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ORD 2010-29 - Entergy, Texas - Deny Rate Increase 04-20-2010 I Agenda Item ORDINANCE NO.2010-29 AN ORDINANCE BY THE CITY OF HUNTSVILLE, TEXAS ("CITY") DENYING THE RATE INCREASE REQUEST OF ENTERGY TEXAS, INC. FILED ON DECEMBER 30, 2009; 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 December 30, 2009 Entergy Texas, Inc. ("Entergy") filed a Statement of Intent with the City to increase electric rates in the Entergy Service Area by$210.5 million per year; and WHEREAS, the City of Huntsville suspended the effective date of Entergy's rates within its jurisdictional limits until at least May 4, 2010 and hired the Lawton Law Firm, P.C. to review the Company's rate change request and proposed tariffs; WHEREAS, the expert utility rate consultants retained to review the Company's rate increase request have made a range of proposed adjustments for areas where Entergy has not justified the need for a rate increase or has failed to comply with regulatory ratemaking requirements. These adjustments on average reduce the Company's purported annual revenue increase to zero dollars, as set out in the recommendations made to the City in the Final Rate Report to Cities Steering Committee ("Report"). The average of the adjustment range, $207.3, would essentially eliminate any increase requested by Entergy. I I WHEREAS, the rate experts retained for the rate review have concluded that Entergy's rate filing request includes rate increases for Entergy's proposed cost of capital, cost of cash working capital, accumulated deferred income taxes, depreciation rates, cost of purchased power capacity, employee compensation—including bonus, stock awards and other compensation—benefits, federal income tax estimates, and storm reserve charges, which are unjustified by Entergy's filing; WHEREAS, Entergy has failed to justify increasing the rates previously determined to be reasonable and necessary by this City and other Texas regulatory authorities; WHEREAS, the statutory deadline to act on Entergy's rate increase request is May 4, 2010; 1 i NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF HUNTSVILLE, TEXAS, THAT: 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 Huntsville hereby denies the rate increase and proposed tariff revisions requested in Entergy's Statement of Intent. Section 3. Entergy is hereby Ordered to continue operating under its existing approved rates. Section 4. 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 5. This ordinance shall become effective from and after its passage. PASSED AND APPROVED this 201h day of tsv' le 0. J. u er, Mayor ATTEST: i L Woodward, City Secretary I #APPRWETO FORM: er, City Attorney i i I 2 RESOLUTION NO.2010-29 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HUNTSVILLE, TEXAS, AUTHORIZING THE SUBMISSION OF A STAFFING FOR ADEQUATE FIRE AND EMERGVENCY RESPONSE (SAFER) GRANT FOR FOUR (4) FIREFIGHTERS; AND AUTHORIZING THE CITY MANAGER TO ACT AS THE CITY'S EXECUTIVE OFFICER AND AUTHORIZED REPRESENTATIVE IN ALL MATTERS PERTAINING TO THE CITY'S PARTICIPATION IN THE SAFER PROGRAM. WHEREAS -T}ie-City desires to ensure the safety of all it citizens and;The City of Huntsville requires the Fire Department be charged with this task;and WHEREAS It is necessary and in the best interest of the City to apply for funding under the 2010 SAFER Grant NOW,THEREFORE,be it resolved by the City Council of the City of Huntsville,Texas,that: SECTION 1: A application is hereby authorized to be filed on behalf of the City and be placed in competition for funding under the SAFER.Grant. SECTION 2: The application will be for no more than $750,000of grant funds for the Huntsville Fire Department. SECTION 3: The Mayor and City Council strongly support this.application to address the safety needs of the Community. SECTION 4: The City Council directs and designates the City Manager, Bill Baine, as the City's Chief Executive Officer and Authorized Representative to act in all matters in connection with this application and the City's participation in the SAFER Grant. PASSED AND APPROVED this 7th day of September,2010. THE CITYOLFHUNTSVILLE L 1 u n r,Mayor IST: LWWoodward,Ci P 0 AS TO FORM: L onard Schneider,City Attorney v I