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1975-677RESOLUTION NO. 75R-677 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM[, CALIFORNIA, URGING THE NATIONAL LEAGUE OF CITIES TO ADOPT A RESOLUTION REQUESTING FEDERAL LEGISLATION TO CORRECT THE "RATE SQUEEZE" SITUATION IN REGARD T0. MUNICIPAL ELECTRICAL SYSTEMS AND TO PROVIDE FOR PRELIMINARY HEARINGS BEFORE RATE INCREASES ARE ALLOWED_ UNDER SECTION 205 OF THE FEDERAL POWER ACT. WHEREAS., the existing procedures under which the Federal Power Commission considers rate increase applications under Section 20.5 of the Federal Power Act impose an unfair and substantial burdenupon the customers of municipal electrical systems. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Anaheim, California, that the National League of Cities is urged to adopt a resolution in substantially the following form. "A RESOLUTION REQUESTING FEDERAL LEGISLATION TO CORRECT THE 'RATE SQUEEZEt SITUATION IN REGARD TO MUNICIPAL ELECTRICAL SYSTEMS AND TO PROVIDE FOR PRELIMINARY HEARINGS BEFORE RATE INCREASES ARE ALLOWED UNDER SECTION 205 OF THE FEDERAL POWER ACT. WHEREAS, the survival of many municipal electric utilities throughout the Nation is at :stake because of repeated efforts of some private utilities to make such operations untenable; and WHEREAS, many private electric utilitiesduring the past two years have forced repeated sharp increases. in wholesale rates upon these municipal systems prior to hearings by regulatory agency to determine whether such increases are just and reasonable; and WHEREAS, in many cases the wholesale power rate charged to such municipal systems is considerably high- er than the rate charged to comparable industrial customers by such 'private utilities; and WHEREAS, the Federal Power Commission has refused to consider.such anticompetetive rate discrimination against municipal utilities and is appealing a recent Court of Appeals decision which would require the Commission to consider and correct this price squeeze situation; and WHEREAS, a continuance of this price squeeze has created a situation where some municipal systems cannot fairly compete with their private power supplier for industrial business and where industrial power consumers must pay more for the same service to the municipal system than it would to the private power company. - 1- WHEREAS, under existing Federal Power Act procedure these wholesale rate increases are made effective at the latest with a five-month suspension; and WHEREAS, the final decision on such rate cases before that Commission generally takes four years or longer while such rates are in effect; and WHEREAS., an amendment to.Section 205 of the Federal Power Act could provide for appropriate hearings before rate increases are permitted in order to reflect the consumerts interest -as well as the private utility's interest. NOW, THEREFORE, BE IT RESOLVED that the National League of Cities hereby requests congressional action be taken to force the Federal Power Commission to.correct immediately the price squee . ze I situation on municipal systems. BE IT FURTHER RESOLVED that the National League of Cities requests -congressional Action be taken to amend Section 205 of the Federal Power. Act to reflect the consumers' interest by providing for preliminary hearings by the Federal Power Commission to decide whether any, part, or all of the requested rate increase is to be allowed before any such increase takes effect, .and that any such increase would be subject to later refund if found to be 'unjustified.'" THE FOREGOING RESOLUTION this 30th day of December, 1975., ATTEST: 77, CITY CLERK OF THE OF ANAHEIM ROF: j h -2- is approved and signed by me MA R OF THE CITY OF ANTHEIM STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss. CITY OF ANAHEIM ) I, ALONA M. HOUGARD, City Clerk of the City of Anaheim, do hereby certify that the foregoing Resolution No. 75R-677 was intro- duced and adopted at a regular meeting provided by law, of the City _ Council of the City of Anaheim held on the 30th day of December, 197 , by the following vote of the members thereof: ' AYES: COUNCIL MEMBERS: Kaywood, Seymour, Pebley, Sneegas and Thom NOES: COUNCIL MEMBERS: None t ABSENT: COUNCIL MEMBERS: None AND I FURTHER CERTIFY that the Mayor of the City of Anaheim approved and signed said Resolution No.175R-67:7 on the 30th day of December, 1975. IN WITNESS WHEREOF, I have hereunto set; my hand and affixed the seal of the City of Anaheim this 30th day of December, 1975. CITY CLERK OF THE CIT 'OF ANAHEIM (SEAL) I, ALONA M. HOUGARD, City Clerk of the City of Anaheim, do hereby certify that the foregoing is the original of Resolution No. 75R-677 duly passed and adopted by the Anaheim City Council on December 30, 1975. City Clerk