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Home My WebLink About05-10-19 Special Meeting of the La Porte City Council REQUEST FOR CITY COUNCIL AGENDA ITEM Appropriation Agenda Date Requested: 5/10/19 Source of Funds: N/A Requested By: Lee Woodward, City Secretary Department: City Secretary Account Number: N/A Amount Budgeted: N/A Report Resolution Ordinance Amount Requested: N/A Exhibits: Election result tabulations Budgeted Item: Yes No Ord. 2019-3743 to canvass SUMMARY & RECOMMENDATION The May 4, 2019, general election results are unofficial until canvassed by the City Council in accordance with the Texas Election Code Chapter 67. Below is the tabulation as called for in EC 67.004: EARLY VOTING RESULTS Candidate Totals City Council District & Position 1 2 3 4 5 6 At-Large- A Zemanek 54 21 34 87 87 49 332 Lunsford 36 20 33 91 103 77 360 Totals 90 41 67 178 190 126 692 District 4 Garza 121 121 Clarke 58 58 Totals 179 179 District 5 Martin 160 160 Rosa 24 24 Totals 184 184 EARLY ELECTION DAY RESULTS VOTING TOTALS Totals City Council District Candidate 123456 & Position At-Large- A Zemanek 332 24 9 24 35 46 36 506 Lunsford 360 15 4 17 55 67 30 548 Totals 692 39 13 41 90 113 66 1054 District 4 Garza 121 72 193 Clarke 58 20 78 Totals 179 92 271 District 5 Martin 160 103 263 Rosa 24 11 35 Totals 184 114 298 Voters Voted District Registered Voters Ballots cast (Check-Percentage ins may be higher than ballots cast due to undervoting) 3644 130 3.57 1 2832 54 1.91 2 3273 109 3.33 3 3170 280 8.83 4 3625 308 8.50 5 3636 193 5.31 6 20180 1074 5.32 Total Following a successful canvass, the Mayor will present the winning candidates with their Section 2.06 of the City Charter of the City of La Porte hall qualify an election, or as soon thereafter as practicablexpected at the May 13 meeting. An election contest for a recount in the Councilperson-District 5 race was filed on Monday, May 6, 2019, and withdrawn on Wednesday, May 8, 2019, in accordance with the Texas Election Code. The Councilperson-District 5 race will be canvassed Monday and Councilmember Martin will take his oath of office at the June 10 meeting. ACTION REQUIRED BY COUNCIL Move to adopt Ordinance 2019-3738, canvassing the returns of the general election held on May 4, 2019, for the purpose of electing a Councilperson-At- Large-Position A and a Councilperson-District 4. Approved for the City Council meeting agenda Corby D. Alexander, City Manager Date ORDINANCE 2019-3738 AN ORDINANCE CANVASSING THE RETURNS OF THE REGULAR MUNICIPAL ELECTION TH HELD WITHIN THE CITY OF LA PORTE ON THE 4 DAY OF MAY, 2019, FOR THE PURPOSE OF ELECTING A COUNCILPERSON-AT-LARGE-POSITION A, A COUNCILPERSON-DISTRICT 4, AND A COUNCILPERSON DISTRICT 5; DECLARING THE RESULTS OF THE ELECTION; FINDING THAT NOTICE OF THE ELECTION WAS DULY AND PROPERLY GIVEN, THAT THE ELECTION WAS PROPERLY HELD AND RETURNS THEREOF MADE BY THE PROPER OFFICIALS IN ACCORDANCE WITH THE LAWS OF THE STATE; CONTAINING A SEVERABILITY CLAUSE; CONTAINING A REPEALING CLAUSE; CONTAINING AN OPEN MEETINGS CLAUSE; AND PROVIDING AN EFFECTIVE DATE WHEREAS, pursuant to Section 2.04(e) of the Charter of the City of La Porte, the City Council, at a special meeting th held on the 10 day of May 2019, proceeded to canvass the returns of the regular municipal election held th in the City on the 4 day of May 2019, for the purpose of electing a Councilperson-At-Large-Position A, a Councilperson-District 4, and a Councilperson-District 5; and WHEREAS the election was held under and pursuant to the provisions of Ordinance 2019-3733 calling the election; and WHEREAS the election having been duly and regularly held as called in the ordinance and according to law, and the returns thereof having been made and the election judges having certified the results of the election, as hereinafter set out, and the City Council having duly and regularly canvassed the returns of the election and finding that the total votes cast at the election were as follows: COUNCILPERSON-AT-LARGE-POSITION A JOHN ZEMANEK 506 BRANDON LUNSFORD 548 COUNCILPERSON-DISTRICT 4 THOMAS GARZA 193 MARC CLARKE 78 COUNCILPERSON-DISTRICT 5 JAY MARTIN 263 CHUCK ROSA 35 WHEREAS the City Council of the City of La Porte finds that the election returns set out above to be accurate and correct. NOW, THEREFORE, BE IT HEREBY ORDAINED BY THE CITY COUNCIL OF THE CITY OF LA PORTE, TEXAS, THAT: SECTION 1: Brandon Lunsford received a majority of the votes cast at the election for the office of Councilperson-At- Large-Position A, and, accordingly, Brandon Lunsford is declared elected to the office of Councilperson-At-Large-Position A, subject to the taking of his oath and filing bond as provided by the laws of the State of Texas. SECTION 2: Thomas Garza received a majority of the votes cast at the election for the office of Councilperson-District 4, and, accordingly, Thomas Garza is declared elected to the office of Councilperson- District 4, subject to the taking of his oath and filing bond as provided by the laws of the State of Texas. SECTION 3: An election contest for a recount in the Councilperson-District 5 race was filed on Monday, May 6, 2019, and withdrawn on Wednesday, May 8, 2019, in accordance with the Texas Election Code. The Councilperson-District 5 race will be canvassed at the next City Council meeting. SECTION 4: The City Council finds that the notice of the election was duly and properly given as required by law and as provided in the ordinance calling the election, and that the election was duly and regularly held, and the returns thereof duly and regularly made by the proper officials of the election, and in all things according to the law. SECTION 5: Each and every provision, paragraph, sentence and clause of this Ordinance has been separately considered and passed by the City Council of the City of La Porte, Texas, and each said provision would have been separately passed without any other provision, and if any provision hereof shall be ineffective, invalid or unconstitutional, for any cause, it shall not impair or affect the remaining portion, or any part thereof, but the valid portion shall be in force just as if it had been passed alone. SECTION 6: All ordinances or parts of ordinances in conflict herewith are hereby repealed to the extent of such conflict only. SECTION 7: 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 Act, 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 further ratifies, approves, and confirms such written notice and the contents and posting thereof. SECTION 8: This ordinance shall be in effect immediately upon its passage and approval. th PASSED, APPROVED, AND ADOPTED this, the 10 day of May, 2019. THE CITY OF LA PORTE, TEXAS _______________________________________ Louis R. Rigby, Mayor ATTEST: APPROVED AS TO FORM: _______________________________________ _______________________________________ Lee Woodward, City Secretary Clark T. Askins, Assistant City Attorney REQUEST FOR CITY COUNCIL AGENDA ITEM Appropriation Agenda Date Requested: May 10, 2019 Requested By: Source of Funds: Corby Alexander, City Manager Department: Administration -CMO AccountNumber: Amount Budgeted: Report Resolution Ordinance Amount Requested: Exhibits: Letter from Houston, Highlights Document, Budgeted Item: YesNo Analysis of Rates and Ordinance SUMMARY & RECOMMENDATION On April 5, 2019 CenterPoint Energy Houston Electric, LLC (“CenterPoint’) submitted a Statement of Intent and Application for Authority to Change Rates (“Application”) within the City of La Porte requesting a rate increase, riders, and tariff changes. The Application was filed with each municipality exercising original jurisdiction over CenterPoint’s electric rates. CenterPoint is requesting a $193.4 million rate increase of which $186.6 million will be collected from retail customers. In addition, CenterPoint is proposing through a separate Tax Cut and Jobs Act (TCJA) Rider, to return approximately $97 million to customers over a three-year period. After the three-year period, the TCJA Rider expires. The City of La Porte, as a local regulatory authority, exercises original jurisdiction over the rates, operations and services of CenterPoint for customers located within the City of La Porte under Section 33.001 of the Public Utility Regulatory Act (“PURA”) in the Texas Utilities Code. The new rates would affect rates, operations or services for CenterPoint retail customers within the City. PURA Sections 36.102 and 36.108 provide that the new rates take effect on the thirty- th fifth (35) day of filing. Additionally, PURA Section 36.108 provides that a local regulatory authority may suspend the operation of the Application for ninety (90) days beyond the date the new rates would otherwise be effective. PURA Section 36.109 provides that unless the local regulatory authority establishes interim rates, the rates in effect at the time the Application is filed remain in effect during the suspension period. The City has been informed that the Houston Coalition of Cities consultant and outside counsel will review the Application, perform a coordinated analysis of the new rates, obtain additional information from CenterPoint, receive public comments, and prepare a rate ordinance recommendation to City Council. The expert utility rate consultant retained to review the Application on behalf of the Coalition have not had sufficient time to determine whether CenterPoint has justified its request for new rates. The Coalition’s consultant and outside counsel recommend that the City suspend CenterPoint’s new rates for ninety (90) days beyond May 10, 2019, the date the new rates would otherwise be effective, to allow for coordinated rate analysis, consideration of the new rates, and public comment. Attached is a letter from the City of Houston related to an invitation to join the Houston Coalition of Cities in the CenterPoint Energy Houston Electric Rate Case Proceeding. If the Council wishes for the City of La Porte to join the Houston Coalition ofCities staff th can prepare a resolution to be approved at the next scheduled meeting on May 13. There is no cost to the coalition member cities; Houston will bear the cost, and seek recovery as allowed. The average residential customer using 1,000 kWh per month would experience an approximate 1.91% increase — $2.50 per month for the first three years, assuming an existing retail rate of $0.125 per kWh. Please note that the residential rate above is inclusive of the TCJA Rider. CenterPoint’s summary did not show the rate after the TCJA Rider expires in three years. As previously mentioned, CenterPoint has issued a notice of intent to change the electric rates; however, if the City Council takes no action the rates will go into effect unless the City Council chooses to approve the attached Ordinance suspending the rate increase for ninety (90) days. ACTION REQUIRED BY COUNCIL Move to adopt Ordinance 2019-3738 suspending for ninety (90) days the new retail electric rates proposed by CenterPoint Energy Houston Electric, LLC for customers within the City of La Porte. Approved for the City Council meeting agenda Corby D. Alexander, City Manager Date CenterPoint Energy Houston Electric Rate Case Highlights Updated April 30, 2019 Approximate $193.4 million increase: o $186.6 million collected from retail customers o $6.8 million from wholesale transmission customers. Refund $97 million to customers through a TCJA Rider (Tax Cut and Jobs Act) over a three-year period o Reduces increase by approximately $32.4 million to $154.4 million annually o For the average residential customer using 1,000 kWh per month, this equates to an approximate 1.91% increase $2.50 per month for the first three years, assuming an existing retail rate of $0.125 per kWh. o The TCJA Rider addresses the unprotected portion of the excess deferred income taxes (EDIT). The TCJA reduced the federal corporate income tax rate from 35% to 21% effective January 1, 2018. EDIT is that portion of the income taxes that the company already collected from the ratepayers, but no longer has to pay to the federal government as a result of the TCJA. Prudency determination on distribution capital investment made in the system since January 1, 2010. o Reconciliation of Distribution Cost Recovery Factor (DCRF) adjustments filed 2015 to 2018. o Allows CenterPoint to recover cost of new capital investment made since last rate case outside of a base rate case o Subject to final determination of reasonableness and prudency (capital expenditures) in this proceeding. o Since the last rate case, the company implemented 4 DCRF increases with a cumulative total of approximately $63.6 million. Because the DCRFs are cumulative, each DCRF is absorbed by the next one. The DCRF goes away once base rates are approved. Next Steps: its Application April 5, 2019). tƌĻğƭĻ ƓƚƷźŅǤ /ĻƓƷĻƩtƚźƓƷ ƷŷğƷ ǤƚǒƩ /źƷǤ źƭ ƭǒƭƦĻƓķźƓŭ ƚƩ ŷğƭ ƭǒƭƦĻƓķĻķ ƷŷĻ ĻŅŅĻĭƷźǝĻ ķğƷĻ ƚŅ ƷŷĻ ƩğƷĻƭ͵ Adopt a resolution joining the Houston Coalition of Cities as soon as possible Timeline: April 5, 2019: CenterPoint Energy Houston Electric filed request to increase rates with cities in its service area; and filed parallel case at the PUC . May 10, 2019: r 90 days (35 days after filing). August 8, 2019: Deadline for cities to take final action, suspension period ends. DocuSign Envelope ID: A1FB994E-1C61-43AB-AB4D-5B601ABAB7C2 City ofLa Porte, Texas Ordinance No. 2019-______ AN ORDINANCE RELATING TO THE RETAIL ELECTRIC RATES OF CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC WITHIN THE CITY OF LA PORTE, TEXAS; SUSPENDING FOR NINETY DAYS THE EFFECTIVE DATE OF NEW RATES; MAINTAINING CURRENT RATES IN EFFECT; CONTAINING FINDINGS AND OTHER PROVISIONS RELATING TO THE FOREGOING SUBJECT; PROVIDING FOR SEVERABILITY. * * * * * * WHEREAS, on April 5, 2019, CenterPoint Energy Houston Electric, LLC submitted a Statement of Intent within the City of La Porte ; and WHEREAS, the City, as a local regulatory authority, exercises original jurisdiction over the rates, operations and services of CenterPoint for customers located within the City under Section 33.001 of tilities Code; and WHEREAS, electric base rate proceeding, as approved by resolution #2010-17 by City Council on July 26, 2010; and WHEREAS, the New Rates would affect rates, operations or services for CenterPoint retail customers within the City; and WHEREAS, PURA Sections 36.102 and 36.108 provide that the New Rates take effect on the th 35 day after the local filing, unless the local regulatory authority suspends the effective date of the New Rates within 35 days of filing; and WHEREAS, PURA Section 36.108 further provides that a local regulatory authority may suspend the operation of the Application for ninety days beyond the date the New Rates would otherwise be WHEREAS, PURA Section 36.109 provides that unless the local regulatory authority establishes interim rates, the rates in effect at the time the Application is filed remain in effect during the Suspension Period; and WHEREAS, during the Suspension Period, the City through consultants and outside counsel will review the Application, perform a coordinated analysis of the New Rates, obtain additional information from CenterPoint, receive public comments, and prepare a rate ordinance recommendation to City Council; and WHEREAS, the expert utility rate consultants retained to review the Application on behalf of the Coalition have not had sufficient time to determine whether CenterPoint has justified its request for New Rates; and 1 WHEREAS, the for ninety days beyond May 10, 2019, the date the New Rates would otherwise be effective, to allow for coordinated rate analysis, consideration of the New Rates, and public comment; and WHEREAS, the City has standing in each case before the Texas Public Utility Commission that relates to an electric utility providing service within the City pursuant to PURA Section 33.025; NOW, THERERFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LA PORTE, 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. To allow for coordinated rate analysis, consideration of other issues, and public comment, the effective date of the New Rates filed with the City by CenterPoint on April 5, 2019, is hereby suspended for ninety days beyond May 10, 2019, or the date the Rate Increase would otherwise be effective, to August 8, 2019. Section 3. The rates in effect as of April 5, 2019, the Application filing date, shall remain in effect until the earlier of the expiration of the Suspension Period or until changed by the adoption of a replacement rate ordinance by this Council. Section 4. The City may intervene and participate in all proceedings related to or affecting rates within the City at the PUC until the final resolution of the New Rates. Section 5. 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 of La Porte, Texas 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 2 ordinance and the subject matter thereof has been discussed, considered and formally acted upon. The City Council further ratifies, approves and confirms such written notice and the contents and posting thereof. PASSED AND APPROVED this _____day of ____________, 2019 APPROVED this day of ,2019. _______________________________ Louis Rigby Mayor of the City of La Porte, Texas City Secretary, Lee Woodward 3