R2019-303 2019-12-09 RESOLUTION NO. R2019-303
A Resolution. of The City Council of the City of Pearland, Texas,
approving an amended application submitted by CenterPoint Energy
Resources Corp. d/b/a CenterPoint Energy Entex ("CenterPoint"), on
or about October 11, 2019, for authority to issue a refund to
customers; directing' CenterPoint to issue a refund; directing
CenterPoint to reimburse the City's rate case expenses; finding that
the meeting complies with the Open Meetings Act; and making other
findings and provisions related to the subject. .
WHEREAS, the United States Congress enacted the Tax Cuts and Jobs Act of
2017 ("TCJA") with an effective date of January 1, 2018, .which resulted in .a major
change, in- federal income-tax laws, including a reduction im the corporate, federal
income-tax rate from 35% to 21%; and
WHEREAS, on August 1, 2019 CenterPoint Energy-Entex ("CenterPoint" or the
"Company") made a filing with the Commission pursuant to Section 104.111 of the Gas
Utility Regulatory Act ("GURA") for customers in the Texas Coast Division and the
Houston Division to reflect a net refund in the amount of $14,373,99,8 related to certain
deferred income taxes and Hurricane Harvey restoration expenses;
WHEREAS, the refund for certain deferred income taxes is necessary for
CenterPoint to give effect to the change in federal law resulting from the passage of the
TCJA;
WHEREAS, through GURA Section 104.111, a gas utility is allowed to reduce its
rates without the need to present a full cost of service study;
WHEREAS, on August 16, 2019, CenterPoint made a supplemental filing
("August Supplemental Filing") to amend its August 1st net refund amount to include
insurance proceeds it received related to its Hurricane Harvey expenses, resulting in a
proposed net refund of$16,556,357;
WHEREAS, the order of the Railroad Commission of Texas ("Railroad
Commission") in Gas Utilities Docket ("GUD") No. 10695 directs gas utilities like
CenterPoint to reduce rates to reflect the benefits of the Tax Cut and Jobs Act of 2017
based on the difference between the utility's most recently approved cost of service
study at the tax rates in effect prior to passage of the Tax Cut and Jobs Act of 2017, and
the tax rates in effect after passage of that Act;
RESOLUTION NO. R2019-303'
WHEREAS, an application made under Gas Utility Regulatory Act ("GURA") §
104.111 is limited in scope to allow for expedited approval of a decrease in rates as
found to be in the public interest by the regulatory authority;
WHEREAS, consistent with the Railroad Commission's Order in GUD No. 10695
and the limited scope of a ratemaking proceeding under GURA § 104.111, on October
11, 2019, CenterPoint amended its application'by making a Second Supplemental Filing
("October Supplemental Filing") to remove from its application expenses it claimed for
restoration costs related to Hurricane Harvey;
WHEREAS, the result of removing such costs from the filing increases the
amount to be refunded to customers in the Houston and Texas Coast Divisions from its
initial filing of$14,373,998 to $17,763,968 (the "Amended Refund");
WHEREAS, the Amended Refund will be effective on bills rendered on or after
January 1, 2020 and amortized over three years;
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
PEARLAND, TEXAS THAT:
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 hereby:
A. APPROVES the rate tariff shown in Attachment A to this Resolution;
B. APPROVES the decrease in revenue per customer class shown in Attachment A
and total refund in the amount of approximately $17,763,968;
C. DIRECTS CenterPoint to issue a refund consistent with the rate tariff shown in
Attachment A;
D. DIRECTS CenterPoint to reimburse the City's rate case expenses incurred as
part of TCUC within 30 days from the date this Resolution is approved; and
E. DENIES all other relief not expressly granted by this Resolution.
Section 3. The effective date for the rate tariff approved by this Resolution shall be
January 1, 2020.
Section 4. A copy of this resolution shall be sent to CenterPoint's local
representative and to Mr. Alfred R. Herrera, Herrera Law & Associates, PLLC, 4400
Medical Parkway, Austin,TX, 78756.
RESOLUTION NO. R2019-303
Section 5. The meeting at which this resolution was approved was in all things
conducted in strict compliance with the Texas Open Meetings Act, Texas Government
Code, Chapter-551.
Section 6. This Resolution shall become effective from and after its passage.
PASSED, APPROVED and ADOPTED this the 9th day of December, A.D.,
2019.
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'••.A'_ TOM REID
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ATTEST:
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MARIA RODRIGUEZ •
INTERIM CITY SECRETARY
APPROVED AS TO FORM:
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DARRIN M. COKER
CITY ATTORNEY