rate increase by an additional thirty days for the City to investigate the Company's filing and to consider settlement of the request; and, WHEREAS, failure to take action regarding CoServ's rate request by January 27, 2005, will cause CoServ's filed request to become effective for all CoSery customers within the municipal limits; and, WHEREAS, the City joined the Coalition of Cities Served by CoSery ("Cities"), a group of other cities similarly affected by CoServ's rate request to jointly hire counsel and an independent consultant to review CoServ's application; and, WHEREAS, after consideration of the Company's filing and the report issued by Cities' expert, the City concludes that CoServ's current rates are unreasonable and should be changed; and, ' WHEREAS, the Company and Cities have reached an agreement as to CoServ's filed request to increase rates conditioned upon final approval by Cities; and, WHEREAS, the Company's requested increase in system -wide annual revenues of $1,165,525 is excessive, and the Company has agreed to an increase in system -wide revenue of $500,000, of which approximately ' $214,000 is associated with changes to the miscellaneous service charges; and, WHEREAS, a condition to the settlement with CoSery is the City's recognition of the Company's right under Texas Utilities Code Section 104.112, independent of the tariffs approved herein, to surcharge facilities relocation charges within the city requiring relocation; and, WHEREAS, a condition to the settlement with CoSery and the revised tariffs approved herein is the Company's commitment that it will not file a request with Cities for a rate increase that becomes effective prior to September 1, 2006; and, WHEREAS, a condition to the settlement with CoSery is the phase in of the base rate increase approved and reflected by the attached tariffs so that the first ten percent of the rate increase will be implemented upon adoption of the revised tariffs and the remaining increase will be implemented in ten -percent increments on or after November 1, 2005 and the balance on or after August 1, 2006; and, WHEREAS, Cities' rate case expenses incurred in this proceeding are reasonable and should be reimbursed by CoServ; and, WHEREAS, the City is unable at this time to determine the reasonableness of the rate case expenses incurred by the Company; and, WHEREAS, the City has reviewed the settlement agreement reached between the Company and the Coalition of Cities Served by CoSery and has determined that approval of the revised tariffs is in the best interest of the City and its residents, results in just and reasonable rates, and, therefore, should be approved by ' the City; and, WHEREAS, since the Company filing is based upon system -wide standardized rates and tariffs, it would be inappropriate for any city or residents of any city to receive benefits not enjoyed by the entire system. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ALLEN, COLLIN COUNTY, TEXAS, THAT: SECTION 1. It is in the best interest of the City and its residents to adopt the revised residential, commercial and miscellaneous service charge tariffs attached hereto to this Ordinance as Exhibit "A" that reflect the settlement agreement reached between CoSery and the Coalition of Cities Served by CoServ. All other tariffs proposed in CoServ's Statement of Intent, except for rate schedule 9 (Rider RCE - rate case expenses) are adopted. SECTION 2. The adoption of the revised tariffs provides for just and reasonable rates to be charged system -wide by the Company. SECTION 3. The system -wide annual base revenue increase of $500,000 is to be phased in over an 18 month period to the extent any increase exceeds 10 percent. SECTION 4. The effective date of the new tariffs is February I, 2005. SECTION 5. No specific rate base, return, revenue or cost adjustments or rate making methodologies are ' approved in reaching the revenue requirements settlement that leads to the rates and charges adopted by this ordinance, except that CoSery may continue to defer its carrying charges on plant held for future use. SECTION 6. Cities' rate case expenses are reasonable and should be reimbursed by CoServ. Ordinance No. 2371-1-05, Page 2 SECTION 7. The issue of the recovery of rate case expenses incurred by CoSery Gas be severed from consideration of the revised base rate tariffs and that the City retain jurisdiction over the rate expense ' reimbursement issue until March 1, 2005, subject to a second thirty -day extension of the City's jurisdiction by CoServ. SECTION 8. CoSery may not file for a further increase in base rates that is intended to become effective prior to September 1, 2006. SECTION 9. Adoption of a most favored nations provision is reasonable and appropriate and that any concession granted to any city is, at the discretion of the City Council, to be implemented in the City. SECTION 10. Relief requested by CoSery not specifically addressed herein is denied. SECTION 11. It is hereby officially found and determined that the meeting at which this Ordinance is passed is open to the public as required by law and that public notice of the time, place and purpose of said meeting was given as required. SECTION 12. A copy of this ordinance, constituting final action on the CoSery application, be forwarded to the appropriate designated representative of the Company, Charles D. Harrell, Chief Financial Officer, CoSery Gas Ltd., 7701 South Stemmons, Corinth, Texas 76210-1842, within 10 days. SECTION 13. This Ordinance shall take effect immediately from and after its passage and acceptance and it is accordingly so ordained. DULY PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF ALLEN, COLLIN COUNTY, TEXAS, ON THIS THE 25r" DAY OF JANUARY 2005. 'APPROVED: Stephen Terrell, MAYO APPROVED AS TO FORM: ATTEST: o 6?. jl d - P ter G. Smltb,PM ATPORNEY Shelley B. Georg C, CITY SEMETARY Ordinance No. 2371-1-05, Page 3 EXHIBIT "A" Rate Schedule 5 RATE R - RESIDENTIAL SALES Applicable to: Entire System Page 1 of 2 Effective Date: February 1, 2005 Application of Schedule Schedule applies to all Residential Customers. Monthly Base Rate Customer's base monthly bill will be calculated using the following Customer and Ccf charges: Charee Customer Charge Volumetric Charge: First 0 Ccf to 20 Ccf Next 50 Ccf All Additional Ccf Purchased Gas Factor Amount T9500 per month, plus $.19437 per Ccf $.14437 per Ccf $.09437 per Ccf In addition to the base monthly bill above, each customer's bill will include a Purchased Gas Factor to account for purchased gas costs and computed in accordance with CoSery Purchased Gas Factor Schedule No. 2. Taxes In addition to the monthly charges above, each customer's bill will include a charge for an amount equivalent to the customer's proportional part of the city franchise fees, state gross receipts taxes, or other governmental levies payable by the Company, exclusive of federal income taxes. Municipal franchise fees are determined by each municipality's franchise ordinance. Each municipality's franchise ordinance will specify the percentage and applicability of franchise fees. From time to time, the tax factor may be adjusted, if required, to account for any over- or under -recovery of municipal franchise fees by the Company and to include an amount equivalent to the proportionate part of any new tax or increased franchise fee or tax, or any other governmental imposition, rental fee, or charge levied, assessed or imposed subsequent to the effective date of this tariff by any governmental authority, including districts, created under the laws of the State of Texas. The Company will also collect sales taxes where applicable. Ordinance No. 2371-1-05. Page 4 EXHIBIT "A" Rate Schedule 5 ' RATE R - RESIDENTIAL SALES Applicable to: Entire System Page 2 of 2 Effective Date: February 1, 2005 Surcharees In addition to the monthly charges above, each customer's bill will include an amount for surcharges calculated in accordance with the applicable rider(s). LINE EXTENSION POLICY The company has the right to contract with individual customers for the installation of gas facilities as provided for by the city franchise. Upon the request of a prospective new residential or commercial customer for service in an area served by CoSery Gas, CoSery Gas will extend its main lines up to 100 feet from an existing CoSery Gas main in the Public Rights of Way, without charge. The 100 -foot allowance applies to a single customer or to a group of customers requesting service from the same extension. Customers requesting mainline extensions in excess of 100 feet shall bear the cost of any additional main, and shall bear the cost of all yard lines, service lines, customer ' meters and regulators, and appurtenant equipment, in accordance with the charges listed in item 12, Line Extension and Installation, of Rate M, Miscellaneous Service Charges. CoSery Gas is not required to extend its mains or facilities if the customer will not use gas for space heating and water heating, or the equivalent load, at a minimum. [I Ordinance No. 2371-1-05 Page 5 [1 EXHIBIT "A" Rate Schedule 6 RATE C - COMMERCIAL SALES Applicable to: Entire System Page 1 of 2 Effective Date: February 1, 2005 Aoolication of Schedule Schedule applies to all commercial customers. Monthly Base Rate Customer's base monthly bill will be calculated using the following Customer and Ccf charges: Char¢e Customer Charge Volumetric Charge: First 0 Ccf to 300 Ccf Next 200 Ccf All Additional Ccf Purchased Gas Factor Amount $15.50 per month, plus $.24436 per Ccf $.19436 per Ccf $.14436 per Ccf In addition to the base monthly bill above, each customer's bill will include a Purchased Gas Factor to account for purchased gas costs and computed in accordance with CoSery Purchased Gas Factor Schedule No. 2. Taxes In addition to the monthly charges above, each customer's bill will include a charge for an amount equivalent to the customer's proportional part of the city franchise fees, state gross receipts taxes, or other governmental levies payable by the Company, exclusive of federal income taxes. Municipal franchise fees are determined by each municipality's franchise ordinance. Each municipality's franchise ordinance will specify the percentage and applicability of franchise fees. From time to time, the tax factor may be adjusted, if required, to account for any over- or under -recovery of municipal franchise fees by the Company and to include an amount equivalent to the proportionate part of any new tax or increased franchise fee or tax, or any other governmental imposition, rental fee, or charge levied, assessed or imposed subsequent to the effective date of this tariff by any governmental authority, including districts, created under the laws of the State of Texas. The Company will also collect sales taxes where applicable. Ordinance No. 2371-1-05. Page 6 EXHIBIT "A" Rate Schedule 6 RATE C - COMMERCIAL SALES Applicable to: Entire System Page 2 of 2 Effective Date: February 1, 2005 Surcharges In addition to the monthly charges above, each customer's bill will include an amount for surcharges calculated in accordance with the applicable rider(s). Line Extension Policy The company has the right to contract with individual customers for the installation of gas facilities as provided for by the city franchise. Upon the request of a prospective new residential or commercial customer for service in an area served by CoSery Gas, CoSery Gas will extend its main lines up to 100 feet from an existing CoSery Gas main in the Public Rights of Way, without charge. The 100 -foot allowance applies to a single customer or to a group of customers requesting service from the same extension. Customers requesting mainline extensions in excess of 100 feet shall bear the cost of any additional main, and shall bear the cost of all yard lines, service lines, customer meters and regulators, and appurtenant equipment, in accordance with the charges listed in item 12, ' Line Extension and Installation, of Rate M, Miscellaneous Service Charges. CoSery Gas is not required to extend its mains or facilities if the customer will not use gas for space heating and water heating, or the equivalent load, at a minimum. 11 Ordinance No. 2371-1-05 Page 7 EXHIBIT "A" Rate Schedule 10 ' RATE M—MISCELLANEOUS SERVICE CHARGES Applicable to: Entire System Page 1 of 2 Effective Date: February 1, 2005 11 Application The service charges listed below are in addition to any other charges under the Company's Tariff for Gas Service and will be applied for the condition described. Other services not covered by these standard conditions will be charged on the basis of an estimate for the job or the Company's actual cost plus appropriate surcharges. Applicable Charees Service Amount of Charge Name and Description Charge No. Connection Charge During Business Hours During standard business hours, for each reconnection of gas service where service has been discontinued at the same premises for any reason, for the initial inauguration of service, and for each inauguration of service when the billable party has changed, with I the following exceptions: $ 65.00 (a) For a builder who uses gas temporarily during construction or for display purposes. (b) Whenever gas service has been temporarily interrupted because of System outage or service work done by Company; or c For any reason deemed necessary for Company operations Connection Charge After Business Hours After standard business hours, for each reconnection of gas service where service has been discontinued at the same premises for any reason, for the initial inauguration of service, and for each inauguration of service when the billable party has changed, with 2 the following exceptions: $ 97.00 (a) For a builder who uses gas temporarily during construction or for display purposes. (b) Whenever gas service has been temporarily interrupted because of System outage or service work done by Company; or c For any reason deemed necessary for Company operations Field Read of Meter 3 A read for change charge when it is necessary for the Company to $ 19.00 read the meter at a currently served location because of a change in the billable party. 4 Returned Check Charges $ 20.00 Ordinance No. 2371-1-05, Page 8 F [1 Ordinance No. 2371-1-05, Page 9 Returned check handling charge for each check returned to Commmv for anv reason. Charge for Temporary Discontinuance of Service - Residential Whenever service has been temporarily disconnected at the request 5 of the customer, this charge plus the appropriate Connection Charge $ 65.00 will be made to reestablish such service for that customer at the same address. Charge for Temporary Discontinuance of Service- NonResidential Whenever service has been temporarily disconnected at the request 6 of the customer, this charge plus the appropriate Connection Charge $ 107.00 will be made to reestablish such service for that customer at the same address. Charge for Meter Testing The Company shall, upon request of a customer, make a test of the accuracy of the meter serving that customer. The Company shall inform the customer of the time and place of the test and permit the customer or his authorized representative to be present if the 7 customer so desires. If no such test has been performed within the $ 1500 previous four (4) years for the same customer at the same location, the test shall be performed without charge. If such test has been performed for the same customer at the same location within the previous four (4) years, the Company will charge the Meter Test Fee. The customer must be properly informed of the result of any test on a meter that services him. Charge for Service Calls During Business Hours A Service Call Charge is made for responding to a service call 8 during standard business hours that is determined to be a customer $ 26.00 related problem rather than a Company or Company facilities roblem. Charge for Service Calls After Business Hours A Service Call Charge is made for responding to a service call after $ 40.00 9 standard business hours that is determined to be a customer related problem rather than a Company or Company facilities problem. Tampering Charge No Company Meters, equipment, or other property, whether on Customer's premises or elsewhere, are to be tampered with or interfered with for any reason. A Tampering Charge is made for unauthorized reconnection or other tampering with Company 10 metering facilities or a theft of gas service by a person on the $ 125.00 customer's premises or evidence by whomsoever at customer's premises. An additional cost for the cost of repairs and/or replacement of damaged facilities and the installation of protective facilities or relocation of meter are made at cost plus appropriate charges as may be detailed in the Company's Service Rules and Regulations Credit/Debit Card Payments Charge 11 Bill payments using credit cards, debit cards, and electronic checks Actual Cost includes third -party transaction fees and administrative costs). Ordinance No. 2371-1-05, Page 9 0 Applicable to: Effective Date: EXHIBIT "A" Rate Schedule 10 — MISCELLANEOUS SERVICE CHARGES 1,2005 rage z of z Ordinance No. 2371-1-05, Page 10 Line Extension and Installation Charges Extension and installation of new mains, service lines, risers, l2 fittings and other appurtenant equipment pursuant to main Actual Cost extension policy in municipal franchise. Credit for main pursuant to municipal franchise. The customer is responsible for the installation of yand line and yard line risers. 13 Construction Crew Charges Actual Cost All labor charges if a construction crew is required. 14 Construction Costs Charges Actual Cost All other construction charges. Ordinance No. 2371-1-05, Page 10