2014-017 - Denying the rate increase requested by Atmos Energy Corp., Mid-Tex Division under the Company’s 2014 annual rate review mechanism filing in all cities exercising original jurisdiction; requiring the company to reimburse cities’ reasonabl

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WHEREAS, on or about February 28, 2014, the Company filed with the City its second annual RRM filing under the renewed RRM tariff, requesting to increase natural gas base rates by $45.7 million; and WHEREAS, ACSC coordinated its review of Atmos Mid -Tex's RRM filing through its Executive Committee, assisted by ACSC attorneys and consultants, to investigate issues identified by ACSC in the Company's RRM filing; and WHEREAS, ACSC attorneys and consultants have concluded that the Company is unable to justify a rate increase of the magnitude requested in the RRM filing; and WHEREAS, ACSC's consultants determined the Company is only entitled to a $19 million increase, approximately 42% of the Company's request under the 2014 RRM filing; and WHEREAS, the Company would only be entitled to approximately $31 million if it had a GRIP case; and WHEREAS, the Company's levels of operating and maintenance expense have dramatically risen without sufficient justification; and WHEREAS, the Company has awarded its executives and upper management increasing and unreasonable levels of incentives and bonuses, expenses which should be borne by shareholders who received a 23% total return on investment in 2013; and WHEREAS, the Company requested a drastically high level of medical expense that is unreasonable and speculatively based upon estimates; and WHEREAS, ACSC and the Company were unable to reach a compromise on the amount of additional revenues that the Company should recover under the 2014 RRM filing; and WHEREAS, the ACSC Executive Committee, as well as ACSC's counsel and consultants, recommend that ACSC Cities deny the requested rate increase; and WHEREAS, the Company's current rates are determined to be just, reasonable, and in the public interest. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS: Section 1. That the findings set forth in this Resolution are hereby in all things approved. Section 2. That the City Council finds that Atmos Mid -Tex was unable to justify the appropriateness or the need for the increased revenues requested in the 2014 RRM filing, and that existing rates for natural gas service provided by Atmos Mid -Tex are just and reasonable.