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LLOYD, GOSSELINK, BLEVINS, ROCHELLE, <br /> BALDWIN & TOWNSEND, P.C. <br /> ATTORNEYS AT LAW <br /> <br /> 111 CONGRESS AVENUE TELEPHONE (512) 322-5800 <br /> SUITE1800 Mr. Gay's Direct Line: (512)322-5875 TELECOPIER (512)472-0532 <br /> AUSTIN, TEXAS 78701 Ernail: ggay@lglaw~irm.corn www.lglawfirmcom <br /> <br /> MEMORANDUM <br /> <br /> TO: Client Cities Served By TXU Gas <br /> <br />FROM: Geoffrey M. Gay <br /> Kristen Doyle <br /> <br />DATE: May 23, 2003 <br />RE: Procedure For Processing New Rate Case <br /> <br /> In our May 20, 2003, memorandum regarding the gas rate case TXU filed today, we <br />provided you with a model resolution that suspends the effective date of TXU's rate request. <br />Since that time, we have heard from several cities regarding some confusion as to what actions <br />must be taken on a city level. For purposes of the procedural timeline, it is critical that your <br />city adopt the resolution we provided you suspending the effective date of TXU's new rates <br />within 35 days (June 26, 2003). <br /> <br /> Cities and TXU are currently in discussions regarding procedural issues that may lead the <br />Steering Committee of Cities to recommend denial of rate relief on an expedited basis in <br />exchange for TXU agreeing to extend its effective date to create 115 extra days of time (for a <br />total of 300 days) at the Commission. However, that agreement has not yet been finalized. We <br />have heard that TXU is encouraging all cities to immediately deny the requested increase, and <br />may have provided your city with a model ordinance doing so. Denial of rate relief should not <br />be done until a procedural agreement is in place. If a city were to deny TXU's rate request <br />immediately, rather than suspending the effective date, the denial could serve to trigger <br />procedural timelines associated with appeals to the Railroad Commission that would <br />significantly shorten the timeline for review. This action would hurt all cities served by TXU. <br />The suspension provides all cities time necessary to cement a procedural agreement with TXU <br />and to investigate the evidence provided by TXU justifying its request. <br /> <br /> If you have questions or need another copy of the model resolution, please contact <br />Geoffrey or Kfisten at (512)322-5877. <br /> <br />1668\09~mmoO30523kpd <br /> <br /> <br />