HomeMy WebLinkAboutResolution - 2004-R0206 - Utility Deposit And Fee Requirements - Southwestern Public Service Co. - 04_22_2004Resolution No. 2004-RO206
April 22, 2004
Item No. 50
ORDER AND RESOLUTION
AN ORDER AND RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF LUBBOCK, SITTING AS A REGULATORY AUTHORITY UNDER
THE TEXAS UTILITIES CODE, SECTION 33.001, AS TO ALL PUBLIC
UTILITIES, ORDERING AND RESOLVING THAT ALL ELECTRIC
UTILITIES SUBJECT TO THE CITY OF LUBBOCK'S REGULATORY
JURISDICTION, INCLUDING BUT NOT LIMITED TO SOUTHWESTERN
PUBLIC SERVICE COMPANY, IMPLEMENT DEPOSIT REQUIREMENTS
FOR ALL CLASSES OF CUSTOMERS SERVED BY IT AND ASSESS AND
COLLECT A FEE FOR CUSTOMER -SITE UTILITY COLLECTIONS; AND
THAT THE TARIFF OF SAID UTILITIES BE REVISED IN CONFORMITY
WITH THIS ORDER
WHEREAS, pursuant to Section 33.001 of the TEXAS UTILITIES CODE, the City
of Lubbock has exclusive original jurisdiction over the rates, operations, and services of
an electric utility operating within the corporate limits of the City of Lubbock;
WHEREAS, any electric utility, as defined in TEx. UTIL. CODE ANN. § 31.002,
located and operating inside the City of Lubbock, including but not limited to,
Southwestern Public Service Company (collectively, the "Utilities" or, singularly, the
"Utility'), is subject to the regulatory authority of the City of Lubbock;
WHEREAS, the purpose of the TEXAS PUBLIC UTILITY REGULATORY ACT (Title 2
of the TEXAS UTILITIES CODE) is set forth in Section 11.002(a) of said Act as follows:
The purpose of this title is to establish a comprehensive and
adequate regulatory system for public utilities to assure
rates, operations, and services that are just and reasonable
to the consumers and to the utilities.
WHEREAS, the lack of a deposit requirement in the tariffs charged by Utilities
for electric service is unreasonable in that it discriminates against those customers who
pay their charges promptly and fully, and it further causes the Utilities to seek otherwise
unnecessary rate increases to offset the deficiencies in revenues resulting from
nonpayment;
WHEREAS, the lack of a deposit requirement is presently unfair to the Utilities in
that it unnecessarily erodes what would otherwise be a reasonable return to the Utilities;
WHEREAS, the lack of a fee for additional cost associated with collecting utility
payments at the location of the customer is presently unfair to the Utilities in that it
unnecessarily erodes what would otherwise be a reasonable return to the Utilities;
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WHEREAS, the City Council makes the following findings as to the Utilities:
1. Any electric utility located and operating in the City of Lubbock,
including but not limited to, Southwestern Public Service Company, is a
regulated electric utility as defined in TEX. UTIL. CODE ANN. § 31.002.
2. The purpose of the TEXAS PUBLIC UTILITY REGULATORY ACT (TEXAS
UTILITY CODE) is set forth in Section 11.002(a) of said Act as follows:
The purpose of this title is to establish a
comprehensive and adequate regulatory system for
public utilities to assure rates, operations, and
services that are just and reasonable to the
consumers and to the utilities.
3. That any changes to existing tariffs of the Utilities hereinafter ordered are
changes in rates of said Utilities as that term is set forth in TEx. UTIL.
CODE Alva. § 31.002.
4. That TEx. UTIL. CODE ANN. § 33.001 grants to the governing body of each
municipality exclusive original jurisdiction over all electric rates provided
by an electric utility within its city.
5. That the duty, in part, of the City Council, sitting as a regulatory authority,
in setting rates is set forth in TEx. UTIL. CODE ANN. § 36.003 as follows:
"(a) The regulatory authority shall ensure that each rate
an electric utility or two or more electric utilities jointly
make, demand, or receive is just and reasonable.
(b) A rate may not be unreasonably preferential,
prejudicial, or discriminatory but must be sufficient,
equitable, and consistent in application to each class of
consumer.
(c) An electric utility may not:
(1) grant an unreasonable preference or
advantage concerning rates to a person in a
classification;
(2) subject a person in a classification to an
unreasonable prejudice or disadvantage concerning
rates; or
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(3) establish or maintain an unreasonable
difference concerning rates between localities or
between classes of service."
6. That the tariffs currently implemented are unjust and unreasonable in the
following particulars:
(a) No deposit is required for any class of customer.
(b) The failure to require a deposit discriminates against those
customers of said utility who pay their charges in full and on time.
(c) The failure to require a deposit produces revenue deficiencies that
will require future requests for rate increases to compensate for said
revenue deficiency.
(d) That customers who pay their charges in full and on time will bear
the expense of future rate increases to compensate for the revenue
deficiency caused by the lack of an adequate deposit requirement.
(e) That the failure to provide for a deposit requirement in the current
tariff leads to an erosion of the existing rates necessitating additional rate
increases to provide a reasonable return to the Utilities.
(f) That the current tariff has no provision to protect against the
nonpayment of a bill rendered by the Utilities and a deposit requirement
will assist in this regard.
(g) That the current tariff has no provision to allow for the collection
of a fee by the Utilities to compensate the Utilities for the additional cost
of collecting customers utility payments at the customers premises.
7. To carry out the purpose of the TEXAS PUBLIC UTILITY REGULATORY ACT,
the current tariffs of the Utilities should be changed to provide for a
deposit requirement as hereinafter ordered.
8. That it is the duty of the City Council sitting as a regulatory authority to
ensure that every rate made, demanded, or received by any electric utility
shall be just and reasonable. It is the further duty of the City Council
sitting as a regulatory authority to see that rates shall not be unreasonably
preferential, prejudicial, or discriminatory, but shall be sufficient,
equitable, and consistent in application to each class of consumers.
9. That the failure of any new tariff as hereinafter ordered, to apply to all
classes of customers would be unjust and unreasonable discrimination
between classes of customers served and in violation of TEX. UTIL. CODE
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ANN. § 36.003, and that such tariff would not be consistent in its
application to each class of consumers as required by statute.
10. That the City Council sitting as a regulatory authority, after notice and
hearing as required in TEx. UTIL. CODE ANN. § 36.15lon its own motion
does hereby find that the tariffs of the Utilities should be amended to
provide for a deposit requirement for all classes of consumers served by
the Utilities as hereinafter ordered; NOW THEREFORE:
BE IT ORDERED AND RESOLVED BY THE CITY COUNCIL OF THE CITY OF
LUBBOCK, TEXAS:
That any utility located and operating in, and subject to the regulatory jurisdiction
of the City of Lubbock, including but not limited to Southwestern Public Service
Company, shall amend their tariffs to require a deposit from customers for electric
service, and shall apply the following sections of this Order and Resolution when
providing electrical services to a consumer:
1. The Utilities shall amend its tariff to require a deposit from a prospective
residential electric service consumer in an amount equal to ONE
HUNDRED THIRTY FIVE AND NO/100 DOLLARS ($135.00), except
as provided herein.
2. The Utilities shall amend its tariff to require a deposit from a prospective
commercial and/or industrial consumer in an amount equal to ONE -
SIXTH (1/6) of the reasonable and good -faith estimate of annual billings
of the consumer, except as provided herein.
3. An applicant for residential electric service shall be exempt from the
deposit requirement if any of the following conditions is met by the
applicant:
(a) i. Proof that during the two years prior to applying for electric
service from the Utility, the applicant was a customer of a
utility providing electric service for at least twelve (12)
consecutive months; and
ii. While a customer, the applicant was not delinquent in
paying for any utility service on more than one occasion;
and
iii. While a customer, the applicant never had service
disconnected for nonpayment;
(b) the applicant demonstrates adequate credit, to the satisfaction of
the Utility, by producing a letter of credit from a utility providing electric
service of whom the applicant was a customer; or
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(c) the applicant is at least sixty-five (65) years of age and has no
outstanding account balance with a utility for utility service that accrued
within the last two years.
4. An applicant for commercial and/or industrial service shall be exempt
from the deposit requirement if the applicant produces the following
information:
(a) Proof that during the two years prior to applying for electric
service from the Utility, the applicant was a customer of a utility providing
electric service for at least twelve (12) consecutive months; and
(b) While a customer, the applicant was not delinquent in paying for
any utility service on more than one occasion; and
(c) While a customer, the applicant never had service disconnected
for nonpayment.
The Utilities shall pay or credit interest on any deposits required and
collected under this Article at a rate and in a manner not inconsistent with
applicable orders from the Public Utilities Commission and the TEXAS
UTILITIES CODE, as it may from time to time be amended, and, absent
conflict with said TEXAS UTILITIES CODE, in accordance with the
following terms:
(a) If a deposit is refunded within thirty (30) days of its receipt, no
interest payment or credit shall be required.
(b) If a deposit is retained for thirty (30) days or longer, interest shall
be prorated and paid or credited retroactively to the date of collection.
(c) Except as provided herein, the customer from whom a deposit has
been collected shall be eligible for a refund of said deposit, if elected by
the customer and the customer notifies the Utility, when the customer has
paid bills for service for twelve (12) consecutive residential billings or for
twenty-four (24) consecutive commercial or industrial billings without
having service disconnected for nonpayment of charges for such service,
and without having more than two occasions on which a bill was
delinquent, and when the customer is not delinquent in the payment of the
current bill. Refunds to eligible customers shall be made promptly and
automatically in the form of cash, or, at the Utilities' sole discretion, as a
credit to the customer's bill.
(d) If a deposit is collected from a consumer by the Utilities pursuant
to this Order and Resolution, the Utilities shall thereafter keep records to
show:
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i. the name and address of each depositor;
ii. the amount and date of the deposit; and
iii. each transaction concerning the deposit.
(e) The Utilities shall issue a receipt of deposit to each applicant from
whom a deposit is received, and shall provide means whereby a depositor
eligible for a refund of deposit may establish a claim for said refund if the
receipt shall have been lost by the depositor.
(f) Any deposit not previously refunded to the customer or credited to
the customer's account as provided herein shall be credited to the
customer's final bill for service.
6. That the Utilities be authorized and directed to assess a collection fee in
the amount of FIFTEEN AND N0/100 DOLLARS ($15.00) for each
payment for utility services that is collected from the customer by the
Utilities staff at the customer's residence, place of business or at any place
other than those locations designated by the Utility for the collection and
payment of charges for the provision of utility services.
BE IT FURTHER ORDERED AND RESOLVED BY THE CITY COUNCIL OF THE
CITY OF LUBBOCK:
That the effective date of this Order and Resolution shall be May 1, 2004, and the
Utilities affected hereby shall be in full compliance with this Order and Resolution after
the above -mentioned date.
That the City Secretary is directed to serve a certified copy of this Order and
Resolution upon the Utilities.
ORDERED AND RESOLVED by the City Council this 22nd day of April, 2004.
ATTEST:
Re ecca Garza, City Secretar
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APPROVED AS TO CONTENT:
Lou Fox City Manfiger
APPROVED AS TO FORM:
GG c
Matthew L. Wade
Natural Resources Attorney
ke/ccdocs/SPS Deposit.order.res
Apri120, 2004
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