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HomeMy WebLinkAboutO-666�I O z ORDINANCE NO. 666 AN ORDINANCE TO ADOPT NEW GAS RATES FOR ALL GAS CUSTOMERS WITHIN THE CITY LIMITS OF FAIRHOPE, AL, AND ALL GAS CUSTOMERS OUTSIDE THE CITY LIMITS OF FAIRHOPE, ALABAMA, AND TO DESIGNATE EACH CLASS OF CUSTOMERS THEREIN. BE IT ORDAINED BY THE MAYOR AND COUNCIL OF THE CITY OF FAIRHOPE, ALABAMA, THAT the following rate designations, and rates, for all gas customers of the City of Fairhope are hereby established: SECTION I. GENERAL SERVICE WITHIN CITY LIMITS - G1 Applicable to individual dwellings and apartments, municipal and school buildings, and small individual commercial establishments whose physical location is within the corporate limits. MONTHLY RATE: First 300 cu.ft. or less for $2.80 ,(minimum), plus Next 1,000 cu.ft. or less @ .56 , per 100 cu.ft., plus Next 8,700 cu.ft. or less @ .50 , per 100 cu.ft., plus Next 90,000 cu.ft. or less @ .437, per 100 cu.ft., plus All over 100,000 cu.ft. @ .405 per 100 cu.ft. SECTION II. GENERAL SERVICE OUTSIDE CITY LIMITS - G2 Applicable to individual family dwellings and apartments, municipal and school buildings, and small commercial establishments whose physical location is outside the corporate limits. MONTHLY RATE: First 300 cu.ft. or less for $3.55 ,(minimum), plus Next 1,000 cu.ft. or less @ .63 , per 100 cu.ft., plus Next 8,700 cu.ft. or less @ .52 , per 100 cu.ft., plus Next 90,000 cu.ft. or less @ .455, per 100 cu.ft., plus All over 100,000 cu.ft. @ .41 per 100 cu.ft. SECTION III. INSIDE LARGE COMMERCIAL & INDUSTRIAL RATE - G3 Applicable to large commercial and industrial customers whose median monthly consumption is 100 Mcf or more on an interruptable basis, and whose physical location is within the corporate limits. MONTHLY RATE: First 20,000 cu.ft. or less for $95.00 ,(minimum), plus Next 80,000 cu.ft. or less @ .437, per 100 cu.ft., plus Next 900,000 cu.ft. or less @ .405, per 100 cu.ft., plus All over 1,000,000 cu.ft. @ .38 per 100 cu.ft. Continued to next page.... Ordinar . 666 , Page 2. SECTION IV. OUTSIDE LARGE COMMERCIAL & INDUSTRIAL RATE - G4 Applicable to large commercial and industrial customers whose median monthly consumption is 100 Mcf or more on an interruptable basis, and whose physical location is outside the corporate limits. MONTHLY RATE: First 20,000 cu.ft. or less for $98.00 ,(minimum), plus Next 80,000 cu.ft. or less @ .44 , per 100 cu.ft., plus Next 900,000 cu.ft. or less @ .405, per 100 cu.ft., plus All Over 1,000,000 cu.ft. @ .38 per 100 cu.ft. SECTION V. SPECIAL WHOLESALE RATE TO TOWN OF DAPHNE, ALABAMA - G5 The rates charged the Town of Daphne shall be as per that certain section entitled "SPECIAL WHOLESALE RATE TO DAPHNE - G5" of the JANUARY 26, 1981, Gas Study prepared by St. John Engineers, Inc., as though set out fully herein. Exhibit A attached. SECTION VI. CITY OF FAIRHOPE USE Rates for City Use shall be the above set out G1, General Service Within City Limits, rates. SECTION VII. GENERAL RULES AND REGULATIONS (a) The above rates are those charged by the CITY and any additional charges levied by State Q7- Federal authorities, such as the 4% State Utilities Tax, shall be in addition to said rates. (b) Bills are payable within ten (10) days from due date and, if not paid within such period, may be increased by an amount to be determined by the City Council. (c) If service is suspended, a reconnection fee will be charged as follows: G1 and G3 (Inside) Customers - $22.00 G2 and G4 (Outside) Customers - $27.50 (d) Service to more than one premises (unless served through one meter) shall not be combined, nor shall it be shared with or resold to others. (e) In the event the supply of natural gas to the City is curtailed or if the total supply is inadequate, only high -priority customers shall con- tinue to receive service in accordance with the CITY's curtailment plan. A high -priority customer includes uses of gas in a residence, small commercial establishment, school, hospital or similar institution, or any use where curtailment would endanger life, health, welfare, or main- tenance of physical property due to the unavailabilty of an alternate energy supply. (f) Normal service and delivery pressure to the customer shall be determined by the pressure available in the CITY's mains at the customer's location and may be reduced as necessary by the CITY to comply with supplier and regulatory curtailment directives under the current Modified IV Catagory Plan. Where the customer's normal operational pressure requirements ex- ceed the delivery pressure available, thus requiring the installation of increased compressor capacity, a pressure factor (corresponding to the psig) will be used to calculate the actual monthly consumption to be bills FIN Continued to next page.... Ordin Jo, 666 , page 3. (g) In the event a Maximum Daily Quanity (MDQ) overrun penalty is levied against the CITY due, in part or in whole, to industrial delivery over- runs, the industry will pay a daily overrun penalty of $1.00 per hundred cubic feet against all units in excess of the industry's established MDQ in addition to established rate. SECTION VIII. If any part of this Ordinance shall be ruled unconstitutional or void by a Court of competent jurisdiction, then all other parts or sections herein shall remain in full force and effect. SECTION IX. All Ordinances in conflict herewith be and the same are hereby repealed. SECTION X. This Ordinance shall take effect on the Mirch 1st, 1981, Utility Billing cycle, after its due adoption and publication as required by ADOPTED THIS 23 DAY OF FEBRUARY, 1981. EXHIBIT A - &ANCE N0. -(�6 (5 pages) FAIRHOPE, ALABAMA NATURAL GAS STUDY Gas Dept. SPECIAL WHOLESALE RATE TO DAPHNE - G5 Applicability & Requirements Applicable only to the Town of Daphne, Alabama, a municipal corporation which retains a one -tenth interest and joint ownership with the City of Fairhope of gas transmission lines directly between the supplier's delivery gate at Bay Minette and Daphne's three distribution system gates. Since Fairhope purchases the entire system volume of gas from the supplier, United Gas Pipe Line Company, Fairhope must in turn bill Daphne for gas which is supplied to Daphne's distribution system after combining meter readings from all three Daphne gates. Fairhope's obligation to bill Daphne for such purchases and other related gas system costs is required by Paragraph THIRD of the January 23, 1950 MEMORANDUM OF AGREEMENT between the above named parties which states that after Daphne has acquired ownership of the Daphne distribution system and interest in the transmission pipe line .."... Daphne shall at all times be entitled to gas from such transmission pipe line to supply its distribu- tion system in such quantities as shall be required by it u to the amount of one -tenth of the volume delivered by the source of gas s�y into such transmission pipe line. Fairhope shall continue to operate and maintain such transmission pipe line and make available to Daphne one -tenth of the volume delivered by the source of gas supply into such transmission line. Emphasis Added) Daphne will pay one -tenth of the cost of operating, repairing and maintaining such gas transmission pipe line and one -tenth the cost of odorizing gas therein, and one -tenth the cost of insurance thereon, and for all gas metered to it, plus its proportionate part of the gas lost in transmission, payments hereof shall be made upon presentation of bill therefor.". This special rate schedule is now necessitated due to curtailment directives, rapid escalation of prices due to gas deregulation mandated by the Natural Gas Policy Act of 1978, previous non -recovery of proportionate gas transmission losses, and for Fairhope to receive fair, just and reason- able compensation for that volume of gas which Daphne requires that exceeds the 1950 MEMORANDUM OF AGREEMENT requirements. Deliveries of gas hereunder shall be firm gas and shall not be subject to curtailment or interruption except as provided in other terms and conditions hereunder. Monthly Rate (Total Purchases From United x 10%) x Current Rate Billed, Plus Excess Daphne Purchases Above 10% x (Current Rate + 600). (Continued - Page 2) Page 2 City of Fairhope, Alabama SPECIAL WHOLESALE RATE TO DAPHNE - G5 (Continued) Billing Daphne's meters shall be read during daylight hours on the same day that corresponds to the United Gas Pipe Line Company's final meter reading day of the month. Within five (5) days following receipt of the United bill for the previous month, Fairhope shall render to Daphne a written bill for the previous month detailing meter readings, consumption, rates and other related charges as may arise from the monthly operation, maintenance, delivery and transmission services provided by Fairhope. Delivery Pressure Gas shall be delivered hereunder at such pressiire(s) as may be necessary to meet Daphne's requirements and as Fairhope may have available from time to time at Daphne's points of delivery, or as limited by supplier or regulatory authority. Daphne agrees to take and receive gas hereunder at the pressure herein provided for and thereafter to regulate and control said gas to the extent necessary for its operations. In order to equalize the pressure and volume of gas billed Daphne to the pressure and total volume billed by United at the source, a pressure factor corzesponding to the metered psig will be used to calculate the actual monthly take to be billed. Notice of Meter Tests Each party shall give to the other party notice of the time of all tests of meters sufficiently in advance of the holding of the test so that the other party may conveniently have its representative present; provided, however, that if either party has given such notice to the other party and the other party is not present at the time specified, then the party giving the notice may proceed with the test as though the other party were present. Periodically, at a frequency in keeping with the quantity of gas delivered through any meter, with this frequency being determined by agree- ment between the parties, each party shall calibrate its meters, all in the presence of representatives of the other party, as hereinabove provided, and both parties shall jointly observe any adjustment made. Correction for Errors of Meters If, upon any test, the percentage of inaccuracy of any metering equip- ment is found to be in excess of two percent (2%), registrations thereof ohall be corrected for a period extending back to the time such inaccuracy occurred, if such time is ascertainable, and if not ascertainable, then back one-half of the time elapsed since the last date of calibration. If for any reason, meters are out of service or out of repair, so that the amount of gas delivered cannot be ascertained or computed from the readings thereof, the gas delivered during the period such meters are out of service or out of repair shall be estimated and agreed upon by the parties hereof (Continued - Page 3) • Page 3 City of Fairhope, Alabama SPECIAL WHOLESALE RATE TO DAPHNE - G5 (Continued) Correction for Errors of Meters - (Continued) upon the basis of the best test data available, using the first of the following methods which is feasible: (a) By using the registration of any check meter or meters if installed and accurately registering. (b) By correcting the error if the percentage of error is ascertainable by calibration, test or mathematical calculation. (c) By estimating the quantity of delivery by deliveries during preceding periods under similar conditions when the meters were registering accurately. Refunds From Supplier If Fairhope, as a result of any order of the Federal Energy Regulatory Commission which becomes final and no longer subject to judicial review, receives cash refunds attributable to deliveries at the Bay Minette gate, Fairhope will then, within thirty (30) days of such receipt, determine and deliver Daphne's attributable portion of such refunds to Daphne. Curtailment Since November,1970, United Gas Pipe Line Company (United) has been under several curtailment programs as filed with the Federal Power Commission (now the FERC) and as ordered by the FERC and as amended and modified by judicial review. On April 1,1977, United instituted an Enforcement Policy of its Maximum Daily Quantity (MDQ) Overrun Penalty which stated that: "... overrun penalties will be billed to city gate distributors to the extent that any such customer exceeds its MDQ and such excess is attributable to new customers added on or after November 1,1976, or to industrial deliveries made on the date of the overrun. .... payment by a city gate customer for volumes of gas taken in excess of the Maximum Daily Quantity does not grant the right to take such excess volumes. Rather, such payment should be construed strictly as a penalty which United must impose in order to encourage a city gate customer to restrict volumes of gas taken in accordance with its applicable Maximum Daily Quantity. Strict adherence to such volumetric limitation is mandated . . ." (Continued - Page 4) n Page 4 City of Fairhope, Alabama SPECIAL WHOLESALE RATE TO DAPHNE - G5 (Continued) Curtailment - (Continued) In addition, the plan provides for imposition of a $10.00 per thousand cubic feet (Mcf) overrun charge on all city gate customers which exceed their aggregate curtailment allocation for any winter or summer season. City gate customer allocations are determined, for purposes of this charge, with reference to their actual takes during the 1972 - 1973 (April - March) winter season, and adjustments are not to be made thereto to reflect either the addition of new residential customers since that time or such increased heating needs as might exist in a colder than normal winter season. United does not presently know for what period of time the Court - ordered four- catagory curtailment plan will remain in effect or the precise level of curtailments which would be required under that plan during succeeding winter months. United considers Fairhope to be the only city gate customer of record at the Bay Minette gate, irrespective of the one -tenth ownership by Daphne of the transmission line from such; however, according to the 1950 MEMORANDUM OF AGREEMENT, Fairhope has acted as and is considered to be an "intermediary supplier" between United and Daphne. As such "intermediary supplier", Fairhope shall enforce United'scurtailment plan and penalties as may be currently in effect or amended upon Daphne until such time that curtailment is retracted by proper authority from United. Maximum Daily Quantities shall mean the maximum volume of gas which Fairhope is obligated to deliver to Daphne in any one day. Daphne MDQ and Base Year Requirements are set forth below: MONTH Mcf /Dav Mcf Month JAN 297 9,197 FEB 552 15,431 MAR 129 3,990 APR 184 5,496 MAY 116 3,579 JUN 111 3,306 JUL 59 1,8o4 AUG 62 1,912 115 3,447 OCT 79 2,441 Nov 329 9,868 DEC 327 10 11 Total 70,584 (Continued - Page 5) Page 5 City of Fairhope, Alabama SPECIAL WHOLESALE RATE TO DAPHNE - G5 (Continued) Payment for Assessed Volumes Exceeding MDQ In the event that United should levy a MDQ penalty against Fairhope due, in part or in whole, to Daphne MDQ overruns during one or more days in the billing month, Daphne's bill for such month otherwise payable shall be increased by the product of $10.00 and the aggregate number of Mcf in excess of the Maximum Daily Quantity. Payment by Daphne for volumes in excess of the Maximum Daily Quantity does not grant Daphne the right to take such excess volumes nor shall such payment exclude or limit any other remedies available to Fairhope against Daphne for failure to limit the quantity of gas taken to its MDQ. Fairhope shall have the right, without obligation, to waive any excess payment for gas taken on one or more days in the billing month in excess of the MDQ if in Fairhope's opinion such overrun volume was caused by an emergency beyond the control of Daphne. Monthly Payments Amounts due Fairhope, as shown by statements furnished Daphne in accordance with the foregoing for service rendered hereunder, are payable within ten (10) days from due date to the City of Fairhope at the Fairhope City Hall. In the event an error is discovered in the amount billed in any statement rendered by Fairhope, such error shall be adjusted promptly, provided that claim therefor shall have been made within 12 months from the date of payment. In the event Daphne shall fail to pay any amount due Fairhope hereunder when the same is due, then interest thereon shall accrue at the rate of twelve percent (12%) per annum from date when such amount is due until the same is paid. If such failure to pay continues for 60 days, Fairhope may, upon receipt of appropriate governmental authority, suspend deliveries of gas hereunder, and the excercise of such right shall be in addition to any and all other remedies available to Fairhope. St.John Engineers, Inc. January 26, 1981