City Council
Oscar Leeser
Peter Svarzbein, District 1
Mayor
Larry Romero, District 2
Emma Acosta, District 3
Carl L. Robinson, District 4
Tommy Gonzalez
Michiel R. Noe, District 5
City Manager
Claudia Ordaz, District 6
Lily Limón, District 7
Cortney Carlisle Niland, District 8
SPECIAL MEETING
OF THE CITY COUNCIL OF THE CITY OF EL PASO
CITY HALL,300 N. CAMPBELL
COUNCIL CHAMBERS
December 2, 2015
9:00 AM
The City Council met at the above place and date. Meeting was called to order at 9:16 a.m. Mayor Oscar Leeser present and presiding and the following Council Members answered roll call: Larry Romero, Emma Acosta, Carl Robinson, Lilia Limon, and Cortney Niland. Late arrivals: Peter Svarzbein and Claudia Ordaz at 10:17 a.m. Representative Michiel Noe requested to be excused.
AGENDA
1.
Briefing, discussion and public comment on the application of El Paso Electric Company to change rates. The City Council will hear comment from all interested parties, but will not take action on the Application to Change Rates.
Mr. Norman Gordon, outside counsel, briefed Council on order of meeting.
Mr. Tim Shockley, El Paso Electric Chief Executive Officer, provided information on why rate case is needed for EP Electric.
Mr. Steve Buraczyk, El Paso Electric Senior Vice President and Operations, presented a PowerPoint presentation, (copy on file in City Clerk’s Office).
Representative Niland asked Mr. Buraczyk about the current reserve margin and about the megawatts purchased in a year on the open market.
Mr. Buraczyk answered that 15%; as peak demand grows so does the margin, it varies each year from 20 to 30% per year. Peak is 1800 megawatts a year.
Representative Robinson commented that he thought the format was supposed to be a listening session, which would be easier to follow.
Mr. Jim Schichtl, El Paso Electric Director of Regulatory Affairs, presented a PowerPoint presentation, (copy on file in City Clerk’s Office). He gave an explanation on the distribution of revenue for each class and cost to serve them.
Representative Niland asked, on the first slide with the proposed rate class, to explain each class on what it costs El Paso Electric to serve the public. She added the increase would not be 11% but close to 30% and that it could be overwritten by the PUC authority.
Mr. Schichtl replied “correct”.
Mayor Leeser added about providing service for cost and asked how they make so much money.
Mr. Schichtl replied that recovery on return of investment in capital into the rate base.
Mayor Leeser asked what the profit was last year; Mr. Schichtl did not know the answer.
Mr. Tim Shockley informed Mayor Leeser that EP Electric has 40 million shares at a little over $2 per share, so it is about $80-$90 million.
Representative Niland asked what is fair on the return on investment; she was trying to determine what is fair.
Mr. Norman Gordon, outside counsel, presented a PowerPoint presentation, (copy on file in City Clerk’s Office). He listed the steps and process on what is next for city’s original jurisdiction. He added the push back was from the PUC staff.
Representative Niland asked how, during the last rate case, the amount was decided.
Mr. Gordon replied the decision is done by the commissioners.
Mr. Gary Hanson, Media Contact for Western Refining, discussed cost of operating with El Paso Electric. He noted the cost difference is substantial compared to other refineries around the state.
Mr. Ben Hallmark, Attorney for Western Refining, commented on the bill comparison and the unfair cost of customer class.
Representative Niland asked: “What is fair cost?” She added the rate class is 20% increase.
Mr. Hallmark’s reply was: “Low 9% in current market conditions.” He added to limit the increase for rate class.
Representative Niland asked of possible electric generation at Western Refining; Mr. Hanson said it is being considered.
Representative Niland asked to have the numbers and added Western Refining is a vital community partner.
Mr. Hanson mentioned the multiple processes and options and said they will keep Council informed.
Mayor Leeser added that Western Refining has been working with the City’s legal department, and mentioned it should continue so that everyone could get to a common number.
Representative Svarzbein asked if 10% profit is fair; Mayor Leeser reply the City of El Paso agrees that is fair.
Representative Acosta expressed a concern from El Paso Electric in the event Western Refining does go off the grid; she asked who would pick up the cost.
Mr. Tim Shockley’s reply was that the cost would be moved to some other class.
Mayor Leeser added that the increase is $9.4 million.
Representative Limón commented her office has received 773 emails stating to reject the rate hike.
Motion made by Representative Niland, seconded by Representative Robinson, and unanimously carried to SUSPEND THE RULES OF ORDER to allow additional speakers to address the Council after the signup period.
The following members of the public commented:
- Mr. Richard Schecterr
- Mr. Gunnar Borge, Solar City
- Mr. John Vandeven
- Mr. Phillip Laing
- Ms. Blanca Gadney-Moss
- Mr. Robert Braunlich
- Ms. Cindy Hernandez
- Reverend Robert E. Mosher
- Mr. Ryan Green
- Mr. Mike Halpin
- Mr. Frederic Dalbin
- Mr. Robert Moss
- Mr. Garry Hansen, Western Refining
- Mr. Raymond Rapisand
- Mr. Xavier Miranda
- Mr. Steve Fischer
- Mr. Larry Perea
- Mr. Keith Pannell
- Mr. John Walton
- Mr. Jim Kelly
- Mr. Sito Negron, Office of Senator Jose Rodriguez
- Mr. Rene Leon, CISD
- Mr. Ray Adauto
NO ACTION taken on this item.
ADJOURN
Motion made by Representative Niland, seconded by Representative Svarzbein, and unanimously carried to ADJOURN this meeting at 11:54 a.m.