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1709 RESOLUTION NO. 1 ~ O A RESOLUTION OF THE WEST MEMPHIS, ARKANSAS CITY COUNCIL RATIFYING A LETTER AGREEMENT WITH ENTERGY, SERVICES, INC. PERTAINING TO OPEN ACCESS TRANSMISSION RATES AND ANCILLARY SERVICES RELATED THERETO. WHEREAS, On June 1, 2001 Entergy Service, Inc, filed an Application at the Federal ' Entergy Regulatory Commission (FERC) seeking to change rates for services for Ancillary ' Services under its effective Open Access Transmission Tariff in FERC Docket No. ERO1-2214- 000, which are chargeable, in part, to West Memphis; and, WHEREAS, such changes are not within current agreements between West Memphis, and Entergy Arkansas, Inc. and may not have been authorized under Settlement Agreements now in effect between West Memphis and Entergy, Arkansas, Inc.; and, WHEREAS, in consideration of West Memphis not Intervening or otherwise participating in the pending FERC Docket No. ERO1-2214-000, Entergy Services, Inc. has agreed not to assess new Ancillary Services charges to West Memphis even if approved by FERC until the expiration of current agreements, without West Memphis's consent. NOW THEREFORE BE RESOLVED BY THE, WEST MEMPHIS, ARKANSAS CITY COUNCIL: Section 1: The attached agreement executed by counsel for West Memphis and counsel for Entergy, Services, Inc. is hereby ratified and confirmed. Section 2: This resolution shall be in full force and effect from and after its passage and approval. / Date : ~vl I a~ ` ~`~ ~~`~''`-' T- Mayor Attest: ~--- A~~, City Cl ____ Y CLERKS OFFICE . « fi I (r a / c7 1-f'~ .e i i ~, • ~ _. 1800 M Street, N.W. Washington, D.C. 20036-5869 202-467-7000 Fax: 202-467-7176 Morgan, wis F~ BOCk1US LLr COUNSELORS A T L A W RE: FEDERAL ENERGY REGULATORY COMMISSION DOCKET NO. EROl-2214-000 WHEREAS, the City of Prescott, Arkansas, Conway Corporation, West Memphis Utilities Commission, City of Osceola, Arkansas, Hope Water and Light Commission and ' Farmer's Electric Cooperative corporation (collectively, "Arkansas Customers") currently receive power and energy and transmission service from Entergy Arkansas, Inc. under a number of Service Agreements and these Service Agreements cover the provision of ancillary services. WHEREAS, on June 1, 2001, Entergy Services, Inc. on behalf of the Entergy Operating Companies (collectively "Entergy") filed revisions to its ancillary services Schedules 3-6 in Docket No. EROl-2214-000. Entergy proposed to modify the descriptions of the ancillary services contained in Schedules 3 through 6 and to update the rates for such services. WHEREAS, a dispute has arisen between Entergy and the Arkansas Customers regarding the application of the ancillary services filing in Docket No. EROl-2214-000 to the Arkansas Customers Service Agreements. THEREFORE, in consideration for the resolution of these disputes and the mutual covenants and undertakings set forth herein, Entergy and the Arkansas Customers agree as follows: Entergy agrees to not pass the additional costs, if any, of the change in ancillary services rates that the Commission establishes in Docket No. ERO1-2214-000. Instead, Entergy intends to continue charging -for ancillary services under the respective Service Agreements using the current methodology. This means that Entergy will absorb any costs associated with the change in ancillary services in Docket No. ERO1-2214-000. 2. In exchange, Arkansas Customers agree not to protest or intervene in Docket No. ERO1- 2214-000. To the extent that the Arkansas Customers protest or intervene in Docket No. ERO1-2214-000, this offer is deemed to be withdrawn and null and void. 3. This Agreement will terminate upon the expiration or cancellation of the Service Agreements that cover the provision of ancillary services to the Arkansas Customers. 4. Entergy will provide the Arkansas Customers with copies of all the pleadings it files in Docket No. ERO1-2214-000. This-will allow the Arkansas Customers to monitor the proceeding without intervention. Philadelphia Washington New York Los Angeles Miami Harrisburg Pittsburgh Princeton ~ London Brussels Frankfurt Tokyo 4 ~ ~ ~ I r, ~ Morgan, Lewis ~Bocl~nis 5. If deemed necessary to satisfy FERC requirements, Entergy will revise and re-file any Service Agreements to comply with this Agreement. Entergy will advise Arkansas Customers of any such requirement, consult with the Arkansas Customers as to any necessary changes, and provide copies of any such revised Service Agreements for review prior to submitting it to the Commission. 6. Entergy reserves its rights to propose changes to its ancillary services rates and/or rate methodologies pursuant to Section 205 or any other applicable provision of the Federal Power Act and FERC's rules and regulations thereunder. No filings will be made that impact the Arkansas Customers' ancillary services rates without prior consultation, good faith negotiations and consent of the Arkansas Customers. 7. If this Agreement is not accepted and approved by the Arkansas Customers without modification, then: (i) it shall not be binding on any party; (ii) all parties shall in that event be deemed to have reserved all their respective rights and remedies in this proceeding; and (iii) this Agreement shall not be part of the record in any such proceeding. In any future proceedings (other than a proceeding involving the honoring or enforcement of this Agreement), the parties shall not be bound or prejudiced by this Agreement. If you agree with the terms of this Agreement as set forth above, please indicate so by executing one copy of the Agreement and returning it to us. The Arkansas Customer's representative signing assents that he possesses the authority to sign this Agreement on behalf of Arkansas Customer's management. Nevertheless, this Agreement is subject to ratification by the Arkansas Customer's governing authorities. Sincerely, Andrea J. Weinstein Attorney for Entergy Services, Inc. Agreed to and Accepted by: Z ary David Wilson Attorney for Arkansas Customers - 7 ©~ ~I