HomeMy WebLinkAboutORD 12-014 ORDINANCE NO. 12-014
AN ORDINANCE BY THE CITY OF BEAUMONT, TEXAS
("CITY") DENYING THE RATE INCREASE REQUEST OF
ENTERGY TEXAS, INC. FILED ON NOVEMBER 28, 2011;
FINDING THAT THE MEETING COMPLIES WITH THE
OPEN MEETINGS ACT; MAKING OTHER FINDINGS
AND PROVISIONS RELATED TO THE SUBJECT; AND
DECLARING AN EFFECTIVE DATE
WHEREAS, on or about November 28, 2011 Entergy Texas, Inc. ("Entergy")
filed a Statement of Intent with the City to increase electric rates in the Entergy Service
Area by$111.8 million per year; and
WHEREAS, the City of Beaumont suspended the effective date of Entergy's rates
within its jurisdictional limits until at least April 1, 2012 and hired the Lawton Law Firm,
P.C. to review the Company's rate change request and proposed tariffs;
WHEREAS, the expert utility rate consultants retained to review the Company's
rate increase on behalf of the City have made a range of proposed adjustments and
concluded that Entergy has not justified the need for a rate increase. The consultants'
analyses eliminate the Company's purported annual revenue increase, as set out in the
recommendations made to the City in the Final Rate Report to Cities Steering Committee
("Report"). The range of adjustments, up to $118.8 million, eliminates any increase
requested by Entergy.
WHEREAS, the rate experts retained for the rate review have concluded that
Entergy's rate filing request includes rate increases for Entergy's proposed cost of
capital, cost of cash working capital, accumulated deferred income taxes, depreciation
rates, cost of purchased power capacity, employee compensation—including bonus, stock
awards and other compensation—benefits, federal income tax estimates, and storm
reserve charges,which are unjustified by Entergy's filing;
WHEREAS, Entergy has failed to justify increasing the rates previously
determined to be reasonable and necessary by this City and other Texas regulatory
authorities;
WHEREAS, the statutory deadline to act on Entergy's rate increase request is
April 1, 2012;
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NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF BEAUMONT, TEXAS, THAT:
Section 1. That the statement and findings set out in the preamble to this
Ordinance are hereby in all things approved and adopted.
Section 2. The City of Beaumont hereby denies the rate increase and
proposed tariff revisions requested in Entergy's Statement of Intent.
Section 3. Entergy is hereby Ordered to continue operating under its existing
approved rates.
Section 4. The meeting at which this Ordinance was approved was in all
things conducted in strict compliance with the Texas Open Meetings Act, Texas
Government Code, Chapter 551.
Section 5. This ordinance shall become effective from and after its passage.
PASSED AND APPROVED this 20th of March, 2012.
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-Ma or Becky Ames -
ATTEST:
City Clerk
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