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Home My WebLink About2004-05-18 City Council (5)City of Palo Alto ’04- ’05 TO:HONORABLE CITY COUNCIL FROM:CITY MANAGER DEPARTMENT: UTILTITIES ATTENTION:FINANCE COMMITTEE DATE:MAY 18, 2004 CMR:268:04 SUBJECT:APPROVAL OF A RESOLUTION ADOPTING A GAS RATE INCREASE RECOMMENDATION Staff and the Utilities Advisory Commission (UAC) recommend that the City Council adopt the attached resolution to increase the natural gas base revenue of FY 04/05 by 9.9%, or approximately $2.5 million, effective July 1, 2004. UTILITIES ADVISORY COMMISSION REVIEW AND RECOMMENDATIONS On May 5, 2004, the UAC was provided with a proposal from staff to increase rates by 9.9% effective July 1, 2004. The UAC unanimously recommended Council adoption of the staff rate proposal. ALTERNATIVES Staff also evaluated the impact of alternative rate proposals. If~proposed increase is higher than proposed, it may have too large of a rate shock on customer’s bills, especially when combined with corresponding increases in electric and water rates. On the other hand, a lower rate increase than is proposed will not be sufficient to shield the utility from market volatility. RESOURCE IMPACT Approval of this proposed rate increase will increase the Gas Fund base sales revenues by approximately ,$2.5 million for F¥ 04-05. If wholesale gas costs continue to increase CMR:268:04 Page 1 of 2 while sales levels continue to be flat, another rate increase might be proposed for FY 05- 06. POLICY IMPLICATIONS This proposed rate increase would satisfy the Utilities Strategic Plan objective of providing superior financial performance to the City and competitive rates to customers. These recommendations do not represent a change in current City policies. ENVIRONMENTAL REVIEW The adoption of the resolution does not constitute a project under the California Environmental Quality Act. Therefore, no environmental assessment is required. ATTACHMENTS A:Resolution B.Gas Rate Schedules G-l, G-2, G-3, G-4, G-6, G-7, G-10 C:Minutes of the UAC meeting of May 5, 2004 PREPARED BY: Lucie Hirmina, Utilities Rates Manage REVIEWED BY: ~irish Balachandran, Assistant Director, Resource Man~.ment Tom Auzenne, Assistant Director, Customer Services DEPARTMENT HEAD: CITY MANAGER APPROVAL: EM] r of Utilities Am SON Assistant City Manager CMR:268:04 Page 2 of 2 ***NOT YET APPROVED*** RESOLUTION NO. RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO AMENDING UTILITY RATE SCHEDULES G-l,G-2, G-6, AND G-10 OF THE CITY OF PALO ALTO UTILITIES RATES AND CHARGES PERTAINING TO GAS RATES The Council of the City of Palo Alto does hereby RESOLVE as follows: SECTION i. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utility Rate Schedule G-I (Residential Gas Service) is hereby amended to read in accordance with sheet G-l- i, attached hereto and incorporated herein. The foregoing Utility Rate Schedule, as amended, shall become effective July i, 2004. SECTION 2. Pursuant to Section 12.20.010 of the Palo Alto Municipa! Code, Utility Rate Schedule G-2 (Commercial Gas Service) is-hereby amended to read in accordance with sheet G-2- i, attached hereto and incorporated herein. The foregoing Utility Rate Schedule, as amended, shall become effective July i, 2004. SECTION 3. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utility Rate Schedule G-6 (Municipal Gas Service) is hereby amended to read in accordance with sheet G-6- i, attached hereto and incorporated herein. The foregoing Utility Rate Schedule, as amended, shall become effective July i, 2004. SECTION 4. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utility Rate Schedule G-10 (Compressed Natural Gas Service) is hereby amended to read in accordance with sheet G-10-1, attached hereto and incorporated herein. The foregoing Utility Rate Schedule, as amended, shal! become effective July I, 2004. SECTION 5. The Council finds that the revenue derived from the authorized adoption enumerated herein shall be used only for the purposes set forth in Article VII, Section 2, of the Charter of the City of Palo Alto. // // 040426 cl 0072391 1 ***NOT YET APPROVED*** SECTION 6. The Council finds that the adoption of this resolution does not constitute a project under the California Environmental Quality Act, California Public Resources Code section 21080, subdivision (b) (8). INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: City Clerk APPROVED AS TO FORM: Mayor APPROVED: Senior Asst. City Attorney City Manager Director of Utilities Director of Administrative Services 040426 cl 0072391 2 RESIDENTIAL GAS SERVICE UTILITY RATE SCHEDULE G-1 A. APPLICABILITY: This schedule applies to natural gas service to individually metered single family premises, including those separately metered in a multi-family complex. B.TERRITORY: Within the service area of the City of Palo Alto and on land owned or leased by the City. RATES:Per Meter Per Month Do (A)Summer Rates (May 1 to October 31): 0-20 therms per therm ........................................................................$0.719 Over 20 therms per therm ........................................................................$1.178 (B)Winter Rates (Nov. 1 to April 30): 0-96 therms per therm Over 96 therms per therm ........................................................................$0.719 ........................................................................$1.178 SPECIAL NOTES: Seasonal rate changes: The summer period is effective May 1 to October 31 and the winter period is effective from November 1 to April 30. When the billing period is partly in the summer period and partly in the winter period, the billing will be computed by prorating the total therm usage and the applicable rates thereto between the two seasonal periods, according to the ratio of the number of days in each seasonal period to the total number of days in the billing period. Service under this schedule is subject to discontinuance in xvhole or in part, for operational reasons or if the City experiences supply or capacity shortages. The City will exercise reasonable diligence and care to furnish and deliver continuous service and a sufficient quantity of gas to customers, but does not guarantee continuity of service or sufficiency of quantity. The City shall not be liable for any damage caused by interruption of service, if the interruption of service is caused by an act of God, Fire, Strikes, riots, war, or any other cause that is beyond the City’s control. CITY OF PALO ALTO UTILITIES Issued by the City Council Supercedes Sheet No. G-1-1 dated 7-1-2003 C!TY OF PALO ALTO UTILITIES Effective 7-1-2004 Sheet No. G-l-1 COMMERCIAL GAS SERVICE APPLICABILITY: UTILITY RATE SCHEDULE G-2 This schedule applies to non-residential customers who use less than 250,000 therms per year at a single address. This schedule may include service to master-metered multi-family facilities. TERRITORY: Within the service area of the City of Palo Alto and on land owned or leased by the City. RATES: All year-round delivered commodity:Per Meter Per Month Per Therm ........................................................................................................................$0.885 SPECIAL CONDITIONS: Service under this schedule is subject to discontinuance in whole or in part, for operational reasons or if the City experiences supply or capacity shol~ages. The City wilt exercise reasonable diligence and care to furnish and deliver continuous service and a sufficient quantity of gas to customers, but does not guarantee continuity of service or sufficiency of quantity. The City shall not be liable for any damage caused by interruption of service, if the interruption of service is caused by an act of God, Fire, Strikes, riots, war, or any other cause that is beyond the City’s control. {End} CITY OF PALO ALTO UTILITIES Issued by the City Council Supersedes Sheet No.G-2-1 dated 7-1-2003 C!TY OF PALO ALTO UTILITIES Effective 7-1-2004 Sheet No. G-2-1 MUNICIPAL GAS SERVICE UTILITY RATE SCHEDULE G-6 A.APPLICABILITY: This schedule applies to service buildings and facilities owned and!or operated by the City of Palo Alto and not currently served under G-11 or G-12. B.TERRITORY: Within the service area of the City of Palo Alto and on land owned or leased by the City. C. RATES:Per Therm Supply Charges: 1.Commodity Charge ........................................................................................$0.391 2.Administrative Fee .........................................................................................$0.018 3.PG&E Local Transportation ..........................................................................$0.021 Total Supply Charges .....................................................................................$0.430 Distribution Charge: 1. Palo Alto Local Distribution .......................................................................... $0.237 D.SPECIAL CONDITION: Service under this schedule is subject to discontinuance in whole or in part, for operational reasons or if the City experiences supply or capacity shortages. The City will exercise reasonable diligence and care to furnish and deliver continuous service and a sufficient quantity of gas to customers, but does not guarantee continuity of service or sufficiency of quantity. The City shall not be liable for any damage caused by interruption of service, if the interruption of service is caused by an act of God, Fire, Strikes, riots, war, or any other cause that is beyond the City’s control. o The Administrative fee is equal to the allocable administrative and overhead costs incurred by the City in providing the gas service. o PG&E Local transportation charge is equal to the cost of transporting gas from the PG&E’s City Gate to the Palo Alto City Gate. CITY OF PALO ALTO UTILITIES Issued by the City Council Supercedes Sheet No. G-6-1 dated 7-1-2003 CITY OF PALO ALTO UTILITIES Effective 7-01-2004 Sheet No. G-6-1 COMPRESSED NATURAL GAS SERVICE UTILITY RATE SCHEDULE G-10 A. APPLICABILITY: This schedule applies to the sale of compressed natural gas (CNG) at the City-oxvned natural gas fueling stations to customer who use CNG for fueling CNG vehicles. B.TERRITORY: Applies to locations within the service area of the City of Palo Alto. C.RATES: Per Therm Commodity Charge Per Gasoline Gallon Equivalent $0.850 $0.990 For billing purposes, the number of gallons will be complied from a Summary of Transactions recorded by the dispensing unit for the customer during the month. D. SPECIAL CONDITIONS 1.Service under this schedule is subject to discontinuance in whole or in part in case of actual or anticipated shortage of natural gas resulting from insufficient supply, inadequate transmission or delivery capacity of facilities. 2.Service under this schedule is provided only from a designated City fueling station which will deliver CNG at approximately 3,000 pounds per square inch (PSI). 3.Individuals responsible for fueling a Natural Gas Vehicle shall be required to complete training sessions to be certified to fuel a vehicle. Each individual must sign and date the Certificate of Instruction for Fueling Natural Gas Vehicle. 4.Customers requesting to take service under this rate schedule are required to sign a Compressed Natural Gas Ageement before commencing service. 5.If required by local or federal law, assessed applicable taxes shall be added to charges shown in this rate schedule. /End] CITY OF PALO ALTO UTILITIES Issued by the City Council Supercedes Sheet No. G-10-1 dated 7-1-2002 C~TY OF PALO ALTO UTILITIES Effective 7-1-2004 Sheet No.G-10-1