CC Resolution No. 2471RESOLUTION NO. 2471
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
BAYTOWN, TEXAS, DENYING THE DISTRIBUTION COST
RECOVERY FACTOR RATE INCREASE OF CENTERPOINT
ENERGY HOUSTON ELECTRIC, LLC, MADE ON OR ABOUT
APRIL 6, 2017; AUTHORIZING PARTICIPATION IN A COALITION
OF SIMILARLY SITUATED CITIES; AUTHORIZING
PARTICIPATION IN RELATED RATE PROCEEDINGS; REQUIRING
THE REIMBURSEMENT OF MUNICIPAL RATE CASE EXPENSES;
AUTHORIZING THE RETENTION OF SPECIAL COUNSEL;
MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE
SUBJECT; AND PROVIDING FOR THE EFFECTIVE DATE
THEREOF.
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WHEREAS, on about April 6, 2017, CenterPoint Energy Houston Electric, LLC
("CenterPoint") filed an application for authority to implement a Distribution Cost
Recovery Factor with the City to increase rates effective September 1, 2017; and
WHEREAS, the City is a regulatory authority under the Public Utility Regulatory
Act ("PURA") and under Chapter 33, §33.001, et seq. of PURA has exclusive original
jurisdiction over CenterPoint's rates, operations, and services within the municipality;
and
WHEREAS, CenterPoint plans to increase its revenue requirement by about $44
million per year; and
WHEREAS, the jurisdictional deadline for the City to act in this rate matter is 60
days from the application date or June 5, 2017; and
WHEREAS, the City will require the assistance of specialized legal counsel and
rate experts to review the merits of CenterPoint's application to increase rates; and
WHEREAS, in order to maximize the efficient use of resources and expertise in
reviewing, analyzing and investigating CenterPoint's rate request it is prudent to
coordinate the City's efforts with a coalition of similarly situated municipalities; and
WHEREAS, the City, in matters regarding applications by CenterPoint to change
rates, has in the past joined with other local regulatory authorities to form the Texas
Coast Utilities Coalition ("TCUC") of cities and hereby continues its participation in
TCUC; and
WHEREAS, the City, joined with other local regulatory authorities and
intervened in proceedings regarding CenterPoint's DCRF application before the Public
Utility Commission of Texas in CenterPoint's DCRF application filed in 2016; and
WHEREAS, CenterPoint simultaneously filed its statement of intent to increase
rates with the Public Utility Commission of Texas, therefore the decision of the Public
Utility Commission of Texas could have an impact on the rates paid by the City and its
citizens who are customers in CenterPoint's service territory and in order for the City's
participation to be meaningful it is important that the City promptly intervene in such
proceeding at the Public Utility Commission of Texas; and
WHEREAS, CenterPoint failed to show that its proposed rate increase is
reasonable and therefore the City has concluded that CenterPoint's proposed rate increase
is unreasonable; NOW THEREFORE,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN,
TEXAS:
Section 1: The findings set out in the preamble are in all things approved and
incorporated herein as if fully set forth.
Section 2: The City DENIES the rate increase CenterPoint filed on or about
April 6, 2017.
Section 3: The City authorizes intervention in proceedings related to
CenterPoint's application for approval of a DCRF before the Public Utility Commission
of Texas and related proceedings in courts of law as part of the coalition of cities known
as Texas Coast Utilities Coalition ("TCUC").
Section 4: The City hereby orders CenterPoint to reimburse the City's rate
case expenses as provided in the Public Utility Regulatory Act and that CenterPoint shall
do so on a monthly basis and within thirty (30) days after submission of the City's
invoices for the City's reasonable costs associated with the City's activities related to this
rate review or to related proceedings involving CenterPoint before the City, the Public
Utility Commission of Texas, or any court of law.
Section 5: Subject to the right to terminate employment at any time, the City
retains and authorizes the law firm of Herrera & Boyle, PLLC, to act as Special Counsel
with regard to rate proceedings involving CenterPoint before the City, the Public Utility
Commission of Texas, or any court of law and to retain such experts as may be
reasonably necessary for review of CenterPoint's rate application subject to approval by
the City.
Section 6: The City shall review the invoices of the lawyers and rate experts
for reasonableness before submitting the invoices to CenterPoint for reimbursement.
Section 7: A copy of this resolution shall be sent to CenterPoint Energy, care
of Mr. Denise Gaw, CenterPoint Energy Service Company, LLC, 1111 Louisiana Street,
Houston, Texas 77002; and to Mr. Alfred R. Herrera, Herrera & Boyle, PLLC, 816
Congress Ave., Suite 1250, Austin, Texas 78701.
Section 8: This resolution shall take effect immediately from and after its passage
by the City Council of the City of Baytown. i9
INTRODUCED, READ and PASSED, by the affirmative
City of Baytown this the 27`x' day of April, 2017.
ATTEST•
LET IA BRYSCH, City Cle
APPROVED AS TO FORM:
NACIO RAMIREZ, SR., Ciokttolmey
%cobfsO Karen Files•City CouncihResolutions\20MApril271DCRFDenial.doc
the City Council of the
, Mayor