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Home My WebLink AboutO-2010-3295 denying Center Point Energy’s proposed rate changeit REQUEST FOR CITY COUNCIL AGENDA ITEM Agenda Date Requested: October 25, 2010 Requested By: Ron Bottoms Department: Administration Report: Resolution: Ordinance: X Exhibits: Ordinance Exhibits: Exhibits: Appropriation Source of Funds: Account Number: Amount Budgeted: Amount Requested: Budgeted Item: YES NO SUMMARY & RECOMMENDATION On July 26, 2010, the City Council adopted Ordinance 3266 suspending the effective date of CenterPoint Energy's new rates until November 2, 2010 and agreed to participate with the Houston Coalition of Cities opposing the rate increase. On September 10, 2010 the Houston Coalition filed the testimony of seven utility rate experts challenging CenterPoint Energy's proposed increase. Rebuttal testimony was filed on September 24"'. The process is ongoing with an expected hearing before the Public Utilities Commission sometime in December or January. The Houston Coalition is recommending that member cities adopt the attached ordinance denying CenterPoint's proposed rate increase and maintaining the existing rates in effect for customers within our city until the proceedings have been concluded. This Ordinance must be passed on or before November 2, 2010, in order to replace Ordinance 3266 and avoid CenterPoint Energy's rate increase. Action Required by Council: approving an ordinance denying CenterPoint Energy's proposed rate increase. Co Ron Bottoms, City Manager 1c) /J16 lic> Date City of La Porte, Texas, Ordinance No. AN ORDINANCE RELATING TO THE RETAIL ELECTRIC RATES OF CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC WITHIN THE CITY OF LA PORTE, TEXAS; DENYING A RATE INCREASE AND MAINTAINING IN EFFECT THE CURRENT RATES THAT SHALL CONSTITUTE THE CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC RATES TO BE OBSERVED WITHIN THE CITY OF LA PORTE, TEXAS UNTIL CHANGED UNDER THE UTILITIES CODE; MAKING FINDINGS AND CONTAINING OTHER PROVISIONS RELATING TO THE FOREGOING SUBJECT; PROVIDING FOR SEVERABILITY; AND DECLARING AN EMERGENCY. if int !f 7f 1< WHEREAS, on June 30, 2010, Centerpoint Energy Houston Electric, LLC ("CenterPoint Electric") filed a Statement of Intent and Application for Authority to Change Rates ("New Rates") within the City of La Porte, Texas ("City") seeking electric rate increases totaling $94 million per year; and WHEREAS, on July 26, 2010, the City of La Porte (City) as local regulatory authority, adopted City of La Porte, Texas Ordinance No. 3266 suspending the effective date of the New Rates until November 2, 2010 (Suspension Period) and maintaining the rates in effect on June 30, 2010 (Current Rates) until the earlier of the expiration of the Suspension Period or the adoption of a replacement rate ordinance; and WHEREAS, during the Suspension period, in order to gather information through the discovery process, the City participated through the Houston Coalition of Cities (Coalition) with other cities in proceedings at the Public Utility Commission (PUC) related to or affecting CenterPoint Electric's rates within the City; and WHEREAS, based on the City's investigation and analysis through the Coalition's utility attorneys and rate experts, the City developed recommendations regarding the New -1- Rates; and WHEREAS, on October 11, 2010, the City's recommendations were presented to City Council; and WHEREAS, the rate analysis and recommendations, as presented at the October 11, 2010, Council Meeting, conclude that CenterPoint Electric has not demonstrated that New Rates are just and reasonable, non-discriminatory and in compliance with all applicable law; and WHEREAS, City Council anticipates that a denial of the New Rates will be appealed to the PUC; and WHEREAS, denial of the New Rates would maintain the Current Rates in effect for customers within La Porte, Texas until further changed under the Utilities Code; and WHEREAS, City Council determines that the CenterPoint Electric Current Rates are the just and reasonable rates to be observed and to remain in force within the City; and WHEREAS, the City Council finds that the public interest will be served by the adoption of an ordinance denying the New Rates, and maintaining in effect the Current Rates because they promote the adequate and efficient provision of service, are just and reasonable and nondiscriminatory and are in compliance with all applicable law; NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LAPORTE, TEXAS: Section 1. That the facts contained in the preamble of this Ordinance are determined to be true and correct and are hereby adopted as part of this Ordinance, Section 2. That the Current Rates for CenterPoint Electric customers receiving service -2- within the City of La Porte, Texas shall remain in effect until further changed under applicable law. Section 3. If any provision, section, subsection, sentence, clause or phrase of this ordinance, or the application of same to any person or set of circumstances is for any reason held to be invalid, the validity of the remaining portions of this ordinance or their application to other persons or sets of circumstances shall not be affected thereby, it being the intent of the City Council in adopting this ordinance that no portion hereof or provision or regulation contained herein shall become inoperative or fail by reason of any unconstitutionality, voidness or invalidity of any other portion hereof, and all provisions of this ordinance are declared to be severable for that purpose. Section 4. The City Council officially finds, determines, recites and declares that a sufficient written notice of the date, hour , place and subject of this meeting of the City Council was posted at a place convenient to the public at the City Hall of the City for the time required by law preceding this meeting, as required by the Open Meetings Law, Chapter 551, Texas Government Code; and that this meeting has been open to the public as required by law at all times during which this ordinance and the subject matter thereof has been discussed, considered and formally acted upon. The City Council filrther ratifies, approves and confirms such written notice and the contents and posting thereof. Section 5. There exists a public emergency requiring that this ordinance be passed finally on the date of its introduction as requested in writing by the Mayor; therefore, this Ordinance shall be passed finally on that date and shall take effect immediately upon its passage and approval by the Mayor. -3- ATTEST: artha A. Gil tt City Secretary APPROVED Knox W. Ask ns City Attorney CITY F RTE By: "�u 1 9. R1 ry, Mayor -4- CO?d?UC.'T OF INV'TERFST AFF]DAWT THE STATS OF TEXAS I COUNTY OF HARRIS I I, U & K- et.iCc'dI as a member of the City of La Pmte dea,/V e /L'.1 make this aftlavif and hereby on oath state the following: I have a sinal in a business entity or real property as defined in Cater 171, Texas Local Govt Code, and a vote is to be taksa or a decision is to be made that will have a special economic effect an this business coley or real property. '1be agenda item on j1 , 20affecting this business entity m4aa Ph"fq;46. COQ (A) OR (B): (A) 'The business entity is ( cr—E2 �;nr� ��Iy (name); or (B) The real property is locked at: I have a -substantial interest fur ft foIlowing reasans: (check all which are applicable) Owncasbip of 10% or mort-of the voningilock or shares -of ft bush= entity_ -OOewsu rs may. of10`X or more or $-15,000 or -more of the fair market vabx of the c/ Fonds rcccive i ftm the business_catity exceed 10% of gross income for the P YM - Red property is involved and I have an equitaNe or legal owamsbip of the property with a fair mvalve of at least $2.500. A relative of mire has a subsutatid interest in. -the business entity or real proparty tient would be affocted. by a decision of the public body of which I am a member. / � 1 lead • 1 m . .Ii1 , . r n1 u; 1 ►w Irl . inn a .! ! . 1, r. n � 1,11 � ul • 1 0 . t 1.1q NT9)1 11 1 L A I #I tjo to) 11 ki 111 ' • ►: 111)1111,'17.4 . 31'118 1 Ism W-11CA till is 1 MII : 1 WING)IR 11 11 -Illy t I �M/ •.`1,1;1 /' lag,.•, •:11 Singed this 2-5 day of -� O �1le fL , 20 Signadtire of THE STATS OF TEXAS I COUNTY OF HARRIS I Beforemr.�✓ on this day personalty appeared Ymwn to me to be the person whose name is sabsczbed to the fmtgoimg instmni& and aci oowdedged to me that he/she e=cuted the same for the purposes and ausiduldom &=in=Tressed. Given nada my hand and sea of ofam this 2 -5 --day of .20J . (SEAL) 1-1.1m dka�' eLd A A A Notary Pub& iu and for the State of Texas MARTHA GUETT is - - - - I My Commission Expires August 31, 2013