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HomeMy WebLinkAboutORD 14-008ORDINANCE NO.14 -008 AN ORDINANCE BY THE CITY OF BEAUMONT, TEXAS ("CITY") DENYING THE RATE INCREASE REQUEST OF ENTERGY TEXAS, INC. FILED ON SEPTEMBER 25, 2013; SETTING JUST AND REASONABLE RATES FOR ENTERGY TEXAS, INC. FOR SERVICE WITHIN THE. MUNICIPAL LIMITS PURSUANT TO A SETTLEMENT WITH ENTERGY TEXAS, INC.; REQUIRING ENTERGY TEXAS, INC. TO FILE UPDATED TARIFFS IN COMPLIANCE WITH THE APPROVED RATES; 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 September 25, 2013 Entergy Texas, Inc. ( "Entergy ") filed a Statement of Intent with the City to increase electric base rates in the Entergy Service Area by $38.6 million per year, to implement new riders charging customers $14.5 million per year, for a total requested annual increase of $53.1 million; and, WHEREAS, the City of Beaumont suspended the effective date of Entergy's rates within its jurisdictional limits until at least January 28, 2014 and hired the Lawton Law Firm, P.C. to review the Company's rate change request and proposed tariffs; and, WHEREAS, Entergy agreed to extend the January 28, 2014, jurisdictional deadline to March 15, 2014, and further agreed to extend the March 15, 2014 deadline to March 24, 2014 in order to accommodate the passage of Ordinances adopting settlement rates; and, WHEREAS, Entergy and parties to PUC Docket No. 41791, Entergy's base rate case currently pending before the Public Utility Commission, have reached a settlement in principle of Entergy's base rate increase request resulting in a $18.5 million increase to Entergy's current adjusted revenues; and, WHEREAS, under the settlement Residential, Small General Service, and the Lighting Class customers will all receive a base rate decrease. The base rate increase /(decrease) is allocated among the customer classes as follows: Table 1 Proposed Settlement Base Rate Increase/ Decrease by Customer Class Customer Class Enter y Initial Request Proposed Settlement Residential $2,049,444 ($2,212,094) _ Small General Service $169,710 ($280,630 General Service $23,549,366 $15,937,075 Large General Service $3,753,620 $1,801,335 Large Industrial_ $9,255,883 $3,508,964 Lighting Service_ ($175,150) $254,652) Total Base Rate Increase: $38,602,873 $18,500,000 WHEREAS, the settlement rates and tariffs are a just and reasonable result and are well within the range of reasonable outcomes of Entergy's base rate case had it been appealed to the Public Utility Commission of Texas; and, WHEREAS, the statutory deadline to act on Entergy's rate increase request is March 24, 2014; NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BEAUMONT: 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 requested in Entergy's Statement of Intent. Section 3. The City finds that an annual base rate increase of $18.5 million is just and reasonable in accordance with Texas Utility Code § 36.003 and consistent with a reasonable resolution of the issues raised by Cities' expert consultants. Section 4. The City finds that the annual base rate increase shall be billed to each customer class in accordance with the class allocation of revenues and rate design as agreed by all parties in the settlement of Docket No. 41791 and as shown above. The settled class allocation and rate design are reasonable and consistent with the recommendation of City's experts retained to review Entergy's rate increase request. Section 5. The City finds that Entergy should be permitted to recover Entergy's rough production cost equalization expenses through surcharge amortized over three years. Section Ei. The City finds that Entergy should be permitted to recover Entergy's reasonable rate case expenses through surcharge amortized over three years. Section 7. Entergy's proposed special circumstances request to recover historical capacity charges of $22,942,706 from customers through reconcilable fuel rates should be and is hereby denied consistent with the parties' settlement in PUC Docket No. 41791. Entergy is also ordered to reduce Entergy's recommended retail fuel reconciliation balance by an additional $1.25 million consistent with the parties' settlement in PUC Docket No. 41791. Section 8. Except as modified by City's Ordinance setting rates and the settlement approved in PUC Docket No. 41791, Entergy's statement of intent application on file with the City is approved. Section 9. Entergy is hereby Ordered to file a proof of revenues and Entergy's proposed tariffs reflecting rates consistent with the City's revenue requirements and adjustments set out above. Such rates and tariffs shall be effective for service rendered on and after April 1, 2014 in accordance with Texas Utility Code § 36.111. In the event that the effective date of rates resulting from the settlement of PUC Docket No. 41791 is delayed beyond the April 1, 2014 effective date, then effective date of Entergy's rates within the City will be suspended and will coincide with the manner of implementation and effective date of rates approved in PUC Docket No. 41791. Section '10. 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 '11. This ordinance shall become effective from and after its passage. PASSED BY THE CITY COUNCIL of the City of Beaumont this the 25th day of February, 2014 yor Becky Ames - RICH WITH iNF0ItNIA7'lON IIILIIA►1111CIIIT T• E• X• A• S 'I�IIIOI^I'lllll 3014001099 e.e THE STATE OF TEXAS § § CERTIFICATE TO COPY OF PUBLIC RECORD COUNTY OF JEFFERSON § I hereby certify, in the performance of the functions of the City Clerk's office, that the attached instrument is a full, true, and correct copy of Ordinance 14-008. This Ordinance was passed by Council on the 25th day of February, 2014, appears of record in my office and that said document is an official record from the public office of the City Clerk of the City of Beaumont, Jefferson County, State of Texas, and is kept in said office. I further certify that I, Tina Broussard, am the City Clerk, of the City of Beaumont, that have legal custody of said record, and that I am a lawful possessor and keeper and have legal custody of the records in said office. In witness whereof I have hereunto set my hand and affixed the official seal of said office this 3Id day of February, 2014. City Clerk City of Beaumont, Jefferson County, Texas j:ua �It�mk Tina Broussard, TRMC City Clerk • (409) 880-3745 • Fax (409) 880-3740 P.O. Box 3827 9 Beaumont, Texas 77704-3827 ORDINANCE NO.14-008 AN ORDINANCE BY THE CITY OF BEAUMONT, TEXAS ("CITY") DENYING THE RATE INCREASE REQUEST OF ENTERGY TEXAS, INC. FILED ON SEPTEMBER 25, 2013; SETTING JUST AND REASONABLE RATES FOR ENTERGY TEXAS, INC. FOR SERVICE WITHIN THE MUNICIPAL LIMITS PURSUANT TO A SETTLEMENT WITH ENTERGY TEXAS, INC.; REQUIRING ENTERGY TEXAS, INC. TO FILE UPDATED TARIFFS IN COMPLIANCE WITH THE APPROVED RATES; 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 September 25, 2013 Entergy Texas, Inc. ("Entergy") filed a Statement of Intent with the City to increase electric base rates in the Entergy Service Area by $38.6 million per year, to implement new riders charging customers $14.5 million per year, for a total requested annual increase of $53.1 million; and, WHEREAS, the City of Beaumont suspended the effective date of Entergy's rates within its jurisdictional limits until at least January 28, 2014 and hired the Lawton Law Firm, P.C. to review the Company's rate change request and proposed tariffs; and, WHEREAS, Entergy agreed to extend the January 28, 2014, jurisdictional deadline to March 15, 2014, and further agreed to extend the March 15, 2014 deadline to March 24, 2014 in order to accommodate the passage of Ordinances adopting settlement rates; and, WHEREAS, Entergy and parties to PUC Docket No. 41791, Entergy's base rate case currently pending before the Public Utility Commission, have reached a settlement in principle of Entergy's base rate increase request resulting in a $18.5 million increase to Entergy's current adjusted revenues; and, WHEREAS, under the settlement Residential, Small General Service, and the Lighting Class customers will all receive a base rate decrease. The base rate increase/(decrease) is allocated among the customer classes as follows: Table 1 Proposed Settlement Base Rate Increase! Decrease by Customer Class Customer Class_ Entergy Initial Request Proposed Settlement Residential $2,049,444 ($2,212,094 Small General Service _ $169,710 ($280,630 General Service_ $23,549,366 $15,937,075 Large General Service _ $3,753,620 $1,801,335 Large Industrial_ _ $9,255,883 $3,508,964 Lighting Service _ $175,150 $254,652 Total Base Rate Increase: _ $38,602,873 $18,500,000 WHEREAS, the settlement rates and tariffs are a just and reasonable result and are well within the range of reasonable outcomes of Entergy's base rate case had it been appealed to the Public Utility Commission of Texas; and, WHEREAS, the statutory deadline to act on Entergy's rate increase request is March 24, 2014; NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BEAUMONT: 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 requested in Entergy's Statement of Intent. Section 3. The City finds that an annual base rate increase of $18.5 million is just and reasonable in accordance with Texas Utility Code § 36.003 and consistent with a reasonable resolution of the issues raised by Cities' expert consultants. Section 4. The City finds that the annual base rate increase shall be billed to each customer class in accordance with the class allocation of revenues and rate design as agreed by all parties in the settlement of Docket No. 41791 and as shown above. The settled class allocation and rate design are reasonable and consistent with the recommendation of City's experts retained to review Entergy's rate increase request. Section 5. The City finds that Entergy should be permitted to recover Entergy's rough production cost equalization expenses through surcharge amortized over three years. Section 6, The City finds that Entergy should be permitted to recover Entergy's reasonable rate case expenses through surcharge amortized over three years. Section 7 Entergy's proposed special circumstances request to recover historical capacity charges of $22,942,706 from customers through reconcilable fuel rates should be and is hereby denied consistent with the parties' settlement in PUC Docket No. 41791. Entergy is also ordered to reduce Entergy's recommended retail fuel reconciliation balance by an additional $1.25 million consistent with the parties' settlement in PUC Docket No. 41791. Section 8. Except as modified by City's Ordinance setting rates and the settlement approved in PUC Docket No. 41791, Entergy's statement of intent application on file with the City is approved. Section 9. Entergy is hereby Ordered to file a proof of revenues and Entergy's proposed tariffs reflecting rates consistent with the City's revenue requirements and adjustments set out above. Such rates and tariffs shall be effective for service rendered on and after April 1, 2014 in accordance with Texas Utility Code § 36.111. In the event that the effective date of rates resulting from the settlement of PUC Docket No. 41791 is delayed beyond the April 1, 2014 effective date, then effective date of Entergy's rates within the City will be suspended and will coincide with the manner of implementation and effective date of rates approved in PUC Docket No. 41791. Section 10. 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 11. This ordinance shall become effective from and after its passage. PASSED BY THE CITY COUNCIL of the City of Beaumont this the 25th day of February, 2014 0 ayor Becky roes - �F-► U'3 ►-"� CITY OF BEAUMONT PO BOX 3827 BEAUMONT TX 77704 FILED AND RECORDED OFFICIAL PUBLIC RECORDS -'e '6(04t Carolyn L. Guidry, County Clerk Jefferson County, Texas March 06, 2014 04:19:35 PM FEE: $46.00 20140@7099