R197RESOLUTION NO. 197
A RESOLUTION BY KENNEDALE TEXAS SUSPENDING THE
PROPOSAL BY ATMOS ENERGY, MID-TEX DIVISION TO IMPLEMENT
INTERIM GRIP RATE ADJUSTMENTS FOR GAS UTILITY INVESTMENT
IN 2004; AUTHORIZING PARTICIPATION WITH OTHER CITIES SERVED
BY ATMOS ENERGY CORP., MID-TEX DIVISION, IN A REVIEW AND
INQUIRY INTO THE SUFFICIENCY OF THE FILING AND THE BASIS
AND REASONABLENESS OF THE PROPOSED RATE ADJUSTMENTS;
AUTHORIZING INTERVENTION IN ADMINISTRATIVE AND COURT
PROCEEDINGS INVOLVING THE PROPOSED GRIP RATE
ADJUSTMENTS; DESIGNATING A REPRESENTATIVE OF THE CITY TO
SERVE ON A STEERING COMMITTEE; RATIFYING THE SELECTION OF
THE LAW FIRM LLOYD GOSSELINK TO REPRESENT THE CITY;
REQUIRING REIMBURSEMENT OF REASONABLE LEGAL AND
CONSULTANT EXPENSES; AND REQUIRING DELIVERY OF THIS
RESOLUTION TO THE COMPANY AND LEGAL COUNSEL.
WHEREAS, KENNEDALE ,Texas ("City") is a gas utility customer of Atmos
Energy, Mid-Tex Division, ("Atmos Mid-Tex" or "the Company") and a regulatory authority
with an interest in the rates and charges of Atmos Mid-Tex; and
WHEREAS, Atmos Mid-Tex made filings with the City and the Railroad Commission of
Texas ("Railroad Commission") in September 2005, proposing to implement interim rate
adjustments ("GRIP Rate Increases") pursuant to Texas Utilities Code § 104.301 on all
customers served by Atmos Mid-Tex; and
WHEREAS, Atmos Energy Corporation has reported a twenty percent increase in net
income for its fiscal year ended September 30, 2004, and projects further increases in profits
from its utility operations in 2005; and
WHEREAS, Atmos Energy Corporation has recently experienced system-wide cost
reductions due to the doubling of its nationwide customer base with the acquisition of TXU Gas,
and has reported to its investors that it has experienced profits its Texas service; and
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WHEREAS, the sufficiency of the filing by Atmos Mid-Tex and its compliance with
statutory mandates is in question and needs to be determined; and
WHEREAS, ratepayers of Atmos Mid-Tex, including the City and its residents, will be
adversely impacted by the proposed GRIP Rate Increases; and
WHEREAS, the City and its residents could benefit from coordination with other cities
served by Atmos Mid-Tex ("Cities") in a review of the reasonableness of the proposed GRIP
Rate Increases and joint participation in any proceedings at the Railroad Commission related to
the proposed GRIP Rate Increases; and
WHEREAS, the reasonable costs associated with the participation of Cities in this rate
proceeding are reimbursable from Atmos Mid-Tex;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF KENNEDALE ,TEXAS, THAT:
1. The November 19, 2005, effective date of the GRIP Rate Increases proposed by
Atmos Mid-Tex is hereby suspended for the maximum period allowed by law to permit adequate
time to investigate the sufficiency of the GRIP rate increase filing, review the proposed
increases, analyze all necessary information, and take appropriate action related to the proposed
increases.
2. The City is authorized to cooperate with other Cities to create and participate in a
Steering Committee to hire and direct legal counsel and consultants, to negotiate with the
Company, to make recommendations to the City regarding the proposed GRIP Rate Increases,
and to direct any administrative proceedings or litigation associated with the proposed GRIP
Rate Increases.
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3. The City ratifies the selection of the law firm of Lloyd Gosselink, in Austin,
Texas, to serve as legal counsel.
4. The City is authorized to intervene in any administrative proceedings or litigation
associated with the proposed GRIP Rate Increases.
5. The City hereby designates David Miller, City Manager as the City's
representative to a Cities' Steering Committee that shall direct the efforts of counsel and
consultants.
6. Atmos Mid-Tex shall promptly reimburse the City's reasonable costs associated
with the City's activities related to the proposed GRIP Rate Increases.
7. A copy of this Resolution shall be sent to Atmos Mid-Tex, care of Richard T.
Reis, at Atmos Energy Corporation, 5420 LBJ Freeway, Suite 1800, Dallas, Texas 75240, and to
Geoffrey Gay, legal counsel to the coalition of cities, at Lloyd Gosselink, 111 Congress Avenue,
Suite 1800, Austin, Texas 78701.
,.~` OF KEN~d this 13t" day of October, 2005.
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• : ',~,.~ ayor, Jim Norw od
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Kathy Turner, City Secretary
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