SB 84: "An Act exempting joint action agencies from regulation by the state or municipalities; relating to the relationship between a joint action agency and the public utilities that form the joint action agency; relating to powers and immunities of a joint action agency; requiring filing of the joint action agency agreement; relating to the financial affairs of a joint action agency; declaring certain joint action agencies to be political subdivisions for certain purposes; relating to liability and indemnification of officers, employees, and agents of joint action agencies; and defining 'agency agreement' as used with reference to joint action agencies."
00 SENATE BILL NO. 84 01 "An Act exempting joint action agencies from regulation by the state or municipalities; 02 relating to the relationship between a joint action agency and the public utilities that 03 form the joint action agency; relating to powers and immunities of a joint action agency; 04 requiring filing of the joint action agency agreement; relating to the financial affairs of a 05 joint action agency; declaring certain joint action agencies to be political subdivisions 06 for certain purposes; relating to liability and indemnification of officers, employees, and 07 agents of joint action agencies; and defining 'agency agreement' as used with reference 08 to joint action agencies." 09 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 10 * Section 1. AS 29.35.070(a) is amended to read: 11 (a) The assembly acting for the area outside all cities in the borough and the 12 council acting for the area in a city may regulate, fix, establish, and change the rates
01 and charges imposed for a utility service provided to the municipality or its inhabitants 02 by a utility that is not subject to regulation under AS 42.05 unless that utility is 03 exempted from regulation under AS 42.05.711(a), [OR] (d) - (k), or (o), or is 04 exempted under regulations adopted under AS 42.05.810 from complying with all or 05 part of AS 42.05.141 - 42.05.721. 06 * Sec. 2. AS 42.05.711(b) is amended to read: 07 (b) Except as otherwise provided in this subsection and in (o) of this section, 08 public utilities owned and operated by a political subdivision of the state, or electric 09 operating entities established as the instrumentality of two or more public utilities 10 owned and operated by political subdivisions of the state, are exempt from this 11 chapter, other than AS 42.05.221 - 42.05.281 and 42.05.385. However, 12 (1) the governing body of a political subdivision may elect to be 13 subject to this chapter; and 14 (2) a utility or electric operating entity that is owned and operated by a 15 political subdivision and that directly competes with another utility or electric 16 operating entity is subject to this chapter and any other utility or electric operating 17 entity owned and operated by the political subdivision is also subject to this chapter. 18 * Sec. 3. AS 42.05.711(l) is amended to read: 19 (l) A person, utility, joint action agency established under AS 42.45.300, or 20 cooperative that is exempt from regulation under (a), [OR] (d) - (k), or (o) of this 21 section is not subject to regulation by a municipality under AS 29.35.060 and 22 29.35.070. 23 * Sec. 4. AS 42.05.711 is amended by adding a new subsection to read: 24 (o) A joint action agency established under AS 42.45.300 is exempt from 25 regulation under this chapter. 26 * Sec. 5. AS 42.45.300 is amended to read: 27 Sec. 42.45.300. Joint action agencies. Two or more public utilities may form 28 a joint action agency for the purpose of participation in the design, construction, 29 operation, and maintenance of a generating or transmission facility and to secure 30 financing for carrying out the design, construction, operation, and maintenance of the 31 facility. A joint action agency may request the Alaska Industrial Development and
01 Export Authority to issue revenue bonds for projects of the agency. [A JOINT 02 ACTION AGENCY HAS THE POWERS OF A PUBLIC UTILITY UNDER 03 AS 42.05.] 04 * Sec. 6. AS 42.45.310(a) is amended to read: 05 (a) Two or more public utilities that purchase power from a power project 06 acquired or constructed as part of the former energy program for Alaska and owned by 07 the Alaska Energy Authority under AS 44.83.396 may form a joint action agency 08 under AS 42.45.300 and under this section to purchase the power project from the 09 Alaska Energy Authority if the purchase and sale of the project has first been 10 authorized by law. 11 * Sec. 7. AS 42.45.310(c) is amended to read: 12 (c) The agency is a body corporate and politic and an instrumentality of the 13 public utilities that form the agency, but has a separate and independent legal 14 existence from the public utilities. A debt, obligation, or liability of the agency does 15 not constitute a debt, obligation, or liability of a public utility. A liability 16 incurred by the agency shall be satisfied exclusively from the assets or revenue of 17 the agency, and a creditor of the agency or any other person does not have any 18 right of action or claim against a public utility, because of a debt, obligation, or 19 liability of the agency. The agency has the powers of a public utility under 20 AS 42.05 and the immunities of a public utility, including those under 21 AS 09.65.085; however, the agency is exempt from regulation under AS 42.05 and 22 is not required to obtain a certificate of public convenience and necessity under 23 AS 42.05.221. In addition to the powers granted to the agency [AUTHORIZED] 24 under AS 42.45.300, this section, and the agency agreement, the agency has the 25 power 26 (1) to adopt bylaws of the agency; 27 (2) to sue and be sued; 28 (3) to carry out the authorized purposes of the agency; [AND] 29 (4) subject to (e) of this section, to issue revenue bonds and other 30 obligations [SECURE FINANCING] that are not obligations of either the state or the 31 public utilities that are parties to [FORMED] the agency agreement to provide
01 financing to carry out the authorized purposes of the agency; and 02 (5) to exercise the powers of eminent domain and declaration of 03 taking to acquire land or materials under the procedures set out in AS 09.55.240 - 04 09.55.460 to carry out the authorized purposes of a joint action agency. 05 * Sec. 8. AS 42.45.310(d) is amended to read: 06 (d) The agency is created by a written agreement among the public utilities 07 forming the agency. Each public utility forming the agency shall adopt the terms of 08 the agreement by ordinance or resolution. After the public utilities that are parties 09 to the agency agreement adopt and execute the agreement, the board of directors 10 of the agency shall file the agency agreement with the Department of Community 11 and Economic Development. In the agreement, the public utilities forming the 12 agency may grant to the agency any right, power, or privilege held or possessed 13 by one or more of the public utilities. The agency [SUBJECT TO (c) OF THIS 14 SECTION, THE] agreement [ESTABLISHING THE AGENCY] may define the 15 powers, functions, and activities of the agency and specify the means by which they 16 shall be performed. The agency agreement may establish the rights and 17 responsibilities of the public utilities that form the agency. If applicable, the agency 18 agreement must [SHALL] provide for 19 (1) apportionment between the public utilities that are parties to 20 [FORMING] the agency agreement of responsibility for [PROVIDING FINANCES 21 TO THE] expenses incurred in the performance of the functions or activities; 22 (2) apportionment of fees or other revenue derived from the functions 23 or activities and the manner in which the revenue shall be accounted for; 24 (3) the transfer of personnel and the preservation of employment 25 benefits; and 26 (4) the rights of the public utilities that are parties to [FORMING] 27 the agency agreement to terminate the agreement, subject to (e) of this section, 28 including resolving disputes if the public utilities are unable, upon termination of the 29 agency agreement, to agree on the transfer of personnel or the division of assets and 30 liabilities between the parties to the agreement. 31 * Sec. 9. AS 42.45.310(e) is amended to read:
01 (e) The public utilities that are parties to [FORMING] the agency 02 agreement shall [PLEDGE AND] agree with the holders of revenue bonds or other 03 obligations issued by the agency [FINANCING SECURED UNDER THIS 04 SECTION], including with a state entity that provides financing to the agency, that 05 the public utilities and the agency will not terminate the agency or take any other 06 action that would limit or alter the rights and powers vested in the agency by this 07 section to fulfill the terms of a contract made by the agency with the holders of the 08 bonds or other obligations and that the public utilities and the agency will not in any 09 way impair the rights and remedies of the holders until the bonds or other obligations 10 [FINANCING SECURED UNDER THIS SECTION], together with the interest on 11 them with interest on unpaid installments of interest, and all costs and expenses in 12 connection with an action or proceeding by or on behalf of the holders of the bonds 13 or other obligations are fully met and discharged. The agency may include this 14 [PLEDGE AND] agreement of the public utilities and the agency, insofar as it refers 15 to holders of bonds and other obligations of the agency, in a contract with the holders 16 and, insofar as it relates to a state entity, in a contract with the state entity. 17 * Sec. 10. AS 42.45.310(f) is repealed and reenacted to read: 18 (f) Bonds and other obligations issued by the agency and all interest and 19 income from them and all fees, charges, funds, revenue, income, and other money 20 pledged or available to pay or secure the payment of the bonds or obligations or 21 interest on them are exempt from taxation. The real and personal property of an 22 agency formed under AS 42.45.300 and this section and the assets, income, and 23 receipts of the agency are exempt from all taxes and special assessments of the state or 24 a political subdivision of the state, including the electric cooperative tax 25 (AS 10.25.540 - 10.25.570). 26 * Sec. 11. AS 42.45.310(g) is amended to read: 27 (g) A loan to, investment in, or other financial assistance [AID] provided to 28 the agency by the state or any political subdivision of the state does not constitute a 29 violation of AS 37.10.085. 30 * Sec. 12. AS 42.45.310(h) is amended to read: 31 (h) An agency formed by, and that continues to include, one or more
01 municipal public utilities is a political subdivision [ONLY] for purposes of 02 AS 38.05.810. 03 * Sec. 13. AS 42.45.310(i) is amended by adding a new paragraph to read: 04 (4) "agency agreement" or "agreement" means the written agreement 05 described in (d) of this section between or among the public utilities creating a joint 06 action agency. 07 * Sec. 14. AS 42.45 is amended by adding a new section to article 6 to read: 08 Sec. 42.45.320. Liability, indemnification, and insurance. (a) A protected 09 person is not individually liable for conduct performed within the scope of the person's 10 duties for the agency. However, the protected person may be held individually liable 11 for conduct if it was not reasonable for the person to believe that the conduct was in, 12 or not contrary to, the best interests of the agency. 13 (b) Unless prohibited by the agency agreement, the agency shall indemnify a 14 protected person who is or may be made a party to a contested matter arising out of 15 acts or omissions within the scope of the person's duties for the agency against 16 expenses actually and reasonably incurred in connection with the contested matter. 17 However, the agency may not indemnify the protected person if the person did not 18 reasonably believe the conduct to be in, or not opposed to, the best interests of the 19 agency. With respect to a criminal action or proceeding, the agency shall indemnify a 20 protected person unless the person had reasonable cause to believe that the conduct 21 was unlawful. 22 (c) An agency may purchase and maintain insurance on behalf of a protected 23 person against liability asserted against the protected person and incurred in an official 24 capacity or arising out of the person's status, whether or not the agency would have the 25 power to indemnify the person against the liability under this section. 26 (d) In this section, 27 (1) "conduct" includes action, inaction, and omission; 28 (2) "contested matter" means a proposed, pending, or completed action 29 or proceeding, whether civil, criminal, administrative, or investigative; 30 (3) "expenses" include attorney fees, judgments, fines, and amounts 31 paid in settlement;
01 (4) "protected person" means a director, officer, employee, or agent of 02 an agency.