2012-232ORDINANCE NO. 2O 12-232
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS
PROVIDING FOR, AUTHORIZING, AND APPROVING THE EXECUTION BY THE CITY
MANAGER OF A FIRST AMENDMENT TO FULL REQUIREMENTS WHOLESALE
ELECTRIC POWER SERVICE AGREEMENT BETWEEN THE CITY OF DENTON, TEXAS
AND NRG POWER MARKETING, LLC.; APPROVING THE EXECUTION OF SUCH
OTHER AND FURTHER RELATED DOCUMENTS, INCLUDING, WITHOUT
LIMITATION, CERTIFICATES, ASSIGNMENTS, LICENSES, DIRECTIONS,
INSTRUMENTS, 1NSTRUCTIONS, CONFIRMATIONS AND STATEMENTS BY THE
CITY MANAGER OR HIS DESIGNEE, WHICH ARE INCIDENT OR RELATED THERETO,
AS SHALL BE REASONABLY DETERMINED BY THE CITY ATTORNEY OR HER
DESIGNEE; CONFIRMING AND RATIFYING THAT THE CITY OF DENTON, TEXAS,
ITS MAYOR, ITS CITY COUNCIL MEMBERS, ITS CITY MANAGER, AND ITS CITY
ATTORNEY OR HER DESIGNEE SHALL BE AUTHORIZED AND EMPOWERED TO
PERFORM SUCH ACTS AND OBLIGATIONS AS ARE REASONABLY REQUIRED TO
CONSUMMATE THIS TRANSACTION; RATIFYING ALL PRIOR ACTIONS TAKEN BY
THE CITY COUNCIL 1N FURTHERANCE OF THE FOREGOING TRANSACTION; AND
DETERMINING THAT SEVERAL OF SAID DOCUMENTS PERTAIN TO A
"COMPETITIVE ELECTRIC MATTER" AS SET FORTH UNDER THE PROVISIONS OF
§§551.086 AND 552.133 OF THE TEXAS GOVERNMENT CODE, AS AMENDED;
FINDING AND DETERMINING THAT TEXAS GOVERNMENT CODE §252.022(a)(15)
APPLIES TO SAID AGREEMENT; ADOPTING SIGNIFICANT RECITATIONS, F1NDINGS
AND CONCLUSIONS, AS ARE SET FORTH IN THE PREAMBLE OF THIS ORDINANCE;
THAT THE PURCHASE OF CAPACITY AND ENERGY, AND OTHER RELATED
ARRANGEMENTS MADE BY THE CITY UNDER THE TERMS OF THIS FULL
REQUIREMENTS WHOLESALE ELECTRIC POWER SERVICE AGREEMENT ARE IN
THE PUBLIC WELFARE; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR;
PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, the City of Denton, Texas ("Denton") is a Home-Rule City and a Texas
municipal corporation governed by the constitution and laws of the State of Texas; and
WHEREAS, in accordance with the provisions of §551.086 of the Texas Government
Code, after due notice of the public meeting was provided as required by law, this "First
Amendment to Full Requirements Wholesale Electric Power Service Agreement between the
City of Denton, Texas and NRG Power Marketing LLC" transaction (hereafter the
"Transaction") was submitted for consideration to the Denton Public Utilities Board on the l Oth
day of September, 2012; a majority of the Public Utilities Board ("PUB") being present, and said
PUB being a"Public Power Governing Body" as defined by State law, convened a Closed
Meeting as permitted by law, and discussed, deliberated and considered the Transaction; and
thereafter in its Closed Meeting on that date, took final action regarding the Transaction and
proceeded to recommend to the City Council that the Transaction by and between Denton and
NRG Power Marketing LLC, a Delaware limited liability company be recommended for
approval by a vote of 5 in favor to 0 opposed; and
WHEREAS, in accordance with the provisions of §551.086 of the Texas Government
Code, after due public notice being given, and the Transaction being related to competitive
electric matters, including business and commercial information, which if disclosed, would give
advantage to its competitors or prospective competitors; and the City Council, a"Public Power
Utility Governing Sody" under Senate Bill 7, convened a Closed Meeting on the 18th day of
September, 2012, and discussed, deliberated, and considered the Transaction, the subject of this
ordinance; and
WHEREAS, thereafter in said Closed Meeting, after due public notice being given, the
City Council, then proceeded to take final action, and voted, by a majority of its members
present, 6 for and 0 opposed, approving the Transaction and voting in favor of the Transaction
described in said ordinance, as set forth below; and
WHEREAS, the City Council has further determined and finds that this "First
Amendment to Full Requirements Wholesale Electric Power Service Agreement between the
City of Denton, Texas and NRG Power Marketing, LLC." (hereafter the "First Amendment") to
be entered into by and between Denton and NRG Power Marketing LLC, a Delaware limited
liability company ("NRG"), and other affiliates of this entity, together with and all other
documents related thereto as from time to time may be executed by the City of Denton, Texas
andJor NRG, in connection therewith; should be excepted from public disclosure, as permitted by
the provisions of §552.133 of the Texas Government Code, as documents that are reasonably
related to a competitive electric matter, the disclosure of which documents would provide an
advantage to the competitors or prospective competitors of Denton Municipal Electric ("DME");
and
WHEREAS, the City Council has further determined that it is in the public interest that it
should exercise its right under the Texas Government Code to lawfully safeguard and keep
certain of these documents sealed, as they are competitive documents which contain competitive
electric information; and
WHEREAS, the City Council finds that there is no divestiture, sale or other disposition of
the property of any utility of the Denton, and therefore, that no public election is required
pursuant to the Charter of the City of Denton, Texas ("Charter"); and
WHEREAS, the City Council finds that said Transaction involves Denton and NRG
modifying the terms and provisions of the "Full Requirements Wholesale Electric Power Service
AgreemenY' dated as of May 17, 2011, and approved by the City Council on said date, wherein
Denton purchased from NRG, a portion of its necessary replacement power and energy
requirements for a contractual term of three years and three months beginning on July 1, 2011, as
provided by ordinance; and that this Transaction involves Denton's continuous and uninterrupted
acquisition of reliable, cost-effective replacement power and energy from NRG with
amendments to said Agreement; with no detriment to the ratepayers of DME; and
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WHEREAS, the City Council finds that the Transaction as provided by this ordinance,
will not impair the ability of Denton to comply with the provisions of any of its utility revenue
bonds, as amended, which are issued and outstanding; and
WHEREAS, the City Council finds that §252.022(a)(15) of the Texas Government Code
is applicable to this Transaction and that the competitive bidding law is not applicable to the
purchase by the City of electricity; and
WHEREAS, Denton and NRG have also previously entered into this Transaction for
NRG's services, among other things, that provides for services related to the purchase of a
portion of Denton's energy capacity and energy management needs; and
WHEREAS, Denton desires to enter into such Transaction in support of the Agreement
with NRG which are incident and related to this First Amendment, and the City Council shall to
take such additional actions as the City Manager or his designee, shall determine to be necessary
and advisable to effectuate the matters set forth herein; NOW, THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1. The recitations set forth in the above Preamble are incorporated herewith
by reference for all purposes.
SECTION 2. The City Council, hereby approves and authorizes the City Manager and
City Secretary, to execute, attest and deliver respectively, the "First Amendment to Full
Requirements Wholesale Electric Power Service Agreement between the City of Denton, Texas
and NRG Power Marlceting, LLC," (the "First Amendment") by and between the City of Denton,
Texas and NRG Power Marketing LLC., a Delaware limited liability company, under the terms
and conditions set forth in E�ibit "A," and made a part hereof, with such ancillary instruments,
changes and additions in substantial compliance with said First Amendment as the City Manager
may approve, and to consuminate the execution and delivery thereof on behalf of the City of
Denton, Texas by or at the direction of the City Manager.
SECTION 3. The City Council, hereby approves and authorizes the City Manager,
City Attorney and City Secretary, or their designees to execute, attest and deliver respectively,
a11 such other documents which are incident and related to the First Amendment referenced
herein and to take such additional actions as the City Manager shall determine to be necessary
and advisable to effectuate the matters set forth above.
SECTION 4. The City of Denton, Texas, the Mayor, the City Manager, the City
Attorney or their designees be, and each of them individually hereby is, authorized and
empowered to perform all such acts and obligations as required with respect to the First
Amendment and documents described herein.
SECTION 5. The Mayor, the City Manager, the City Attorney, the City Secretary, or
their designees be, and each of them individually hereby is, authorized, empowered and directed
to negotiate, deliver and perform all such acts and things and to sign all such documents,
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certificates, contracts, assignments, licenses, leases, agreements, directions, instruments and
statements, each together with such amendments, changes and additions thereto as the Mayor,
the City Manager, the City Attorney or their designees sha11 determine to be necessary or
advisable to effectuate the matter set forth herein, any such determination to be conclusively
evidenced by the taking or causing to be taken of such action or the execution and delivery of
any such document, certificate, agreement, license, lease, direction, instrument or statement by
the Mayor, the City Manager, the City Attorney or their designees.
SECTION 6. All prior actions talcen by the Mayor, the City Manager, the City
Attorney or their designees in furtherance of the foregoing matters be and they are hereby
confirmed, ratified, approved and authorized in all respects as of the dates and times such actions
were taken.
SECTION 7. Immediately following the execution and delivery of the documents
described as the First Amendment, as provided for in this ordinance, the City Secretary is hereby
directed to seal and maintain said documents in her custody and control, as documents excepted
from public disclosure under the provisions of §552.133 of the Texas Government Code (the
"Public Power Exception"); unless otherwise lawfully ordered to disclose said documents.
SECTION 8. The expenditure of funds as provided for in this ordinance is hereby
authorized.
SECTION 9. This ordinance shall become effective immediately upon its passage
and approval.
PASSED AND APPROVED this the � day of 9��/y/,�_ , 2012.
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
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By:
APP ED A TO LEGAL FORM:
ANITA BURGESS, CITY ATTORNEY
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MARK . B OUGHS, YOR