Legislature(2021 - 2022)BARNES 124
04/27/2022 03:15 PM House LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| SB186 | |
| SB190 | |
| SB193 | |
| HB405|| HB406 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 382 | TELECONFERENCED | |
| + | SB 45 | TELECONFERENCED | |
| += | HB 405 | TELECONFERENCED | |
| += | HB 406 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| + | SB 186 | TELECONFERENCED | |
| + | SB 190 | TELECONFERENCED | |
| + | SB 193 | TELECONFERENCED | |
SB 190-REGULATORY COMMISSION AK/REFUSE UTILITIES
3:39:38 PM
CO-CHAIR FIELDS announced that the next order of business would
be CS FOR SENATE BILL NO. 190(FIN), "An Act extending the
termination date of the Regulatory Commission of Alaska;
relating to Regulatory Commission of Alaska regulations
regarding refuse utilities; relating to the powers and duties of
the legislative audit division; and providing for an effective
date."
3:39:46 PM
The committee took a brief at-ease.
3:40:24 PM
SENATOR ROBERT MYERS, Alaska State Legislature, as the prime
sponsor, he testified that CSSB 190(FIN) would extend the
termination date of the Regulatory Commission of Alaska (RCA)
until 6/30/30, in alignment with the recommendations of the
legislative auditor. He explained that the RCA is an
independent, quasi-judicial regulatory body formed by the
legislature in 1999 to replace the Alaska Public Utilities
Commission. The RCA, he continued, monitors active certificates
for public utilities and pipelines, with these certificates
covering a broad range of activities from provisional
certificates for small village water and wastewater systems to
fully regulated telecommunications, electric, and natural gas
monopolies. He noted that the changes made in the Senate
Finance Committee were simple housekeeping that he supports as
they address the refuse utility backlog by adding them to the
simplified rate filing procedure and removing an extra RCA
annual report review process on the advice of the legislative
auditor.
3:41:58 PM
DAWSON MANN, Staff, Senator Robert Myers, Alaska State
Legislature, on behalf of Senator Myers, prime sponsor, provided
the sectional analysis for CSSB 190(FIN). He spoke from the
written sectional analysis titled "SB 190 Ver. W Sectional
Analysis," which stated [original punctuation provided]:
Section 1: Page 1, Lines 6-11
This section adds intent language that the Regulatory
Commission of Alaska shall adopt regulations specific
to refuse utilities to provide for sufficient public
notice and time for ratepayers to meaningfully comment
on rate filings.
Section 2: AS 42.05.381(e) Page 1, Lines 12-14, Page
2, Lines 1-8
This section amends AS 42.05.381(e) to include refuse
utilities. AS 42.05.381(e) is the section of law that
provides for a simplified rate filing procedure.
Section 3: AS 44.66.010(a)(3) Page 2, Lines 9-11
This section extends the termination date for the
Regulatory Commission of Alaska until June 30, 2030.
Section 4: AS 24.20.271(11) Page 2, Line 12
This section repeals AS 24.20.271(11), a requirement
for the legislative audit division to conduct an audit
every two years of information found in the annual
reports regarding compliance by the Regulatory
Commission of Alaska.
Section [5]: Page 3, Line 13
This section establishes an immediate effective date.
3:42:37 PM
CO-CHAIR FIELDS asked what prompted the addition of the language
in Section 1 on page 1, lines 6-11.
MR. MANN offered his understanding that the intent language was
added [in the Senate Finance Committee] to make clear that the
RCA was going to adopt internal rules to make sure there is
public notice in relation to refuse utilities as per the change
made in Section 2.
MR. MANN returned to the sectional analysis and pointed out that
the inclusion of refuse utilities in Section 2 was an addition
made in the Senate Finance Committee. He further pointed out
that the repeal in Section 4 of the audit under AS 24.20.271(11)
was added by the Senate Finance Committee on recommendation of
the legislative auditor.
3:44:59 PM
CO-CHAIR FIELDS asked whether the intent language was prompted
by rates going up sharply somewhere in the state.
SENATOR MYERS replied that this is not due to a jump in waste
utility rates, but rather to waste utilities trying to expand
outside some of their traditional areas within city limits but
the regulations have not been allowing them to do so.
Currently, he explained, due to the way waste utilities are
regulated, it takes about two years to go through the entire
process to update a utility's rates. He deferred to the RCA and
the legislative auditor to expand further.
3:46:01 PM
CO-CHAIR FIELDS opened invited testimony.
3:46:25 PM
KRIS CURTIS, CPA, CISA, Legislative Auditor, Division of
Legislative Audit, provided invited testimony during the hearing
on CSSB 190(FIN). She spoke from the written audit report in
the committee packet titled "A Sunset Review of the Department
of Commerce, Community, and Economic Development, Regulatory
Commission of Alaska (RCA)," dated 9/21/21. [Referring to pages
3-4 of the report], she said the audit concluded that RCA
operated in an effective manner and served the public's interest
by: assessing the capabilities of utility and pipeline
companies to safely serve the public; evaluating tariffs and
charges made by regulated entities; verifying the pass-through
charges to consumers from electric and natural gas utilities;
adjudicating disputes between ratepayers and regulated entities;
providing consumer protection services; and conducting financial
reviews as part of the power cost equalization program. She
stated that the division is therefore recommending the maximum
eight-year extension.
MS. CURTIS discussed the survey conducted by the division as
part of the sunset audit (Appendix B pages 19-20). She said the
survey was sent to 188 stakeholders that were party to a docket
or a tariff filing during the audit period, with 59 responding.
She noted that by far the responses to the survey questions are
positive or neutral, with only a small percent negative. She
listed the four questions that were asked: Overall, how
satisfied are you with the following services provided by RCA?
To what extent do you agree that RCA acts in the public's
interest? Based on your experience, how often does RCA meet its
statutory timelines? To what extent do you agree that RCA
effectively communicates?
MS. CURTIS returned to page 4 of the audit report. She said the
division concluded that RCA resolved most of its consumer
complaints within its internal, non-statutory, measure of 30
days. To provide an idea of the types of complaints received by
RCA, she drew attention to the listing of consumer complaints in
Exhibit 3 on page 5. She revisited page 4 and said the division
also concluded that RCA processed tariff filings and dockets
within the statutory and regulatory timelines.
MS. CURTIS turned to page 9 of the report and pointed out that
the audit makes one administrative recommendation, which is
related to RCA's monthly meetings. Regulations for RCA require
meetings twice a month, she said, but in instances where there
are no agenda items RCA has been cancelling the meetings.
During the audit period, she related, 25 of 88 scheduled
meetings were cancelled, including six instances where meetings
were consecutively cancelled. According to RCA management, she
related, regulations require the meetings, but regulations also
allow RCA to waive a regulatory requirement by its own motion.
Auditors confirmed that there is an ability to waive but that it
must be an official motion, she continued, so these were
cancelled without official motion. It is certainly reasonable
to cancel a meeting when there is nothing on the agenda, she
allowed, but it does not explicitly comply with the regulations,
so this was brought to RCA's attention.
MS. CURTIS directed attention to pages 23-26 and stated that
both the DCCED commissioner and the RCA board chairman are
supportive of the eight-year extension.
3:50:51 PM
The committee took a brief at-ease.
3:50:57 PM
CO-CHAIR FIELDS requested background on the integration of
expansion of refuse collection and utility service areas into
the bill.
3:51:27 PM
KEITH KURBER, Commissioner, Regulatory Commission of Alaska
(RCA), responded that two separate issues were brought up by
Senator Myers. Regulated and non-regulated utilities require a
Certificate of Public Convenience and Necessity (CPCN), he
explained, and an expansion of service area is typically done
through amendment of a CPCN. It is routine and not time
consuming, he stated, the commission just revalidates the
utility's previously validated fitness, willingness, and ability
to accomplish its task. He said he doesn't know what prompted
[the Senate Finance Committee's] change, but that RCA Chairman
Picket stated in his testimony on the Senate side that this is
not a difficult task for the commission to re-do a regulation
docket to assess and modify the commission's regulations to
allow for simplified rate filing for refuse utilities. Mr.
Kurber specified that both full-blown rate cases and simplified
rate filings require standard public notice requirement, with
timelines typically shorter for simplified rate filings and
hence the term simplified. Quite a bit of expense can be
involved in doing a full-blown rate case, he noted, and smaller
utilities, whether electric cooperatives in rural areas or
refuse utilities, may not have the staff to do some of the
calculations necessary to produce the final result. He said he
therefore speculates that this could be an assistance to some of
the smaller rate regulated refuse utilities.
3:54:24 PM
SENATOR MYERS added that refuse utilities, for the most part,
have existed and operated within a city - the city requires
residential trash pickup, so the rates reflect that basically
everybody is getting trash pickup. Refuse utilities are trying
to expand outside of the city limits, he explained. For
example, in Fairbanks they are trying to expand north of the
city limits and pick up more customers, which requires
experimenting with their rates to make them work. The problem,
he said, is that the current process for altering rates takes
about two years. So, if the utility picks a number that is too
high or too low it takes a long time for that to get fixed and
creates a backlog within the RCA to address those changes.
Hence, he continued, the suggestion was made in the Senate
Finance Committee to put it into the simplified rate filing
process so that those changes can be addressed within a few
months rather than about two years.
3:55:48 PM
REPRESENTATIVE MCCARTY asked whether this [proposed] process
will allow for people in the expanded service area to have
feedback on whether they want to be part of a collection.
SENATOR MYERS answered that the proposed new process does not
require somebody to be a refuse customer, as opposed to people
living within city limits being required to sign up. Simplified
rate filings still provide time for public feedback as the rates
change, he explained, but because the simplified rate process is
a shorter time period there are also limits as to how much the
rate can change within that time period. A refuse utility
wanting a larger change, he specified, would have to go through
the original longer process. In further response, Senator Myers
confirmed that this would not force people to pay a business,
they could choose to take their garbage to the dump themselves.
3:57:37 PM
[CSSB 190(FIN) was held over.]