CSSB 213(FIN) AM(EFD FLD): "An Act extending the Alaska Public Utilities Commission; relating to regulation of public utilities and to regulatory cost charges."
00CS FOR SENATE BILL NO. 213(FIN) am(efd fld) 01 "An Act extending the Alaska Public Utilities Commission; relating to regulation 02 of public utilities and to regulatory cost charges." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 42.05.141(a) is amended to read: 05 (a) The Alaska Public Utilities Commission may do all things necessary or 06 proper to carry out the purposes and exercise the powers expressly granted or 07 reasonably implied in this chapter, including 08 (1) regulate every public utility engaged or proposing to engage in a 09 utility [SUCH A] business inside the state, except to the extent exempted by 10 AS 42.05.711 [, AND THE POWERS OF THE COMMISSION SHALL BE 11 LIBERALLY CONSTRUED TO ACCOMPLISH ITS STATED PURPOSES]; 12 (2) investigate, upon complaint or upon its own motion, the rates, 13 classifications, rules, regulations, practices, services, and facilities of a public utility 14 and hold hearings on them;
01 (3) make or require just, fair, and reasonable rates, classifications, 02 regulations, practices, services, and facilities for a public utility; 03 (4) prescribe the system of accounts and regulate the service and safety 04 of operations of a public utility; 05 (5) require a public utility to file reports and other information and 06 data; 07 (6) appear personally or by counsel and represent the interests and 08 welfare of the state in all matters and proceedings involving a public utility pending 09 before an officer, department, board, commission, or court of the state or of another 10 state or the United States and to intervene in, protest, resist, or advocate the granting, 11 denial, or modification of any petition, application, complaint, or other proceeding; 12 (7) examine witnesses and offer evidence in any proceeding affecting 13 the state and initiate or participate in judicial proceedings to the extent necessary to 14 protect and promote the interests of the state. 15 * Sec. 2. AS 42.05.253(a) is amended to read: 16 (a) A regulated public utility operating in the state shall pay to the commission 17 an annual regulatory cost charge in an amount not to exceed .8 [.61] percent of gross 18 revenue derived from operations in the state, as modified under (c) of this section if 19 appropriate. An exempt utility shall pay the actual cost of services provided to it by 20 the commission. 21 * Sec. 3. AS 42.05.253(c) is amended to read: 22 (c) In determining the amount of the regulatory cost charge imposed under (a) 23 of this section, 24 (1) a utility selling utility services at wholesale shall modify its gross 25 revenue by deducting payments it receives for wholesale sales; 26 (2) a local exchange telephone utility shall modify its gross revenue by 27 deducting payments received from other carriers for settlements or access charges; 28 (3) an electric utility shall reduce its gross revenue by subtracting 29 the cost of power; in this paragraph, "cost of power" means the costs of 30 generation and purchased power reported to the commission. 31 * Sec. 4. AS 42.05.253(e) is amended to read:
01 (e) The commission shall administer the charge imposed under this section. 02 The Department of Revenue shall collect and enforce the charge imposed under this 03 section. The Department of Administration shall identify the amount of the 04 operating budget of the commission that lapses into the general fund each year. 05 The legislature may appropriate an amount equal to the lapsed amount to the 06 commission for its operating costs for the next fiscal year. If the legislature does 07 so, the commission shall reduce the total regulatory cost charge collected for that 08 fiscal year by a comparable amount. 09 * Sec. 5. AS 42.05.431(a) is amended to read: 10 (a) When the commission, after an investigation and hearing, finds that a rate 11 demanded, observed, charged, or collected by a public utility for a service subject to 12 the jurisdiction of the commission, or that a classification, rule, regulation, practice, 13 or contract affecting the rate, is unjust, unreasonable, unduly discriminatory or 14 preferential, the commission shall determine a just and reasonable rate, classification, 15 rule, regulation, practice, or contract to be observed or allowed and shall establish it 16 by order. [A MUNICIPALITY MAY COVENANT WITH BOND PURCHASERS 17 REGARDING RATES OF A MUNICIPALLY OWNED UTILITY, AND THE 18 COVENANT IS VALID AND ENFORCEABLE AND IS CONSIDERED TO BE A 19 CONTRACT WITH THE HOLDERS FROM TIME TO TIME OF THE BONDS. 20 THE FINANCIAL COVENANTS CONTAINED IN MORTGAGES AND OTHER 21 DEBT INSTRUMENTS OF COOPERATIVE UTILITIES ORGANIZED UNDER 22 AS 10.25 ARE ALSO VALID AND ENFORCEABLE, AND RATES SET BY THE 23 COMMISSION MUST BE ADEQUATE TO MEET THOSE COVENANTS. 24 HOWEVER, A COOPERATIVE UTILITY THAT IS NEGOTIATING TO ENTER A 25 MORTGAGE OR OTHER DEBT INSTRUMENT THAT PROVIDES FOR A 26 TIMES-INTEREST-EARNED RATIO (TIER) GREATER THAN THE RATIO THE 27 COMMISSION MOST RECENTLY APPROVED FOR THAT COOPERATIVE 28 SHALL SUBMIT THE MORTGAGE OR DEBT INSTRUMENT TO THE 29 COMMISSION BEFORE THE INSTRUMENT TAKES EFFECT. THE 30 COMMISSION MAY DISAPPROVE THE INSTRUMENT WITHIN 60 DAYS 31 AFTER ITS SUBMISSION. IF THE COMMISSION HAS NOT ACTED WITHIN
01 60 DAYS, THE INSTRUMENT IS CONSIDERED TO BE APPROVED.] 02 * Sec. 6. AS 42.05.431 is amended by adding new subsections to read: 03 (i) A municipality may covenant with bond purchasers regarding rates of a 04 municipally owned utility, and the covenant is valid and enforceable and is considered 05 to be a contract with the holders from time to time of the bonds. For telephone 06 utilities, rates set by the commission must be adequate to meet those covenants. 07 However, the commission is not required to set rates for telephone services regulated 08 by the commission to recover the allocated costs and coverage requirements of services 09 that are not regulated by the commission. Bonds or other debt issued to finance 10 unregulated, competitive ventures by a municipally owned telephone utility may not 11 be incurred in a manner that would permit a creditor, on default, to have recourse to 12 the assets of the basic regulated telephone utility business. 13 (j) The financial covenants contained in mortgages and other debt instruments 14 of cooperative utilities organized under AS 10.25 are also valid and enforceable, and 15 rates set by the commission must be adequate to meet those covenants. However, a 16 cooperative utility that is negotiating to enter a mortgage or other debt instrument that 17 provides for a times-interest-earned ratio (TIER) greater than the ratio the commission 18 most recently approved for that cooperative shall submit the mortgage or debt 19 instrument to the commission before the instrument takes effect. The commission may 20 disapprove the instrument within 60 days after its submission. If the commission has 21 not acted within 60 days, the instrument is considered to be approved. 22 * Sec. 7. AS 42.05.711(e) is amended to read: 23 (e) Notwithstanding any other provisions of this chapter, any electric or 24 telephone utility that does not gross $50,000 annually is exempt from regulation under 25 this chapter unless [25 PERCENT OF] the subscribers petition the commission for 26 regulation under AS 42.05.712(h). 27 * Sec. 8. AS 42.05.711(f) is amended to read: 28 (f) Notwithstanding any other provisions of this chapter, an electric or 29 telephone utility that does not gross $500,000 [$325,000] annually may elect to be 30 exempt from the provisions of this chapter other than AS 42.05.221 - 42.05.281 under 31 the procedure described in AS 42.05.712.
01 * Sec. 9. AS 42.05.711(g) is amended to read: 02 (g) A utility, other than a telephone or electric utility, that does not gross 03 $150,000 [$100,000] annually may elect to be exempt from the provisions of this 04 chapter other than AS 42.05.221 - 42.05.281 under the procedure described in 05 AS 42.05.712. 06 * Sec. 10. AS 42.05.711(i) is amended to read: 07 (i) A utility that [WHICH] furnishes collection and disposal service of 08 garbage, refuse, trash, or other waste material and has annual gross revenues of 09 $300,000 [$200,000] or less is exempt from the provisions of this chapter, other than 10 the certification provisions of AS 42.05.221 - 42.05.281, unless [25 PERCENT OF] 11 the subscribers [OR SUBSCRIBERS REPRESENTING 25 PERCENT OF THE 12 GROSS REVENUE OF THE UTILITY] petition the commission for regulation under 13 AS 42.05.712(h). Notwithstanding AS 42.05.712(b) and (g), if subscribers 14 representing 25 percent of the gross revenue of the utility petition the commission 15 for regulation, the utility is subject to the provisions of this chapter. 16 * Sec. 11. AS 42.05.711(k) is amended to read: 17 (k) A utility that [WHICH] furnishes cable television service is exempt from 18 the provisions of this chapter other than AS 42.05.221 - 42.05.281 [,] unless [25 19 PERCENT OF] the subscribers petition the commission for regulation under the 20 procedure described in AS 42.05.712. 21 * Sec. 12. AS 42.05.712(h) is amended to read: 22 (h) A utility or cooperative that is already exempt from regulation under this 23 section or that is exempt from regulation under AS 42.05.711(e), (i), or (k) may 24 elect to terminate its exemption in the same manner. 25 * Sec. 13. AS 42.06.285(a) is amended to read: 26 (a) A pipeline carrier operating in the state shall pay to the commission an 27 annual regulatory cost charge in an amount not to exceed .8 [.61] percent of gross 28 revenue derived from operations in the state. A regulatory cost charge may not be 29 assessed on pipeline carrier operations unless the operations are within the jurisdiction 30 of the commission. 31 * Sec. 14. AS 42.06.285(c) is amended to read:
01 (c) The commission shall administer the charge imposed under this section. 02 The Department of Revenue shall collect and enforce the charge imposed under this 03 section. The Department of Administration shall identify the amount of the 04 operating budget of the commission that lapses into the general fund each year. 05 The legislature may appropriate an amount equal to the lapsed amount to the 06 commission for its operating costs for the next fiscal year. If the legislature does 07 so, the commission shall reduce the total regulatory cost charge collected for that 08 fiscal year by a comparable amount. 09 * Sec. 15. AS 44.66.010(a)(4) is amended to read: 10 (4) Alaska Public Utilities Commission (AS 42.05.010) -- June 30, 11 1998 ; 12 * Sec. 16. REPEAL OF SUNSET OF REGULATORY COST CHARGES. Sections 22, 13 26, 36, and 38, ch. 2, FSSLA 1992, are repealed. 14 * Sec. 17. APUC STAGGERED TERMS. Notwithstanding AS 42.05.030(a), after the 15 expiration in 1999 of the term of the member of the Alaska Public Utilities Commission with 16 a major or experience in engineering, the vacancy shall next be filled for a term of four years 17 in order to adjust the staggering of the terms of the members of the commission so that no 18 more than one commission member's term expires each year. 19 * Sec. 18. APPLICATION TO ONGOING PROCEEDINGS. The amendment to 20 AS 42.05.141(a), made by sec. 1 of this Act, applies to proceedings begun on or after the 21 effective date of sec. 1 of this Act.