HomeMy WebLinkAboutORD 20-008ORDINANCE NO. 20-008
AN ORDINANCE OF THE CITY OF BEAUMONT, TEXAS
DENYING THE STATEMENT OF INTENT OF
CENTERPOINT ENERGY RESOURCES CORP., D/B/A
CENTERPOINT ENERGY ENTEX AND CENTERPOINT
ENERGY TEXAS GAS TO INCREASE RATES IN THE
BEAUMONT/EAST TEXAS DIVISION; REQUIRING
REIMBURSEMENT OF MUNICIPAL RATE CASE
EXPENSES; FINDING THAT THE MEETING COMPLIES
WITH THE OPEN MEETINGS ACT; AND DECLARING AN
EFFECTIVE DATE FOR THIS ORDINANCE.
WHEREAS, on or about November 14, 2019, CenterPoint Energy Resources
Corp. d/b/a CenterPoint Energy Entex and CenterPoint Energy Texas Gas
("CenterPoint" or "Company") filed a Statement of Intent with the City of Beaumont
("City") to increase gas' rates in the Beaumont/East Texas Division Service Area by
$6.816 million per year; and,
WHEREAS, City has exclusive original jurisdiction over the rates, operations and
services of a gas utility in areas in the municipality pursuant to Tex. Util. Code
§103.001; and,
WHEREAS, Gas Utility Regulatory Act § 103.021 requires a local regulatory
authority to make a reasonable determination of rate base, expenses, investment and
rate of return and retain the necessary personnel to determine reasonable rates; and,
WHEREAS, the City's reasonable cost for regulatory expenses in ratemaking
proceedings shall be reimbursed by the gas utility under Gas Utility Regulatory Act §
103.022;
WHEREAS, in order to exercise its exclusive original jurisdiction and properly
review the requested rates, it was necessary for the City to suspend CenterPoint's
proposed effective date for 90 days; and,
WHEREAS, the City retained the Lawton Law Firm, P.C. to review CenterPoint's
rate request and make necessary rate recommendations to the City; and,
WHEREAS, the Lawton Law Firm recommended that the City deny the
requested Statement of Intent. The Company's requested rate of return and capital
structure is inconsistent with that of similarly -situated gas distribution utilities, and the
Company's requested depreciation rates rely on a depreciation study that is five years
old and therefore is not representative of the Company's current invested capital. As
such, the Company has failed to show that its requested rates are just and reasonable;
NOW, THEREFORE, BE IT ORDAINED BY THE
CITY COUNCIL OF THE CITY OF BEAUMONT:
SECTION 1. The statements set out in the preamble to this ordinance are
adopted herein as if set forth herein.
SECTION 2. CenterPoint's Statement of Intent to Increase Rates in the
Beaumont/East Texas Service Area is denied.
SECTION 3. The Company shall maintain its current rates under its currently
approved rate schedules.
SECTION 4. The Company shall promptly reimburse the City's rate case
expenses, as provided by GURA § 103.022(a).
SECTION 5. The meeting at which this ordinance was approved was in all things
conducted in strict compliance with the Texas Open Meetings Act, Chapter 551.
SECTION 6. This ordinance shall be effective immediately on passage.
PASSED BY THE CITY COUNCIL of the City of Beaumont this the 25th day of
February, 2020.
ATTEST:
Tina Broussard, City Clerk
- Mayor ecky Ames -