11 - Deny Distribution Cost Recovery proposed by Oncor ElectricItem No. 11
TO: City Council
John Godwin, City Manager
FROM: Gene Anderson, Finance Director
SUBJECT: ONCOR DISTRIBUTION COST RECOVERY FACTOR FILING
DATE: April 9, 2018
BACKGROUND: On April 5, 2018, Oncor Electric Delivery Company LLC filed an
application For approval of a distribution cost recovery fiacfor (DCRF). In filing, Oncor is seeking
an increase in distribution revenues of S 19,002.177 from cities it serves.
STATUS OF ISSUE: The City of Paris has original .jurisdiction concerning Oncor rates within
its borders. It plans to Join other cities served by Oncor in reviewing this revenue increase. In
order to do so, the attached resolution will deny the increase requested by Oncor. The denial will
allow Oncor cities the necessary time to study the revenue increase request and bring back an
action recoininendation to their city councils. If' the city fails to act within 60 days of the
application, the revenue increase will go into effect alltornatically.
BIJDGET: The Oncor Cities Steering Committee (OCSQ will engage a consultant to do this
review. Oncor will rein-iburse OCSC for the cost of this review. ']"here will be no direct cost to
the City of Paris,
RECOMMENDATION: Motion to approve a resolution to deny the DCRF application proposed
by Oncor.
MODEL S7AFF REPORT REGARDING ONCOR'S DISTRIBU1,10N
OST
a, FILING
On April 5, 2018, Oncor Electric Delivery Company LLC ("Oncor"or "Company") filed
,an Application for Approval of a Distribution Cost Recover Factor ("DCRF")i to Increase
Distribution Rates with each of the cities in their service area. In the filing, the Company asserts
that it is seeking an increase in distribution revenues of $19,002,177.
The resolution authorizes the City to join with the Steering Committee of Cities Served
by Oncor C'MC") to evaluate the filing, determine whether the filing complies with law, and if
lawful, to determine what further strategy, including settlement, to pursue.
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I This section authorizes the City to participate with OCSC as a party in the
Company's DCRF filing, PUC Docket No� 48231.
—2. Tbis section authorizes the hiring of Lloyd Gosiselink and consultants to review
the filing, negotiate with the Company, and make recommendations to the City regarding
reasonable rates. Additionally,, it authorizes OCS,C to direct any necessary administrative
proceedings or court litigation associated with an appeal of this application filed with the PiUC. —
3. This paragraph finds that the Company's application is unreasonable and should
be: denied.
4. This section states that the Company"s current rates shal I not be changed.
57be Company will reimburse Cities for their reasonable rate case expenses. Legal
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to Oncor for reimbursement,
6. This section recites that the Resolution was passed at a inceting that was open to
the public and that the consideration of the Resolution was properly noticed.
7. This section provides that Oncor and counsel for OCSC will be notified of the
City's action by sending a copy of the approved and signed Resolution to counsel.
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Section 3. That the rates proposed by Oncor to be recovered through its DCRF
charged to customers located within the city limits are hereby found to be unreasonable
and shall be denied.,
Section . "hat the Company shall continue to charge its existing rates to
customers %"thin the City.
Section 5. That the City's reasonable rate case expenses shall be reimbursed in
full by Oncor within 30 days of presentation of an invoice to Oncor.
Section 6. That it is hereby officially found and determined that the! meeting at
which this Resolution I's passed is open to the public! as required by law and the public
notice of the time, p�lace, and purpose of said meeting was given as required.
Section 7. That a copy of this Resolution shall be sent to Stephen N. Ragland,
1616 Woodall Rodgers F'reeway, Dallas, Texas '75202 and to Thomas Brocato, General
Counsel to the es, at Lloyd Gosselink Rochelle & Townsend,Box 1.725, Austin,
Texas 78767-172S.
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