05-B-Suspend TXU Gas Rates - Laserfiche WebLink

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Subsequent to the filing of this rate proposal, the City Attorney's Office began to contact other cities included in the supposed distribution system. The purpose was to attempt to coordinate in a unified fashion a position with regard to the proposed rate adjustments. Thereafter, a letter was received by the City of Paris over the signature of the Mayor of the City of Denison (copy enclosed) suggesting the cities meet and confer on the issues presented to determine a common and unified approach to dealing with the Company's rate requests. The City of Paris has responded favorably to this proposal (copy of response letter enclosed). The meeting is currently scheduled for Wednesday, March 21, 2001, in Greenville, Texas. Representatives of the City will attend. Based on the options available to the City of Paris, it would appear most prudent to adopt an ordinance suspending for ninety (90) days the effective date of the proposed rate adjustments to enable the City of Paris to participate with other cities in evaluating the rate proposals and approaching those proposals in unison. DESCRIPTION: The ordinance included in the agenda package contains the necessary elements to successfully suspend the rate proposal presented by TXU Gas. The ordinance itself was proposed by the Company, and should therefore be acceptable to the Company, with certain adjustments made by the City Attorney's Office. Approval of the ordinance will suspend the proposed rate increase for ninety (90) days, during which time the City could participate with other cities in evaluating the merits of the rate proposals. RECOMMENDED ACTION: Consider approval of the ordinance suspending the proposed rate increases presented by TXU Gas for a period of ninety (90) days, and authorize City staff to participate in the necessary proceedings, including hiring of special consultants jointly with other cities, to properly evaluate the rate proposals presented. STAFF CONTACT: Larry W. Schenk, City Attorney; and Michael E. Malone, City Manager COST: Implementation of the proposed rate increases, without further study or suspension, would result in an annual increase to customers within the city of Paris of an average of 10.56% for the distribution component of the rate, or a total of a $542,068.76 impact on rate payers. SCHEDULE: Approval of the ordinance will suspend the effective date of the rate increase, currently scheduled for April 6, 2001, for a period of ninety (90) days, or until July 5, 2001. COUNCIL DATE: Consider for approval at City Council's Monday, March 26, 2001, special Council meeting. ADDITIONAL MATERIALS: See proposed ordinance suspending the rates; proposed draft of Most Favored Nation Status letter; and correspondence related to the rate proposals.