HomeMy WebLinkAboutResolution - 2021-R0273 - Atmos Energy Railroad Commission CaseResolution No. 2021-RO273
Item No. 7.12
July 27, 2021
RESOLUTION NO. 2021-RO273
RESOLUTION BY THE CITY OF LUBBOCK, TEXAS ("CITY")
AUTHORIZING THE CITY TO PARTICIPATE AS PART OF A
COALITION OF CITIES IN PROCEEDINGS TO BE HELD BY THE
RAILROAD COMMISSION OF TEXAS RELATED TO
IMPLEMENTATION OF HOUSE BILL 1520; AUTHORIZING THE
HIRING OF ATTORNEYS AND CONSULTANTS; DIRECTING THE
ACTIVITIES OF LAWYERS AND CONSULTANTS REGARDING THE
RAILROAD COMMISSION'S HB 1520 PROCEEDINGS; REQUIRING
REIMBURSEMENT OF REASONABLE LEGAL AND CONSULTANT
EXPENSES TO THE EXTENT ALLOWED BY LAW; FINDING THAT
THE MEETING COMPLIES WITH THE OPEN MEETINGS ACT; AND
MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE
SUBJECT
WHEREAS, on June 16, 2021, Governor Greg Abbott signed House Bill 1520,
directs the Railroad Commission of Texas and the Texas Public Finance Authority to
together to issue bonds, the proceeds of which gas utilities would use to pay providers of
gas, for gas provided to gas utilities during the winter storm of February, 2021; and
WHEREAS, HB 1520 provides financial relief to gas utilities that choose to apply
the bonds by potentially providing a low-cost source of financing to fulfill
obligations to natural gas suppliers; and
WHEREAS, any bonds issued under the authority of HB 1520 are to be secured by
mandatory charge on each gas -utility customer's bill and revenue from such mandatory charge
to be dedicated to paying off the bonds; and
WHEREAS, the bonds would allow customers to pay over an extended period,
than potentially through a single billing statement, for the extraordinary cost of gas
during the winter storm of February, 2021; and
WHEREAS, the amount of debt to be issued to pay the gas utilities and in turn
natural-gas suppliers is estimated to be in the range of $4 billion to $5 billion; and
WHEREAS, on or after June 16, 2021, the Railroad Commission issued a "Notice
Operators" to all gas utilities in the State directing all gas utilities that elect to participate in
debt financing of their extraordinary costs for natural gas purchased during the winter storm o
February, 2021, to submit their applications to the Railroad Commission by July 30, 2021; and
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WHEREAS, the information the gas utilities are expected to submit with their respecti
applications will include a voluminous amount of data related to each gas utility's costs of
its practices regarding the purchase of natural gas, including any financial -hedging
and gas -storage practices the utility employs, the costs of transportation of the natural gas; and
WHEREAS, after the Railroad Commission issues its order establishing the amount o
costs to be financed, it will direct the Texas Public Finance Authority to issue bonds secured
mandatory charges imposed on each customer's gas -utility bill; and
WHEREAS, all costs related to the issuance of any bonds, including the cost of
gas and the underwriting costs for issuance of the bonds are to be recovered through
charged end -use customers, including the City; and
WHEREAS, pursuant to Utilities Code § 103.023(a) the City has standing in each
before the Railroad Commission that relates to a gas utility's rates and services in
municipality; and
WHEREAS, the City has the authority under Utilities Code § 103.023(a) to participate
ratemaking proceedings and engage consultants and attorneys to advise and represent the
and assist in litigation before a regulatory authority, or a court; and
WHEREAS, to the extent the Railroad Commission's proceeding(s) to implement H
1520 comprise a ratemaking proceeding, the gas utility shall reimburse the City for
reasonable cost of the services of a person engaged under Utilities Code § 103.022 to the
the applicable regulatory authority determines is reasonable; and
WHEREAS, the Railroad Commission has indicated that it may address in a si
consolidated proceeding all applications submitted by the gas utilities that elect to participate
the debt financing of their extraordinary costs for natural gas purchased during the winter sto
of February, 2021, including Atmos Energy, CenterPoint Entex, and Texas Gas Service; and
WHEREAS, to maximize the efficient use of resources and expertise in
analyzing, and investigating a gas utility's application to change its rates and/or impose
on ratepayers, the City has in the past joined with other local regulatory authorities to form
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Atmos Texas Municipalities ("ATM"), comprised of the Cities of Amarillo, Lubbock,
and Channing ("ALDC") and hereby continues its participation in ATM-ALDC;
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY O
LUBBOCK, TEXAS THAT:
Section 1. The findings set out in the preamble are in all things approved and incorporate(
herein as if fully set forth.
Section 2. The City continues its participation with other cities in a coalition of cities known
as the Atmos Texas Municipalities ("ATM"), comprised of the Cities of Amarillo, Lubbock
Dalhart, and Charming ("ALDC") with the understanding that the Steering Committee of ATM
ALDC is to provide direction and guidance to Special Counsel representing said cities.
Section 3. The City authorizes participation and intervention in proceedings at the Railroa(
Commission of Texas and the Texas Public Finance Authority related to proceedings t(
implement House Bill 1520, as well as appeals taken, if any, from those state agencies' action.
and decisions.
Section 4. The City directs Herrera Law & Associates, PLLC as Special Counsel t
represent the City with regard to proceedings to implement House Bill 1520 and relate
proceedings before local and state regulatory authorities and any court of law and authorize
Special Counsel to engage such experts as may be reasonably necessary for review an
evaluation of applications submitted by a gas utility, including Atmos Energy, CenterPoij
Entex, and Texas Gas Service, related to House Bill 1520.
Section 5. To the extent the Railroad Commission's proceedings to implement House Bi
1520 comprise a ratemaking proceeding, Atmos Energy shall reimburse the City on a month]
basis, for the reasonable costs of attorneys and consultants and expenses related thereto, upon
presentation of invoices reviewed by the ATM-ALDC's Steering Committee.
Section 6. A copy of this resolution shall be sent to Mr. Alfred R. Herrera, Herrera Lai
Associates, PLLC, 4524 Burnet Road., Austin, Texas 78756.
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Section 7. The meeting at which this resolution was approved was in all things conducted
strict compliance with the Texas Open Meetings Act, Texas Government Code, Chapter 551.
Section 8. This resolution shall become effective from and after its passage.
PASSED AND APPROVED this 27th day of July 2021.
Lj �v
ATTEST:
. Vp'.' )K-1 -
RebbCca Garza, City Se eta
APPROVED AS TO CONTENT:
W. Jarr Atkinson, City Manager
APPROVED AS TO
DANIEL M. POPE, MAYOR
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