Loading...
The URL can be used to link to this page
Your browser does not support the video tag.
September 21, 1976
~~~lt MINUTES OF A SPECIAL MEETING OF THE COUNCIL OF THE CITY OF WEST MEMPHIS, ARKANSAS, HAD AND HELD ON SEPTEMBER 21, 1976. The City Council of the City of West Memphis, Arkansas, met in special session at its regular meeting place in West Memphis, Arkansas, at x:00 p.m. on September 21, 1976. The following were present: Mayor Joyce Ferguson, presiding, and Aldermen: D. M. Grimsley, J. E. Hightower, Pritchard Horton, Doug Morris, Tilden Rodgers, and R. T. Bentley; and City Attorney R. L. ,~ni.th. Absent: Aldermen: Thomas Dickerson, W. L. Harris, J. C. .King, and R. S. Cosgrove. It being determined a quorum was present, the following proceedings were had to wit: The Special Meeting was called by Mayor Ferguson for the purpose of approving the settlement Agreement with Arkansas Power & Light Company, and a salary matter pertaining to Gary Pospi~,l. Waivers of Notice Of Meeting signed by the absent Aldermen were filed. P. G. Para, General Manager of the Utility Department., summarized proceedings pertaining to rate increase of Arkansas Power & Light. Company, and explained negotiations as to the Settlement Agreement and Arkansas Power & Light Company Electric Rate Schedule. Alderman Cosgrove made a delayed appearance during the summary and explanation. After discussion, Alderman Rodgers, seconded by Alderman Grimsley, moved that the Resolution approving and authorizing the Settlement Agreement be read. Upon vote, the voting was as follows: Aye: Aldermen: Grimsley, Hightower, Horton, Morris, Rodgers, Bentley;la~d Cosgrove. No : None . City Attorney Smith read the proposed resolution and Settlement Agreement. Alderman Grimsley, seconded by Alderman Horton, moved to adopt the Resolution. Upon roll call vote, the voting was as follows: Aye: Aldermen: Grimsley, Hightower, Horton, Morris, Rodgers, Bentley, and Cosgrove. No : None . The Resolution and Settlement Agreement read as follows: .,~ ....".._ a. RESOLUTION N0. 567 . A RESOLUTION APPROVING AND AUTHORIZING THE EXECtJTION~ OF A SETTLEMENT AGREEMENT TOEBE ~ - ENTERED INTO BY AND BETWEEN THE CITY 0 WES_ T__M~M.PH~ , AR;I{ANSAS POWER & LIGHT COMPANY, AND-EIGHT OTHER WHOLESALE ELECTRIC CUSTOMERS OF A~SAS POWER & LIGHT COi~s.PANY OF CERTAIN CONTESTED RATE PROCEEDINGS BEFORE THE FEDERAL POWER COMMISSION .WHEREAS, on June 1, 1973, Arkansas Power & Light Company - filed with the Federal Power Commission certain rate schedules which increased rates and charges to the City and other elec- tric wholesale customers, which proceeding bears FPC Docket ' No. E-8250; and WHEREAS, on September $, 1975, Arkansas Power & Light Company filed revised rate schedules providing for additional increases in rates and charges, which proceeding bears FPC Docket No. ER 76-110; and WHEREAS, representatives of the City andthe eight other electric wholesale customer intervenors. in said Federal Power C~rr~m:~asion rate proceedings have negotiated a settlement of the disputes among the parties, to be presented to the Federal Power Commission; and WHEREAS, responsible officials of the City's electric system and the City Council have reviewed said settlement agree- dated September 16 1976 meat/and have found that said agreement is reasonable and proper and in the best interests of the City and its electric customers; NOW, THEREFORE, BE IT RESOLVED: Section 1. That the City Council of Wes.t,~p,~ r; ~ , Arkansas, hereby approves said settlement agreement in the form and containing the terms previously negotiated, a copy of which is attached to this resolution. Section 2. That the Mayor and Clerk of the City of West Memos , Arkansas, are hereby authorised, directed _...._. and empowered to execute the above described settlement agreement 1 ~~ ~ - _r..~...~..,.....:~.~.:_.~_.:~.~,,,W..,,w .~~ _. _~_. with the Arkansas. Power & Light Company and other electric . wholesale customers of Arkansas ,Power &: L~.ght Company, fcir and on behalf of the 'City of ._,.. emnh; g Arkansas , ._~ -- and the Mayor, Clerk-and other officials of the Ci ty are hereby authorized and directed to take such oche r actions as may be necessary. to effectuate.-and care out Y said .agreement... Section 3. This resolutor_ shall be in full fo rce and. - effect from and after its passage and approual. . ~--~ ~ - SETTLE~~IEr:~' AGREE"~IENl jy'HEREAS, it is the intent, of the parties to endeavor to reach full agreement on the design of any ne~a .rates -applicable to these - ..~~Tf3EREP,S, it is also that to the fullest practical be based upon and reflect cos oasts should be recovered via costs via energy charges. j,Tholesale. custor:ters.. the intent of the parties ~ex-tent rate. desigx~ should t behavior, i _ e . , fixed demand charges and variable t~THEP~AS, CUStor~iars do not desire to impede the Company in obtaining compensatory rate levels front the taho?esale customers nor do they desire to have "veto" rights over the Cor~lpany' s right to design i-ts rates to prop~orly reflect costs. However, Customers desire to hav and Conpa~y agrees that Customers show?d haver input into the design of rates and charges so as to minz3nize Customers' cash f lo:~ prob_lems , i . e . , .the reLationsizip botEVoen the amount of ..Customers' ~;rhglesale poc•~er bill and the amount billed to their retail customers_ This input- ~•rould involve only the design of .new rates for the re- covery of a given level of t~rholesale revenue requirements as det~~rr:~inCd by the Compan~r pursuant to the grovi,sions set forth under par~tc~raoh number 2 of this S:'ttle~ren-t Agree-zon t . X33 -2- j~,HEREFOP•E, Arkansas Poti•rer & Light Company anc? the Customer Intervenors, in resolution. of the prooGzargs in Federal Po:•rer Com-r~2ission Doeket Nos. --E--850 an3 EP. ?b-Zi a, agree as follo~crs - 1. Company will furnish to Customers prior to - filing stiith the Federal Po~•rer Co-:tntission its proposed rate design and Customers will, j•Tithin tcsenty days, a3" ` vise the Company in writing of any objections they have to the proposed rate design and stating the-nature of such objections. Customers and Company will. then en- deavor to resolve their differences on rate design. Eno t - rate le~.jel) . In the event the part.i~s ~L~ u==:~~yL ~~- resolve their differences on rate design ~•Tithin tc~enty ( 2.0) days after the aforementioned notice f root Customers , . - Company is free to design and file tJith FPC rates to re-- cover the jaholesale customer revenue requirements, deter- mined as provided herein in paragraph number 2, provid°d that the design of rates therein reflects the sar•_~e _ relationship or application of principles to the -then existing demand cl~:argLs and energy charges. z.f ter consider- ation of FPC regulations governing fuel adjust~:.ent clauses, - and by leaving the ratc'net percentage at its then exist- ing leJel, presently 75 o for the municipal eustor.~~rs anc? 10 ; for the cooperative customers . Concurrently, ~•rit:~ the filing of ~~uch rates on :•,hich there is disagreement as to their design, Co::~pany ~•;i11 notify Custo:~~ers ir_ c•;ri-tiTiy of its intEntion to chzn:~e eY.lStlnc~ rate des? e:r_, 1~4 . _~_ effe.cti~Te upon thr~ expiration of tz~ro years -alter -suc'rt notice, <<ncZ such chance m3~; bo mplerten~ed ~rthaut Cus toTners' agreement . - It is agread that the foregoing res ~rc-~ions on rate dosign.shall run for the remainingu~!~x~ired primary .team of the existing con~ract, i~.clucling any option period, betT:reen the Company :and .each wi1E3~:esa~e custom~zr and, further, ..that this condition` t:TOUId be .. . consistent with and subject to any rate-design require--- ..meats of the Federal Po~•~er Commission, as presently i~ Effect or as subsequently modified during the .tout cif 'this Settlement Agreezner_t . phis co~tdition is subject to approval. by the i Federal ~'o.>>er Co~~-nisson without modification. 2. The parties acree that for the .purpose of arriving at ~fholesale revenue recluiremen~s aztd design-- ing specific rages and charges applicable Thereto,-the Catr~pany trill in thG future de~Tclow a, cost of `service study for each ~~~holesale classification, using the same total Company test year data (e.q., thz sam' rate-.base - - items, the same `efpenses, the sane rate of return, etc_j consistent with the rules and regulations of the .~rkar?sas :P;ublic S rvice Co,~~:Tission and the ss.ne allocztio~~ me~hods as ~.opro~Tec? by tho F-Arkansas Public Servico Co,~~nission (prosen;~.ly t~,e single paa res~orsibli~.y m~ ~'nod~ , Zs ~~ - used by the Company in .arriving ~,t its r:'tail rever_ue requirements in its most recently filed . retail rate case or its most recent filing of cost of service studies in ~ . Support of .current or new retail rate levels, unless ©therc~ise provided for herein . T'ne Company t•: i 11 not file c~,~holesale rates ~Jith the FPC which t•Till, E•rhen applied ._ to tesi year billing determinants, produce gross Cbzfore discount) revenues greater than tha ~~holesale revenue requirements developed as provided for herein_ - After August 30, 1976, Company ~,rzll file for ~ _ retail rite increases first, folloT.ved by a filing fog increases in z•Tholesale rates, based on its exp~ctatior_ shat the cost of providing service in each jurisdiction.. ~.s increasing at about the same rate due to inflation, the rapid expansion of bulk poc~~zr supply facilities and the way customzrs. in each jurisdiction use poc,~er and er_erry.. Hoti~rever, the parties realize that the Company's cr.~ole- sale rates and retail rates are subject to the jurisdiction of entirely separate regulatory agencies ar_d, consequen.t~.y,, _ there ~•~ill be differences in the type and amount of data ' required by each and there nay be .difference in the relative amount of rate increases authorized, thus po tc:~~tially necessitating f i lirgs out of the Gbove ~Stab~_1s1tC'd SEgU°:'1C4 . .~ s~ - 5 - In the e~,7Ent that such differences in re~.ati~re amount of alloc•~ed rate increases result in a s.gnifieant change in the relations'nip bet~•reen gross c~T'nolesale an3 retail rates, from that produced by the .above uniform costing approach, and to~the extent that such rela-cion-- sh~.p is signi.f cant? y changed, t•~hether by decision ~o f the ~rka.nsas Public Service Commissionr Federal Po:•rer Com_Vnssion or other~,rise,- so that the comparable t~rhole_ sale rates are signf ican tIy higher or lower -than they would. be if set-as described above in relation to the r.~:t.~c.l rate authorized or ' to be c'narged, .the Company will immediately, either: {a) File .aunilateral reduction -of pending ~•rn.ale- sale rates to levels subst~ntial~.y equivalent to the ne~,~ 1y-effective retail rates , or tb) Commence negotiations c~rith custor~~ers for t.Ze express purpose of negotiating and sQeking FPC approval of settle:ner_t rates deve? opal in con- formance t,~ith. the uni form costing r:e-th~dology establish; d in this agree:~ent and ~•;hich are con- sistent i•~it'rz FPC' s implenentation of the holdir_g .af the United States Supreme Court in Federal Pc~taer Ce~~_;!:~ss ion v . Con :~;a~T C©rp, e t al . .,~.. ____ _ ..r._. _ Gustor~ers shall give carit~ten notice ~o Co~tpany no lit ter .than t~~irty (30) days a Lter the order .~ X37 - _ 6 _ of the Arkansas Public Service Corc~~n~i ss? on and all appeals establishing a retai3. rate are ' final of thoir intent to cor:~menc2 negotiations_ " Such notice shall also specify the individuals ~,'no shall have the authority to represent the Customers in the negotiations contemplated by this Agreement, and the scope of the1 r autho- - - - . rity. Thereafter, both Company and Customers shall conduct negotiations for the purpose of arriving a t such settlement rates, provided r tP ut such negotiations, shall not, except by mutual consent continue longer than ninety {9©} days _ f torn the final order in the retail case _ If , `for any reason, such negotiations do not result in ~ 4i31 agreed upon se ttlemen-t rate t,~ ithin such ninety { 5 0) day poriod, or a mutually agreed extension thereof, then, in that event, those matters sti ll a-t issue shall be su'nmitted to the Fedral Power Co~-n? ssion for determination; or (c} Ref ile for rates at :~~holesale to attain Gross rate levels substantially equivalent to th:e then effective retail rates. All t~.holesale rates filed as a result of any of_•the aboLTe shall be x'e-troactivy to the effective dt to of tho j,~hole- Salo rate being suL~ers~aEC?, unless ot~~erc•;is^ ,_~u-tually agreed upon_ ~~8 _~_ The Cus-to~.ers agree that so long -as the Campa:iy :files t~rholesale re,tes established in the foregoing Wanner, they will .not intervene in protest of such rates, except to the exter_t- required to facilitate 2 {b-} above. Cust©rcers retain their right to intervene, however, in order -~o preserve their rights as to positions takers-by other parties in the proeezding or positions -taken by the Co~~- pony that result in a change in position-from the rates established herein. The Company agrezs ..that i-t ~ii.13 .eomp~.y t~~ith the `regulations of the Cor-~mission in the filincE of - rie-~ ~,Tholesale rates . - This .condition .shall .run for the rer~ai Wing unexpired terr:~ of .each Customer.' s Existing Cvntrac t, in-- eluding any option period, and shall. be sczbj ec-c to all rates and regulations of the Federal Po~:er Com:.?ssion . 3 . ~~iith in 3 0 days after the date upon c~rhieh -the Commission's order approving this Settlement b~ea~e fin~.l and nonappea~ a'r~le, the Co:~pany wi3.l refund to these Customers, in Docket No. E--8250, $2, fi75,162.15, plus interest co:zputecl at the rate of 7 ~ per annurl for the period January l', 197 through Ceto'oer 9 , 197 ~~ , and at -the rate of 9 ~ per annum for the period October L0, 197 through Becemr~er 18, L97u_ It is .agreed thGt the Company will retain ali other. amounts that it collected sui~j ect to refund in Phase I and Ph.e:se ~l of Docket Igo. E-8250 for t'.nc pcr?od January 1, 197', through, .~ :~3over~ber 30, 1975. 3 `7 -s- 4. ti~ithin 30 days after the date .upon t;'rtich the Coilrtission's order approving this Sett?er:?znt becomse final and nonappealable, thz Company ~ail.l file in Docket ~:o _ ER76-110 revised Rate Schedules U4 and 3==, ~•-'h.icn are attached hereto as Appendix A and gill refund to Customers the difference between the amounts billed p}.~rsuant to Rate Schedules U4 and B~ as originally filed in Docket ~:o . ER7 6-110 , and placed into effect subject to refund on Decem'oer 1, 1975, and the attached revised rate schedules: plus interest computed at the rate of 9v per annum- . 5. Intervenors agree not to raises before tie ~'PC or any other regulatory agency or court, al.legations~ canCerning price squeeze or other anti_competitive issues based upon facts occurring prior to t~!' date of this Settler~znt Agreement. 6. This Agreement is expressly contingent upon -its approval by the Federal Fo~•~er Co~:~rission w? thGUt modification, unless such rodiiica-cion (s) as .the Federal Power Commission may require are agreed to by t'ne parties_ All parties to this Agreement ~•~ill cooperated in seeking its acceptance and approval by t'ne Federal Poc~=zr Conmission_ If this Agreement is not accepted and appio~~ed by the Federal Po.•~er Commission ~,~ithou~ codification, then: . ~~~ - ~ - ~ -- (i} it shall not be .binding on any party; -(ii} all parties shall in that eve~rtt be de~mzd `to have reserved all -their respective rights and remedies in this procezd~.ng; (iii} this Settlement Agreerient shall .not be part.- of the record in such proceeding, and a11`discussions and negot?ations thereon shall be privileged; and {i~r} -the patties shall _~ not be ~ obliged to negotiate further, o-che~ than to c~is- cuss in faith .whether the modification (s} required by the ~ed~ral Power Cor~+~-nission are acceptable to ~hzm.- 7. ..Nothing in this Settle?~ent Agrees : ert shall _ - constitute an admission by any ...party of the. correctr~.ess ©r applic~.bi.lty of any claim, defense, ru~.e Qr interpre- - Cation t~f law, allegation of fact, principle ar r1ethad of r rateraakzng or cost of .service deter~r=inaton in ~oc~ce-t ~Io. E--8250. or EP•76--110. .This Settlement AgreerEent is madA upon the explicit understanding that_it constitutes a negotiated settlement with respzet -t© the Co~par_y's juri.s-- dictional .rates . It is .further agreed that ire. any future negotiation or proceeding or proceedings c~rh.atsoever (other than any proc~.eding involving the honoring, en=orce- ment or construction of this Set-tlenent Agre~m~nt or of the revision to any rate schedules to be .filed tri-th the Commission pursuant to thus SEttlement ~lgree.R ent} the ~~1 -lo- parties shall not be bound or prejudiced by this Settlement Agreement. This document is signed by negotiators for the Customers with the expectation and .belief that they are authorized to execute this Agreement. However, the negotiators for Customers do not represent that they can legally bind the parties to the litigation. _.. .AGREED to this day of September, 19.76. CONTr;AY CORPORATION, BENTOi3 MUtTICIPAL LIGHT AT1D ~r7~1TER ~r.ORKS , HOPE :~:ATER AND LIGHT COI~ih1l S S I ON , GTTY Off' NORTH LITTLE . ROC:; APKANAAS , CIT~'Y OF OSCEOLA, ARKANSAS ~ ;."I"''Y 4F PRESCOTT, ARKANSAS ~:~k'' OF ZaFST MEMPHIS , A:~ ~'t'~N S 1~S , ~ARiY~i~~ ELECTRIC COOPERATIVE CCt~~FORATION, and MISSISSIPPI COiTNTY ELECTRIC COOPER,AZ'IVE, INC . B~~. ,~ ~ c> ~ ~ Jame H. Brewer Manager, Ccn~;~ay Corporation ~~ i _. ~~ ' --_.'y~~~L_._._ -r-- 7jachury ~. ~tii~ 11 'ssist~, t City Attorney I Iortri Little Rock, Arkansas ~__~ ARKANSAS PO~:ER & LIGHT COMPANY By. O . V . Ho 1 err~an Director of Rates and Research By Arch P. Pettit President By Reeves E. Ritchie Chairman of the Board and Chief Executive Officer i~2 Alderman Bentley announced a Utility Committee meeting will be held on Wednesday, September 29, 1976, at 5 p.m., and disposition of funds from the settlement will be discussed. P. G. Para was requested to obtain figures on the settlement-and costs. Dick Tidwell was requested to have a current financial statement of the Utility Department. The Council held a private session on a personnel matter. Mayor Ferguson presented recommendations from the personnel session as to Gary Pospisil, Alderman Bentley, seconded by Alderman Horton moved that Gary Pospisil be made a Department head of the City with title of Plumbing and Sewer Inspector. Upon vote, the voting was as follows: Aye: Aldermen: Grimsley, Hightower, Horton, Morris, Rodgers, Bentley, and Cosgrove. No: None. Alderman Bentley, seconded by Alderman Horton, moved that increase salary of Gary Pospisil $100.00 a month, and purchase a pick-up truck with radio with utility and pity channels out of Utility Funds, and waive bids if get same price as the last bids of Utility Equipment. Upon vote, the voting was as follows: Aye: Aldermen: Grimsley, Hightower, Horton, Morris, Rodgers, Bentley, and Cosgrove. No : None . The Mayor brought to the Councils attention request of Brian Williams that the Mayor and Council consider recommending to the election Commission that change the voting place for Ward ?~ - 1 voting precinct from the fire station to the utility building. After consideration, Alderman Horton, seconded by Alderman Grimsley, moved that leave as is. Upon vote, the voting was as follows: Aye: Aldermen: Grimsley, Hightower, Horton, Morris, Rodgers, Bentley, and Cosgrove. No : None . Alderman Cosgrove, seconded by Alderman Morris, moved to adjourn. Upon vote, the voting was as follows: Aye: Aldermen: Grimsley, Hightower, Horton, Morris, Rodgers, Bentley, and Cosgrove. No: None. ATT CITY ~; ;` YOR APPROVED: OCTOBER 7, 1976