Res 035-2006 3/7/2006 ,
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RESOLUTION NO. � 7��' - _��
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WICHITA
FALLS, TEXAS, AUTHORIZING THE CITY MANAGER TO EXECUTE A
SETTLEMENT AGREEMENT WITH TXU ELECTRIC DELIVERY;
FINDING AND DETERMINING THAT THE MEETING AT WHICH THIS
RESOLUTION WAS PASSED WAS OPEN TO THE PUBLIC AS
REQUIRED BY LAW.
WHEREAS, the City of Wichita Falls is a member of the Steering Committee of
Cities served by TXU (Steering Committee); and,
WHEREAS, the Steering Committee did encourage certain member cities to
initiate show cause rate proceedings against TXU Electric Delivery (Electric Delivery);
and,
WHEREAS, Electric Delivery and the Steering Committee engaged in settlement
discussions regarding abatement of any full-scale rate investigation and interim relief
that may be available to Cities, leading to a settlement in February 2005 that made
Steering Committee members whole for their alleged excess costs associated with
street lighting and water pumping in exchange for delay in Show Cause filing
requirements; and,
WHEREAS, Electric Delivery has desired to further extend for two years the
currently scheduled June 2006 rate case filing in exchange for extension of payments
to Cities under the February 2005 Agreement and other benefits to Cities; and,
WHEREAS, the Steering Committee and Electric Delivery have reached a
Settlement Agreement that extends the previously negotiated settlement terms by two
years and adds benefits to Cities, including reimbursement for participation in ERCOT
and market development activities, and $18 million in funds for beneficial public use as
may be determined in the discretion of Steering Committee member cities and which
may include, but is not limited to, energy education for citizens, reductions in rates for
city services, investments in community facilities, and investment in energy efficiency
measures; and,
WHEREAS, current electric market constraints make it impractical to pass the
potential benefits of rate reductions on to residential ratepayers, because most
consumers remain on price-to-beat rates which are fixed by statute and rule, and the
minority of consumers who have switched to service from a competitive retail electric
supplier may only realize rate reduction benefits if their REP contract requires a pass-
through of such rate reduction; and,
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WHEREAS, the Steering Committee and Electric Delivery have reached a
separate agreement wherein the Company will increase franchise fee factors over a
four-year period, producing increased revenues for each member city; and,
WHEREAS, Electric Delivery has committed to the Steering Committee during
the period of rate case abatement to share information on certain company operations
and procedures that should enhance the Cities' ability to appropriately exercise
regulatory responsibilities in the rate proceeding that Electric Delivery has agreed to file
on or before July 1, 2008; and,
WHEREAS, the Settlement Agreement calls for immediate and long-term
benefits to flow to all city members of the Steering Committee, which in turn have
indirect but positive benefits to all city residents and public safety in general; and,
WHEREAS, the Steering Committee values the benefits of settlement to Cities at
approximately $85 million between 2005 and 2009, and comparable value is unlikely to
be achieved through litigation.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF WICHITA FALLS, TEXAS, THAT:
SECTION 1. The City Manager is hereby authorized to sign the Extension and
Modification of Settlement Agreement and Agreement to Resolve Outstanding
Franchise Issues, both dated January 19, 2006, between the Cities' Steering
Committee and TXU Electric Delivery.
SECTION 2. It is hereby officially found and determined that the meeting at
which this resolution was passed was open to the public as required by law.
PASSED AND APPROVED this the 7 day of March, 2006.
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MAYO
ATTEST:
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Clerk