05-C1 ATMOS Cities Settlement Agreement

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EXHIBIT A TARIFF FOR GAS SERVICE ATMOS ENERGY CORP., MID-TEX DIVISION RIDER: Rider RRM - Rate Review Mechanism APPLICABLE TO: Entire Mid-Tex Division REVISION DATE: EFFECTIVE DATE: PAGE: 3 of 5 February 1, 2008 however, that neither the Residential nor the Commercial customer charges may increase more than 20% per year. b) If Company's earnings during the Evaluation Period exceed 9.6% return on common equity, the Company shall calculate an adjustment to rates to refund the revenue required to achieve a return on equity of 9.6% for the Evaluation Period. If Company's earnings during the Evaluation Period are below 9.6% retum on common equity, the Company shall calculate an adjustment in rates to collect the additional revenue required to increase its return on equity for the Evaluation Period to 9.6%. The Company will calculate an adjustment for the Rate Effective Period to refund or collect this difference. c) The Company will adjust rates for the Rate Effective Period to include recovery of any known and measurable changes to operating and maintenance costs including, but not limited to, all payroll and compensation expense, all benefit expense, all pension expense, insurance costs, materials and supplies, bad debt costs, all medical expense, transportation and building and lease costs for the Rate Effective Period. Additionally, utility plant for the Rate Effective Period will be established by using the Evaluation Period ending balances, inctuding associated changes in depreciation and amortization expense and taxes. In calculating the Company's known and measurable changes for prospective R.RM adjustment purposes, the following limitations will apply, on a Per Connection Basis. 1. Operating and Maintenance expenses for the Rate Effective Period, cannot increase more than 5% per connection per year without specific identification and justification. T'he beginning Operation and Maintenance expense for the 2007 RRM filing (the initial filing) will be $161 million. 2. Net plant investment for the Rate Effective Period cannot increase more than 5% per connection per year without specific identification. However, in performing a cap test to verify compliance, Company shall exclude any changes in net plant investment associated with federal, state, or local mandates related to safety, compliance, or road moves. d) The Company also shall provide a schedule demonstrating the "proof of revenues" relied upon to calculate the proposed rate for the Rate Effective Period. The proposed rates shall conform as closely as is practicable to the revenue allocation principles approved in the Final Order. Attestation A sworn statement shall be filed by the Company's Chief Officer in Charge of Mid-Tex Operations affirming that the filed schedules are in compliance with the provisions of this mechanism and are true and correct to the best of his/her lrnowledge, information and belief. No testimony shall be filed. 25 . _ Y.