Title
Resolution - A Resolution of the City Council of the City of Mansfield, Texas, Approving a Negotiated Settlement Between the Atmos Cities Steering Committee (“ACSC”) and Atmos Energy Corp., Mid-Tex Division Regarding the Company’s 2016 Rate Review Mechanism Filing
Requested Action
Consideration of attached resolution
Recommendation
Adoption of attached resolution
Description/History
The City, along with other similarly situated cities served by Atmos, is a member of the Atmos Cities Steering Committee (“ACSC”). The Rate Review Mechanism (RRM) Tariff was originally adopted by ACSC member cities in 2007 as an alternative to the Gas Reliability Infrastructure Program (“GRIP”), the statutory provision that allows Atmos to bypass the City’s rate regulatory authority to increase its rates annually to recover capital investments.
On March 1, 2016, Atmos made a filing requesting $35.4 million additional revenues on a system-wide basis. Because the City of Dallas has a separate rate review process, exclusion of Dallas results in the Company requesting $28.6 million from other municipalities.
If the Company had used the GRIP process rather than the RRM process it would have received a $41 million increase, or about $11 million more than will be approved by the attached Resolution. ACSC and the Company have reached an agreement, reflected in the Resolution, to reduce the Company’s request by $5.5 million, such that the Resolution approving new rates reflects an increase of $29.9 million on a system-wide basis, or $21.9 million for Mid-Tex Cities, exclusive of the City of Dallas.
Justification
The ACSC Executive Committee and its consultants find the settled amount of $29.9 million to be a comprehensive settlement of gas utility rate issues arising from Atmos Mid-Tex’s 2016 RRM filing, and that such settlement is in the public interest and is consistent with the City’s statutory authority.
Funding Source
N/A
Prepared By
Jeff Price, Director of Utilities, City of Mansfield
817-932-3961
jeff.price@mansfieldtexas.gov