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264404 WHITE - CITV CLERK � PINK - FINANCE CO1111C11 B��'UERY MQYORTMENT GITY OF SAINT PAUL File NO. ������ ° � C ncil Resolution - � ` ;� r Presented By �""' Referred To Committee: Date Out of Committee By Date WHEREAS, by Ordinance No. 15638, Council File No. 263517, approved June 3, 1974, the City Council of the City of Saint Paul did agree and adopt certain findings of Leonard E. Lindquist, Hearing Examiner, all-ow- ing Northern States Power Company an increase in its revenues in the amount of 16.2/ above the 1973 test year revenues, and pursuant to the understand- ing between the Saint Paul City Council and the Northern States Power Com- pany, the utility did submit its schedule of rates to be put into effect u�on meter readings on and after May I5, 1974 with the intention that the schedule of rates would provide only revenue to which the Company was en- titled; and WHEREAS, the rate schedules were placed into effect during the months of June, July and August and will continue in the future, and to this date such rates have been subject to repeated complaints by all classes of consumers on the grounds that t�iey are not allowing the Com- pany the revenue intended by this Council, -bu� instead are affording �he-� Company an unexpected increa�e in revenue completely out of line with the determination of the Hearing Exarniner and the intentions of the City Council; and WHEREAS, upon the comparison of the revenues received during the months of July and August of 1974 and comparable months in 1973, it appears that the payment of individual customers has ranged in the various classes of service to anywhere from 22/ over the revenues in 1973 to 43% over the revenues in 1973, and, thus, the increase brought about by the Company through its rate schedules constitutes an amount far in excess of anything granted by the City Council of the City of Saint Paul, and unless there is a drastic offset in other months, the rate schedules are out of line with the permitted adjustment as a eonsequence of the final determination of the COUIVCILMEN Yeas $1�tt,1�1' Nays Requested by Department of: tfCiiY Konopatzki In Favor Levine • Meredith Against BY �pmafia Roedler Tedesco Mme.President Bert�er �lt Form Approved by City Attorney Adopted by Council: Date Certified Passed by Council Secretary BY By Approved by Maxor: ,Date Approved by Mayor for Submission to Council By BY . ��"���'�� -2- Hearing Examiner, lending sustenance to the complaints made by the various classes of consumers of the Northern States Power Company to this Council; - and � WHEREAS, it is in the interest of and in the service of the resi- dents of the City of Saint Paul, including small homeowners, small commercial establishments, building owners, industrial owners, and others, that the entire question of the rate schedules and rate de- sign be examined as soon as possible and the examination be repeated under circumstances expected to arise in the near future; Now, Z'here- fore, Be It RESOLVED, By the City Council of the City of Saint Paul that Thomas J. Stearns, Public Utility Rate Expert, is directed to contact and consult with individuals and municipal bodies interested in pro- viding, in conjunction with the City of Saint Paul, a coordinated sur- veillance of the rate practices of the Northern States Power Company, and interested, also, in furthering a sustained effort to prevent the type of discrimination and procurement of excessive revenues that appear to �5e in effect at the present time; and be it FURTHER RESOLVED, that in the course of such consultation, Thomas J. Stearns examine the possibility of arranging a unified a�pearance with other communities before the Minnesota Public Service Commission in 1975, with or without a rate consultant, depending upon the feasi- bility and expense, to protect the residents of the City of Saint Paul, WHI7E - CITY CLERK COl1IIC11 �s44o4 PINK - FINANCE � GITY OF SAINT PAITL � CANARV yDEPARTMENT B�.UE - MAYOR File NO. Council Resolution Presented By Referred To Committee: Date Out of Committee By Date -3- as well as those of other communities, from the unfair, unreasonable, and unauthorized procurement of revenue that may arise, either through the Company' s application for a revenue increase before the Minnesota Public Service Commission or its design and presentation of a rate schedule in connection with any order of the Commission that permits a change in the revenue to the Northern States Power Company. COUKCILMEN Yeas �tleT Nays Requested by Department of: � K��o opatzki `�' In Favor Levine Meredith � Against BY �qmolnc Roedler V�e �� z �.� �pt"d-by���� � a n�T � �Q74 Form Approved by.E-ity 7�ttorney o e ouncil. � te , . � �, Certi ' sse y Council Secretar� .--�Y By Approve MaXor: Date 0 Approved by Mayor for Snb�ission to Council By BY PUBLISH ED 0 C T 2 6 1974 r ^� � ' ""� � +,�, 4- >��� eelesaa ueo�ana m��i�w CITY OF SAINT PAUL OFFICE OF THE CITY COIINCIL QITY HAI.T. AND COURT HOUSE SAINT PAUL. MINNESOTA 55102 PHONE 612 \ 298-6289 October 15, 1974 PATRICK J. ROEDLER SH[RLEY M. GEER Councilman Legislative Aide Dear President Hunt and Council Members: Ever since the City Council approved the increases in Northern States Power Company's electric rates, my office has heard nothing but complaints about the charges for electric service. Homeowners, small businessmen, downtown building owners, and any number of other users have called me personally or written to complain about their exhorbitant electric bills. In answer to aTfi, I tried to explain that the City Council allowed NSP a 16.2% increase in revenue over what they received in 1973. This would mean variances in some of the rates, and possibly somewhat higher rates because of the summer-winter rate schedules. But it was my understanding as a member of the Utilities Committee that the whole thing would level off around 16.2% for the year. In recent weeks, I have received preliminary analysis of NSP revenue increases, based on data contained in NSP's monthly reports on gas, electric and steam customers; sale of kilowatt hours; and revenues from each class of customer. These are the reports the city receives from NSP under terms of our franchise agreement. Comparison of the NSP reports for June, July and August, 1973, with the same months of 1974, shows that NSP revenues have increased dramatically. Instead of revenue increases for July and August being up 18-19%, as might be expected, the revenue is up 27%. This is close to NSP's oriqinal 28% increase request when we began the rate hearings. To qrasp the nature of the increases requires a breakdown according to types of users. Revenue for individual homeowners for July, 1974, has increased 22.91% over the same month last year, although the Council was told it would average 14% for the year. Revenues from small commercial establishments--corner grocery stores, small shops, garages and retail outlets--is up 45.98% for July 1974. Large commercial and indus- trial establishments are paying a 23.06% increase in revenues over what they paid in July a year ago. Similar increases show up in the August 1974 figures. Revenues for residential users were up 24.21� over August 1973. Although revenues for small commercial business dropped slightly, it was still 32.51% over that of August 1973. Large industrial customers' revenues increased 24.87%. Z2 . • Page 2 No matter how you view the NSP revenue reports, the preliminary analysis raises very serious questions about possible overcharges in electricity rates; the accuracy of NSP's electric rate schedules; whether NSP is complying with the City Council 's authorization of the 16.2% increase in their revenues; and the fairness of the 400 kilowatt hour cut off for the sumner rate schedule. I think close scrutiny of NSP's rate schedule is necessary and I would like to suggest that NSP redraft and resubmit its rate schedules to the City Council immediately. At the same time, I feel that the City Council should direct Mr. Tom Stearns, our utilities rate expert, to contact representatives of other communities to determine if they are having similar problems, and if they are willing to join us in contacting the Public Service Corranission and probing deeper into the NSP revenue/rate situation. I am submitting to the City Council a resulution authorizing Mr. Stearns to take steps to further analyze these figures and report back to the Council . The resulution directs Mr. Stearns to work with individuals and municipal bodies to provide a con- tinued surveillance of the rate practices of the Northern States Power Company. It also directs him to appear before the Public Service Commission, if necessary to protect the interests of St. Paul citizens in connestion with future rate increase requests by Northern States Power Company. I request your support in adopting this resolution. Sinc ly, Patrick J oedler Councilman