§ 37-58. Statements of intent regarding major changes.

Statements of intent to increase rates in a manner which would constitute a "major change" in rates, as that term is defined in section 43 of the Act, shall include all information required in this section as well as all additional information, if any, that may be required by the Act. In the case of electric utilities, the requested information shall be for the entire electric system in question, even if that system extends beyond the city limits, unless another basis is specified herein. In the case of gas utilities, the requested information shall be for the entire division in question even if that division extends beyond the city limits, unless another basis is specified herein. In the case of water or sewer utilities, the requested information shall be for the entire water or sewer system in question, even if that system extends beyond the city limits, unless another basis is specified herein. The elements comprising the major change filing package are in the following:

(1)

Summary information:

a.

A complete set of proposed tariff revisions;

b.

A statement specifying in detail each proposed tariff revision, the classes and numbers of utility customers affected, and the change in gross revenues (in absolute dollar amounts and in percentage terms—each by customer class and by total) that the utility expects the revised tariffs to furnish as opposed to those furnished by existing tariffs;

c.

A schedule comparing under current tariffs the income statements of the system or division for the test year and the twelve-month period immediately previous to the test year, together with a description of all substantial changes reasonably anticipated by the utility to occur during the projected fiscal year;

d.

A schedule comparing the capital structure of the utility for the test year and the twelve-month period immediately previous to the test year, with a description of all substantial changes reasonably anticipated by the utility to occur during the projected fiscal year. [Note: If any component of the capital of the utility is not obtained primarily through its own financing, but rather is obtained primarily from a company which controls the utility ("controlling company"), then the capital structure information shall be both for the controlling company on a consolidated basis and for the utility. If the utility controls any other companies, then the capital structure information shall be both for the utility on a consolidated basis and for the utility on an unconsolidated basis];

e.

A schedule showing gross plant in service of the system or division and a breakdown by functional classification of construction work in progress for the test year;

f.

A schedule showing forecasted construction expenditures of the system or division for the three (3) years following the test year. [Note: Such schedule shall, to the extent possible, show expenditures on major projects separately];

g.

A schedule showing the rates of return (on an actual and adjusted basis) for the test year on the original cost rate base of the system or division (thirteen-month average) and the book common equity of the utility (thirteen-month average), together with an explanation of the basis on which those rates of return were calculated; and

h.

A schedule in the same format as reported to stockholders, setting forth the balance sheets of the utility and the system or division at the end of the test year and at the end of the twelve-month period immediately previous to the test year.

(2)

Rate base information:

a.

A schedule showing for the test year the components of the system's or division's original cost rate base, current cost rate base, and adjusted value rate base calculated in accordance with those weighing factors set forth in subparagraph (2)b. below;

b.

A schedule showing the weighing factors which the utility suggests should be used in determining the adjusted value rate base and setting forth the rationale for the use of such weighing factors;

c.

A schedule setting forth the following elements of the system's or division's plant in service accounts:

1.

The book dollar amount of plant in service classified by major accounts of the applicable uniform system of accounts, as of the beginning of the test year;

2.

The book additions and reductions during the test year to such major accounts; and

3.

The balances of such accounts at end of the test year;

d.

A schedule showing for each of the twelve (12) months in the test year the monthly book balance of all of the system's or division's plant in service, classified by production, transmission, distribution, and general in the case of electric and water utilities, and classified by distribution and general in the case of gas utilities;

e.

A schedule showing, for the system or division, gross plant in service and a breakdown by functional classification of construction work in progress for the test year, together with a description of all administrative and general expenses related to construction (including the methods and procedures followed in capitalizing interest during construction);

f.

A schedule showing for the system or division:

1.

The accumulated provisions, as of the beginning of the test year, for depreciation and amortization of plant in service classified to the extent available by production, transmission, distribution, and general in the case of electric utilities; by distribution and general in the case of gas utilities; and by transmission, distribution, and general in the case of water or sewer utilities;

2.

The book additions and reductions to such provisions during the test year; and

3.

The balance of such provisions at the end of the test year;

g.

A schedule showing for each of the twelve (12) months in the test year the system's or division's monthly book balances of the accumulated provisions for depreciation and amortization of plant in service;

h.

A schedule showing the determination of current cost of the system's or division's plant in service, including an explanation of the methods and calculations used in arriving at such costs;

i.

A schedule showing the determination of the adjustment for both age and condition of the system's or division's plant in service, including an explanation of the methods and calculations used;

j.

For electric utilities only, a schedule showing plants under construction or included in the construction budget itemized by:

1.

Name of unit;

2.

Capacity of unit;

3.

Date in service or estimated date in service;

4.

Estimated total cost;

5.

Cost at the beginning of the test year and end of test year;

6.

Estimated annual cost from the test year end until placement in service;

7.

Purpose of unit (replacement or growth); and

k.

For water and sewer and gas utilities, a schedule showing facilities under construction or included in the construction budget itemized by:

1.

Date in service or estimated date in service;

2.

Estimated total cost;

3.

Cost at the beginning and end of test year;

4.

Estimated annual cost from test year end until placement in service;

5.

Purpose of construction (replacement or growth);

l.

For electric utilities only, a schedule showing the following information:

1.

Historical heat rate by plant for the five (5) fiscal years previous to the test year end;

2.

Heat rate used for conversion;

3.

Historical fuel mix for the five (5) fiscal years previous to the test year end;

4.

Current fuel mix at the time of filing;

5.

Historical generating mix for the five (5) years previous to the test year end; and

6.

Generating mix used at the time of filing;

m.

A schedule of planned retirements by major generating unit in the case of electric utilities, major transmission or distribution unit in the case of water and sewer utilities, and major distribution unit for gas utilities over the five-year period after the test year end;

n.

A schedule showing the computation of the utility's allowance for funds used during construction rate; also an explanation of the utility's policy regarding the capitalization of allowance for funds used during construction which includes limits on projects, amounts, and timing;

o.

A schedule showing the utility's plant held for future use including the reason that the plant or property is being held for future use and the anticipated date such plant or property will be placed into service;

p.

A schedule showing the amount of construction work in progress requested by the utility at the end of the test year; such schedule shall be itemized by major project and shall show the estimated date of placement in service and the estimated cost of each project at the time of placement in service;

q.

A schedule showing the monthly balance of construction work in progress during the test year, the monthly balance used to calculate the charge to the allowance for funds used during construction during the test year, and the monthly charge to the allowance for funds used during construction during the test year;

r.

A schedule showing the amount of construction work in progress requested by the utility that will not increase the capacity of the applicable system or division;

s.

A schedule showing the computation of the working capital allowance requested by the system or division; this schedule shall include for each of the twelve (12) months in the test year the monthly book balances during the test year for materials and supplies (excluding appliances), prepayments, and (in the case of electric utilities only) fuel. [Note: The fuel allowance requested by the utility should also show monthly quantities measured in oil barrels or gallons and coal tons. Additionally, the average monthly purchase price per unit (barrels, gallons, or tons) shall be shown for each month within the test year. Additionally, an explanation and detailed reconciliation must be given regarding the treatment of merchandising and jobbing related to receivables and payables in the determination of working capital, if applicable];

t.

A schedule listing the banking and depository institutions from which records can be supplied to compute the total daily bank balances by day for the test year, including cash, special deposits, working funds, and temporary cash investments;

u.

A copy of a lead-lag study and supporting workpapers which may have been performed and used by the utility in requesting its proposed working capital allowance;

v.

A schedule showing the balance of the unamortized investment tax credit, showing remaining balances generated before 1971 and since 1971;

w.

A schedule showing the vintage years and balance by vintage year that are included in the utility's unamortized investment tax credits;

x.

A schedule showing the monthly balance of customer deposits and the associated interest for each month during the test year;

y.

A schedule showing the monthly balance of contributions in aid of construction and customer advances during the test year and an explanation regarding the treatment of these items in the utility's rate application;

z.

If applicable, a schedule showing the utility's annual accruals and charges against the insurance reserves for the past five (5) years, including an explanation of when and how the insurance reserves were established and how the annual accrual amount was established;

aa.

An explanation of the purpose of receivables from associated companies and payables to associated companies, where applicable;

bb.

A schedule showing the amount and details of any transactions related to property, plant and equipment between the utility and any subsidiary or any other utility; and

cc.

A schedule showing the percentage overall rate of return requested by the utility on the original cost rate base, current cost rate base, and adjusted value rate base and the general reasons and justifications for the requested rate of return in narrative form.

(3)

Cost of capital information: [Note: If any component of the capital of the utility is not obtained primarily through its own financing, but rather is obtained primarily from a company which controls the utility ("controlling company"), then the cost of capital information submitted hereunder shall be both for the controlling company on a consolidated basis and for the utility. If the utility controls any other companies, then the cost of capital information submitted hereunder shall be both for the utility on a consolidated basis and for the utility on an unconsolidated basis.]

a.

A schedule showing the capitalization of the utility (and controlling company, if any) at the end of the test year and the latest date available (broken down by the following components: Short-term debt, long-term debt, preferred equity, and common equity), all pro forma adjustments to the capitalization (with supporting details), the cost of each component of capitalization, and the weighted overall cost of capital;

b.

A schedule showing, for each series of the utility's (and the controlling company's, if any) long-term debt outstanding at the end of the test year and the latest date available, the following information:

1.

Title of the debt issue;

2.

Date of issuance and date of maturity;

3.

Interest rate;

4.

Principal amount of issue and gross proceeds;

5.

Underwriter's discount or commission and amount;

6.

Issuance expense including amount, percent gross proceeds, net proceeds and net proceeds per unit;

7.

Cost of money: yield to maturity based on the interest rate and net proceeds per unit outstanding determined by reference to any generally accepted table of bond yields;

8.

If the issue is owned by an affiliate of the utility (or the controlling company, if any), state the name of the affiliate and its relationship to the utility (and the controlling company, if any); and

9.

If the utility (or the controlling company, if any) has acquired at a discount or premium some part of the outstanding debt which could be used in meeting sinking fund requirements or for other reasons, it shall show the annual amortization of the discount or premium for each series of debt from the date of acquisition over the remaining life of the debt being retired and shall separately show the total remaining or unamortized discount and premium, as a result of such amortization, applicable to the test year;

c.

A schedule showing the monthly balances of short-term debt, excluding the current portion of long-term debt, for the utility (or controlling company, if any), during the test year and the latest date available, including the following information:

1.

Title of the issue and lender name (bank loan, commercial paper, etc.);

2.

Date of issuance and maturity;

3.

Interest rate;

4.

Principal amount of issue;

5.

Compensating balance, if any, including the supporting compensating balance agreement; and

6.

Interest expense including the cost of money computed as the interest rate divided by net proceeds per unit outstanding; if the issue is owned by an affiliate of the utility (or the controlling company, if any), then the name of the affiliate, its relationship to the utility (and the controlling company, if any) and an explanation of the method of determining the interest rate shall be stated;

d.

A schedule showing for each class and series of preferred and preference stock of the utility (and the controlling company, if any) outstanding at the end of the test year and the latest date available, the following information:

1.

Title of the stock issue;

2.

Date of issuance;

3.

If callable, the call price;

4.

If convertible, the terms of conversion;

5.

Par or stated amount of issue and gross proceeds;

6.

Underwriter's discount or commission and amount;

7.

Issuance expenses including amount, percent gross proceeds, net proceeds and net proceeds per unit;

8.

Cost of money: dividend rate divided by net proceeds per unit;

9.

Whether the issue was offered to stockholders through subscription right or to the public; and

10.

If the issue is owned by the affiliate to the utility (or the controlling company, if any), state the name of the affiliate and its relationship to the utility (and the controlling company, if any);

e.

A schedule showing the details of any anticipated financing of the utility (and controlling company, if any) over the twelve-month period immediately succeeding the test year, including:

1.

Title of the issue;

2.

Date of issuance and maturity, if applicable;

3.

Interest or dividend rate, if applicable;

4.

Principal amount of issue;

5.

Discount, premium, and debt expense, if applicable; and

6.

Cost of money, where applicable;

f.

A schedule showing the utility's (or controlling company's, if any) yearly high and low common stock prices for the ten (10) years preceding the test year, where applicable;

g.

A schedule showing the utility's (or controlling company's, if any) monthly high and low common stock prices during the test year, where applicable;

h.

A schedule showing the computation of the utility's (and the controlling company's, if any) times interest earned ratio and fixed charge coverage ratio (by Securities and Exchange Commission method) before and after taxes for the actual test year and for the test year adjusted to take into account all pro forma adjustments and the requested revenue increase; and

i.

A schedule providing a summary of the utility's (and the controlling company's, if any) debt instrument fixed charge requirements plus any other pertinent information (such as restrictions) pertaining to the issuance of the debt.

(4)

Income information:

a.

A schedule setting forth for the utility and the relevant system or division, the test year income statement, all pro forma adjustments to the test year income statement, and an adjusted test year income statement taking into account such pro forma adjustments;

b.

A schedule showing the details of all pro forma adjustments to the test year income statements referred to in (4)a above, with a full explanation of the methods and calculations on which said pro forma adjustments are based;

c.

A schedule setting forth monthly detailed net income statements of the utility, and the relevant system or division, for the test year, showing revenues by customer class and showing detailed operating expenses;

d.

A schedule showing actual sales by month (KWH, MCF, or MGD where applicable and revenue) of the utility by customer classification for the twelve (12) months during the test year and projected annual sales (units and dollars) for the next three (3) years subsequent to the test year end;

e.

For electric and gas utilities, a schedule showing the monthly amount of fuel adjustment revenue by customer class and in total for the twelve (12) months during the test year;

f.

For electric and gas utilities, a narrative explanation of items or customers which are not subject to the current or proposed fuel adjustment;

g.

For electric and gas utilities, a schedule showing the computation of the fuel adjustment amount for each month during the test year;

h.

A schedule showing the number of customers by customer classification of the utility by month during the test year and the projected annual number of customers by customer classification for the period subsequent to the test year end during which the requested rates are to be in effect;

i.

A schedule showing utility personnel by department for the utility for the three (3) years prior to the test year end, during the test year, and budgeted for the period subsequent to the test year end during which the requested rates are to be in effect;

j.

The utility's current and proposed wage contracts, where applicable;

k.

A schedule showing rate case expenses incurred at the time of the filing and estimated rate case expenses for the utility and outside expert witnesses; the schedule should itemize:

1.

The salary, expenses and allocations thereof to the filing for each expert retained (other than a regular salaried employee of the utility), whether such person is expected to testify upon the hearing of the rate case or not;

2.

All materials and supplies cost;

3.

Any other costs associated with the filing preparation and hearings;

l.

A schedule reconciling book net income of the utility with taxable net income as reported to the Internal Revenue Service for the most recent year for which a tax return was filed and the previous three (3) years;

m.

A schedule showing the tax computation for the relevant system or division of the utility during the test year and all supporting workpapers;

n.

A schedule showing the computation of consolidated income taxes for the utility and for the controlling company, if any, during test year operations;

o.

A schedule showing a reconciliation of the treatment of allowance for funds used during construction (AFUDC) for both book and tax purposes for the utility during the test year; this schedule shall be accompanied by a narrative explanation;

p.

A schedule showing the depreciation rates used by the utility in its filing classified by major plant accounts;

q.

A schedule indicating for the utility the date of the most recent change in depreciation lives and studies supporting such a change in depreciable asset lives and corresponding depreciation rates;

r.

A schedule showing the computation of the incremental gross revenue conversion factor for the relevant system or division;

s.

A schedule showing the amounts expended by or allocated to the utility and the relevant system or division during the test year, with the corresponding amount for: business gifts, entertainment, charitable or civic contributions, membership in social, recreational, fraternal or religious clubs or organizations, institutional advertising, conversational advertising, consumption-inducing advertising, and other advertising;

t.

A schedule showing the amounts expended by or allocated to the utility and the relevant system or division (other than salary or wages subject to withholding of federal income tax) for:

1.

Legal representation in Texas;

2.

Representation before the Texas Legislature;

3.

Representation before any other governmental agency or body in Texas;

4.

Representation before any federal governmental agency or body;

[Note: This statement shall include the actual expense for the test year, with any adjustments for known changes, and the actual expenses for the last odd-numbered calendar year]; and

u.

A schedule showing the net income or loss resulting from the sale or lease by the utility, and the relevant system or division, of appliances, fixtures, equipment, or other merchandise.

(5)

Rate design information:

a.

A schedule showing for the utility, and the relevant system or division, the following test year information for each customer class:

1.

The designation of the class;

2.

The total number of customers of the class;

3.

The total consumption in KWH, MCF or MGD of the customer class; and

4.

The total revenues derived from customers of the class;

b.

A schedule showing for the relevant system or division and for the test year a bill frequency or other analysis showing consumption and number of bills at each rate and for each customer class for which the utility maintains such records in the normal course of business;

c.

A schedule showing the utility's current and proposed rates of return by customer class under the allocation methods proposed by the company; provided, however, if the utility has a cost of service study on file with the department, then this schedule may be omitted; [Note: the utility shall make available to the director all relevant workpapers used to derive such rates];

d.

A schedule showing the following utility statistics for the past five (5) years from the test year end and subsequent period during which the requested rates are to be in effect:

1.

Consumptions (KWH, MCF, or MGD) by class by month;

2.

Number of customers by month by class;

3.

System demand by month;

4.

Where applicable, cooling and heating degree days by month, both normal and actual;

5.

Actual peak per year by class;

6.

Actual generating capability at peak, where applicable;

7.

Actual firm purchase power commitments at peak, where applicable;

8.

Reserve capacity at peak, based on generating capability, where applicable; and

9.

Reserve capacity at peak, based on generating capability plus firm purchase power commitments, where applicable;

e.

For electric utilities, a schedule showing for each generating facility existing currently:

1.

Capacity;

2.

Fuel;

3.

Date installed;

4.

System capacity at date installed;

5.

System demand at date installed;

6.

Annual consumption of system year installed.

(6)

Expert testimony: The utility shall submit two (2) copies of the testimony and reports, if any, of company representatives and outside expert witnesses used to support such filing.

(Code 1968, § 38-37; Ord. No. 81-1589, § 1, 8-18-81)