Senate Bill No. 356
(By Senator Wiedebusch)
[Introduced February 9, 1996; referred to the Committee
on Energy, Industry and Mining.]
A BILL to amend and reenact section five, article one, chapter
five-d of the code of West Virginia, one thousand nine hundred
thirty-one, as amended, relating to the public energy
authority act; powers, duties and responsibilities of the
authority generally; and restoring the power and authority of
the public energy authority to initiate, acquire, construct,
finance or issue bonds for electric power projects and
transmission facilities and to exercise the power of eminent
Be it enacted by the Legislature of West Virginia:
That section five, article one, chapter five-d of the code of
West Virginia, one thousand nine hundred thirty-one, as amended, be
amended and reenacted to read as follows:
ARTICLE 1. PUBLIC ENERGY AUTHORITY OF THE STATE OF WEST VIRGINIA.
§5D-1-5. Powers, duties and responsibilities of authority
generally; restoration of certain powers.
The West Virginia public energy authority is hereby granted,
has and may exercise all powers necessary or appropriate to carry
out and effectuate its corporate purpose. The authority shall have
the power and capacity to:
(1) Adopt, and from time to time, amend and repeal bylaws
necessary and proper for the regulation of its affairs and the
conduct of its business and rules to implement and make effective
its powers and duties, such rules to be promulgated in accordance
with the provisions of chapter twenty-nine-a of this code.
(2) Adopt and use an official seal and alter the same at
(3) Maintain a principal office and, if necessary, regional
suboffices at locations properly designated or provided.
(4) Sue and be sued in its own name and plead and be impleaded
in its own name, and particularly to enforce the obligations and
covenants made under this article. Any actions against the
authority shall be brought in the circuit court of Kanawha county.
(5) Foster, encourage and promote the mineral development
(6) Represent the state with respect to national initiatives
concerning the mineral development industry, and international
marketing activities affecting the mineral development industry.
(7) Engage in strategic planning to enable the state to cope
with changes affecting or which may affect the mineral development
(8) Acquire, whether by purchase, construction, gift, lease,
lease-purchase or otherwise, any electric power project or natural
gas transmission project. In the event that an electric power
project to be constructed pursuant to this article is designed to
utilize coal wastes for the generation of electricity or the
production of other energy, such project shall also be capable of
using coal as its primary energy input: Provided, That it shall be
demonstrated to the authority's satisfaction that quantities of
coal wastes exist in amounts sufficient to provide energy input for
such project for the term of the bonds or notes issued by the
authority to finance the project and are accessible to the project.
(9) Lease, lease with an option by the lessee to purchase,
sell, by installment sale or otherwise, or otherwise dispose of, to
persons other than governmental agencies, any or all of its
electric power projects or natural gas transmission projects for
such rentals or amounts and upon such terms and conditions as the
public energy authority board may deem advisable.
(10) Finance one or more electric power projects or natural
gas transmission projects by making secured loans to persons other
than governmental agencies to provide funds for the acquisition, by
purchase, construction or otherwise, of any such project or
(11) Issue bonds for the purpose of financing the cost of
acquisition and construction of one or more electric power projects
or natural gas transmission projects or any additions, extensions or improvements thereto which will be sold, leased with an option
by the lessee to purchase, leased or otherwise disposed of to
persons other than governmental agencies or for the purpose of
loaning the proceeds thereof to persons other than governmental
agencies for the acquisition and construction of said projects or
both. Such bonds shall be issued and the payment of such bonds
secured in the manner provided by the applicable provisions of
sections seven, eight, nine, ten, eleven, twelve, thirteen and
seventeen, article two-c, chapter thirteen of this code: Provided,
That the principal and interest on such bonds shall be payable out
of the revenues derived from the lease, lease with an option by the
lessee to purchase, sale or other disposition of or from loan
payments in connection with the electric power project or natural
gas transmission project for which the bonds are issued, or any
other revenue derived from such electric power project or natural
gas transmission project.
(12) In the event that the electric power project or natural
gas transmission project is to be owned by a governmental agency,
apply to the economic development authority for the issuance of
bonds payable solely from revenues as provided in article fifteen,
chapter thirty-one of this code: Provided, That the economic
development authority shall not issue any such bonds except by an
act of general law: Provided, however, That the authority shall
require that in the construction of any such project, prevailing
wages shall be paid as part of a project specific agreement which also takes into account terms and conditions contained in the West
Virginia - Ohio valley market retention and recovery agreement or
a comparable agreement.
(13) Acquire by gift or purchase, hold and dispose of real and
personal property in the exercise of its powers and the performance
of its duties as set forth in this article.
(14) Acquire in the name of the state, by purchase or
otherwise, on such terms and in such manner as it deems proper, or
by the exercise of the right of eminent domain in the manner
provided in chapter fifty-four of this code, such real property or
parts thereof or rights therein, rights-of-way, property, rights,
easements and interests it deems necessary for carrying out the
provisions of this article, and compensation shall be paid for
public or private lands so taken; and the authority may sell any of
the real property or parts thereof or rights therein,
rights-of-way, property, rights, easements and interests acquired
hereunder in such manner and upon such terms and conditions as the
authority deems proper: Provided, That if the authority determines
that land or an interest therein acquired by the authority through
the exercise of the power of eminent domain for the purpose of this
article is no longer necessary or useful for such purposes, and if
the authority desires to sell such land or interest therein, the
authority shall first offer to sell such land or interest to the
owner or owners from whom it was acquired, at a price equal to its
fair market value: Provided, however, That if the prior owner or owners shall decline to reacquire the land or interest therein, the
authority shall be authorized to dispose of such property by direct
sale, auction or competitive bidding. In no case shall such land
or an interest therein acquired under this subdivision be sold for
less than its fair market value. This article does not authorize
the authority to take or disturb property or facilities belonging
to any public utility or to a common carrier, which property or
facilities are required for the proper and convenient operation of
such public utility or common carrier, except for the acquisition
of easements or rights-of-way which will not unreasonably interfere
with the operation of the property or facilities of such public
utility or common carrier, and in the event of the taking or
disturbance of property or facilities of public utility or common
carrier, provision shall be made for the restoration, relocation or
duplication of such property or facilities elsewhere at the sole
cost of the authority.
The term "real property" as used in this article is defined to
include lands, structures, franchises and interests in land,
including lands under water and riparian rights, and any and all
other things and rights usually included within the said term, and
includes also any and all interests in such property less than full
title, such as easements, rights-of-way, uses, leases, licenses and
all other incorporeal hereditaments and every estate, interest or
right, legal or equitable, including terms for years and liens
thereon by way of judgments, mortgages or otherwise, and also all claims for damages for such real estate.
For the purposes of this section "fair market value" shall be
determined by an appraisal made by an independent person or firm
chosen by the authority. The appraisal shall be performed using
the principles contained in the "Uniform Appraisal Standards for
Federal Land Acquisitions" published under the auspices of the
interagency land acquisition conference, United States government
printing office, 1972.
(15) Make and enter into all contracts and agreements and
execute all instruments necessary or incidental to the performance
of its duties and the execution of its powers: Provided, That if
any electric power project or natural gas transmission project is
to be constructed by a person other than a governmental agency, and
with whom the authority has contracted to lease, sell or finance
such project upon its completion, then the authority shall not be
required to comply with the provisions of article twenty-two,
chapter five of this code requiring the solicitation of competitive
bids for the construction of such a project.
(16) Employ managers, superintendents and other employees, and
retain or contract with consulting engineers, financial
consultants, accountants, architects, attorneys and such other
consultants and independent contractors as are necessary in its
judgment to carry out the provisions of this article, and fix the
compensation or fees thereof. All expenses thereof shall be
payable solely from the proceeds of bonds issued by the economic development authority, from the proceeds of bonds issued by or loan
payments, lease payments or other payments received by the
authority, from revenues and from funds appropriated for such
purpose by the Legislature.
(17) Receive and accept from any federal agency, or any other
source, grants for or in aid of the construction of any project or
for research and development with respect to electric power
projects, natural gas transmission projects or other energy
projects, and receive and accept aid or contribution from any
source of money, property, labor or other things of value to be
held, used and applied only for the purpose for which such grants
and contributions are made.
(18) Purchase property coverage and liability insurance for
any electric power project or natural gas transmission project or
other energy project and for the principal office and suboffices of
the authority, insurance protecting the authority and its officers
and employees against liability, if any, for damage to property or
injury to or death of persons arising from its operations and any
other insurance which may be provided for under a resolution
authorizing the issuance of bonds or in any trust agreement
securing the same.
(19) Charge, alter and collect transportation fees and other
charges for the use or services of any natural gas transmission
project as provided in this article.
(20) Charge and collect fees or other charges from any energy project undertaken as a result of this article.
(21) When the electric power project is owned and operated by
the authority, charge reasonable fees in connection with the making
and providing of electric power and the sale thereof to
corporations, states, municipalities or other entities in the
furtherance of the purposes of this article.
(22) Purchase and sell electricity or other energy produced by
an electric power project in and out of the state of West Virginia.
(23) Enter into wheeling contracts for the transmission of
electric power over the authority's or another party's lines.
(24) Make and enter into contracts for the construction of a
project facility and joint ownership with another utility, and the
provisions of this article shall not constrain the authority from
participating as a joint partner therein.
(25) Make and enter into joint ownership agreements.
(26) Establish or increase reserves from moneys received or to
be received by the authority to secure or to pay the principal of
and interest on the bonds issued by the economic development
authority pursuant to the provisions of article fifteen, chapter
thirty-one of this code or bonds issued by the authority.
(27) Broker the purchase of natural gas for resale to end-
users: Provided, That whenever there are local distribution
company pipelines already in place the authority shall arrange to
transport the gas through such pipelines at the rates approved by
the public service commission of West Virginia.
(28) Engage in market research, feasibility studies,
commercial research and other studies and research pertaining to
electric power projects and natural gas transmission projects or
any other functions of the authority pursuant to this article.
(29) Enter upon any lands, waters and premises in the state
for the purpose of making surveys and examinations as it may deem
necessary or convenient for the purpose of this article, and such
entry shall not be deemed a trespass, nor shall an entry for such
purposes be deemed an entry under any condemnation proceedings
which may be then pending, and the authority shall make
reimbursement for any actual damages resulting to such lands,
waters and premises as a result of such activities.
(30) Participate in any reorganization proceeding pending
pursuant to the United States Code (being the act of Congress
establishing a uniform system of bankruptcy throughout the United
States, as amended) or any receivership proceeding in a state or
federal court for the reorganization or liquidation of a
responsible buyer or responsible tenant. The authority may file
its claim against any such responsible buyer or responsible tenant
in any of the foregoing proceedings, vote upon any question pending
therein, which requires the approval of the creditors participating
in any reorganization proceeding or receivership, exchange any
evidence of such indebtedness for any property, security or
evidence of indebtedness offered as a part of the reorganization of
such responsible buyer or responsible tenant or of any entity formed to acquire the assets thereof and may compromise or reduce
the amount of any indebtedness owing to it as a part of any such
(31) Make or enter into management contracts with a second
party or parties to operate any electric power project or any gas
transmission project and associated facilities, or other related
energy project, either during construction or permanent operation.
(32) Do all acts necessary and proper to carry out the powers
expressly granted to the authority in this article.
(33) Nothing herein shall be construed to permit the
transportation of gas produced outside of this state through a
natural gas transmission project.
(34) The authority shall, after consultation with other
agencies of state government having environmental regulatory
functions, promulgate legislative rules pursuant to chapter
twenty-nine-a of this code, to establish standards and principles
to be applied to all projects in assessing the effects of projects
on the environment: Provided, That when a proposed project
requires an environmental impact statement pursuant to the National
Environmental Policy Act of 1969, a copy of the environmental
impact statement shall be filed with the authority and be made
available prior to any final decision or final approval of any
project and prior to the conducting of any public hearings
regarding the project, and in any such case, no assessment pursuant
to the legislative rule need be made.
(35) The power and authority granted to the public energy
authority pursuant to this section and section six of this article
to initiate, acquire, construct, finance or issue bonds for
electric power projects and transmission facilities, or to exercise
the power of eminent domain with respect to any project, shall
terminate on the effective date of this section: Provided, That
nothing herein shall be construed to affect the validity of any act
of the public energy authority prior to the effective date of this
section or to impair the rights of bondholders with respect to
bonds or other evidence of indebtedness issued prior to the
effective date of this section. Following the effective date of
this section, the public energy authority may exercise any power
expressly granted pursuant to this section or section six of this
article with respect to any project or facility previously
constructed or acquired, any existing contractual obligations, and
any outstanding bonded indebtedness.
(NOTE: The purpose of this bill is to restore the power and
authority of the Public Energy Authority to initiate, acquire,
construct, finance or issue bonds for electric power projects and
transmission facilities and to exercise the power of eminent domain
that was terminated by amendment to this section in 1994.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would