05-01 - O TOWN OF PROSPER ORDINANCE NO. 05-01
AN ORDINANCE OF THE TOWN OF PROSPER, TEXAS, FINDING THAT THE CURRENT
RATES OF COSERV GAS LTD. ARE UNREASONABLE; APPROVING COSERV GAS LTD.'S
REVISED AND UNCONTESTED TARIFFS; APPROVING A RATE PHASE-IN; AUTHORIZING
CONTINUATION OF DEFERRAL OF CARRYING CHARGES ON PLANT HELD FOR FUTURE
USE; RECOGNIZING COSERV'S RIGHT TO SURCHARGE FOR FACILITY RELOCATION
REQUIRED BY THE TOWN; SETTING THE EFFECTIVE DATE OF NEW TARIFFS AS
FEBRUARY 1, 2005; FINDING CITIES' RATE CASE EXPENSES REASONABLE; SEVERING
THE DETERMINATION OF THE REASONABLENESS OF COSERV GAS LTD.'S RATE CASE
EXPENSE FROM APPROVAL OF THE REVISED TARIFFS; RETAINING JURISDICTION OVER
THE DETERMINATION OF THE REASONABLENESS OF COSERV GAS LTD.'S RATE CASE
EXPENSE ISSUE UNTIL MARCH 1, 2005; ADOPTING A BASE RATE CASE MORATORIUM;
FINDING THAT ANY RELIEF REQUESTED BY COSERV GAS LTD. NOT SPECIFICALLY
GRANTED HEREIN IS DENIED; ADOPTING A MOST FAVORED NATIONS PROVISION;
FINDING THAT THE MEETING AT WHICH THIS ORDINANCE IS PASSED IS OPEN TO THE
PUBLIC AS REQUIRED BY LAW; AND PROVIDING FOR NOTICE OF THIS ORDINANCE TO
COSERV GAS LTD.
WHEREAS, on or about August 25, 2004, CoSery Gas Ltd. ("CoServ" or"Company"), filed with the Town of
Prosper ("Town") a Statement of Intent to change gas rates in all municipalities within the CoSery System effective
October 1, 2004; and
WHEREAS, the Town has exclusive original jurisdiction to evaluate the Company's Statement of Intent as it
pertains to the distribution facilities located within the Town, pursuant to Texas Utilities Code §§ 102.001(b) and
103.001; and
WHEREAS, the Town suspended the effective date of CoServ's rate request until December 28, 2004 and
CoSery extended the effective date of the rate increase by an additional thirty days for the Town to investigate the
Company's filing and to consider settlement of the request; and
WHEREAS, failure to take action regarding CoServ's rate request by January 27, 2005, will cause CoServ's
filed request to become effective for all CoSery customers within the municipal limits;
WHEREAS, the Town joined the Coalition of Cities Served by CoSery ("Cities"), a group of other cities
similarly affected by CoServ's rate request to jointly hire counsel and an independent consultant to review CoServ's
application; and
WHEREAS, after consideration of the Company's filing and the report issued by Cities' expert, the Town
concludes that CoServ's current rates are unreasonable and should be changed; and
WHEREAS, the Company and Cities have reached an agreement as to CoServ's filed request to increase
rates conditioned upon final approval by Cities; and
WHEREAS, the Company's requested increase in system-wide annual revenues of $1,165,525 is
excessive, and the Company has agreed to an increase in system-wide revenue of$500,000, of which approximately
$214,000 is associated with changes to the miscellaneous service charges; and
C:\Documents and Settings\Shanae Jennings\My Documents\ORDINANCES & RESOLUTIONS\ORDINANCES\2005 Ordinances
and Resolutions\05-01,Ordinance-Establishing Revised CoSery Rates.doc
Page 1 of 10
WHEREAS, a condition to the settlement with CoSery is the Town's recognition of the Company's right
under Texas Utilities Code Section 104.112, independent of the tariffs approved herein, to surcharge facilities
relocation charges within the city requiring relocation; and
WHEREAS, a condition to the settlement with CoSery and the revised tariffs approved herein is the
Company's commitment that it will not file a request with Cities for a rate increase that becomes effective prior to
September 1,2006;and
WHEREAS, a condition to the settlement with CoSery is the phase in of the base rate increase approved
and reflected by the attached tariffs so that the first ten percent of the rate increase will be implemented upon
adoption of the revised tariffs and the remaining increase will be implemented in ten-percent increments on or after
November 1,2005 and the balance on or after August 1,2006; and
WHEREAS, Cities' rate case expenses incurred in this proceeding are reasonable and should be
reimbursed by CoServ;and
WHEREAS, the Town is unable at this time to determine the reasonableness of the rate case expenses
incurred by the Company;and
WHEREAS, the Town has reviewed the settlement agreement reached between the Company and the
Coalition of Cities Served by CoSery and has determined that approval of the revised tariffs is in the best interest of
the Town and its residents, results in just and reasonable rates,and,therefore, should be approved by the Town;and
WHEREAS, since the Company filing is based upon system-wide standardized rates and tariffs, it would be
inappropriate for any city or residents of any city to receive benefits not enjoyed by the entire system.
NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF PROSPER,
TEXAS:
SECTION 1. That it is in the best interest of the Town and its residents to adopt the revised residential,
commercial and miscellaneous service charge tariffs attached hereto to this ordinance that reflect the settlement
agreement reached between CoSery and the Coalition of Cities Served by CoServ. All other tariffs proposed in
CoServ's Statement of Intent,except for rate schedule 9(Rider RCE- rate case expenses)are adopted.
SECTION 2. That the adoption of the revised tariffs provides for just and reasonable rates to be
charged system-wide by the Company.
SECTION 3. That the system-wide annual base revenue increase of$500,000 is to be phased in over
an 18 month period to the extent any increase exceeds 10 percent.
SECTION 4. That the effective date of the new tariffs is February 1, 2005.
SECTION 5. That no specific rate base, return, revenue or cost adjustments or rate making
methodologies are approved in reaching the revenue requirements settlement that leads to the rates and charges
adopted by this ordinance, except that CoSery may continue to defer its carrying charges on plant held for future use.
SECTION 6. That Cities' rate case expenses are reasonable and should be reimbursed by CoServ.
SECTION 7. That the issue of the recovery of rate case expenses incurred by CoSery Gas be severed
from consideration of the revised base rate tariffs and that the City retain jurisdiction over the rate expense
C:\Documents and Settings\Shanae Jennings\My Documents\ORDINANCES & RESOLUTIONS\ORDINANCES\2005 Ordinances
and Resolutions\05-01,Ordinance-Establishing Revised CoSery Rates.doc
Page 2 of 10
reimbursement issue until March 1, 2005, subject to a second thirty-day extension of the Town's jurisdiction by
CoServ.
SECTION 8. That CoSery may not file for a further increase in base rates that is intended to become
effective prior to September 1,2006.
SECTION 9. That adoption of a most favored nations provision is reasonable and appropriate and that
any concession granted to any city is,at the discretion of the Town Council,to be implemented in the Town.
SECTION 10. That relief requested by CoSery not specifically addressed herein is denied.
SECTION 11. That it is hereby officially found and determined that the meeting at which this Ordinance
is passed is open to the public as required by law and that public notice of the time, place and purpose of said
meeting was given as required.
SECTION 12. That a copy of this ordinance, constituting final action on the CoSery application, be
forwarded to the appropriate designated representative of the Company, Charles D. Harrell, Chief Financial Officer,
CoSery Gas Ltd.,7701 South Stemmons,Corinth,Texas 76210-1842,within 10 days.
DULY PASSED AND APPROVED BY THE TOWN COUNCIL OF THE TOWN OF PROSPER, TEXAS ON
THIS 11th DAY OF JANUARY,2005.
HARLE NI EFL Mayor C S WAN S G
ATTESTED TO:
•
SHANAE JENNIN ,Town Secr
C:\Documents and Settings\Shanae Jennings\My Documents\ORDINANCES & RESOLUTIONS\ORDINANCES\2005 Ordinances
and Resolutions\05-01,Ordinance-Establishing Revised CoSery Rates.doc
Page 3 of 10
Rate Schedule 5
RATE R - RESIDENTIAL SALES
Applicable to: Entire System Page 1 of 2
Effective Date: February 1, 2005
Application of Schedule
Schedule applies to all Residential Customers.
Monthly Base Rate
Customer's base monthly bill will be calculated using the following Customer and Ccf charges:
Charge Amount
Customer Charge $ 9.00 per month, plus
Volumetric Charge:
First 0 Ccf to 20 Ccf $.19437 per Ccf
Next 50 Ccf $.14437 per Ccf
All Additional Ccf $.09437 per Ccf
Purchased Gas Factor
In addition to the base monthly bill above, each customer's bill will include a Purchased Gas Factor to
account for purchased gas costs and computed in accordance with CoSery Purchased Gas Factor
Schedule No. 2.
Taxes
In addition to the monthly charges above, each customer's bill will include a charge for an amount
equivalent to the customer's proportional part of the city franchise fees, state gross receipts taxes, or other
governmental levies payable by the Company, exclusive of federal income taxes. Municipal franchise fees
are determined by each municipality's franchise ordinance. Each municipality's franchise ordinance will
specify the percentage and applicability of franchise fees. From time to time, the tax factor may be
adjusted, if required, to account for any over- or under-recovery of municipal franchise fees by the
Company and to include an amount equivalent to the proportionate part of any new tax or increased
franchise fee or tax, or any other governmental imposition, rental fee, or charge levied, assessed or
imposed subsequent to the effective date of this tariff by any governmental authority, including districts,
created under the laws of the State of Texas. The Company will also collect sales taxes where applicable.
C:\Documents and Settings\Shanae Jennings\My Documents\ORDINANCES & RESOLUTIONS\ORDINANCES\2005 Ordinances
and Resolutions\05-01,Ordinance-Establishing Revised CoSery Rates.doc
Page 4 of 10
Rate Schedule 5
RATE R- RESIDENTIAL SALES
Applicable to: Entire System Page 2 of 2
Effective Date: February 1, 2005
Surcharges
In addition to the monthly charges above, each customer's bill will include an amount for surcharges
calculated in accordance with the applicable rider(s).
LINE EXTENSION POLICY
The company has the right to contract with individual customers for the installation of gas facilities as
provided for by the city franchise. Upon the request of a prospective new residential or commercial
customer for service in an area served by CoSery Gas, CoSery Gas will extend its main lines up to 100 feet
from an existing CoSery Gas main in the Public Rights of Way, without charge. The 100-foot allowance
applies to a single customer or to a group of customers requesting service from the same extension.
Customers requesting mainline extensions in excess of 100 feet shall bear the cost of any additional main,
and shall bear the cost of all yard lines, service lines, customer meters and regulators, and appurtenant
equipment, in accordance with the charges listed in item 12, Line Extension and Installation, of Rate M,
Miscellaneous Service Charges. CoSery Gas is not required to extend its mains or facilities if the customer
will not use gas for space heating and water heating, or the equivalent load, at a minimum.
C:\Documents and Settings\Shanae Jennings\My Documents\ORDINANCES & RESOLUTIONS\ORDINANCES\2005 Ordinances
and Resolutions\05-01,Ordinance-Establishing Revised CoSery Rates.doc
Page 5 of 10
Rate Schedule 6
RATE C-COMMERCIAL SALES
Applicable to: Entire System Page 1 of 2
Effective Date: February 1, 2005
Application of Schedule
Schedule applies to all commercial customers.
Monthly Base Rate
Customer's base monthly bill will be calculated using the following Customer and Ccf charges:
Charge Amount
Customer Charge $15.50 per month, plus
Volumetric Charge:
First 0 Ccf to 300 Ccf $.24436 per Ccf
Next 200 Ccf $.19436 per Ccf
All Additional Ccf $.14436 per Ccf
Purchased Gas Factor
In addition to the base monthly bill above, each customer's bill will include a Purchased Gas Factor to
account for purchased gas costs and computed in accordance with CoSery Purchased Gas Factor
Schedule No. 2.
Taxes
In addition to the monthly charges above, each customer's bill will include a charge for an amount
equivalent to the customer's proportional part of the city franchise fees, state gross receipts taxes, or other
governmental levies payable by the Company, exclusive of federal income taxes. Municipal franchise fees
are determined by each municipality's franchise ordinance. Each municipality's franchise ordinance will
specify the percentage and applicability of franchise fees. From time to time, the tax factor may be
adjusted, if required, to account for any over- or under-recovery of municipal franchise fees by the
Company and to include an amount equivalent to the proportionate part of any new tax or increased
franchise fee or tax, or any other governmental imposition, rental fee, or charge levied, assessed or
imposed subsequent to the effective date of this tariff by any governmental authority, including districts,
created under the laws of the State of Texas. The Company will also collect sales taxes where applicable.
C:\Documents and Settings\Shanae Jennings\My Documents\ORDINANCES & RESOLUTIONS\ORDINANCES\2005 Ordinances
and Resolutions\05-01,Ordinance-Establishing Revised CoSery Rates.doc
Page 6 of 10
Rate Schedule 6
RATE C-COMMERCIAL SALES
Applicable to: Entire System Page 2 of 2
Effective Date: February 1, 2005
Surcharges
In addition to the monthly charges above, each customer's bill will include an amount for surcharges
calculated in accordance with the applicable rider(s).
Line Extension Policy
The company has the right to contract with individual customers for the installation of gas facilities as
provided for by the city franchise. Upon the request of a prospective new residential or commercial
customer for service in an area served by CoSery Gas, CoSery Gas will extend its main lines up to 100 feet
from an existing CoSery Gas main in the Public Rights of Way, without charge. The 100-foot allowance
applies to a single customer or to a group of customers requesting service from the same extension.
Customers requesting mainline extensions in excess of 100 feet shall bear the cost of any additional main,
and shall bear the cost of all yard lines, service lines, customer meters and regulators, and appurtenant
equipment, in accordance with the charges listed in item 12, Line Extension and Installation, of Rate M,
Miscellaneous Service Charges. CoSery Gas is not required to extend its mains or facilities if the customer
will not use gas for space heating and water heating, or the equivalent load, at a minimum.
C:\Documents and Settings\Shanae Jennings\My Documents\ORDINANCES & RESOLUTIONS\ORDINANCES\2005 Ordinances
and Resolutions\05-01,Ordinance-Establishing Revised CoSery Rates.doc
Page 7 of 10
Rate Schedule 10
RATE M—MISCELLANEOUS SERVICE CHARGES
Applicable to: Entire System Page 1 of 3
Effective Date: February 1, 2005
Application
The service charges listed below are in addition to any other charges under the Company's Tariff for Gas Service and
will be applied for the condition described. Other services not covered by these standard conditions will be charged
on the basis of an estimate for the job or the Company's actual cost plus appropriate surcharges.
Applicable Charges
Service Amount of
Charge Name and Description Charge
No.
Connection Charge During Business Hours
During standard business hours, for each reconnection of gas service
where service has been discontinued at the same premises for any
reason, for the initial inauguration of service, and for each inauguration
of service when the billable party has changed, with the following
1 exceptions: $ 65.00
(a) For a builder who uses gas temporarily during construction or
for display purposes.
(b) Whenever gas service has been temporarily interrupted
because of System outage or service work done by Company;
or
(c) For any reason deemed necessary for Company operations
Connection Charge After Business Hours
After standard business hours, for each reconnection of gas service
where service has been discontinued at the same premises for any
reason, for the initial inauguration of service, and for each inauguration
of service when the billable party has changed, with the following
2 exceptions: $ 97.00
(a) For a builder who uses gas temporarily during construction or for
display purposes.
(b) Whenever gas service has been temporarily interrupted because
of System outage or service work done by Company; or
(c) For any reason deemed necessary for Company operations
Field Read of Meter
3 A read for change charge when it is necessary for the Company to read $ 19.00
the meter at a currently served location because of a change in the
billable party.
C:\Documents and Settings\Shanae Jennings\My Documents\ORDINANCES & RESOLUTIONS\ORDINANCES\2005 Ordinances and
Resolutions\05-01,Ordinance-Establishing Revised CoSery Rates.doc
Page 8 of 10
Rate Schedule 10
RATE M—MISCELLANEOUS SERVICE CHARGES
Applicable to: Entire System Page 2 of 3
Effective Date: February 1, 2005
Returned Check Charges
4 Returned check handling charge for each check returned to Company $ 20.00
for any reason.
Charge for Temporary Discontinuance of Service- Residential
Whenever service has been temporarily disconnected at the request of
5 the customer, this charge plus the appropriate Connection Charge will $ 65.00
be made to reestablish such service for that customer at the same
address.
Charge for Temporary Discontinuance of Service—NonResidential
Whenever service has been temporarily disconnected at the request of
6 the customer, this charge plus the appropriate Connection Charge will $ 107.00
be made to reestablish such service for that customer at the same
address.
Charge for Meter Testing
The Company shall, upon request of a customer, make a test of the
accuracy of the meter serving that customer. The Company shall inform
the customer of the time and place of the test and permit the customer
or his authorized representative to be present if the customer so desires.
7 If no such test has been performed within the previous four (4) years for $ 15.00
the same customer at the same location, the test shall be performed
without charge. If such test has been performed for the same customer
at the same location within the previous four (4) years, the Company will
charge the Meter Test Fee. The customer must be properly informed of
the result of any test on a meter that services him.
Charge for Service Calls During Business Hours
8 A Service Call Charge is made for responding to a service call during $ 26.00
standard business hours that is determined to be a customer related
problem rather than a Company or Company facilities problem.
Charge for Service Calls After Business Hours
9 A Service Call Charge is made for responding to a service call after $ 40.00
standard business hours that is determined to be a customer related
problem rather than a Company or Company facilities problem.
C:\Documents and Settings\Shanae Jennings\My Documents\ORDINANCES & RESOLUTIONS\ORDINANCES\2005 Ordinances and
Resolutions\05-01,Ordinance-Establishing Revised CoSery Rates.doc
Page 9 of 10
Rate Schedule 10
RATE M—MISCELLANEOUS SERVICE CHARGES
Applicable to: Entire System Page 3 of 3
Effective Date: February 1, 2005
Tampering Charge
No Company Meters, equipment, or other property, whether on
Customer's premises or elsewhere, are to be tampered with or interfered
with for any reason. A Tampering Charge is made for unauthorized
reconnection or other tampering with Company metering facilities or a $ 125.00
10 theft of gas service by a person on the customer's premises or evidence
by whomsoever at customer's premises. An additional cost for the cost
of repairs and/or replacement of damaged facilities and the installation of
protective facilities or relocation of meter are made at cost plus
appropriate charges as may be detailed in the Company's Service Rules
and Regulations
Credit/Debit Card Payments Charge
11 Bill payments using credit cards, debit cards, and electronic checks Actual Cost
(includes third-party transaction fees and administrative costs).
Line Extension and Installation Charges
Extension and installation of new mains, service lines, risers, fittings and
12 other appurtenant equipment pursuant to main extension policy in Actual Cost
municipal franchise. Credit for main pursuant to municipal franchise.
The customer is responsible for the installation of yard line and yard line
risers.
13 Construction Crew Charges Actual Cost
All labor charges if a construction crew is required.
14 Construction Costs Charges Actual Cost
All other construction charges.
C:\Documents and Settings\Shanae Jennings\My Documents\ORDINANCES & RESOLUTIONS\ORDINANCES\2005 Ordinances and
Resolutions\05-01,Ordinance-Establishing Revised CoSery Rates.doc
Page 10 of 10