TITLE
Consider an ordinance approving a negotiated settlement between the Atmos Cities Steering Committee and Atmos Energy, Mid-Tex Division regarding the 2017 Rate Review Mechanism Filings.
SUMMARY
DATE: June 6, 2017
TO: Ronald L. Olson, City Manager
VIA: Kathy Davis, City Attorney
FROM: Traci Briggs, Deputy City Attorney
SUBJECT: A negotiated settlement between ACSC and Atmos for the 2017 Rate Review Mechanism filing
BACKGROUND AND FINDINGS:
The City, along with other similarly situated cities served by Atmos Energy Corp., Mid-Tex Division (“Atmos”), is a member of the Atmos Cities Steering Committee (“ACSC”). The Rate Review Mechanism (“RRM”) was originally adopted by ACSC member cities in 2007 as an alternative to the Gas Reliability Infrastructure Program (“GRIP”), the statutory provision that allows Atmos to bypass the City’s rate regulatory authority and increase its rates annually to recover capital investments.
On March 1, 2017, Atmos made an RRM filing requesting $57.4 million in additional revenues on a system-wide basis. Because the City of Dallas has a separate rate review process, exclusion of Dallas results in the Company requesting $46.4 million from other municipalities.
ACSC and Atmos have reached an agreement, reflected in the attached ordinance, to reduce Atmos’s request by $9.4 million, reflecting an increase of $48 million on a system-wide basis, or $38.8 million for Mid-Tex Cities, exclusive of the City of Dallas. If Atmos had used the GRIP process rather than the RRM process, it would receive a $52.4 million increase, exclusive of Dallas.
The increase will be effective for bills issued on or af...
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