00 SENATE BILL NO. 47                                                                                                      
01 "An Act relating to the extent to which the Alaska Public Utilities Commission                                          
02 may exercise its powers when regulating utilities; establishing a regulatory cost                                       
03 charge on public utilities and pipeline carriers; relating to the allocation of costs                                   
04 in hearings before the Alaska Public Utilities Commission; relating to the method                                       
05 by which utilities are exempted from and made subject to regulation by the                                              
06 Alaska Public Utilities Commission; relating to the monetary threshold for                                              
07 regulation of certain kinds of utilities by the Alaska Public Utilities Commission;                                     
08 extending the Alaska Public Utilities Commission; relating to staggered terms for                                       
09 members of the Alaska Public Utilities Commission; and providing for an effective                                       
10 date."                                                                                                                  
11 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
12    * Section 1.  AS 42.05.141(a) is amended to read:                                                                    
13  (a)  The Alaska Public Utilities Commission may do all things necessary or                                           
14 proper to carry out the purposes and exercise the powers expressly granted or                                           
01 reasonably implied in this chapter, including                                                                          
02   (1)  regulate every public utility engaged or proposing to engage in a                                              
03 utility [SUCH A] business inside the state, except to the extent exempted by                                           
04 AS 42.05.711 [, AND THE POWERS OF THE COMMISSION SHALL BE                                                               
05 LIBERALLY CONSTRUED TO ACCOMPLISH ITS STATED PURPOSES];                                                                 
06   (2)  investigate, upon complaint or upon its own motion, the rates,                                                  
07 classifications, rules, regulations, practices, services, and facilities of a public utility                          
08 and hold hearings on them;                                                                                              
09   (3)  make or require just, fair, and reasonable rates, classifications,                                            
10 regulations, practices, services, and facilities for a public utility;                                                
11   (4)  prescribe the system of accounts and regulate the service and safety                                            
12 of operations of a public utility;                                                                                      
13   (5)  require a public utility to file reports and other information and                                              
14 data;                                                                                                                   
15   (6)  appear personally or by counsel and represent the interests and                                                 
16 welfare of the state in all matters and proceedings involving a public utility pending                                  
17 before an officer, department, board, commission, or court of the state or of another                                 
18 state or the United States and to intervene in, protest, resist, or advocate the granting,                              
19 denial, or modification of any petition, application, complaint, or other proceeding;                               
20   (7)  examine witnesses and offer evidence in any proceeding affecting                                                
21 the state and initiate or participate in judicial proceedings to the extent necessary to                                
22 protect and promote the interests of the state.                                                                         
23    * Sec. 2.  AS 42.05 is amended by adding a new section to read:                                                      
24  Sec. 42.05.254.  PUBLIC UTILITY REGULATORY COST CHARGE.   (a)                                                         
25 A regulated public utility operating in the state shall pay to the commission an annual                                 
26 regulatory cost charge in an amount not to exceed .8 percent of gross revenue derived                                   
27 from operations in the state, as modified under (c) of this section if appropriate. An                                  
28 exempt utility shall pay the actual cost of services provided to it by the commission.                                  
29     (b)  The commission shall by regulation establish a method to determine                                            
30 annually the amount of the regulatory cost charge for a public utility. If the amount                                   
31 the commission expects to collect under (a) of this section and under AS 42.06.286(a)                                   
01 exceeds the authorized budget of the commission, the commission shall, by order,                                        
02 reduce the percentages set out in (a) of this section so that the total amount of the fees                              
03 collected approximately equals the authorized budget of the commission for the fiscal                                   
04 year.                                                                                                                   
05     (c)  In determining the amount of the regulatory cost charge imposed under (a)                                     
06 of this section,                                                                                                        
07     (1)  a utility selling utility services at wholesale shall modify its gross                                        
08 revenue by deducting payments it receives for wholesale sales;                                                          
09     (2)  a local exchange telephone utility shall modify its gross revenue by                                          
10 deducting payments received from other carriers for settlements or access charges;                                      
11   (3)  an electric utility shall reduce its gross revenue by subtracting the                                           
12 cost of power; in this paragraph, "cost of power" means the costs of generation and                                     
13 purchased power reported to the commission.                                                                             
14     (d)  The commission shall calculate the total regulatory cost charges to be                                        
15 levied against all regulated electric utilities under this section. The commission shall                                
16 allocate the total amount among the regulated electric utilities by using an equal charge                               
17 per kilowatt hour sold at retail.                                                                                       
18     (e)  The commission shall administer the charge imposed under this section.                                        
19 The Department of Revenue shall collect and enforce the charge imposed under this                                       
20 section.  The Department of Administration shall identify the amount of the operating                                   
21 budget of the commission that lapses into the general fund each year.  The legislature                                  
22 may appropriate an amount equal to the lapsed amount to the commission for its                                          
23 operating costs for the next fiscal year.  If the legislature does so, the commission shall                             
24 reduce the total regulatory cost charged collected for that fiscal year by a comparable                                 
25 amount.                                                                                                                 
26     (f)  The commission shall allow a public utility to recover all payments made                                      
27 to the commission under this section. The commission may not require a public utility                                   
28 to file a rate case in order to be eligible to recover the regulatory cost charge.                                      
29     (g)  The commission may adopt regulations under AS 44.62 (Administrative                                           
30 Procedure Act) necessary to administer this section, including requirements and                                         
31 procedures for reporting information and making quarterly payments. The Department                                      
01 of Revenue may adopt regulations under AS 44.62 (Administrative Procedure Act) for                                      
02 investigating the accuracy of filed information, and for collecting required payments.                                  
03     (h)  In this section,                                                                                              
04     (1)  "exempt utility" means a public utility that is certificated by the                                           
05 commission under AS 42.05.221 - 42.05.281 but, in accordance with AS 42.05.711,                                         
06 is exempt from other regulatory requirements of this chapter;                                                           
07     (2)  "gross revenue" means the total operating revenue from intrastate                                             
08 services, as shown in a utility's annual report required by the commission by                                           
09 regulation;                                                                                                             
10     (3)  "regulated utility" means a public utility that is certificated by the                                        
11 commission under AS 42.05.221 - 42.05.281 and that is subject to the other regulatory                                   
12 requirements of this chapter;                                                                                           
13     (4)  "wholesale sales" means sales to another utility for resale under                                             
14 circumstances that make revenue from the resale subject to the regulatory cost charge                                   
15 imposed under this section.                                                                                             
16    * Sec. 3.  AS 42.05.651(a) is amended to read:                                                                       
17     (a)  During [AFTER COMPLETION OF] a hearing or investigation held under                                          
18 this chapter, the commission may  [SHALL] allocate the costs of the hearing or                                        
19 investigation among the parties, including the commission, as is just under the                                         
20 circumstances. In allocating costs, the commission shall consider the regulatory cost                                  
21 charge paid by a utility under AS 42.05.254 and may consider the results, ability                                      
22 to pay, evidence of good faith, other relevant factors, and mitigating circumstances.                                   
23 Notwithstanding an intervening party's ability to pay, if the commission determines                                     
24 that an intervening party has conducted its intervention in a frivolous manner, the                                     
25 commission shall allocate all costs associated with the intervention to that party. The                                 
26 costs allocated may include the costs of any time devoted to the investigation or                                       
27 hearing by hired consultants, whether or not the consultants appear as witnesses or                                     
28 participants. The costs allocated may also include any out-of-pocket expenses incurred                                  
29 by the commission in the particular proceeding. The commission shall provide an                                         
30 opportunity for any person objecting to an allocation to be heard before the allocation                                 
31 becomes final.                                                                                                          
01    * Sec. 4.  AS 42.05.711(e) is amended to read:                                                                       
02  (e)  Notwithstanding any other provisions of this chapter, any electric or                                            
03 telephone utility that does not gross $50,000 annually is exempt from regulation under                                  
04 this chapter unless [25 PERCENT OF] the subscribers petition the commission for                                         
05 regulation under AS 42.05.712(h).                                                                                     
06    * Sec. 5.  AS 42.05.711(f) is amended to read:                                                                       
07  (f)  Notwithstanding any other provisions of this chapter, an electric or                                             
08 telephone utility that does not gross $500,000 [$325,000] annually may elect to be                                    
09 exempt from the provisions of this chapter other than AS 42.05.221 - 42.05.281 under                                    
10 the procedure described in AS 42.05.712.                                                                                
11    * Sec. 6.  AS 42.05.711(g) is amended to read:                                                                       
12  (g)  A utility, other than a telephone or electric utility, that does not gross                                      
13 $150,000 [$100,000] annually may elect to be exempt from the provisions of this                                        
14 chapter other than AS 42.05.221  - 42.05.281 under the procedure described in                                           
15 AS 42.05.712.                                                                                                           
16    * Sec. 7.  AS 42.05.711(i) is amended to read:                                                                       
17  (i)  A utility that [WHICH] furnishes collection and disposal service of                                            
18 garbage, refuse, trash, or other waste material and has annual gross revenues of                                       
19 $300,000 [$200,000] or less is exempt from the provisions of this chapter, other than                                  
20 the certification provisions of AS 42.05.221  - 42.05.281, unless [25 PERCENT OF]                                       
21 the subscribers [OR SUBSCRIBERS REPRESENTING 25 PERCENT OF THE                                                          
22 GROSS REVENUE OF THE UTILITY] petition the commission for regulation under                                             
23 AS 42.05.712(h).  Notwithstanding AS 42.05.712(b) and (g), if subscribers                                               
24 representing 25 percent of the gross revenue of the utility petition the commission                                     
25 for regulation, the utility is subject to the provisions of this chapter.                                              
26    * Sec. 8.  AS 42.05.711(k) is amended to read:                                                                       
27  (k)  A utility that [WHICH] furnishes cable television service is exempt from                                       
28 the provisions of this chapter other than AS 42.05.221 -  42.05.281 [,] unless [25                                      
29 PERCENT OF] the subscribers petition the commission for regulation under the                                           
30 procedure described in AS 42.05.712.                                                                                   
31    * Sec. 9.  AS 42.05.712(h) is amended to read:                                                                       
01  (h)  A utility or cooperative that is already exempt from regulation under this                                       
02 section or that is exempt from regulation under AS 42.05.711(e), (i), or (k) may                                      
03 elect to terminate its exemption in the same manner.                                                                    
04    * Sec. 10.  As 42.06 is amended by adding a new section to read:                                                     
05  Sec. 42.06.286. PIPELINE CARRIER REGULATORY COST CHARGE.      (a)                                                    
06 A pipeline carrier operating in the state shall pay to the commission an annual                                         
07 regulatory cost charge in an amount not to exceed .8 percent of gross revenue derived                                   
08 from operations in the state. A regulatory cost charge may not be assessed on pipeline                                  
09 carrier operations unless the operations are within the jurisdiction of the commission.                                 
10     (b)  The commission shall by regulation establish a method to determine                                            
11 annually the amount of the regulatory cost charge. If the amount the commission                                         
12 expects to collect under (a) of this section and under AS 42.05.254(a) exceeds the                                      
13 authorized budget of the commission, the commission shall, by order, reduce the                                         
14 percentage set out in (a) of this section so that the total amount of the fees collected                                
15 approximately equals the authorized budget of the commission for the fiscal year.                                       
16     (c)  The commission shall administer the charge imposed under this section.                                        
17 The Department of Revenue shall collect and enforce the charge imposed under this                                       
18 section.  The Department of Administration shall identify the amount of the operating                                   
19 budget of the commission that lapses into the general fund each year.  The legislature                                  
20 may appropriate an amount equal to the lapsed amount to the commission for its                                          
21 operating costs for the next fiscal year.  If the legislature does so, the commission shall                             
22 reduce the total regulatory cost charged collected for that fiscal year by a comparable                                 
23 amount.                                                                                                                 
24     (d)  The commission may adopt regulations under AS 44.62 (Administrative                                           
25 Procedure Act) necessary to administer this section, including requirements and                                         
26 procedures for reporting information and making quarterly payments. The Department                                      
27 of Revenue may adopt regulations under AS 44.62 (Administrative Procedure Act) for                                      
28 investigating the accuracy of filed information, and for collecting required payments.                                  
29     (e)  In this section, "gross revenue" means the total intrastate operating revenue                                 
30 as shown in a pipeline carrier's annual report required by the commission by                                            
31 regulation.                                                                                                             
01    * Sec. 11.  AS 42.06.610(a) is amended to read:                                                                      
02     (a)  During a proceeding held under this chapter, the commission may                                             
03 [SHALL] allocate the cost of the proceeding among the parties, including the                                            
04 commission, as is just under the circumstances. In allocating costs, the commission                                    
05 shall consider the regulatory cost charge paid directly or indirectly under                                             
06 AS 42.06.286.  The costs allocated may include the costs of any time devoted to                                        
07 investigations or hearings by hired consultants, whether or not the consultants appear                                  
08 as witnesses or participants. The commission shall provide an opportunity for any                                       
09 person objecting to an allocation to be heard before the allocation becomes final.                                      
10    * Sec. 12.  AS 44.66.010(a)(4) is amended to read:                                                                   
11   (4)  Alaska Public Utilities Commission (AS 42.05.010) -- June 30,                                                  
12 1999 [1994];                                                                                                           
13    * Sec. 13.  APUC STAGGERED TERMS.  Notwithstanding AS 42.05.030(a), after the                                        
14 expiration in 1999 of the term of the member of the Alaska Public Utilities Commission with                             
15 a major or experience in engineering, the vacancy shall next be filled for a term of four years                         
16 in order to adjust the staggering of the terms of the members of the commission so that no                              
17 more than one commission member's term expires each year.                                                               
18    * Sec. 14.  APPLICATION TO ONGOING PROCEEDINGS.  The amendment to                                                    
19 AS 42.05.141(a), made by sec. 1 of this Act, applies to proceedings begun on or after the                               
20 effective date of sec. 1 of this Act.                                                                                   
21    * Sec. 15.  Section 1 of this Act takes effect July 1, 1996.                                                         
22    * Sec. 16.  Except as provided in sec. 15 of this Act, this Act takes effect immediately                             
23 under AS 01.10.070(c).