(a) In an appeal brought under this subchapter, the city has the burden of establishing that every annual charge at issue is authorized by Texas Natural Resources Code, §117.102, or Texas Utilities Code, §121.2025. If the city fails to demonstrate that any annual charge at issue is authorized by Texas Natural Resources Code, §117.102, or Texas Utilities Code, §121.2025, the Commission shall either declare the annual charge invalid in its entirety or shall reduce the annual charge to an amount authorized by Texas Natural Resources Code, §117.102, or Texas Utilities Code, §121.2025.
(b) A city may assess a reasonable annual charge for the placement, construction, maintenance, repair, replacement, operation, use, relocation, or removal by an owner or operator of a pipeline facility on, along, or across public right-of-way in the city. This charge may not exceed the cost to the city of regulating the pipeline facility.
(c) In determining whether an annual charge is reasonable, the Commission may consider:
  (1) whether the charges assessed by the city against pipeline facilities are commensurate with charges assessed for other uses of public right-of-way in the city, other than by franchised public utilities;
  (2) whether the charges assessed by the city are commensurate with charges assessed against pipeline facilities in public right-of-way by other cities in Texas; and
  (3) whether total costs of regulating pipeline facilities within the city are fairly allocated among all pipeline facilities, including whether the exclusion of any pipelines from the charges is reasonable.
(d) In determining whether an annual charge exceeds costs of regulating pipeline facilities the Commission may consider:
  (1) historical costs attributable to regulating pipeline facilities adjusted for known and measurable changes, including out-of-pocket expenses and an allocable portion of the capital depreciation of specialized equipment and salaries, employee benefits, and reasonable overhead for city officials and employees engaged in and fairly attributable to regulating pipeline facilities;
  (2) whether any costs advanced by the city to support the charge are attributable to the costs of activities other than regulating public right-of-way in the city, such as safety regulation, emergency response, or other action that is not required to administer, supervise, inspect, or otherwise regulate the location of a pipeline facility in public right-of-way in the city, whether or not authorized to be performed by the city; and
  (3) whether charges assessed against pipeline facilities in the aggregate exceed the city's actual or reasonably expected costs of regulating pipeline facilities in public right-of-way in the city.

Source Note: The provisions of this §7.6006 adopted to be effective March 15, 2007, 32 TexReg 1275