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HomeMy Public PortalAboutResolution No. 223-05 03-08-2005 RESOLUTION 223-05 RESOLUTION ABATING SHOW-CAUSE AND ACCEPTING SETTLEMENT WITH TXU ELECTRIC DELIVERY WHEREAS on or about March 8, 2005, the City of Richland Hills ,acting under its original jurisdiction to regulate electric transmission and distribution utilities and as a member of the Steering Committee of Cities served by TXU (Steering Committee) did pass a resolution requiring TXU Electric Delivery (Electric Delivery) to show-cause why its rates should not be reduced; and WHEREAS Electric Delivery and the Steering Committee engaged in settlement discussions regarding abatement of any full-scale rate investigation and interim relief that may be available to Cities; and WHEREAS it remains impractical, if not impossible, to deliver rate relief to the vast majority of residential customers until the expiration of price to beat (PTB) on January 1, 2007; and . WHEREAS the unfair and adverse impacts of street lighting and water pumping tariffs that Cities have experienced since the implementation of retail deregulation on January 1, 2002 can be addressed on an interim basis pending a final order in a future rate case through a financial distribution from the Steering Committee of funds received from Electric Delivery as part of a Settlement; and WHEREAS the coupling of interim relief with the Steering Committee's recognition that resources should be devoted to the 2005 Legislative Session to promote overall enhancements in electric retail competition for the benefit of all end-users; and WHEREAS the Steering Committee and Electric Delivery have entered into a Settlement Agreement pending approval by the 20 Cities that passed show-cause resolutions; and WHEREAS Electric Delivery has agreed to improve communication, coordination and timing of construction in rights of way, permit development of a tariff that will allow city mandated underground placement of distribution facilities, modify certain franchise renewal negotiation positions and improve meter reading on certain city accounts that are estimated; and • • WHEREAS Electric Delivery has committed to the Steering Committee during the period of rate case abatement to share information on certain company operations and procedures that should enhance the Cities' ability to appropriately exercise regulatory responsibilities in the rate proceeding that Electric Delivery has agreed to file on or before July 1, 2006; and WHEREAS that Agreement calls for immediate and long-term benefits to flow to all city members of the Steering Committee which in turn have indirect but positive benefit to all city residents and public safety in general. THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF Richland Hills that: 1. The Show-Cause proceeding initiated against TXU Electric Delivery in Resolution No. 223-05 is abated and no rate case filing will be expected from Electric Delivery before July 1, 2006. 2. The Settlement Agreement between the Cities' Steering Committee and TXU Electric Delivery is hereby ratified. • Approved this 8 day of March , 2005. ~ ~ Jam. M Or Nelda S. Stroder . Attest: Y~',~ Lv i Sut er, City Secretary • • AGREEMENT TO RESOLVE OUTSTANDING FRANCHISE ISSUES This Agreement To Resolve Outstanding Franchise Issues ("Agreement") is made and entered into between TXLJ Electric Delivery Company ("Electric Delivery") and the Steering Committee of Cities Served by TXU Electric Delivery Company on behalf of all cities listed on Exhibit A to this Agreement ("Cities"), hereinafter referred to jointly herein as "Signatories." The cities listed on Exhibit A to this Agreement are hereinafter referred to as "Member Cities." WHEREAS, several Member Cities have expressed concern about the increasing cost and complexity of managing utilities in public rights-of--way and the desire to receive increased compensation from utilities for their use of such rights-of--way; WHEREAS, several Member Cities who receive their franchise fee payments from Electric Delivery on a prospective yearly basis have expressed interest in transitioning to prospective quarterly payments; WHEREAS, the Signatories desire to resolve outstanding issues related to franchises; and WHEREAS, after extensive negotiations, the Signatories have reached a resolution of those issues. NOW, THEREFORE, the Signatories, through their undersigned representatives, hereby agree to the following: • 1. The Signatories agree that this Agreement shall become effective only upon the execution of this Agreement and of the Extension and Modification of Settlement Agreement between the Signatories dated January 2~, 2006. The effectiveness of this Agreement shall be accomplished pursuant to the terms of paragraphs 4 and 19 of the Extension and Modification Settlement Agreement. 2. To recognize the increasing cost and complexity of managing utilities in public rights-of- way, Electric Delivery agrees to increase the franchise fee factor for each Member City on January 1, 2006, by 2%. The franchise fee factor is the amount per kilowatt hour which is multiplied times the number of kilowatt hours of electricity delivered by Electric Delivery to each retail customer whose consuming facility's point of delivery is located within the Member City's municipal boundaries. Electric Delivery will also increase the franchise fee factor to be paid to the Member Cities an additional 1% on January 1, 2007, on January 1, 2008, and on January 1, 2009, for a total potential increase of 5% above the franchise fee factor in effect on December 31, 2005. Exhibit B to this Agreement reflects the franchise fee factors in effect for all Member Cities in 2005, and the increased franchise fee factors for Member Cities provided by this paragraph for 2006, 2007, 2008, and 2009. 3. Electric Delivery's obligation to increase its franchise fee payments to reflect the increased franchise fee factors described in paragraph 2 ceases on the date upon which: (1} Electric Delivery is called in for a rate case by any municipality; (2) a proceeding concerning Electric Delivery's rates is initiated under Subchapters C or D of the Public Utility Regulatory • Page 1 Act, Tex. Util. Code Title 2 ("PUR.A") Chapter 36; (3) a proceeding affecting Electric Delivery's rates is initiated as a result of a settlement; or (4) legislation becomes effective that modifies the franchise fee authorized by PURR. 4. The Signatories agree that if the Public Utility Commission of Texas denies recovery in Electric Delivery's rates of the fees associated with the increased franchise fee factors described in paragraph 2, then the franchise fee factors immediately revert to the franchise fee factors in effect on December 31, 2005. Electric Delivery will not seek to impose a refund or credit obligation on Member Cities for franchise fees already paid under the increased franchise fee factors. 5. Electric Delivery agrees to amend its existing franchise agreements with those Member Cities who receive their annual franchise fee payments from Electric Delivery on a prospective basis, and who wish. to receive franchise fee payments on a quarterly basis, to reflect the following points. Implementation of this amendment will be at each eligible Member City's option. Exhibit C is a list of Member Cities who are eligible to take advantage of this provision. For the purposes of this Agreement, "privilege period" is the period during which Electric Delivery will have the right to use the public rights-of--way to deliver electricity to a retail customer. "Basis period" is the period during which kWh delivered to each retail customer whose consuming facility's point of delivery is located within the Member City's municipal boundaries is used for the payment calculation. (a.) In calendar year 2006, the annual payment to be made by Electric Delivery to the eligible Member Cities will be paid in full on the date required by the applicable franchise agreement. (b.) Electric Delivery agrees to amend the franchise of eligible Member Cities to make quarterly payments on a prospective basis in lieu of the annual prospective payments as follows: (i.) A quarterly payment schedule will be established with the first quarterly payment due three months after the 2006 annual payment date in the existing franchise. (ii.) If the franchise amendment reflecting this Agreement is not effective prior to the first quarterly payment date, Electric Delivery will pay any quarterly payments due within 30 days of the effective date of the amendment. Subsequent payments will be made in accordance with the schedule established in the franchise amendment. (iii.) The basis period used in determining the first quarterly payment will be the three-month period immediately following the end of the basis period designated in the existing franchise agreement that corresponds to the last annual payment made in 2006. The basis period used in determining each subsequent quarterly payment will be the subsequent three-month period. Page 2 (iv.) The privilege period covered by the first quarterly payment will be the three-month period immediately following the end of the privilege period designated in the existing franchise agreement that corresponds to the last annual payment made in 2006. The privilege period for each subsequent quarterly payment will be the subsequent three-month period. (c.} For an eligible Member City that chooses to amend its franchise agreement with Electric Delivery in this manner, Electric Delivery will cease to make annual franchise fee payments after December 31, 2006. (d.) In no instance will Electric Delivery agree to payment provisions that would require payment for the same privilege period twice. (e.) The franchise amendment must extend the term of the amended franchise agreement for at least five years beyond its current expiration date. (f.) Since the quarterly franchise payments will correspond to a privilege period that is more than 12 months beyond the date of the payment, no franchise payments will be made during the final year of.the franchise term unless the franchise is extended as set out herein. The amended franchise agreement will include a provision allowing Electric Delivery to elect to make one or more quarterly payments during the final year of the franchise term that will prepay in full the corresponding number of quarterly franchise periods that extend beyond what • would otherwise be the term of the franchise agreement. The amended franchise agreement will include a provision requiring that any subsequent franchise agreement must recognize that any quarterly payments made during the final year of the amended franchise agreement term constitute full payment for the relevant quarterly franchise periods. (g.) Unless the existing franchise agreement is due to expire within 12 months of the date this Agreement is ratified, no other changes to the franchise will be included as part of this franchise amendment. If the existing franchise agreement is due to expire within 12 months of the date this Agreement is ratified, the parties' ability to negotiate other provisions of the franchise at the time the franchise is amended to accommodate this Agreement is not so limited. 6. Each person executing this Agreement represents that he or she is authorized to sign this Agreement on behalf of the party represented. 7. The Signatories expressly acknowledge and agree that oral and written statements made by any party or its representative during the course of the negotiations that led to this Agreement cannot be used or portrayed as an admission or concession of any sort and shall not be admissible as evidence in any proceeding in any forum. i Page 3 • Executed on this the 277nday of January, 2006, by the Signatories hereto, by and through their undersigned duly authorized representatives. TXU Electric Delivery Company Steering Committee of Cities Served by TXU Electric Delivery Company on behalf of all cities listed on Exhibit A to this Agreement sy: By: Its: y~CE laG-0'r'r Its: C'.1,,~ ~r ~ l • • Page 4 Exhibit A . CiTy of Addison City of Highland Park City of University Park CiTy of Allen City of Honey Grove City of Venus City of Alvarado City of Howe City of Waco CiTy of Andrews City of Hurst City of Watauga CiTy of Archer City City of Hutto City of White Settlement City of Arlington City of Irving City of Wichita Falls City of Belton City of Jolly City of Woodway City of Benbrook City of Josephine CiTy of Big Spring City of Justin City of Breckenridge City of Kaufman City of Bridgeport City of Keller City of Brownwood City of Kerens City of Buffalo City of Lakeside City of Burkburnett City of Larnesa CiTy of Burleson City of Lindale City of Caddo Mills City of Little River Academy City of Cameron City of Malakoff City of Canton City of Mansfield City of Carrollton City of McKinney City of Celina City of Midland City of Centerville City of Murphy City of Cleburne City of Murchison City of Colleyville City of New Chapel Hill City of Collinsville City of North Richland Hills City of Comanche City of O'Donnell • City of Corinth CiTy of Oak Leaf City of Crowley City of Oak Point City of Dallas City of Odessa City of Dalworthington City of Ovilla Gardens City of Palestine City of DeLeon City of Pantego City of Denison City of Paris City of Early City of Plano City of Eastland City of Ranger City of Edgecliff Village City of Rhome City of Euless City of Richardson City of Farmers Branch City of Richland Hills City of Flower Mound City of Roanoke City of Forest Hill City of Robinson City of Fort Worth City of Rockwall City of Frisco City of Rosser City of Frost City of Rowlett City of Glenn Heights City of Sherman City of Grand Prairie City of Snyder City of Granger City of Southlake City of Grapevine City of Sulphur Springs City of Gunter City of Sunnyvale City of Harker Heights City of Sweetwater City of Heath City of Temple • City of Henrietta City of The Colony City of Hewitt City of Tyler Exhibit B . . . . • • • 0.002671 0.0025 0.002595 0.002620 ~:002646.......................................... 1 :Addison 0.002934 0.00279 0.002850 0.002878 0.002 6 2 :Allen ~ ....p.............. ....3 :Alvarado 0.003096 „ 0 :003158 ,,,,0:003189 .•...•„"0:003220 ,,,,",,,,,,,,,...0:003251 0 003271 4 ;Andrews 0.003145 0.003208 0,003239..... . p 0.00327 0.003339 0.003372 0.003405 0.003438 5 :Archer City 6 ;Arlington 0.002766 ,,,,"0:002821 •.....,.,•0 :002849. _..._-•,,,,,,,,,,,,,,0 :002877. 0.002904 0.003240 0.003271 7 :Belton ~ 0.003115 0.003177 :003208 ..............s............................................................................. ...........z.." , 8 =.Benbrook 0.003002 ,,,"0;003062 ••,"0:003092 ..•,..,,,,,"0:003122 15 0 002750 0 002777 :............"4 . 9 Bid Siring "0.002670 .......0.002723 0.002251 0.002296 0.002319 0.002341 . SO €Bredcenrid~e li 'Brid a ort 0.002547...,,,,,,,.,•,,,,,,,"0;002598 •••.,,,,,,0.002623 0.002649 .~...P .0:003222 ~~12 Brownwood 0.003069 0.003130 0.003161 0.003192 . . , 0.003133 0.003196 0.003227 0.003258 13 I Buffalo 14 Burkbumett ~ 0.003003 0.003063 0.003093 0.003123 0.003153 . • 0.003125 15 :Burleson 0.00297 0.003036 0.003065 0.003 5 • 0.003521 0.003555 0.003589 16 :Caddo Mills ~ 0.003418 ......."0;003486 0.003017 17 Cameron ~ 0.002873 ....................x:002930 0 :002959...................."~ :002988 • 18 'Canton ...................................s • .........0.003216 0 ;003280 0.003312. 0 :U03345 0.003377 »19 ~•"Carrollton"~~••~~~~~~•~~~~•~~•~~~••• ~ , 0.()02695 0 :002749 0.002776 0 ;002803 0.002830 0 003328 0 003360 20 'Celina 0.003200 0.003264 "0.003296 0.003150 0.003213 0.003245 0.003276 0.003308 21 :Centerville 0 002448 22 :Cleburne 0.002354 ...................."0:002401,, .....0:002425. 0.00298 0.003044 0.003074 0.003103 24 ;Collinsville ~ 0.003212 0.003276 ,,,"0;003308 0.003340 ...........p .....................................................j................ .0:0033,"3 r~ 25 :Comanche € 0.003203 0.003267 0.003299 ."0 :003331 . 0.003046 26 ;Corinth 0.002901 0.002959 0.002988 0.003017 ...........t_..." 0.003219 0.003250 27 ,Crowley..........." 0.003095 0.003157 0 ;003188 . 28 ~ :Dallas ~ 0.002622 0.002674 ,0 ;002701 0.002727 0.002753 29~ =Dalworthin~ton~Gardens~ 0.003023 0.003083 0.003114 0.003144 0.003174 : 0 003378 0.003411 0.003444 30 De Leon 0003280 ...........0 ;003346 0.002766 0.002821 0.002849 0.002877 0.002904 31 Denson ~ 32 :Early 0.003221 _0 :003285 0;003318 .0.003350 r • 0:003305 33 ;Eastland 0.003148 0.003211 „"0 :003242 0 ;003274. .002908 "0:0029_•,,. 34 Edgecliff Village 0.002796 0.002852 0.002880 . 0.003090 0.002971 0.003030 0.003060 0.003 35 € Euless . 36 'Farmers Branch 0.00?452 ,,,,,,,,,,,,,,,,,,,,"0;002501 „0 :002526, ,"„"0:002550 ,,,,,,,,,,,,,,,,,,."0 ;00?575 37 :Flower Mound 0.003031 0 003092 0 003122 0 003152 0 003183 ...4 .....................................................5............»«».."....... 0.002915 0.002973 0.003002 0.003032 38 :Forest Hill 39 'Fort 1North". ».......O.U02651 ~ :00?704 0 :002731 0.002757. 0 ;002784 » . »y......... ............................i... 40 :Frisco 0.002 0.003023 ...................0;003053 0:003083, ~:00311? ...........h 41 :Frost ~ 0.003336 0.003403 0.003436 0.003469 0.003503 . . . a . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 003234 42 :Glenn Heights @ 0.00311 0.003172 0.003203 0.0032 , 0.002784 43 :Grand Prairie ~ 0.002651 0:002704 ....................0;002731......................0;00,,,,,,,,,,,,,,,,,..,,,,,,•„ ......:.....................................................a..................................................... 0 003562 44 :Gran er ~ 0.003392 :003460 0 :003494 0.003528 ~ ................................a............•..................... 45 Grapevine 0.002545 :02596 :U0262I......................x:002647 ..................."0 :002672 0.003258 46 iGunter 0.003103 „0.003165 ....."~:003196 .....................0:003227......."....................».......... ~~47"s-Harker Hei~~•hts • 0:003099 0 ;003161 0.003192 0.003223 0.003254 ..~..~.Heath..........~ ............................:...........0:3072 0:003133 .0:003164 .................0;003195, 0;003226 » 0.003226 0.003291 0.003323 0.003355 . •0.003387 49 :Henrietta ~~50~ ~Hewitt~•~~•~~~~~~~• 4 0.003060 0.003121 0.003152 0.003182 0.003213 • .................•...'.............0.002885. ..0.002943 0.002972 0.003000 ................0.003029 . 51 ;Highland.Park 0 003557 52 ;Honey Grove 0.003388 0.003456 0.003490 0.003524 . . . . ...........................................................0.003245..................0.003310. 0.003342 0.003375 0.003407 53 ':Howe 0.003068 0.003098 0.003128 54 :Hurst 0.002979 „0.003039 2.14.06_12NLtrs Page 9 of 16 • ~xUibik r SS -HUtta tt OD339 . 4;6c13453 0 4p3~97 !5.603331 0 X3565 56 Irvin ~ c) U42fi5{3 G, fl~0Q7p3 0 l5D273a 0,00??55 b tt7tJ2;t33 ~ ....._......._._..._x„ . 57 ~Jnll~ d 60295 6.fl630Zfa G G4,~0S5 1•~ 00 Ofi5 a 003115 58 ,IS~Se~IA'1e 6 603221 4.643285 C C4331B 0 Cf033x~ 4x'433&2 55 ~3u~brr 13.043243 - . . _ ...«.««R-..«.«,.........- C.fl43' 0 Ct~6 6 UD3373 6 C4'1u5 60 ;Kaufman U C03Da p.003C~sKl 0.0{#312Q 6.003134 6.Cg31fiQ fit ~K~Ilcr ~ 0.043J61 0.063122 6.003153 a D33 &3 Q C03~ l4 fKerers 66p33F2 O,Gp33?8 . 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A, W- •+vv+t~.1~1a~•tiiettcam „~3s-17~'nrk'z 17d,:e1 h ine: 1~ I2; 3?3-~~~+~ 'I't3 St~cGr4~t~ ~azstrnirtci: !.'fanil~~ts lhat lya~~c F+~sed. ('aa~cRawr~iua+~ns FFLOM 4.'reafftr:.v C~a}' Kri~,tert L~vyt~ rte; ~•fndel R~sc~lutiau r~rm,~ Siafl' I?elarl Al~~tting ~h~vi ~`ru'.~ Pr~G~~in~ raid Rx~fil;~°in~ SiUlemctit turd 1'+p1i~t~ ~r8titce.rirt~ i;Qnttn~i~e 7tlCelin~, itt :~#~ittt',ta~ rrn t"ebntttiry 9. ~,Lt{1tJ 1n ,cur ~asttu~;~ 1-8, ~~'i613~i ntc~ar,raaxc~utn. aa~ €nf~r~e~ ~~~au thrit the S~c~rin~ iv'r7mtnitit~P i5f ~eti~~ Sorted b~• 1'?{tl atzd 7~:1 E.3c~tre Dislrihuuon t~'~ll rc.cetrtl~ rc:trc#ted a ~cttlen~en.L tt~ieeraent theN extends Che bcstclit-ti t~c~oi~i:rlcxl in '~G~7~ aftc4 increases value to Chic, i~egt~:~d thy: or3~ginai serth~rnarit. r~s ivitlr tie ~a-ior settlement aKrteineat, ~H 1 fI'9 ~crribers of the St~vriu~; {.'armmitiec tutu} ~1ze a~~tion ko appnrl-e the :~~ttlewrnl A~I'eE~crtr hefoce tt~C1[a£itti fl+[~v av ~E. ~ itil.~t_ 'Atlaackted t>J 'ihis tn~tno ar~z t~~~ clvcwnc~tts: I.} rtrc~,1~:I r:atrltltiott }ttrtWaer ~latttirno t3~ ~liv~ ,:an~c rtctann }~t}trc cit} initiated a~trin~ iti 2.Oi~~ utrtl ra4if;~i~7gthe Icrrns o:' tlr~ .~'icttlc-t~~ttt A~e~rtteltt; ~ntf '?.5 a ifirvi~ ~r~.ff report ~~~laia ;imp, tltc r~~~rtluti:~n, liecaust: rto ~i~' +~~~ill eivc ttrr}~ henrJ=it.~ ~ronr l~~ set~Ecniur~€ until ',:vcr}~ Stcccirrg C~rltnrTtitt~c ,.rt.p hac rattili~d lt~: fieltlerncni As_:r~etneni, please pl>tce the r~suluriotz ~n ycaur un,ncif ttgc~traa ~s suun pus~il~k4. Cutt9a3ct Jud4~ ?~~leinittgcx ~jra7eitain~cra,l~la~a~itntt.c_ax~, 71z1~~~-~R9.~), +~~'il~. the draw +a~t•,en yttt,r cotauril ~aiEl ccr~sifler the n~~t~lutior~. Ple~:~e fttz «r email i~ttt'+~f~t~;r u unp,' ~F't~~res~tui'snn ~onc*.~ 1t ~T35 ~.^'t"Crl 3tjOjJl4l~. 'tfte ~iccsing E:~nimiltee nxrst ci~~iSe_ n~7!~r the rntat7cti~ r~beivcal lcuit~T?4t7, itg t;l~ I+~rtrt of ltttzygi sutra ptayrrtents, 5ttc~t¢Id Lug ~sEtlxattior~cd rA~ rnrmbars_ Ire a~tditi~oEl, pls~ns slrotrld he ~F~~'ed att+3 a bu~i~etscl (ire Stccrira~ t:onttnilt~e ~ctit~lfias at t~1C C~~rnntis~iux~~ and at ERC;E~T, s7teciing has k~con 4ctie~~aleci tier Fel~rc~r}~ iLtil~i> ~r 1~:~~fl in Arhni,tA~n ~ilr ,attona~;±r~'ti t3fficu~ T~inin~ ~Roont cm the T[c~r ai the R~tutYiciPtal Clffisc '(~4r4~~ar rat ?f!1 h_ Abr~rt Sh~cct. ~t7 ihal ~~.•e CaII- pl~ti fvr rt crrtered lus~ctt, plca~c rartta4t 3utl~~ v.7tl1 }~uur ,plans In ~~tend the ~rtecxati~~. Ii }'au hawc an~• questbvr~s re~as'dn~~ tfie s~tflc~rrreatt~t~r rr3e~tSn~, pfea~e ctTntac"[~sEe~t" t' `t?l3~2-a~4~[ }+~r~~c~'ffreyk~,tty~rr'ef~la~~lirrn.corn; ~1~~ ~?~-SS"5~. ~eirt}rle cttil~lo-nvl~ir~_c~rna ~ ~ ~;~1 etTlCtncnt ~ r~lgtv~id~c v+:r3tcmcastimmstfitS(}L~~ t!y I ~rnr ' , :~:i~-~ sl ~ ~,•,t ;h Ll+~yd Cie t~seklnk l~le~ ltzs fsc~cJ~e~.~ t4z 'Ct_a~~!7~~;c,r tt~, F'. c°. • http://www.richlandhills.com/admin/agenda/docs/104%SC2.14.06 12NLtrs.htm 2/16/2006 2.14.06_12NLtrs Page 14 of 16 • ~T1.PT ~~t~crx`cSLPP~RTI~i{><~5t~l.t.?Tic}N F'CTItTHER .~R.4't'lIVG SLOW C'.kU4E 14C:TIC}V .~\ll Tt11TTI+YI'1c~ ~~,TTLF,!~~F±1'[' ~~(;~t~'F.~~lisll`'I' BET~'4T,i~ hi S'I'b;~RI'~G C(.1141h~11'3~TEE f>f~ t''I'I'iF:.~~ 9~RV`tr~!) tit" TkU A'+t>n T':~t~ L'LECTRtt~ t>~ Li~'ERY ltl'iC) Ttt~ ("it}~ of i:~ a member tsd' [i ICk'~1=tncm~rr ~:i[)~ ;sr~a§idon }:nu~Yn e~ the ~caering t:ornmiar~s ~~f C:ities S~.rti~cct lk~ 't'kL~. 1'he -~teerin~ C`ommiklc~e ?tas ise~ttititi3rd a ~ettleinent .ygicct€lcrrt w~i[h ~1"?L' ~Ic,~.tric i~eli4~~~• C'om~+rrng ('t'?CCJ} to fiirta~e:r delay the. filing rate case sn cxchtrn~,e. fr~r teens that bez~cf [the Cit}~ antl lh~ j~uh]iC. 'Y'hc ~ur{~irs~a i~f this rc~ozt is tv .irk ,nuthnsi~ation Cc>e tlfe ('it~~ to fcirtt~c~ ;rbar~ the show ~sr,~# ~n~ceadi~~ x~nd to r~if}' the s,;ttlcrs~rnl rr~,~eii~en[ t>ctw'r~ca Ike Scee.ritt~g C'c~mmitir~ arad'l~.'{t;. i)LS~USS~IUId Thy: St~erin~ t.ommitt4c ftu~ teen %n caistrnce yist>;>e the late }95~i~. It tcrc~k;:oz ~ fr,rsital sGtuctur~: i~~ the curly` 19yi?s ~s~hen ~itie5 scrt~e~l l:~s"U gr,r-i~ u~ d~eir ststtric+r~~ right a~ rate cti~ cx~anse reimlaurscrncn] in ~xch~ngc. foe hi~ht~r i~anchisc frc rtlvr;lestts; ~tn~»~c:~~d l~>t~ cinf m~lution~ :utd rusdcd bti~ SFr crt~eiia asscs5rnccta, thr, Steering L:osrJt}i.tlc~~e It~she~t~ the ~[rr~a1't ItuhEie. itatcr~csi sttf~,~r,cate h4forc ttac P~bli~ tftilitV C'oinmi~siGaa,; the C'onrtsttttlt~-Le~as}atu~na+att p1c~:;Sric u[ititw r~gu}itlir~r, matters dealing with TXt 1 for ncurl~' tx+~i, d~.~d.:~:- :~ftcr r[tundr~ o? c~nsidcr.ation iar 2iHl~, [he~ Sitic-rir,~, t'.i,m~3llt~c~ ze~a5irhrnerrtfcd tlaui T3CC't be t~,~t~;ed iti[o a full kale ravi~evu ~f its 3tisun~ic cost of sc~rr•ic:e, sontctC~r'nrthal }gad not c>tiuurrrd. in antx?~ tlts~s~ a decade. Ln thG f',I! ref 2(14f, tt~~enl+~ ~[eering ~'o~nrnitle~ cities. inehrclir~~ the Ci~- of . 17asscd rc.olt~6i~}ns rtiquiring TYL: ~l~ctj~ic L~c3~i~,ury t;~ ri1i,~~~ ~u~, ti+rhp itie ttc~it-Liypxs~;ibl~ tr~rrcrr,ic~ion utd disiritiuti~an charac~ ~hu;rla ntr[ L>e rLduc~cd. 'T'Fx~ rszt~ inguir}~ .~~t~tf .jtrhtil~ir~ b}~ scz~~titl Crrcicn•~_ Fit~st, the P~tC' categorir~ix3 m:rnicihal ~ceo~nts w~~itb bi~surler tcrmmc~i;+9 servi~~e acc~sus~ts irs the ?O(}] rate pr~tcrr'.aiing~ that Icu t~, the iie[~nulated cnvirranrr~ent. '1'it~s tcrf ta~> rr~apiica[iot~ of unfttiF dantairc4 ratcht.ts rrxul Itagher ct-,,trgs IaFrn,lnici~al ~~;ttcr }~urrsltifl~,. It also led t~~ r,~s~.i~,n~:ty high ~ ~i~txlTes =nr strccF lag}itirrc. Secoud, '['~T.: [~atl ~tlcc earnings moni tirang ~~potts at thr FT ]C' th:~r_ cstr;blisfi~-d ~ha C'ntnpat:}~ v.•sis car~er- earning. Third, the C;flm~dn}~ htul rGre37ts~,~ Ennr t$tiuts~h nussat~~ z~~,r~',ani~aticzn trntl The 3iyputltetical cis[ strucaures t47e 1'CJ~C; ~~d utt~sl m justify t;airrenl sate4 i~ ~,Q01 were a47 laogu- <<a4id. 1~he Stccr§ng Cr~snn7ittec and T~'~1 rr.Fieii~r~ a scti9crrrrnl in ~ar95r '2Ut~5 tv Eielay the f}fit of itite in(Eirrnatian fiy T'.3~LT tr9itil tl7e stsmrncr of 2flr?ti. `I'hc scttlct~cr,[ terms t:allcd hor TXU fo tvi~ ~~~ith citie4 r,n ce.itaiit items of ~Ct~tcern-and tti rr~stk~ artnaa! c:~h err}~rr,ctit~ rtit SS m}tli~tt ter, Kate fiteerine Lommittre; +rthi~c.h trvstY t1t~3~ tlsslre~ed cc+ meittt~~r citias. 'Chi:~'it} i)I' ~ r~titis<I the settlentcnt. t~~•cr ihe~ Mast ;>uG~cral moni.Jis, "~'~tJ a.n,f the ~trCl7rto Con~milic^~ h~V~ l~n r~7scts~Si~Jt~,t$M@ ~rrsaii~ali~ty of snodi€yirrg and cxtonclinit t?ie terrt~s c~~f the {ari~in~"~ scl[[k~rnBslt agrecm~.~l ~nt# tlclayirtQ 'I,~~~'s Jti}}~ ~'4lflfi rate case lilir?~. ~1fie1` wUllt~~.iino t{re i3cnt.fit~ irr he rierivcd frrt~s acsc~lan~ ttte sett}cln~cnt r,n~ ~fela~in~ tt~c. r;ric~ ~;:r4e against t,~c Iik4l;Ht~,tid of strc.:res in a~hic~.~}t3 • http://www.richlandhills.com/admin/agenda/docs/104%SC2.14.06 12NLtrs.htm 2/16/2006 2.14.06_12NLtrs Page 15 of 16 • ~,+>ai~it~e ttutcan~cs yr ,~~etcleiiti~l au~d cit~r~~j>CCifiC,#s$t1Lt5 zt a ral~ crime btitaat~d Sn July ?~?(}ti`, the ~te~rirle, Committc~ a~rrt~ed acccpt~tttc~~e cif tiwa ~:ettl~wtt~rti agr~~m~nt ea#'lier this r~+:>rzG}r, DC~~. itcrn5 ref t}~e Settlen3cnt A~r~acrraent a~~ 1. 1:~4U ~~~i1( ulc :t rare case in Jut1l' ~OQS ~.vitlt a []ecem~ct• c~ttlitaa tort }~trr, TArE7 tir~il} cnw~tinuc io mr~kc annual S$ ~iliit~n g~ivrnent5 t~ th4 ~~a`i•i~t~~.. Cctrnnuticc a~titil a final oedcr is ~r+Cere~ in the ~ti'~7~ rate cae, v~•~i~ch pr~t~abi~r ~,~~Bl nc~t be until the. end of 20tt'?, "!'his is a t~~.•o year d~(~r~~«ur r~ ihr g~reviouily ncg~riaiel a~~,re~ment. ~rlris rtinnbu~es ~'ieic~ faz c~.KCCS4i~•a ~tr>~cl ligf~tsng aid ~~~atc~ pt~rn~ine, rates. It htiA~s_~; ~~~rtwxit».tt:.lr~ $3i~ utiliion in tt~lir~ t<7 tttc Sta::rin~ C'~tmxnittae rtrcmL~:ts bc:}+~~~rw ~t7f~~ and 2f)04. ':3. ~~3:C.' ~~Zll mtikr. tv,•~, gialr~tents of milli~lt Ste~rut~ CrrrTirrtiE}eye cities he€ore 1~tu~in~ 31, ~~t}. ~'ttr"hat~e~rial pnhii~ ~~~.e.~% ~t ~tl unexpired iuo4'igion3 ~f lhr~ }at~st a~~eetneni ~~~ii1 be pr~,~r°~~ti a~ ih>r c~~sk forces referenced in ~c ct~rlicr figr~airent ~~61 sfi h~ i.-rc<stcd. Tl~r C~~w~~pany i~~ill r~iml~ttrse uls to Sa0.0~0 p~-r rr3rmth to the 5}twring C'cttnttu~tc~e fur parricipation :it ~:RCt)'}~ ~n~ tf~e~~TC_ T31i~ is wurd7 tr~~cr. ~7 niillits~, ff. S.,parflic lrcrn~ t}'ie rate: settlctn;;ril, bti4 firil;e3 in bcnZlit trtndet the ~ectlerhertt A~rccrtict~}, i~ ik~e Con~g,~n}~'~ cr~srirnitrncnt ttr ~Itl~:ti:r~.w~ ~~tmc~ire iee factor_~ and ~~crn~it sl) [.'hies ~h~ dCSn~e iu re~i'4d gnart~,rl~~ franchise lie fs~vc~icaits as opp;s~ci in a3mttal pa}~mcnts t~ir w~i~,tain that. re,nlt. The trtmctri5e tee faetnr u:crti,tsc 4~~iU }>>~rdttcc ;~pp~~xrnrs~i~l~, '~2'~ rnilli4~n in ben~,fit to Sl~~rir~~r c sar3utlit~t:c i?ic~nluv~ b~totaen ?746 ar~d ?t,)Ct~3 anrJ ah~proxirn~telt~ ~l2 ntiltion:uu~€~t~ll~~ thereat~cr, 'i'#'tc Stc~rirw~ ~cyttwwr~ittee e.onclaidcd !ha} ilrlr,yiw~g a ecri~prch~.nsi4~a rate case. un1tlEJunr.. r~~ tr~tcl itnrnediatcly etrpttari~~ t»neficial fin:utt,ixl t~rrns u'a~ the csptimt~l ccuines~s~ acCiPa F:~r `tlt,~. tarsons ~I;r(ecl }~elr~r~~_ A~iost r~ iden}ial crssu~rr~esx reinair, on price tip l~at (1'TBj rtlc~s :rrd ot~ rate relic[ d~~t st~te~sf~il frr~~tiecution of a r;~tc~ c~<~sc sa~aia7st tlrc C:as~,iny aufstlld floe; tt~ PTEt ca,z,t+~~~tee~_ ~tU`hil the cilITCnI P'CT3 raruetu~re. tcrwnint~trs J~r~uary 1, ~'UG?• p+~lir:; trtial;e.r~ at thy. Pitbiic i~tilit~ {'nnunission t"~CTCI Intl t}ia Le~,islatu~. r,~~- c}iscussin~ c~tendin~ ~~~?r3i~ fryrtia ot: P1B~i~tdr' J~Rtnary' 1. 2{I07. rr•~•~.r~ if [:.itie.~ ti~~or~ s ct+nsic€cra~il~ t°icti~=~~ by rcduc::ng Tkl"s x~~:enrt~s by tx*,r.~r 51}lI? awiillinn, nuinciuti~ pxnin!: 3~pr~aenting t}sficrcnt t;~pe-s of custurncrs ~ai~iafd tight ar~on~~K 4hcm~e}r~~efi 4~~~er Itotr~ the rK'vrnisc r'ed~setion chot~ld bc: ,~ill~~~ated to reduce r.h:.~ ibr t}ie 1~at~~uF ~Ct~S9e3 of crtstcir~cr~. There as no icrtaini}~ 4}rat tea residentitil acct srrya3l er~i~r~t~cr:,ial ,~uy~;~+r~t~rs Fvcruld ~eei~~,: an~• mt:a~rincfi~} rate reduction. In l(ye an[;~ rna,jor ra}t~ t:r~.ue trx he litig:~tcc3 ~in~:a <l~~gu9ation o,;c¢rtcd un 7aaniai'ti ?OU,~., nc~ pUC'. f+~~snd dial die urili?y in c{~titie~it should hti+'c its orr.~iU re~~enues rcduccci, l~tt ntn~dteless raiscci rc~ic}enual rates_ Farhr~rm~i~, even if http://www.richlandhills.com/admin/agenda/docs/104%SC2.14.06 12NLtrs.htm 2/16/2006 2.14.06_12NLtrs Page 16 of 16 si~trff'seant ratc~n~u~li+,mr t~ resic~c~tial rind c~mr~rcrcial tHri[l~s coeald ~c tichiCr~e~, k~ertefits ~~au]rl not n~;t:es~cyrily~Eic px~etf utt t© egad-tt~~ by~ the ret<~il clcctnc ~r~wider~ (ItEPs~ lfaat ;erce uustn~ners s~~ho have encer~d the cl:,rc~aiaated n7~~kci. ?vlalch caf the ~.ncfit in cutcin~ T~+'~J fi[4~a,;c (7~1i~•et~~'s ragas u~anld, ui~dcr thc~ ~eesar,~ ~rt.~kr.~ si~aetut~e, siinp4a~ l7ta+'v c~ Chv 'Tk'U sftliitccl RrF'. T~t~s~5~tl~xr»ent Arrrcm~nt ~~a~t~id,es X18 milli<)rE far ~'iucs to ~~t~gtl~r' tea "bc~7c~icit~;~h1}li~ use' in ll~uia$'s~ry uncertain resitlrnlir~l rate. reductions slr.rannin~ from.;itika~itin_ The un~ansl million tr,~pment t~ Stec~nn~: C'nrnnt[tice mcmt~er~ «~as $a cd is~n a heli~;f that sircut 1i~hting rates .ire c:.>GC~G.tihi~,~e an~+ thin wtilar hur~•~hine dcrnrincl rar,:hats arc in~FT?r~;=priate_ V4'hil~ tlac Cvmps~af3~ is obli~z~Ecd under die ~U44 Scttlernen€;~pprt~~•cd h~~ Steering C'u€nmittee ~~t}e~ihers in ?0~75J t~7 sup~att r,.dutaion to ~u~eet lighting ~,n~ l~anlpin~ rasc~~ c.+)slfiist~nt wilf~ lfie .mntaal{~ar~t7iCnis to Cit~e,,ther~e is no gtao-irant~ drat the. PL:C wt~wld appr~vc~ s~sch pxr~lx~sal, TFie hr~ipcrsed Scttlamert€ :'lgreen~ent aaE73aiins a itan~~rr uC k~~aerats that ~~~ozild irat h~ ~a~~aifabl~c as ~liaf in a litigatctl ral~~ came. 'flee I'LTC has nip iuristiictitro ita irrc~atic frinchi4e tea factors ar addrras v~'tten or ho~~ Ir:ane}~sSe fve pa.~tnc~nth are ~tiadc. ('itics un,ucccssfu[lti~ at~~ml7ts~d u> achieve Iranbi7ise fee eecaiati+.an in il~~e la.~t iwcr grncrhl sessions of the L.e~istatur~ ~~nd~ fay°unib4c I~t'aatcf~ist fee chanvr. fr~r Catias is ~tnlikci~~ ~(a «ccur ~itdepcnda?tt i~f tlae~ actt]~m~tt1 A,treertsau[, :~dclitiun~ll}~, tlae Commission is utaabl~; aut~ttsriz~ l~a~~m~ntx to C`it~e.~ car ~t~} ~U~YU7it~r t'e1rra~eittativc for f+airi.ii:ipation iat;=.RCt~1' i~r~ rraarl,ct dusi~n rrztalcea~. '1~~.; Scttlc.ment rlgreemtint tE~lays rattaer chttit tCStninsiGefi a rate rco~ic~+'r. ~7e ~~tttcsr~~t ~~n?Ei7aeni t~bligatc-s ihG ~:csatpan}~ to cuoctsr~te ~S~ttit Cat~cs ia~ saa~hinr an trztt~t:r~initd~n,~ of Comptiny 471rcratioits pear l0 1ha fGlin~ ~ a rtatc. ~;tsc and fi_int~cr pru~~i~le_, for rc:imbs~r~iwa~7att[a~f C~itics' c~pcnsrs ;,:4h4rcisted ~a~iii~ rcvi:.va ~afC'rampar,,~ affiiiii4cd ta~arasacaons. The St~r'rng 4'ommittee Values the tnt~l itene#iis o1' the 4ettlernent :~~rcernent wfith ' TXU at a~ProximaLelWv ~li~ ntillftrn far the herit~ti 2bU~ - ZIWa (thfs inctndes the Yrs~~zehi face incrr.~~s tbrnugh X009). Pro~+rah;ti~.ie~; are less than 5C? ly~cent tl9at thi~ PLtG in 2t]~!7 ~Irotald rca~iy cait~pdtrhblc sAlne. at the end t~F a rr,1t ca~~ A~ttsrettv~;r, thai+e ir; no cc~aint~r- that. resid~nti.tl cust~rxtars would xcecti~:r. ra»}~ ltiencfit ev,~,~ if thr. C'~in~ntission t~i1i°r~rraly re~uc.~ecl o.~c,r~tll t~atas by $~s5 milli~~n. The St,~fi rew~rrtt7tends~;ictoptictn uf~cTte ~e~olut~o>t Ciastif~e,~~~~~ing tic ~atc ease filing ,insl r~tiiy~ing Iha 5ettlentcnt r1~*rttsrirnt. ,~1i SG;cring C'utr~rt~ittec rncmb~;r cities ~rt~st take ,i:SiCtil to ~pprorL the rrctIca~tealt in ~rdcr for the l~~jrefits to flcati~~ r.<y an~r` ir~4rri~cr, ~,)1 Pa+~r3tdrU.to be zr~~~kc hk `!'Xl.,' will not hG rc.le.ased Etntii the sr.6llement i; ru`l~+ ratitici3_ • http://www.richlandhills.com/admin/agenda/docs/104%SC2.14.06 12NLtrs.htm 2/16/2006