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RESOLUTION N0. ann7_n~~ <br />A RESOLUTION OF THE CITY OF PARIS, TEXAS, DENYING THE <br />REQUEST OF ATMOS ENERGY CORP., MID-TEX DIVISION, FOR AN <br />ANNUAL GAS RELIABILITY INFRASTRUCTURE PROGRAM (GRIP) <br />RATE INCREASE IN THIS MUNICIPALITY, AS A PART OF THE <br />COMPANY'S STATEWIDE GAS UTILITY DISTRIBUTION SYSTEM; <br />SUPPORTING STATUTORY REFORM OF THE TEXAS GRIP <br />STATUTE, FINDING THAT THE MEETING AT WHICH THIS <br />RESOLUTION IS PASSED IS OPEN TO THE PUBLIC; AND <br />PROVIDING FOR NOTICE OF THIS RESOLUTION TO ATMOS <br />ENERGY CORP., MID-TEX DIVISION AND THE CITY'S LEGISLATIVE <br />DELEGATION. <br />WHEREAS, the City of Paris, Texas ("City") is a gas utility customer of Atmos Energy <br />Corp., Mid-Tex Division ("Atmos Mid-Tex" or "the Company"), and a regulatory authority with <br />an interest in the rates and charges of Atmos Mid-Tex; and, <br />WHEREAS, Atmos Mid-Tex made filings with the City and the Railroad Commission <br />of Texas ("Railroad Commission") on or about May 31, 2007, proposing to implement interim <br />rate adjustments ("GRIP rate increases"), pursuant to Texas Utilities Code § 104.301, on all <br />customers served by Atmos Mid-Tex, effective July 30, 2007; and, <br />WHEREAS, the Gas Reliability Infrastructure Program (GRIP) statute approved in the <br />2003 Regular Session of the 78~' Legislature changes 100 years of Texas law and allows a <br />natural gas utility to implement annual surcharges for increases in investment without having to <br />account for the offsetting decreases in costs or increases in revenue experienced by the utility; <br />and, <br />WHEREAS, Texas is the only state out of the twelve states served by Atmos that has a <br />GRIP statute that allows for piecemeal recovery for any change to invested capital; and <br />WHEREAS, Atmos has implemented four GRIP surcharges and collected more than $20 <br />million in GRIP surcharges from customers since the utility acquired the TXU Gas system in <br />2004; <br />WHEREAS, the City supports the statutory reform of the GRIP statute to ensure fairness <br />to ratepayers and to eliminate piecemeal recovery for any change to invested capital; and, <br />WHEREAS, Atmos Mid-Tex was recently granted a rate increase as a result of its filing <br />in GUD No. 9670, in which the Final Order was only signed on March 29, 2007; and, <br />WHEREAS, in GUD No. 9670, it was determined that Atmos Mid-Tex had <br />inappropriately included certain expenditures in its prior GRIP rate increases for rate years 2003, <br />2004, and 2005; and, <br />