AGENDA CAPTION:
Title
Consider approval of Ordinance 2014-68, on third and final reading, granting to Centerpoint Energy Resources Corp., dba Centerpoint Energy Texas Gas Operations, the right, privilege and franchise to construct, install, extend, remove, replace, abandon, operate and maintain its facilities within the public rights-of-way of the City of San Marcos, Texas for the transportation, delivery, sale and distribution of natural gas; containing other provisions relating to the foregoing subject; providing for severability and providing an effective date.
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Meeting date: November 5, 2014 - 1st Reading
November 18, 2014 - 2nd Reading
December 2, 2014 - 3rd Reading
Department: City Manager's Office, Steve Parker, Assistant City Manager/Chief Financial Officer
Funds Required:
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Funds Available:
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CITY COUNCIL GOAL:
BACKGROUND:
The City of San Marcos has been in negotiation with the Centerpoint Energy Company in hopes of changing the terms of the existing franchise fee agreement that exists between the two entities. The agreement calls for an increase from 3% to 5% of gross revenues which will mean an increase in annual revenue to the City of approximately $81,000 per year. This contract continues our dedication to financial stability of all City funds.
The agreement does give up the city's original jurisdiction over Centepoint's gas rates but the City would still be able to contest potential rate increases proposed by the Centerpoint in the future by participating in contested case hearings at the Texas Railroad Commission filed by other cities in the south Texas region. The City Charter provides that an ordinance granting a franchise to a public service company becomes effective thirty days after approval on third reading.