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15-Oncor Electric DeliveryCITY COUNCIL AGENDA ITEM BRIEFING SHEET Submittal Date: Originating Department: Presented By: Agenda Item No.: 1-17-2011 Council Date: Finance Gene Anderson 15. 1-24-2011 RECOMMENDED MOTION: Motion to approve a resolution suspending Oncor Electric Delivery Company's requested rate increase for ninety days. POLICY ISSUE(S): Fiscal management. Oncar Electric Delivery Company filed an application on or about January LUl 1 Wliri Cliles rcLaiiiiiIg original jurisdiction seeking to increase system-wide transmission and distribution rates by $353 million. The Company asks the City to approve a 14.6% increase in residential rates, a 15.5% increase in commercial rates, and a 25.9% increase in street lighting rates. According to Oncor, annual rates would increase by approximately $60 for an average residential customer. The resolution suspends the February 14, 2011 effective date of the Oncor's rate increase for the maximum period permitted by law to allow the City, working in conjunction with the Steering Committee of Cities Served by Oncor, to evaluate the filing, determine whether the filing complies with law, and if lawful, to determine what further strategy, including settlement, to pursue. The law provides that a rate request made by an electric utility cannot become effective until at least 35 days following the filing of the application to change rates. The law permits the City to suspend the rate change for 90 days after the date the rate change would otherwise be effective. If the City fails to take some action regarding the filing before the effective date, Oncor's rate request is deemed administratively approved. BOARD/ COMMISSION RECOMMENDATION: None EXHIBITS: R esolution ACTION: BUDGET INFO: Fj Financial Report ❑ Minute Order Expense $NA ❑ Department Report Z Resolution Budgeted Amt. $NA ~ Presentation ❑ Ordinance yTD Actual $NA ~ Public Hearing ❑ Other Acct. Name NA Acct. Number NA FISCAL NOTES: None REVIEWED AND APPROVED BY: Z Administration Z City Clerk ❑ Community Development ❑ EMS/IT Z Finance ❑ Fire ❑ Municipal Court Z Legal ❑ Library ❑ Police ❑ Eng./Public Works ❑ Utilities City of Paris iCevtseu I.ivI+ivo 89 DRAFT S:\RESWORK\CURREN"I10ncor Rate Increase Suspension RES 2011.DOC RESOLUTION NO. RESOLUTION OF THE CITY OF PARIS SUSPENDING THE FEBRUARY 14, 2011, EFFECTIVE DATE OF ONCOR ELECTRIC DELIVERY COMPANY'S REQUESTED RATE CHANGE TO PERMIT THE CITY TIME TO STUDY THE REQUEST AND TO ESTABLISH REASONABLE RATES; APPROVING COOPERATION WITH THE STEERING COMMITTEE OF CITIES SERVED BY ONCOR TO HIRE LEGAL AND CONSULTING SERVICES AND TO NEGOTIATE WITH THE COMPANY AND DIRECT ANY NECESSARY LITIGATION AND APPEALS; FINDING THAT THE MEETING AT WHICH TffiS RESOLUTION IS PASSED IS OPEN TO THE PUBLIC AS REQUIRED BY LAW; REQUIRING NOTICE OF THIS RESOLUTION TO THE COMPANY AND LEGAL COUNSEL FOR THE STEERING COMMITTEE WHEREAS, on or about January 7, 2011, Oncor Electric Delivery Company ("Oncor"), pursuant to PURA 33.001 and 36.001 filed with the City of Paris a Statement of Intent to increase electric transmission and distribution rates in all municipalities exercising original jurisdiction within its service area effective February 14, 2011; and WHEREAS, the City of Paris is a member of the Steering Committee of Cities Served by Oncor ("Steering Committee") and will cooperate with the 146 similarly situated city members and other city participants in conducting a review of the Company's application and to hire and direct legal counsel and consultants and to prepare a common response and to negotiate with the Company prior to setting reasonable rates and direct any necessary litigation; and WHEREAS, PURA § 36.108 grants local regulatory authorities the right to suspend the effective date of proposed rate changes for ninety (90) days after the date the rate change would otherwise be effective; and WHEREAS, PURA § 33.023 provides that costs incurred by Cities in ratemaking activities are to be reimbursed by the regulated utility. THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS: Section 1. That the February 14, 2011 effective date of the rate request submitted by Oncor on or about January 7, 2011, be suspended for the maximum period allowed by law to permit adequate time to review the proposed changes and to establish reasonable rates. Section 2. That As indicated in the City's resolution approving membership in the Steering Committee, the Executive Committee of the Steering Committee is authorized to hire and direct legal counsel and consultants, negotiate with the Company, make recommendations regarding reasonable rates, and to intervene and direct any necessary administrative proceedings 1 90 or court litigation associated with an appeal of a rate ordinance and the rate case filed with the City or Public Utility Commission. Section 3. That the City's reasonable rate case expenses shall be reimbursed by Oncor on a monthly basis. Section 4. That it is hereby officially found and determined that the meeting at which this Resolution is passed is open to the public as required by law and the public notice of the time, place, and purpose of said meeting was given as required. Section 5. That a copy of this Resolution shall be sent to Oncor, care of Autry Warren, Oncor Electric Delivery Company, LLC, 1601 Bryan St., 23'd Floor, Dallas, Texas 75201 and to Geoffrey Gay, General Counsel to the Steering Committee, at Lloyd Gosselink Rochelle & Townsend, P.C., P.O. Box 1725, Austin, Texas 78767-1725. Section 6. That this resolution shall be effective immediately upon passage. DULY PASSED AND APPROVED this 24t1i day of January, 2011. Will Biard, Mayor ATTEST: Janice Ellis, City Clerk APPROVED AS TO FORM: W. Kent McIlyar, City Attorney 2 91