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Introduced Version Senate Bill 566 History

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Senate Bill No. 566

(By Senator Snyder)

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         [Introduced March 19, 2013; referred to the Committee on Government Organization; and then to the Committee on the Judiciary          .]                            

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A BILL to amend and reenact §24-2-4b of the Code of West Virginia, 1931, as amended, relating to permitting Class III cities and Class IV towns and villages to opt into rate regulation by the Public Service Commission; setting forth the procedure; establishing that an enacted municipal rate is presumed to be lawful; setting forth a rate review procedure; setting forth a procedure to determine allegations of rate discrimination; lengthening certain time periods; and permitting those Class III cities and Class IV towns and villages who have opted into regulation by the Public Service Commission to opt out only by order of the commission.
Be it enacted by the Legislature of West Virginia:
    That §24-2-4b of the Code of West Virginia, 1931, as amended, be amended and reenacted to read as follows:
          ARTICLE 2. POWERS AND DUTIES OF PUBLIC SERVICE COMMISSION.
§24-2-4b. Procedures for changing rates of electric and natural gas cooperatives, local exchange services of telephone cooperatives and municipally operated public utilities.

          (a) The rates and charges of electric cooperatives, natural gas cooperatives and municipally operated public utilities, except for municipally operated commercial solid waste facilities as defined in section two, article fifteen, chapter twenty-two of this code, Class III cities and Class IV towns or villages who have opted into commission regulation of the municipal utility's rates and charges pursuant to subsection (j) of this section, and the rates and charges for local exchange services provided by telephone cooperatives are not subject to the rate approval provisions of section four or four-a of this article, but are subject to the limited rate provisions of this section.
          (b) All rates and charges set by electric cooperatives, natural gas cooperatives and municipally operated public utilities and all rates and charges for local exchange services set by telephone cooperatives shall be just, reasonable, applied without unjust discrimination or preference and based primarily on the costs of providing these services. The rates and charges shall be adopted by the electric, natural gas or telephone cooperative's governing board and in the case of the municipally operated public utility by municipal ordinance to be effective not sooner than forty-five days after adoption: Provided, That notice of intent to effect a rate change shall be specified on the monthly billing statement of the customers of the utility for the month next preceding the month in which the rate change is to become effective or the utility shall give its customers, and in the case of a cooperative, its customers, members and stockholders, other reasonable notices as will allow filing of timely objections to the rate change. The rates and charges shall be filed with the commission, together with any information showing the basis of the rates and charges and other information as the commission considers necessary. Any change in the rates and charges with updated information shall be filed with the commission. If a petition, as set out in subdivision (1), (2) or (3), subsection (c) of this section is received and the electric cooperative, natural gas cooperative, telephone cooperative or municipality has failed to file with the commission the rates and charges with information showing the basis of rates and charges and other information as the commission considers necessary, the suspension period limitation of one hundred twenty fifty days and the one hundred-day hundred thirty-day period limitation for issuance of an order by a hearing examiner, as contained in subsections (d) and (e) of this section, is tolled until the necessary information is filed. The electric cooperative, natural gas cooperative, telephone cooperative or municipality shall set the date when any new rate or charge is to go into effect.
          (c) An enacted municipal rate ordinance shall be presumed to be valid and lawful. The commission shall review and approve or modify the rates or refer an ordinance for further review under subdivision (4) of this subsection, upon the filing of a petition within thirty days of the adoption of the ordinance or resolution changing the rates or charges by:
          (1) Any customer aggrieved by the changed rates or charges who presents to the commission a petition signed by not less than twenty-five percent of the customers served by the municipally operated public utility or twenty-five percent of the membership of the electric, natural gas or telephone cooperative residing within the state;
          (2) Any customer who is served by a municipally operated public utility and who resides outside the corporate limits and who is affected by the change in the rates or charges and who presents to the commission a petition alleging discrimination between customers within and without the municipal boundaries. The petition shall be accompanied by evidence of discrimination; or
          (3) Any customer or group of customers who are affected by the change in rates who reside within the municipal boundaries and who present a petition to the commission alleging discrimination between customer or group of customers and other customers of the municipal utility. The petition shall be accompanied by evidence of discrimination; or
__________(4) Upon receipt of an allegation of discrimination made pursuant to subdivision (2) or (3) of this subsection, the commission shall review the filing and any information filed by the municipal utility pursuant to subsection (b) of this section. If, after review to be completed no later than thirty days from receipt of the protest, the commission finds the protest and filings by the utility present a question of law or fact that supports, or may support, a claim of discrimination, the commission shall find a sufficient prima facie showing of discrimination and shall refer the ordinance for further proceeding pursuant to subsection (e) of this section.

          (d)(1) The filing of a petition with the commission signed by not less than twenty-five percent of the customers served by the municipally operated public utility or twenty-five percent of the membership of the electric, natural gas or telephone cooperative residing within the state under subdivision (1), subsection (c) of this section shall suspend the adoption of the rate change contained in the ordinance or resolution for a period of one hundred twenty fifty days from the date the rates or charges would otherwise go into effect or until an order is issued as provided herein.
          (2) Upon sufficient showing of discrimination by customers outside the municipal boundaries or a customer or a group of customers within the municipal boundaries under a petition filed under subdivision (2) or (3), subsection (c) of this section, the commission shall suspend the adoption of the rate change contained in the ordinance for a period of one hundred twenty days from the date the rates or charges would otherwise go into effect or until an order is issued as provided herein issue a finding within one hundred fifty days of the date the rates have taken effect unless otherwise tolled pursuant to subsection (b) of this section.
          (e) The commission shall forthwith appoint a hearing examiner from its staff to review the grievances raised by the petitioners and found to constitute a prima facie case of discrimination. The hearing examiner shall conduct a public hearing and shall, within one hundred thirty days from the date the rates or charges are effective or would otherwise go into effect, unless otherwise tolled as provided in subsection (b) of this section, issue an order approving, disapproving or modifying, in whole or in part, the rates or charges imposed by the electric, natural gas or telephone cooperative or by the municipally operated public utility pursuant to this section.
          (f) Upon receipt of a petition for review of the rates under the provisions of subsection (c) of this section, and a subsequent finding of a prima facie case of discrimination, if alleged, the commission may exercise the power granted to it under the provisions of section three of this article. The commission may determine the method by which the rates are reviewed and may grant and conduct a de novo hearing on the matter if the customer, electric, natural gas or telephone cooperative or municipality requests a hearing.
          (g) If the commission finds an enacted municipal rate ordinance to be unlawful or invalid, it shall order the modification of the subject rates and/or charges, and shall further order a refund of any improperly assessed and collected rates or charges.
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(g) (h) The commission may, upon petition by a municipality or electric, natural gas or telephone cooperative, allow an interim or emergency rate to take effect, subject to refund or future modification, if it is determined that the interim or emergency rate is necessary to protect the municipality from financial hardship attributable to the purchase of the utility commodity sold, or the commission determines that a temporary or interim rate increase is necessary for the utility to avoid financial distress. In such cases, the commission may waive the forty-five day waiting period provided for in subsection (b) of this section and the one hundred twenty-day fifty-day suspension period provided for in subsection (d) of this section.
          (h) (i) Notwithstanding any other provision, the commission has no authority or responsibility with regard to the regulation of rates, income, services or contracts by municipally operated public utilities for services which are transmitted and sold outside of the State of West Virginia.
          (j) Class III cities and Class IV towns or villages may opt into commission regulation of the municipal utility's rates and charges by filing with the executive secretary of the commission, a resolution enacted by the governing body requesting regulation by the commission. Once a Class III or Class IV governing body files the resolution, the commission shall notify all utility customers of the filing entity of the requested regulation through publication of a Class I legal advertisement in compliance with article three, chapter fifty-nine of this code. Upon receipt by the executive secretary of an affidavit of publication of this notice, the municipal utility may file, and the commission shall process, rate requests from the municipal utility subject to section four-a of this article rather than the provisions of this section. A Class III city or Class IV town or village opting into rate regulation under this subsection may subsequently petition the commission to opt out of rate regulation, and may do so by order of the commission.


               
          NOTE: The purpose of this bill is to permit Class III cities and Class IV towns and villages to opt into rate regulation by the Public Service Commission. The bill sets forth the procedure to be used. The bill establishes that an enacted municipal rate is presumed to be lawful. The bill sets forth a rate review procedure. The bill sets forth a procedure to use to determine allegations of rate discrimination. The bill lengthens certain time periods. The bill permits those Class III cities and Class IV towns and villages who have opted into regulation by the Public Service Commission to opt out only by order of the commission.


          Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.
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