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RE 2002-03-19.3RESOLUTION NO. 2002-0319.3 A RESOLUTION OF THE CITY OF COPPELL, TEXAS, AUTHORIZING THE CITY OF COPPELL TO AUTHORIZE LEGAL COUNSEL AND RATE CASE CONSULTANT TO OPPOSE AN INCREASE OF GAS TARIFFS AND RATE; AUTHORIZING THE CITY TO INTERVENE IN TXU GAS DISTRIBUTION COMPANIES MARCH 1, 2002 FILED STATEMENT OF INTENT TO CHANGE RATES; TO INTERVENE IN ANY RELATED DOCKET OR MATTER BEFORE THE TEXAS RAILROAD COMMISSION; AND, SUSPENDING THE PROPOSED TARIFF AND SCHEDULE OF RATES OF TXU GAS DISTRIBUTION COMPANY. WHEREAS, TXU Gas Distribution Company, (hereinafter called "TXU Gas"), on March 1, 2002, filed a Statement of Intent to Change Rates with individual cities for an increase in rates, a copy of which is attached hereto and incorporated herein by reference; and WHEREAS, the municipality of Coppell, Texas, a Home Rule municipality (hereinafter called "City") is a regulatory authority having a statutory duty to participate in such proceedings and whose citizens will be substantially affected by the rates established as a result of such proceedings; and WHEREAS, the City is entitled to be reimbursed for its reasonable expenses, pursuant to the Texas Gas Utilities Regulatory Act; and WHEREAS, a steering committee of distribution system cities has been formed to facilitate and coordinate the participation of cities in the service area of TXU Gas in the above reference rate proceedings, in Exhibit "A"; and WHEREAS, after having considered information from TXU Gas, it is the opinion of the City Council that the proposed Schedule of Rates should in the public interest be suspended for a period of ninety (90) days from the effective date stated in TXU Gas Statement of Intent or other documentation, as initially filed or hereafter revised, for further study, investigation, presentation of evidence and public hearing; and WHEREAS, it is in the public interest to join with other cities to review such filing and present evidence as may be appropriate before the Texas Railroad Commission an advise of legal counsel and by the steering committee of affected cities; NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF COPPELL, TEXAS: SECTION 1. That the City Council of the City of Coppell, Texas, authorizes City Manager and/or his designee and the City Attorney, to represent the City on the Steering 46532 Committee of affected cities (hereinafter called "Steering Committee") and said person shall take appropriate action to oppose the proposed rate and tariff increases reflected therein and, hereby authorizes the Steering Committee of which the City shall join as participating member, to retain appropriate legal counsel and engage rate case consultants; and to intervene on behalf of the City in related dockets and appeals before the Texas Railroad Commission. SECTION 2. The City Counsel hereby suspends the operation of the proposed tariffs and Schedule of Rates, which would otherwise go into effect for a period of ninety (90) days from the effective date stated in the TXU Gas Statement of Intent, or other documentation, as initially filed or hereafter revised, until midnight, July 3, 2002, and for such additional period of time as may be necessary and authorized by law. During such period of suspension, the rates in force shall be those rates in effect when the suspended schedule was first filed and shall continue in force until finally approved, modified or denied by the City Council. SECTION 3. The City should join with other participating cities to review such filing and cause to be prepared a report and recommend a rate ordinance for the consideration of all participating cities and to intervene before the Texas Railroad Commission, subject to the right to terminate such participation at any time by written notice and to act independently in the exercise of local regulatory authority. SECTION 4. The City Secretary shall cause copies of this resolution to be sent to the TXU Gas representative: and to Autry Warren Rate Manager, TXU Gas Distribution 1601 Bryan St. Dallas, Texas 75201-3402 Mr. Jay B. Doegey City Attorney City of Arlington Post Office Box 231 Arlington, Texas 76004-0231 2 Robert E. Hager City Attorney City of Coppell 1800 Lincoln Plaza 500 North Akard Dallas, Texas 75201 DULY RESOLVED AND ADOPTED by the City Council of the City of Coppell, Texas, on this the 19th day of March, 2002. CITY OF COPPELL, TEXAS CANDY SHEEHAN, MAYOR ATTEST: LIBBY BALL, CITY SECREARY APPROVED AS TO FORM: ROBERT E. HAGER, CITY ATTORNEY BEFORE THE RESPECTIVE GOVERNING BODIES OF THE NORTH TEXAS METROPLEX DISTRIBUTION SYSTEM CITIES AND TOWNS STATEMENT OF INTENT TO CHANGE RESIDENTIAL, COMMERCIAL AND INDUSTRIAL RATES, TO CLOSE CERTAIN INDUSTRIAL RATE SCHEDULES (INCLUDING INDUSTRIAL RATES-N) TO NEW CUSTOMERS, TO ELIMINATE MILITARY RATES-N, TO ELIMINATE RATE SCHEDULES FOR PUBLIC FREE SCHOOLS-N AND COMMERCIAL CONTRACT FOR PUBLIC SCHOOL GAS SERVICE, TO ELIMINATE THE WEATHER NORMALIZATION ADJUSTMENT CLAUSE, TO ELIMINATE THE COST OF SERVICE ADJUSTMENT CLAUSE, TO ELIMINATE THE PLANT INVESTMENT COST ADJUSTMENT CLAUSE, TO PROVIDE FOR A SURCHARGE FOR UNCOLLECTIBLE EXPENSES, AND TO PROVIDE FOR A MISCELLANEOUS SERVICE CHARGE FOR THE TEMPORARY DISCONTINUANCE OF SERVICE TO THE HONORABLE GOVERNING BODY OF EACH NORTH TEXAS METROPLEX DISTRIBUTION SYSTEM CITY OR TOWN: COMES NOW TXU Gas Distribution, a Division of TXU Gas Company, a gas utility under Subtitles A & B of Title 3 of the Texas Utilities Code (Vernon 1997) ("Utilities Code"), and files this its Statement of Intent to Change Residential, Commercial and Industrial Rates, to Close Certain Industrial Rate Schedules (including Industrial Rates-N) to New Customers, to Eliminate Military Rates-N, to Eliminate the Rate Schedules for Public Free Schools-N and Commercial Contract for Public School Gas Service, to Eliminate the Weather Normalization Adjustment Clause, to Eliminate the Cost of Service Adjustment Clause, to Eliminate the Plant Investment Cost Adjustment Clause, to Provide a Surcharge for Uncollectible Expenses and to Provide for a Miscellaneous Service Charge for the Temporary Discontinuance of Service in the North Texas Metroplex Distribution System ("Metroplex System"), ("Statement of Intent") pursuant to Utilities Code § 104.101 - 104.111. Your city or town is one of the cities or towns included in the Metroplex System, which are listed in Attachment A to this Statement of Intent. Also filed herewith and made a part hereof for all purposes, is the Tariff for Gas Service in the North Texas Metroplex Distribution System ("Tariff") and the supporting Cost of Service Schedules ("Schedules"). I. PROPOSED TARIFFS AND SCHEDULES TXU Gas Distribution proposes to change its rates in accordance with the Tariff, which includes an Index of Rates and List of Metroplex System Cities and Towns, rates for Residential Service, Commercial Service, Industrial Sales, Industrial Transportation, Industrial Sales and Transportation, Rate Adjustment Provisions - Gas Cost Adjustment, Tax and Franchise Fee Adjustment, Surcharges, Uncollectible Recovery, Adjustment, and Miscellaneous Service Charges - Connection Charge, Read for Change Charge, Returned Check Charges, 4 Delinquent Notification Charge, Main Line Extension Rate, Excess Flow Valve Charge, Certain Standby Gas Generators, Temporary Discontinuance of Service. Electric Generation customers are included as Industrial customers receiving transportation service under the applicable transportation rate schedule. The Tariff supersedes or amends, as set forth therein, all previous tariffs for the services affected by this filing in effect within the city or town limits of your city or town. II. DETAILS OF PROPOSED INCREASE Details of each proposed increase are contained in Schedules A through L of the Cost of Service Schedules, which are filed herewith. The effect of the proposed increase on the revenues o£the utility is set forth in Schedules L-1 through L-5. All Residential, Commercial, Industrial, Industrial Sales, Industrial Transportation, Industrial Sales and Transportation and Public Authority (if any) customers of TXU Gas Distribution within the city or town lift, ts of your city or town and the other Metroplex System Cities and Towns will be affected by this change. The class and number of affected customers is set forth in Schedule J-1 of the Schedules. III. EFFECT OF PROPOSED CHANGES Estimated total increase in annual revenue is $33.9 million or 8.01% based upon Current Annual Revenue from Residential, Commercial, and all contract Industrial customers (which includes Industrial Rates-N customers, electric generation customers, and all other contract Industrial customers such as contract sales and transportation customers as noted above). The filing is based on a Test Year ended September 30, 2001 and reflects present annual revenue under present rates of $422.4 million and Estimated Annual Revenue under the proposed rates of $456.3 million. The proposed charges for Main Line Extensions do not directly increase or decrease revenues. Payment by a customer for a gas main extension is accounted for in contributions-in- aid of construction, a deduction from total investment for rate making purposes, that reduces the rate base and ultimately the required rate. The proposed change will close Certain Industrial Rate Schedules (including Industrial Rates-N) to new customers and will eliminate the rate schedules for Public Free Schools-N and Commercial Contract for Public School Gas Service. The proposed change will also eliminate Military Rates-N. Firm gas service will be available to military customers and public schools under the Commercial rate proposed herein, upon expiration of the current 5 contract year under the contract in effect between the school district, military customer and TXU Gas Distribution. The proposed change will eliminate the Weather Normalization Adjustment Clause, the Cost of Service Adjustment Clause and the Plant Investment Cost Adjustment Clause and will impose a surcharge to collect certain uncollectible expenses. The filing also includes a new miscellaneous service charge related to temporary discontinuance of service. The proposed changes will not result in a major change as that term is defined in § 104.101 of the Utilities Code. IV. EFFECTIVE DATE OF PROPOSED CHANGES TXU Gas Distribution hereby requests this Honorable Governing Body to approve the filed Tariff for application within the corporate limits of your city or town effective April 5, 2002. V. NOTICE Service or publication of the required notice containing the information related to this Statement of Intent shall be made in accordance with applicable statutes and rules. Notice to residential and commercial customers will be made by notice published in newspapers consistent with all applicable rules. Notice to industrial customers will be made by certified mail, postage prepaid, return receipt requested. THEREFORE, TXU Gas Distribution requests that your city or town allow such new rates to become applicable within the corporate limits of each Metroplex System municipality by operation of law- or by ordinance granting it the authority to change rates. Respectfully submitted, TXU GAS DISTRIBUTION, a Division of TXU Gas Company By: Title: Rates Manager Date Filed: 6 ATTACHMENT A NORTH TEXAS METROPLEX DISTRIBUTION SYSTEM Addison Hickory Creek Sansom Park Allen Highland Village Seagoville Anna Hurst Shady Shores Argyle Hutchins Southlake Arlington Irving Sunnydale Aubrey Josephine The Colony Azle Justin Trophy Club Balch Springs Keller Watauga Bedford Kennedale Westlake Benbrook Krum Westminster Blue Mound Lake Dallas Westover Hills Blue Ridge Lake Worth Westworth Village Burleson Lakeside White Settlement Carrollton Lancaster Wilmer Cedar Hill Lavon Wylie Celina Lewisville Colleyville Lincoln Park Coppell Little Elm Copper Canyon Mansfield Corinth Marshall Creek Corral City McKinney Cross Roads Melissa Crowley Mesquite Dalworthington Gardens Mobile City Denton Murphy DeSoto Nevada Double Oak North Richland Hills Duncanville Northlake Edgecliff Village Ovilla Euless Pantego Everman Parker Fairview Pilot Point Farmers Branch Plano Farmersville Ponder Fate Princeton Flower Mound Prosper Forest Hill Richardson Fort Worth Richland Hills Frisco River Oaks Garland Roanoke Glenn Heights Rockwall Grand Prairie Rowlett Grapevine Royse City Haltom City Sachse Haslet Saginaw Heath Sanger