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WHEREAS, <br /> the Gas Utility Regulatory Act grants local regulatory authorities the right <br />to intervene in rate proceedings filed at the Railroad Commission; and, <br />WHEREAS, <br /> the Texas Utilities Code § 103.022 provides that costs incurred by the City <br />in ratemaking activities are to be reimbursed by the regulated utility; and, <br />WHEREAS, <br />ACSC’s rate case expenses incurred in this proceeding are reasonable and <br />should be reimbursed by the Company; and, <br />WHEREAS, <br /> counsel for ACSC, upon review of the Company’s filing and upon <br />consultation with various consultants, recommends finding that the Company’s proposal is <br />unjustified, unreasonable and is not in compliance with the GRIP statute (Texas Utilities Code <br />§ 104.301) either in fact or in law; and, <br />WHEREAS, <br /> information provided by the Company in response to ACSC’s requests for <br />information indicates that the Company actually decreased per-customer investment in <br />infrastructure during calendar year 2003; and, <br />WHEREAS, <br /> the Company has publicly stated that it will receive substantial profit in <br />2005 over that approved by the Commission in GUD No. 9400; and, <br />WHEREAS, <br /> the Company’s GRIP request fails to account for growth in numbers of <br />customers, thereby undercounting the revenues it will receive from its proposed GRIP rate <br />increase; and, <br />WHEREAS, <br /> the Company’s GRIP request fails to recognize that GUD No. 9400 rates <br />included profit based on TXU Corporation’s capital structure rather than Atmos Energy Corp.’s <br />current capital structure, which justifies a lower rate of return; and <br />WHEREAS, <br /> the information reviewed by the ACSC consultants indicates that <br />implementation of the Company’s GRIP request would result in further over-earning by the <br />Company above that approved by the Commission in GUD No. 9400; and <br />WHEREAS, <br /> in consideration of the city taking action before August 12, 2005, on the <br />currently pending GRIP request, the Company has agreed not to file any additional GRIP <br />NOW, THEREFORE, <br />requests before September 15, 2005; <br />BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PARIS, PARIS, <br />TEXAS: <br />Section 1. <br /> That the findings set out in the preamble to this ordinance are hereby in all <br />things approved. <br />Section 2. <br /> That the Company’s GRIP rate increase request is found to be unjustified, <br />unreasonable and in violation of the GRIP statute and is therefore denied in all respects. The <br />2 <br />1668\12\Ordinance <br /> <br />