Senate Bill No. 551

(By Senator Dittmar)

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[Originating in the Committee on Natural Resources;


reported April 2, 1997.]

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A BILL to amend article four, chapter twenty-two-c of the code of West Virginia, one thousand nine hundred thirty-one, as amended, by adding thereto a new section, designated section twenty-three-a, relating to findings and declarations; prohibiting municipal, county or regional solid waste authorities from competing with private solid waste haulers unless first meeting certain requirements; providing that public notice and hearing be provided before planned public solid waste hauling services commence operations; requiring a public authority to demonstrate that planned services would be cost effective; requiring public authorities to comply with particular existing legal requirements relative to private solid waste companies if they offer planned services; requiring a five year notice be given to private solid waste companies before hauling services from a public authority commences or, alternatively, requiring payment of a sum representing one year of lost revenue that would be incurred by private companies if the planned public services commence operations; requiring a qualified economist and accountant to perform the computation of the projected lost revenue; and defining "compete" and "competition".

Be it enacted by the Legislature of West Virginia:
That article four, chapter twenty-two-c of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended by adding thereto a new section, designated section twenty- three-a, to read as follows:
ARTICLE 4. COUNTY AND REGIONAL SOLID WASTE AUTHORITIES.

§22C-4-23a. Prevention of unduly burdensome rates to residential, commercial and industrial consumers of solid waste services.
(a) The Legislature hereby finds and declares as follows:
(1) Residential, commercial and industrial solid waste customers should not be arbitrarily or unfairly charged higher rates for solid waste hauling services, but should be permitted to pay substantially the same rates relative to one another, when such customers exist in the same geographic area served by a solid waste hauling service.
(2) County, municipal or regional solid waste authorities, or combinations thereof, may wish to provide solid waste hauling services within or outside their respective geographical boundaries. However, when a county, municipal or regional solid waste authority provides solid waste hauling services it often competes with an existing private solid waste company that offers hauling services. The very essence of this competition is that it is conducted on significantly unfair and unequal terms.
(3) A private solid waste company offering hauling services is regulated by the public service commission, while having a duty imposed by law to serve all customers within the private solid waste company's service area. Contrary to this, a municipal, county or regional solid waste facility is not so regulated nor is it required to serve all customers within the private solid waste company's service area.
(4) A municipal, county or regional solid waste authority has the ability to pick and choose which customers it will serve. These choices are largely made in consideration of the easiest customers to reach as well as the most profitable customers to serve.
(5) As a municipal, county or regional solid waste authority obtains customers, existing private solid waste companies that offer hauling services must charge higher rates to their customers in order to compensate for the customers lost to a municipal, county or regional solid waste authority. This rise in rates is unfair to the remaining customers, yet no other viable option exists which would allow the private company to remain in business and still offer the service.
(6) Legislative action is needed to protect solid waste customers from paying rate increases that are arbitrarily and unfairly imposed and to level the playing field that now exists between private and public entities offering solid waste hauling services.
(b) No municipal, county or regional solid waste authority may make a final determination to compete, after making an initial determination pursuant to subsection (c) of this section, for hauling business with a private solid waste company offering hauling services that is authorized to do so pursuant to section five, article two, chapter twenty-four-a of this code, or section three, article three of said chapter, without first complying with the following requirements:
(1) A hearing shall be scheduled and held which shall provide for open public comment and debate regarding the feasibility and desirability of the municipal, county or regional solid waste authority offering such hauling services.
(2) At a minimum, notice shall be given forty-five days before the scheduled date of the hearing and it shall be provided by first class United States mail, postage prepaid, which shall be directed to every private solid waste company providing hauling services which provide such service within the geographical area contemplated to be served by the municipal, county or regional solid waste authority. Public notice shall also be provided by Class II publication in a newspaper of general circulation serving the geographical area.
(3) Following any public hearing required by this subsection, and in no event longer than one year thereafter, the municipal, county or regional solid waste authority may provide the service upon satisfactory demonstration that it will provide it in a more cost effective manner to affected customers than can otherwise be provided by private solid waste companies offering hauling services: Provided, That, a county or regional government or authority, or a municipal government or authority seeking to offer the service outside its geographical boundaries, shall be required to comply with the provisions of section five, article two, chapter twenty-four-a of this code, or with section three, article three of said chapter before it may provide the service.
(c) After a municipal, county or regional authority or government makes an initial determination to provide hauling services for solid waste, it shall provide notice of such initial determination, at a minimum, five years before the planned commencement of such services, to all private solid waste haulers that may be affected by the provision of the services by such authority or government. Alternatively to the five-year provision of notice provided for hereunder, the municipal, county or regional authority or government may pay the private solid waste companies that offer hauling services that will be affected by the planned operations, an amount equal to the projected lost revenues that will be incurred for one year by the affected private solid waste companies as the result of the intended competition from the municipal, county or regional authority or government. Lost revenues shall be projected using sound accounting, actuarial and economic principles. The projections shall be computed by a qualified economist and accountant with minimum qualifications consisting of an undergraduate degree in economics and a graduate degree at the masters level in accounting, both degrees having been attained from accredited institutions of higher learning.
(d) For the purposes of this section, "compete" or "competition" means a municipal, county or regional solid waste authority's or government's provision of solid waste hauling services which are intended to, or result in, the loss of existing customers from existing private solid waste companies that provide hauling services in a particular geographical area.
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(NOTE: The purpose of this bill is to protect private solid waste companies that offer hauling services from economic encroachments from local or regional governments or authorities that offer or intend to offer solid waste hauling services to customers or potential customers of the private solid waste companies. The proposed legislation makes findings that the protective provisions are needed to prevent residential, industrial and commercial customers from being subjected to varying rates that are arbitrarily and unfairly imposed under the current legal scheme relative to private and public solid waste removal services. It further finds that the current scheme imposes unfair burdens on private solid waste haulers relative to haulers operating under county, municipal or regional authorities. Finally, it requires public authorities to give five years notice upon an initial determination to provide solid waste hauling services which would encroach in areas where existing private companies provide the service, or alternatively pay projected lost revenue to private companies in an amount representing one year. After a final determination, presumably at the lapse of five years, to provide services, the public authority would be required to provide forty- five days notice of the scheduling of a public hearing intended for public comment and debate on the proposed provision of services. The public authority would then be required to demonstrate the proposed services would be "cost effective.")

Section twenty-three-a is new; therefore, strike-throughs and underscoring have been omitted.