HomeMy WebLinkAbout7-24-2003-09 - Resolution - 07/24/2003 RESOLUTION NO. 7 -24- 2003 -09
A RESOLUTION OF THE CITY OF COLLEGE STATION, TEXAS, APPROVING THE
SETTLEMENT FOR ELECTRIC UTILITY TRANSMISSION SERVICE WITH THE CITY
OF BRYAN AND RATIFYING AND APPROVING THE SETTLEMENT WITH TMPA.
WHEREAS, the City of College Station has been involved in litigation with the City of Bryan
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and TMPA for a number of years over electric transmission service; and
WHEREAS, the City Council of College Station approved a settlement amount of $6.5 million to
TMPA on April 28, 2003, and the final settlement documents on June 26, 2003; and
WHEREAS, the Mayor of College Station signed the documents on July 1, 2003, and the funds
were wired to TMPA on July 8, 2003; and
WHEREAS, the City Council of College Station approved a settlement amount of $2.2 million
with the City of Bryan on June 26, 2003; and
WHEREAS, these settlements will end long- standing litigation between College Station and
Bryan and College Station and TMPA for the 1997, 1998 and 1999 years; now, therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF COLLEGE STATION,
TEXAS:
1. That the City Council of the City of College Station, Texas, ratifies and approves the
payment of $6.5 million and all settlement steps taken as to TMPA, including Exhibit #1,
the TMPA settlement documents, attached and made a part of this resolution for all
purposes.
2. That the City Council of the City of College Station, Texas, approves the payment of $2.2
million to, and the settlement agreement with, the City of Bryan, including Exhibit #2,
the Bryan settlement documents, attached and made a part of this resolution for all
purposes; and authorizes the Mayor of College Station to sign on behalf of the City of
College Station.
3. That this resolution shall take effect immediately from and after its passage.
ADOPTED this 24th day of July , 2003.
ATTEST: APPROVED:
e . < % ItL _ , dh
C i HOOKS, City Secretary RON I I , Mayor
APPROVED:
* lb" City Attorn - jogg
O/ group /legal /harvey /misc /2003/bryan settlement resolution.doc
EXHIBIT 1
TMPA SETTLEMENT DOCUMENTS
O /group /legal /harvey /misc /2003/bryan settlement resolution.doc
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FULBRIGHT & JAWORSKI L.L.P.
A REGISTERED LIMITED LIABILITY PARTNERSHIP
%ilie 801 PENNSYLVANIA AVENUE. N.W.
WASHINGTON. D.C. 20004-2623
WWW.FULBRIGHT.COM
MICHAEL J. MANNING DIRECT DIAL: (202) 662 -4550
PARTNER TELEPHONE: (202) 662 -0200
MMANNING @FULBRIGHT.COM FACSIMILE: (202) 662 -4643
July 8, 2003 .. - RECENED
F
LEGAL UtPAkTM UT
Ms. Magalie R. Salas
JUL 1 0 2003
Secretary
Federal Energy Regulatory Commission cn v OF
888 First Street, N.E. COLLEGE E T ATiON .�
Washington, D.C. 20426
Re: City g of College Station, Texas, FERC Docket No. TX96 -2 -000, et al.; Offer of
Partial Settlement and Stipulation and Agreement, Explanatory Statement, and
Proposed Order
Dear Secretary Salas:
‘oe Enclosed for filing with the Commission, pursuant to Section 602 of the Commission's
Rules and §385.602 , 18 C.F.R. Re ulations (2003), is an Offer of Partial Settlement and
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Stipulation and Agreement, an Explanatory Statement, and a Proposed Order which resolves all
issues as between the City of College Station, Texas and the Texas Municipal Power Agency
("Settling Parties") in the above- referenced docket. A stamped copy of this filing is being
provided to Judge Herbert Grossman who was appointed as the settlement judge in this
proceeding. . A cop y of this filing also is being provided to FERC staff and all parties on the
official service list.
Pursuant to Rule 602(0 of the Commission's Rules of Practice and Procedures, Settling
Parties hereby provide notice that comments on the Offer of Partial Settlement are due on or
before July 28, 2003, and reply comments, if any, would be due ten days later.
Respectfully submitted,
1 /if / t
Michael J. anning
Attorney for Texas Municipal Po er Agency
Enclosures
cc: Judge Herbert Grossman
FERC Staff
ilime Ms. Lisa S. Gast
All Parties to Service List
45334790.1
HOUSTON • NEW YORK • WASHINGTON DC • AUSTIN • DALLAS • Los ANGELES • MINNEAPOLIS • SAN ANTONIO • HONG KONG • LONDON • MUNICH
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UNITED STATES OF AMERICA
BEFORE THE
FEDERAL ENERGY REGULATORY COMMISSION
City of College Station, Texas )
Docket No. TX96 -2 -000, et al.
EXPLANATORY STATEMENT IN SUPPORT OF
OFFER OF PARTIAL SETTLEMENT AND
STIPULATION AND AGREEMENT
Pursuant to Rule 602 of the Federal Energy Regulatory Commission's ( "FERC"
or "Commission ") Rules of Practice and Procedure, 18 C.F.R. §385.602 (2003), the
Texas Municipal Power Agency ( "TMPA ") and the City of College Station, Texas
( "College Station ") (collectively, the "Settling Parties ") submit this explanatory statement
along with an Offer of Partial Settlement and Stipulation and Agreement (hereafter the
"Agreement ") to the Commission for its consideration and approval. This Agreement
resolves all issues between the Settling Parties in these proceedings. The Agreement,
however, does not resolve the issues in these proceedings between College Station and
the City of Bryan, Texas and the Bryan Texas Utilities Board (collectively, "Bryan ").
The Settling Parties support this Agreement and will so advise the Commission in
their comments. The undersigned counsel are authorized to represent that Bryan does not
contest the Agreement.
In accordance with the Commission's revised procedures for the certification of
uncontested offers of settlement, the Settling Parties state that (1) the issues underlying
the Agreement involve certain provisions for the transmission of electric power and
and 212 of the Federal Power Act ( "FPA "); (2) the ma energy under §§211 major
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implications of the Agreement are that compensation for transmission service has been
resolved for the p eriod from January 1, 1997 through December 31, 1999 for which the
established settlement judge e Station III; 2 (3) none of rocedures in Colle Commission esta procedures g
the issues raise policy implications because of the "black box" nature of the Agreement;
(4) no other proceedings pending at the Commission are affected; and (5) the Agreement
does not involve any issues of first impression and there are no previous reversals on the
issues involved.
INTRODUCTION
College Station, on December 15, 1995 and as amended on January 18, 1996,
filed its application, pursuant to §211 and 212 of the FPA, as amended by the Energy
4 60 Policy Act of 1992,` f or an order requesting that the Commission direct TMPA and
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Bryan to provide firm transmission services. TMPA, College Station, and Bryan are all
within the Electric Reliability Council of Texas ( "ERCOT ") and consequently, the
Commission is, under FPA §212(k), required to defer to the PUCT's transmission
practicable and consistent with FPA § ratemaking methodology, insofar asp
However, the Commission determined that it could not establish rates for a period before
•
it issued its final order requiring transmission service.
1 16 U.S.C. § §824j and 824k (2000).
2 City of College Station, Texas, 97 FERC ¶ 61,152 (2001).
3 16 U.S.C. § §824j and 824k.
4 Pub. L. No. 102 -486, 106 Stat. 2776 (1992).
5 City of College Station, Texas, 76 FERC 1161,138 (1996)( "College Station II").
*11110 7 6 16 U.S.C. §824k(k).
City of College Station, Texas, 80 FERC 11 61,375 (1997).
8 College Station II, 76 FERC at R 61.744.
2
kit* The Commission later determined that the PUCT on August 11, 1997, but
effective as of January 1, 1997, had adopted an ERCOT -wide pricing methodology that
would apply to the transmission service TMPA provided to College Station.`' In that
pp Y p �
same order, the p arties were directed to enter into negotiations concerning the rates and
terms of service.' °
In its Final Order Establishing Rates, Terms and Conditions for Transmission
Services," the Commission found that those negotiations had not been successful. In that
order, the Commission adopted the ERCOT -wide ratemaking methodology established
by the PUCT, and further noted that none of the parties objected to the application of this
methodology period January `' for the eriod Janua 1, 2000 and beyond.' The Commission also
determined that TMPA and Bryan were entitled to recover reasonable regulatory
ex p enses,' 3 and TMPA and Bryan subsequently filed applications for recovery of those
expenses. The effect of these rulings is that (1) the Commission determined it had no
jurisdiction to set rates effective before February 16, 1999, the date of its final order in
College Station I; (2) the Commission adopted the PUCT's ERCOT -wide methodology
for the p eriod February 16, 1999 through and including December 31, 1999, which was
objected to by TMPA and Bryan; and (3) the Commission also adopted the PUCT's
ERCOT -wide methodology for the period on and after January 1, 2000, which was not
objected to by any party.
Subsequently, in its November 8, 2001 order, the Commission noted that on June
28, 2001, the Texas Supreme Court ruled that the PUCT "did not have authority to
9 City of College Station, Texas, 80 FERC ¶ 61,375.
10 Id.
" City of College Station, Texas, 86 FERC ¶ 61,165 (1999)( "College Station I").
12 College Station 1, 86 FERC at ¶ 61,581.
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`dictate by rule' the rates that municipally -owned utilities such as Bryan and TMPA must
‘0* charge to other utilities for wholesale transmission service. " The Commission re-
affirmed its earlier decision that the PUCT's methodology would apply for the period on
and after January 1, 2000. Noting that "[t]he current uncertainty as to what may occur
in Texas may provide an incentive for the parties to reach a mutually agreeable resolution
of this matter," the Commission ordered that the rates, terms and conditions for
transmission service for the period January 1, 1997 through December 31, 1999 be set for
settlement judge procedures pursuant to Rule 603 of the Commission's Rules of Practice
and Procedure.' U The Commission later also referred the claims of TMPA and Bryan for
regulatory expenses to settlement judge reg y p p
SUMMARY OF THE AGREEMENT
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The Agreement is based on the mutual desire of the Settling Parties to terminate
further litigation in a manner that is fair and reasonable and in the public interest. The
major terms of this Agreement are as follows:
1. On the Closing Date, which is five business days after the Agreement is
executed by TMPA and College Station, College Station will pay to TMPA the sum of
$6,500,000.00. TMPA and College Station will concurrently release each other with
respect to claims for transmission service for the period from January 1, 1996 through
and including December 31, 1999. The PUCT's ERCOT -wide transmission rate will
apply for the period on and after January 1, 2000.
13 Id. at IT 61,581.
14 City of College Station, Texas, 97 FERC ¶ 61,152 (2001).
15 Id.
16 Id. atli 61,665.
" Cite of College Station, Texas, 101 FERC ¶ 61,052 (2002).
4
2. This Stipulation is a complete resolution of Docket Nos. TX96 -2 -000, et
al. with respect to the issues between the Settling Parties and does not require TMPA to
modify its FERC tariff. The various provisions of this Agreement are not severable. The
Agreement does not, however, address or resolve any issue pending in these proceedings
between College Station and Bryan.
COMMISSION ACTION REQUESTED
The attached Agreement reflects a fair and reasonable resolution of many
complex issues and is in the public interest. The Settling Parties jointly state that they
will support the Agreement if the Agreement is approved in its entirety without
modification. Assuming that the Commission approves the Agreement as set forth above,
the Settling Parties jointly request that the Commission dismiss, with prejudice, these
proceedings as to all issues raised as between TMPA and College Station as a part of
such approval. The Settling Parties urge the Commission to expeditiously approve the
Agreement as filed and to grant any waivers necessary for the Agreement to be
implemented.
‘0*
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‘s'
Respectfully submitted,
- -
Lambeth Townsend
7 Z:1 chael J. anni g
LLOYD, GOSSELINK, BLEVINS, Glenn S. Benson
ROCHELLE, BALDWIN & Letitia W. McKoy
TOWNSEND, P.C. FULBRIGHT & JAWORSKI L.L.P
111 Congress Avenue, #1800 801 Pennsylvania Avenue, N.W.
Austin, TX 78701 Washington, DC 20004 -2623
(512) 322 -5800 (202) 662 -4550
William B. Wagner
James R. Bailey
FULBRIGHT & JAWORSKI L.L.P
600 Congress Avenue
Suite 2400
Austin, TX 78701 -3271
(512) 474 -5201
‘o# Attorneys for the Texas Municipal
Power Agency
#
Stephen Fogel Walla e L. Duncan
Joe N. Pratt Lisa S. Gast
BICKERSTAFF, HEATH, SMILEY, POLLAN, DUNCAN, WEINBERG, GENZER &
KEVER & MCDANIEL, L.L.P. PEMBROKE, P.C.
816 Congress Avenue, Suite 1700 1615 M Street, N.W., Suite 800
Austin, Texas 78701 -2643 Washington, D.C. 20036 -3203
(512) 472 -8021 telephone (202) 467 -6370 telephone
(512) 320 -5638 facsimile (202) 467 -6379 facsimile
Attorneys for the
City of College Station, Texas
DATE: July 8, 2003
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UNITED STATES OF AMERICA
BEFORE THE
FEDERAL ENERGY REGULATORY COMMISSION
City of College Station, Texas )
) Docket No. TX96- 2 -000, et al.
OFFER OF PARTIAL SETTLEMENT AND
STIPULATION AND AGREEMENT
Pursuant to Rule 602 of the Rules of Practice and Procedure of the Federal Energy
Regulatory Commission ( "Commission" or "FERC "), 18 C.F.R. § 385.602 (2003), the
Texas Municipal Power Agency and the City of College Station, Texas submit this Offer
of Partial Settlement and Stipulation and Agreement to resolve by settlement all issues
between the Texas Municipal Power Agency and College Station in these proceedings,
which were initiated by College Station in its Amended Application for an Order
Requiring Transmission Service pursuant to § 211 of the Federal Power Act ( "FPA ").
This Offer of Partial Settlement and Stipulation and Agreement does not resolve the
issues in these proceedings between College Station and the City of Bryan, Texas and the
Bryan Texas Utilities Board (collectively, "Bryan ").
ARTICLE 1
DEFINITIONS
1.1 "The Agreement" means this Offer of Partial Settlement and Stipulation
and Agreement.
1.2 "College Station" means the City of College Station, Texas, and the City's
agents, employees, officers, managers (in their capacities only as employees, officers, or
30503276.1
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managers), and the Mayor and council members (in their acities only as elected
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municipal officials).
1.3 "TMPA" means the Texas Municipal Power Agency, and the Agency's
agents, employees, officers, directors, and managers (in their capacities only as
employees, directors, officers, and managers).
1.4 "TXU" means Texas Utilities Electric Company, TXU Electric Company,
or Oncor Electric Delivery Company, and further includes any other wholesale seller of
electricity that succeeded TXU as the wholesale supplier of electric power and energy to
College Station.
1.5 "Wholesale Transmission Services" means the use made by College
Station of TMPA's transmission system to deliver to College Station electric power
purchased by College Station from TXU for the period January 1, 1996 through
December 31, 1999.
1.6 The "Terminated Proceedings" means and includes the following judicial
proceedings:
a. Texas Municipal Power Agency v. Public Util. Comm 'n, No. 97-
07000, District Court of Travis County, Texas, 200th Judicial District (TMPA's
challenge to Public Utility Commission of Texas ( "PUC ") Docket No. 15296 Final Order
setting rates for College Station to pay Bryan and TMPA); and
b. City of Bryan and Texas Municipal Power Agency v. Public Util.
Comm 'n, No. 96- 03168, District Court of Travis County, Texas, 53rd Judicial District
(TMPA's suit or claims to enjoin PUC in Docket No. 15296).
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kkiov 1.7 The "Brazos County Lawsuit" means the judicial proceeding styled as
J p g sty
Texas Municipal Power Agency and City of Bryan v. City of College Station, et al.,
No. 43,098 -85, District Court of Brazos County, Texas, 85th Judicial District (TMPA's
claims as plaintiff in trespass suit against College Station and TXU).
1.8 The "FERC Proceeding" means City of College Station, Texas, Docket
No. TX96 -2 -000, et al., before the Federal Energy Regulatory Commission (College
Station's FPA sec. 211 application).
1.9 The "College Station Petition Proceeding" means the Petition of the City
of College Station to Initiate an ERCOT -Wide Dispute Resolution Proceeding or, in the
Alternative, Determine Reasonable and Comparable Transmission Rates for the Texas
Municipal Power Agency and the City of Bryan, Docket No. 25197, Before the Public
Utility Commission of Texas (College Station's application for ERCOT -wide rates).
1.10 The "Related Proceedings" means the Terminated Proceedings, the FERC
Proceeding, the College Station Petition Proceeding, and the Brazos County Lawsuit.
1.11 "Rate Orders" means the orders issued by the Public Utility Commission
of Texas ( "PUC ") setting rates for the wholesale transmission of electric power within
ERCOT for 1997, 1998, and 1999, more formally cited as follows:
• Regional Transmission Proceedings to Establish Postage Stamp Rate and
Statewide Loadflow Pursuant to Subst. Rule 23.67, [Final] Order, Docket No.
15 840 (Pub. Util. Comm'n of Tex. Aug. 11, 1997);
• Proceeding to Modify ERCOT Transmission Rates for 1998 Pursuant to
Substantive Rule 23.67, Order on Rehearing, Docket No. 18459 (Pub. Util.
Comm'n of Tex. Sept. 17, 1998); and
• Proceeding to Modify ERCOT Transmission Rates for 1999 Pursuant to
Substantive Rule 23.67, Order on Rehearing, Docket No. 20381 (Pub. Util.
Comm'n of Tex. Oct. 13, 1999).
kik.*
30503276.1
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1.12 "Post -1999 Rate Orders and Appeals" means the orders issued issued by the PUC
setting rates for the wholesale transmission of electric power within ERCOT for 2000,
2001, and 2002, more formally cited as follows:
• Proceeding to Establish ERCOT Transmission Charges for 2000 Pursuant
to P.U.C. Subst. Rule § 25.192, [Final] Order, Docket No. 22055 (Pub.
Util. Comm'n of Tex. June 15, 2000); and City Public Service Board of
San Antonio v. Public Utility Comm 'n, No. GNO -02343 (Consolidated)
(Apea1 of PUC Dkt. No. 22055), District Court of Travis County, Texas,
200 Judicial District;
• Commission Staff's Application to Set 2001 Wholesale Transmission
Service Charges for the Electric Reliability Council of Texas, [Final]
Order, Docket No. 24418 (Pub. Util. Comm'n of Tex. Dec. 17, 2001); and
Texas Municipal Power Agency v. Public Utility Comm 'n, No. GN2-
00685, District Court of Travis County, Texas, 126 Judicial District; and
• Commission Staffs Application to Set 2002 Wholesale Transmission
Service Charges for the Electric Reliability Council of Texas, [Final]
Order, Docket No. 25002 (Pub. Util. Comm'n of Tex. Dec. 20, 2002); and
Texas Municipal Power Agency v. Public Utility Comm 'n, No. GN3 -
00714, District Court of Travis County, Texas, 200 Judicial District; and
Texas Municipal Power Agency v. Public Utility Comm 'n, No. GN3 -
01234, District Court of Travis County, Texas, 353r Judicial District.
1.13 "All TMPA Claims" means all existing, known, and unknown claims,
demands, and causes of action, in law or equity, known or unknown, pending or
threatened, for all existing, known, and unknown damages and remedies (1) that arise out
of or relate to the Wholesale Transmission Services or (2) that have been brought or that
could have been brought by or on behalf of TMPA against College Station in the Related
Proceedings, or in any court, tribunal, or forum, it this or any other jurisdiction, in these
United States or anywhere else with respect to any transaction, contract, representation,
operations, conduct, action, or omission arising out of or with respect to the Wholesale
Transmission Services. Under this definition, "All TMPA Claims" includes, BUT IS
NOT LIMITED TO, all claims, demands, lawsuits, debts, accounts, covenants,
30503276.1
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agreements, actions, cross - actions counterclaims, liabilities, .
gr aims, liabilities, obligations, losses, costs,
expenses, remedies, and causes of action of any nature, whether in contract or in tort, or
based upon fraud or misrepresentation, breach of duty or common law, or arising under
or by virtue of any judicial decision, statute, or regulation, for past, P resent, future,
known, and unknown injuries, property or economic damage, and all other losses and
damages of any kind that arise out of the Wholesale Transmission Services, including
BUT NOT LIMITED TO the following: all actual damages; all exemplary and punitive
damages; all penalties of any kind, including WITHOUT LIMITATION any tax
liabilities or penalties; damage to business reputation; lost profits or good will;
consequential damages; damages ensuing from loss of credit; and, prejudgment and
postjudgment interest, costs, and attorney's fees. This definition further includes, BUT
IS NOT LIMITED TO, all elements of damages, all remedies, and all claims, demands,
and causes of action that are now recognized by law or equity or that may be created or
recognized in the future by any manner, including WITHOUT LIMITATION by statute,
regulation, or judicial decision, including WITHOUT LIMITATION by virtue of the
Texas Deceptive Trade Practices - Consumer Protection Act.
1.14 "All College Station Claims" means all existing, known, and unknown
claims, demands, and causes of action, in law or equity, known or unknown, pending or
threatened, for all existing, known, and unknown damages and remedies (1) that arise out
of or relate to the Wholesale Transmission Services or (2) that have been brought or that
could have been brought by or on behalf of College Station against TMPA in the Related
Proceedings, or in any court, tribunal, or forum, in this or any other jurisdiction, in these
United States or anywhere else with respect to any transaction, contract, representation,
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‘110' operations, conduct, action, or omission arising out of or with respect p g sp to the Wholesale
Transmission Services. Under this definition, "All College Station Claims" includes,
BUT IS NOT LIMITED TO, all claims, demands, lawsuits, debts, accounts, covenants,
agreements, actions, cross - actions, counterclaims, liabilities, obligations, losses, costs,
expenses, remedies, and causes of action of any nature, whether in contract or in tort, or
based upon fraud or misrepresentation, breach of duty or common law, or arising under
or by virtue of any judicial decision, statute, or regulation, for past, present, future,
known, and unknown injuries, property or economic damage, and all other losses and
damages of any kind that arise out of the Wholesale Transmission Services, including
BUT NOT LIMITED TO the following: all actual damages; all exemplary and punitive
damages; all penalties of any kind, including WITHOUT LIMITATION any tax
liabilities or penalties; damage to business reputation; lost profits or good will;
consequential damages; damages ensuing from loss of credit; and, prejudgment and
postjudgment interest, costs, and attorney's fees. This definition further includes, BUT
IS NOT LIMITED TO, all elements of damages, all remedies, and all claims, demands,
and causes of action that are now recognized by law or equity or that may be created or
recognized in the future by any manner, including WITHOUT LIMITATION by statute,
regulation, or judicial decision, including WITHOUT LIMITATION by virtue of the
Texas Deceptive Trade Practices - Consumer Protection Act.
1.15 The "Consideration" means the payment to TMPA of the sum of Six
Million Five Hundred Thousand Dollars ($6,500,000.00), together with the mutual
covenants, promises, and releases contained in this Agreement.
41116,
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1.16 "Closing Date" means the date five (5) business days after this Agreement
has been executed by both TMPA and College Station, or if that day is not a business
day, the next business day.
1.17 "Final Commission Order" means, when used in this Agreement to
describe a decision or order of the Commission, that the decision or order is no longer
subject to Commission consideration. Any order shall be deemed a "Final Commission
Order" as of the date rehearing is denied, or the date on which the right to request such
rehearing expires.
ARTICLE 2
SCOPE OF THE AGREEMENT
In connection with the execution and delivery of this Agreement, the parties agree
to the following:
2.1 On the Closing Date:
a. College Station shall deliver the cash portion of the Consideration to
TMPA by wire transfer payment using the following instructions:
Texas Municipal Power Agency
Revenue DDA #00100001107
JPMorgan Chase Bank
Houston, TX
ABA# 113000609
b. For the Consideration, TMPA RELEASES, ACQUITS, and
FOREVER DISCHARGES College Station from All TMPA Claims that have accrued or
may ever accrue to TMPA. This release does not extend to a person or entity other than
College Station.
c. For the Consideration, College Station RELEASES, ACQUITS, and
FOREVER DISCHARGES TMPA from All College Station Claims that have accrued or
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may ever accrue to College Station. This release does not extend to a person or entity
other than TMPA.
2.2 College Station and TMPA will jointly file this Agreement (or such
settlement as modified pursuant to sec. 4.3 below), along with the Explanatory Statement
in Support of Offer of Partial Settlement and Stipulation and Agreement in the FERC
Proceeding. College Station and TMPA agree to take all steps to support this Agreement
and to seek approval of this Agreement by the Commission as soon as possible. In
particular, and without limitation, to the extent the Commission solicits comments on this
Agreement, TMPA and College Station agree to jointly submit comments in support of
this Agreement and to urge its prompt approval.
2.3 Within five (5) business days after the FERC approval of this Agreement
without modification is final and non - appealable:
‘0' a. TMPA will dismiss with prejudice its claims in the Terminated
Proceedings;
b. TMPA and College Station will jointly file with the Court in the
Brazos County Lawsuit the Joint Motion for Severance and the Order Granting
Severance, included as p art of Exhibit "A" attached hereto, and further will move that the
Court enter the Agreed Judgment substantially in the form included as part of Exhibit
c. TMPA will file in the appeals of the Post -1999 Rate Orders and
Appeals (if it has not already done so) all pleadings and other documents necessary to
irrevocably waive its points of error or appeal points regarding the PUC's jurisdiction
over TMPA's wholesale transmission service to College Station and the level of TMPA's
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44111" rates (Points of Error 2 and 3 in TMPA's Motion for Rehearing on Docket 22055 • Points
8 ,
of Error 2 and 3 in TMPA's Motion for Rehearing in Docket 24418; and Point of Error 4
in TMPA's Motion for Rehearing in Docket 25002); and
d. College Station will file in the College Station Petition Proceedin g all
pleadings and other documents necessary to withdraw with prejudice its request (both the
primary and alternate requests) that the PUC establish wholesale transmission rates for
College Station to pay TMPA or for TMPA to pay College Station; College Station may,
however, maintain its alternate request for relief as to Bryan and may maintain its
primary request for relief to the extent it does not involve TMPA.
2.4 TMPA and College Station acknowledge the sufficiency of the
Consideration by signing this Agreement. The parties agree and acknowledge that
payment has previously been made for transmission service TMPA provided to College
Station for calendar year 1996 under the rate set by the PUC in its Docket 15296. The
cash portion of the Consideration that College Station pays to TMPA under this
Agreement covers the period January 1, 1997 through December 31, 1999. The parties
recognize and agree that the PUC has not yet established or set a rate or rate
methodology, on remand, for the period September 1, 1999 to December 31, 1999 (the
"Stub Period "). If the PUC adopts a rate or a rate methodology for transmission services
provided by TMPA to College Station for the Stub Period (the "PUC Rate "), the parties
agree that a portion of the cash Consideration shall be allocated to reflect such PUC Rate
and the charges associated therewith. The remainder of the cash portion of the
Consideration shall be allocated to the time period, January 1, 1997 through August 31,
1999. By way of example, if the PUC orders College Station to refund $10,000 to TMPA
kiss,
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and to pay $20,000 to TMPA for transmission services for the Stub Period, $30,000 of
the $6,500,000 shall be allocated to such charges and they will have been paid out of the
amounts provided herein.
2.5 Representations and Warranties of College Station --In return for the
Consideration and the other mutual promises contained herein, College Station represents
and warrants the following to TMPA:
a. College Station is correctly described in this Agreement;
b. Before executing this Agreement, College Station became fully
informed of the terms, contents, conditions, and effect of this Agreement;
c. Before executing this Agreement, College Station's council was fully
informed of the terms, contents, conditions, and effect of this Agreement and all
necessary council approval was obtained;
d. The signatory to this Agreement for College Station is fully authorized
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and legally competent to execute this Agreement and is a duly authorized representative
of College Station;
e. This Agreement is fully and forever binding on College Station, its
successors, administrators, and any assigns;
f. No promise or representation of any kind has been made to College
Station or anyone acting for College Station, except as is expressly stated in this
Agreement;
g. College Station has not assigned, pledged, or in any other manner sold
or transferred any rights, title, interest, or claim that arises out of the Wholesale
Transmission Services or any part of the claims being released herein;
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h. In entering this Agreement, College Station has had the benefit of the
advice of lawyers of its own choosing; and, College Station enters this Agreement freely,
Y
by College Station's own choice and judgment, and without duress or other influence;
and
i. College Station recognizes that all statements and the recitations
contained in this Agreement are contractual and not mere recitals.
2.6 Representations and Warranties of TMPA --In return for the
Consideration and the other mutual promises contained herein, TMPA represents and
warrants the following to College Station:
a. INIPA is correctly described in this Agreement;
b. Before executing this Agreement, TM:PA became fully informed of the
terms, contents, conditions, and effect of this Agreement;
c. Before executing this Agreement, TMPA 's Board of Directors was
fully informed of the terms, contents, conditions, and effect of this Agreement and all
necessary board of directors approval was obtained;
d. The signatory to this Agreement on behalf of TMPA is fully
authorized and legally competent to execute this Agreement and is a duly authorized
representative of TMPA;
e. This Agreement is fully and forever binding on TMPA, its successors,
administrators, strators, and any assigns;
f. No promise or representation of any kind has been made to TMPA or
anyone acting for TMPA, except as is expressly stated in this Agreement;
%Me
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kit"' g. TMPA has not assigned, pledged, or in any other manner sold or
transferred any rights, title, interest, or claim that arises out of the Wholesale
Transmission Services or any part of the claims being released herein;
h. In entering this Agreement, TMPA has had the benefit of the advice of
lawyers of its own choosing; and, TMPA enters this Agreement freely, by TMPA's own
choice and judgment, and without duress or other influence; and
i. TMPA recognizes that the statements and recitations contained in this
Agreement are contractual and not mere recitals.
2.7 In the unlikely event that TMPA seeks to set aside all or P art of this
Agreement in any judicial or administrative proceeding (the `New TMPA Proceeding"),
then TMPA stipulates and agrees, that, in addition to any other rights it may have at law
or in equity, College Station shall have the following rights:
a. TMPA shall pay College Station for all its reasonably incurred
attorney fees, expert fees, and other out -of- pocket costs (collectively, "Regulatory
Expenses ") incurred by College Station in such New TMPA Proceeding and any appeal
Y PPe
thereof, regardless of which party ultimately prevails. Eighty percent (80 %) of the full
amount of such Regulatory Expenses shall be paid monthly by TMPA as such expenses
are incurred, subject to a final true -up after the courts or administrative agencies approve
the reasonable amount of such Regulatory Expenses.
b. College Station shall be permitted to institute any judicial or
administrative actions against TMPA to recover compensation for the Wholesale
Transmission Services. In the event College Station institutes such a proceeding, TMPA
waives, and agrees not to assert, any defense to such claim based upon statute of
30503276.1
12
limitations, laches, estoppel, or other similar defense based upon the passage of time
(including but not limited to retroactive ratemaking) or the dismissal of any cases that
were pending at the time this Agreement was executed, or both. Further, TMPA agrees
that College Station may file or institute any or all of the proceedings pending as of the
time of execution of this Agreement and that TMPA treat all such proceedings as if they
had never been dismissed.
2.8 In the unlikely event that College Station seeks to set aside all or part of
this Agreement in any judicial or administrative proceeding (the "New College Station
Proceeding "), then College Station stipulates and agrees, that, in addition to any other
rights it may have at law or in equity, TMPA shall have the following rights:
a. College Station shall pay TMPA for all its reasonably incurred
attorney fees, expert fees, and other out -of- pocket costs (collectively, "Regulatory
%lime Expenses") incurred by TMPA in the New College Station Proceeding and any appeal
thereof, regardless of which party ultimately prevails. Eighty percent (80%) of the full
amount of such Regulatory Expenses shall be paid monthly by College Station, as such
expenses are incurred, subject to a final true -up after the courts or administrative agencies
approve the reasonable amount of such Regulatory Expenses.
b. TMPA shall be permitted to institute any judicial or administrative
actions against College Station to recover compensation for the Wholesale Transmission
Services. In the event TMPA institutes such a proceeding, College Station waives, and
agrees not to assert, any defense to such claim based upon statute of limitations, laches,
estoppel, or other similar defense based upon the passage of time (including but not
limited to retroactive ratemaking) or the dismissal of any cases that were pending at the
30503276.1
13
i 1 ,
time this Agreement was executed, or both. Further, College Station agrees that TMPA
may file or institute any or all of the proceedings pending as of the time of execution of
this Agreement and that College Station treat all such proceedings as if they had never
been dismissed.
ARTICLE 3
PROCEEDINGS RESOLVED
3.1 Pursuant to the Agreement, TMPA and College Station have resolved all
claims regarding payment for Wholesale Transmission Services that College Station took
from TMPA for the period from January 1, 1996 through and including December 31,
1999. The Commission had previously ordered a rate to apply for the period on and after
January 1, 2000, which rate was not contested by any arty hereto) Further pursuant to
P P
the Agreement, TMPA's claim for an award of regulatory expenses incurred in
‘tor connection with College Station's request for Wholesale Transmission Services q es has been
resolved. Thus, this Agreement, coupled with the Commission's previous order adopting
a rate to apply on and after January 1, 2000, disposes of all matters at issue between
TMPA and College Station in this proceeding, in the proceedings described in sections
1.6, 1.7, 1.8, 1.9, 1.11, and 1.12 of this Agreement, and in the claims described in
sections 1.13 and 1.14 of this Agreement. This does not, however, require TMPA to
cease or withdraw its appeals of the matters set forth in § 1.11 and § 1.12 and does not
prevent TMPA from urging or asserting any rate or rate methodology for the Stub Period,
but TMPA agrees not to seek rate or monetary relief from College Station in such
' City of College Station, Texas, Docket No. TX96- 2-001, Order Granting and Denying Rehearing and
Establishing Settlement Judge Procedures, 97 FERC V 61,152 at p. 61,666 (2001); City of College Station,
Texas, Docket No. TX96- 2-003, Order Denying Rehearing, 99 FERC 1161,163 at p. 61,668 n.9 (2002).
30503276.1
14
4 1
proceedings or in any remands of such proceedings through August 31, 1999. Payment
of any rate or monetary relief that the PUC may order College Station to pay TMPA for
the Stub Period shall be governed, as between TMPA and College Station, by the terms
of section 2.4. Consequently, TMPA and College Station agree to jointly request that the
Commission dismiss, with prejudice, its proceedings as to all issues raised as between
I' PA and College Station as a part of its approval of this Agreement. The Agreement,
however, is between only TMPA and College Station and does not address any matter or
issue pending between College Station and Bryan.
ARTICLE 4
EFFECTIVE DATE
4.1 This Agreement is effective and binding as of the date it is executed by
both TMPA and College Station.
Commission's order approving this Agreement shall constitute: (a) 4.2 The Commissi pp g gre
granting of all such waivers, special permissions, and authorizations with respect to the
requirements of the FPA and the Commission's Rules and Regulations that are necessary
to effectuate all of the provisions of this Agreement over which the Commission has
jurisdiction; and (b) subject to the provisions and exceptions of this Agreement, the final
disposition of all rate issues covered by this Agreement in Docket No. TX -96-2 -000, et
al. over which the Commission has jurisdiction.
4.3 The various provisions of this Agreement are not severable, provided
however that TMPA and College Station shall be deemed to have accepted any change,
condition, or modification included in the order approving the Agreement in this docket
unless by written notice filed with the Commission and served on all participants within
15 days of the issuance of such order, TMPA or College Station shall have stated its
30503276.1
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