HB 279: "An Act relating to the power of the Regulatory Commission of Alaska to adjust a rate charged or to be changed by a public utility that is a commercial enterprise operating for profit when the commission determines that the rate or a factor affecting that rate compensates for a utility's negligent conduct, recklessness, or intentional violation of a law."
00 HOUSE BILL NO. 279 01 "An Act relating to the power of the Regulatory Commission of Alaska to adjust a rate 02 charged or to be changed by a public utility that is a commercial enterprise operating 03 for profit when the commission determines that the rate or a factor affecting that rate 04 compensates for a utility's negligent conduct, recklessness, or intentional violation of a 05 law." 06 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 07 * Section 1. AS 42.05.431(a) is amended to read: 08 (a) When the commission, after an investigation and hearing, finds that a rate 09 demanded, observed, charged, or collected by a public utility for a service subject to 10 the jurisdiction of the commission, or that a classification, rule, regulation, practice, or 11 contract affecting the rate, is unjust, unreasonable, unduly discriminatory or 12 preferential, the commission shall determine a just and reasonable rate, classification, 13 rule, regulation, practice, or contract to be observed or allowed and shall establish it by
01 order. However, in an order established under this subsection that applies to a 02 public utility that is a commercial enterprise operating for profit, the commission 03 may not compensate the utility for its negligent conduct, recklessness, or 04 intentional violation of the law. A municipality may covenant with bond purchasers 05 regarding rates of a municipally owned utility, and the covenant is valid and 06 enforceable and is considered to be a contract with the holders from time to time of the 07 bonds. The financial covenants contained in mortgages and other debt instruments of 08 cooperative utilities organized under AS 10.25 are also valid and enforceable, and 09 rates set by the commission must be adequate to meet those covenants. However, a 10 cooperative utility that is negotiating to enter a mortgage or other debt instrument that 11 provides for a times-interest-earned ratio (TIER) greater than the ratio the commission 12 most recently approved for that cooperative shall submit the mortgage or debt 13 instrument to the commission before the instrument takes effect. The commission may 14 disapprove the instrument within 60 days after its submission. If the commission has 15 not acted within 60 days, the instrument is considered to be approved.