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S1249......................................................by STATE AFFAIRS IDAHO ELECTRICITY AUTHORITY - Amends and adds to existing law to provide the Idaho Electricity Authority; to provide powers of the director of the authority; to create and give duties to the authority; to provide regulations for sale of power by the authority; to state conditions required for the authority to contract power from the United States or someone other than the United States; to provide conditions for purchase of facilities by the authority; to provide for approval of rates; to state criteria for return on investments; to create the Idaho Electricity Authority Fund; to provide requirements for administration of contracts; to establish that the authority will be regulated by the Public Utilities Commission; to provide that state agencies shall provide assistance to the authority; to determine how public utilities may expand their service area; to determine the authority's eligibility for taxation; and to provide for bonding. 03/13 Senate intro - 1st rdg - to printing 03/14 Rpt prt - to St Aff
|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-sixth Legislature First Regular Session - 2001 IN THE SENATE SENATE BILL NO. 1249 BY STATE AFFAIRS COMMITTEE 1 AN ACT 2 RELATING TO THE IDAHO ELECTRICITY AUTHORITY; AMENDING SECTION 50-2502, IDAHO 3 CODE, TO INCLUDE THE IDAHO ELECTRICITY AUTHORITY AND THE STATE OF IDAHO IN 4 THE DEFINITION OF PUBLIC UTILITY AND TO MAKE TECHNICAL CORRECTIONS; AMEND- 5 ING TITLE 61, IDAHO CODE, BY THE ADDITION OF A NEW CHAPTER 14, TITLE 61, 6 IDAHO CODE, TO PROVIDE THE IDAHO ELECTRICITY AUTHORITY ACT, TO PROVIDE A 7 DECLARATION OF POLICY, TO DEFINE TERMS, TO PROVIDE THE POWERS OF THE 8 DIRECTOR OF THE AUTHORITY, TO CREATE AND GIVE THE DUTIES OF THE AUTHORITY, 9 TO PROVIDE REGULATIONS FOR SALE OF POWER BY THE AUTHORITY, TO STATE CONDI- 10 TIONS REQUIRED FOR THE AUTHORITY TO CONTRACT FOR POWER FROM THE UNITED 11 STATES, TO PROVIDE CONDITIONS WHERE THE DIRECTOR CAN CONTRACT WITH SOMEONE 12 OTHER THAN THE UNITED STATES FOR POWER, TO PROVIDE CONDITIONS FOR PURCHASE 13 OF FACILITIES BY THE AUTHORITY, TO PROVIDE FOR APPROVAL OF RATES, TO GIVE 14 REQUIREMENTS FOR ADMINISTRATION OF CONTRACTS, TO STATE CRITERIA FOR RETURN 15 ON INVESTMENT TO THE AUTHORITY, TO STATE GUIDELINES WHEN THE AUTHORITY 16 CONTRACTS WITH A PUBLIC UTILITY, TO PROVIDE RULES FOR EXTENSION OF CON- 17 TRACTS BETWEEN A PUBLIC UTILITY AND THE AUTHORITY, TO STATE RULES REGARD- 18 ING PROCUREMENT OF POWER FROM THE PUBLIC UTILITIES, TO ESTABLISH THE IDAHO 19 ELECTRICITY AUTHORITY FUND IN THE STATE OPERATING FUND, TO ESTABLISH THAT 20 THE AUTHORITY WILL BE REGULATED BY THE PUBLIC UTILITIES COMMISSION, TO 21 PROVIDE THAT STATE AGENCIES SHALL PROVIDE ASSISTANCE TO THE AUTHORITY UPON 22 REQUEST, TO DETERMINE HOW PUBLIC UTILITIES MAY EXPAND THEIR SERVICE AREAS 23 UNDER THE ACT, TO DETERMINE THE AUTHORITY'S ELIGIBILITY FOR TAXATION, TO 24 PROVIDE FOR COMMENCEMENT OF ACTIVITIES, TO PROVIDE FOR CESSATION OF ACTIV- 25 ITIES, TO PROVIDE FOR BONDING AND TO PROVIDE FOR SEVERABILITY. 26 Be It Enacted by the Legislature of the State of Idaho: 27 SECTION 1. That Section 50-2502, Idaho Code, be, and the same is hereby 28 amended to read as follows: 29 50-2502. DEFINITIONS. As used in this chapter, the following words and 30 phrases and any variations thereof shall have the following meaning: 31 (1) "Communication service" means the transmission of intelligence by 32 electrical means, including, but not limited to, telephone, telegraph, 33 messenger-call, clock, police, fire alarm and traffic control circuits or the 34 transmission of standard television or radio signals. 35 (2) "Convert" or "conversion" means the removal of all or any part of any 36 existing overhead electric or communications facilities and the replacement 37 thereof with underground electric or communication facilities constructed at 38 the same or different locations. 39 (3) "Electric or communication facilities" means any works or improve- 40 ments used or useful in providing electric or communication service, includ- 41 ing, but not limited to, poles, supports, tunnels, manholes, vaults, conduits, 42 pipes, wires, conductors, guys, stubs, platforms, crossarms, braces, trans- 43 formers, insulators, cut-outs, switches, capacitors, meters, communication 2 1 circuits, appliances, attachments, and appurtenances. "Communication facili- 2 ties" shall not include facilities used for the transmission of intelligence 3 by microwave or radio, apparatus cabinets or outdoor public telephones. 4 (4) "Extension" or "extending" means any continuation, either overhead or 5 underground, of existing distribution or transmission facilities or the con- 6 struction of new electric or communication facilities which are reasonably 7 required by prudent electrical or communication practices. 8 (5) "Governing body" means the board of county commissioners or mayor and 9 council or board of directors as may be appropriate depending on whether the 10 improvement district is located in a county or within a city. 11 (6) "Ordinance" shall be construed to mean resolution where the governing 12 body properly acts by resolution and vice versa. 13 (7) "Overhead electric or communication facilities" means electric or 14 communication facilities located, in whole or in part, above the surface of 15 the ground. 16 (8) "Public utility" means any one (1) or more, public or private persons 17 or corporations or the Idaho electricity authority that provide electric or 18 communication service to the public by means of electric or communication 19 facilities and shall include the state of Idaho or any city, special district, 20 or public corporation that provides electric or communication service to the 21 public by means of electric or communication facilities. 22 (9) "Underground electric or communication facilities" means electric or 23 communication facilities located, in whole or in part, beneath the surface of 24 the ground. 25 (10) A "lot" or "parcel" of land means a single tract or parcel of land 26 containing five (5) acres or less. No single tract or parcel of property con- 27 taining more than five (5) acres may be included in any district organized 28 under this chapter, unless located within an incorporated city, without the 29 consent of the owner or owners thereof. 30 Definitions in section 50-1702, Idaho Code, shall be applicable to any sec- 31 tions of chapter 17, title 50, Idaho Code, incorporated in this chapter by 32 reference. 33 SECTION 2. That Title 61, Idaho Code, be, and the same is hereby amended 34 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap- 35 ter 14, Title 61, Idaho Code, and to read as follows: 36 CHAPTER 14 37 IDAHO ELECTRICITY AUTHORITY 38 61-1401. DECLARATION OF POLICY. (1) The legislature finds and declares 39 that the power system on the Columbia River and its tributaries is a resource 40 of low-cost hydroelectric power of which Idaho citizens should enjoy the bene- 41 fits and it is incumbent upon the legislature of the state of Idaho to protect 42 the interests of the people of the state of Idaho by protecting the benefits 43 of the Columbia River power system and all rivers tributary thereto. 44 (2) The legislature further finds and declares that it is the purpose of 45 this chapter to: 46 (a) Provide, through the Idaho electricity authority established by this 47 chapter, low power rates to customers in Idaho who might be deleteriously 48 impacted by electric utility deregulation at the federal and regional lev- 49 els or by rising power costs generally; 50 (b) Make possible rates for power consumers in Idaho at the lowest gener- 51 ating costs consistent with good business principles and protection of the 52 environment; and 3 1 (c) Distribute power obtained by the Idaho electricity authority from the 2 Columbia River system and other sources at cost to Idaho consumers. 3 61-1402. DEFINITIONS. As used in this chapter: 4 (1) "Authority" means the Idaho electricity authority. 5 (2) "Bonneville power administration" means the Bonneville power adminis- 6 tration, its successor or other agency or corporation of the United States 7 authorized to sell energy generated by federal facilities located in the 8 states of Idaho, Oregon, Washington and Montana. 9 (3) "Commission" means the public utilities commission of Idaho. 10 (4) "Cooperative corporation" means a cooperative corporation furnishing 11 electric service in the state of Idaho to its consumer members who own and 12 operate the cooperative. 13 (5) "Cost" means all commonly accepted accounting costs including, but 14 not limited to, depreciation, interest on borrowed funds, maintenance of 15 reserves for uncollectible accounts and other contingencies, and accumulation 16 of working capital over a reasonable period of time. 17 (6) "Director" means the director of the Idaho electricity authority. 18 (7) "Federal Columbia River power system" means those electric generating 19 facilities, power from which is marketed in whole or in part by the Bonneville 20 power administration, including, but not limited to, generating facilities not 21 owned by the federal government, power from which is purchased by the Bonne- 22 ville power administration, or electric generating facilities on tributaries 23 to the Columbia River. 24 (8) "Municipality" means any city, municipal corporation or other politi- 25 cal subdivision in this state. 26 (9) "Power" means electricity in any form capable of being measured, 27 transmitted and sold for use by customers of the authority. 28 (10) "Public utility" has the meaning given the term "electrical corpora- 29 tion" in section 61-119, Idaho Code. 30 (11) "Publicly owned utility" means an electric utility owned or operated, 31 in whole or in part, by a municipality or cooperative electrical association. 32 (12) "Purchase" means acquisition by purchase, exchange, barter, gift or 33 forgiveness of indebtedness or amounts owed. 34 (13) "Sell" means to give up by sale, exchange, barter, gift or forgive- 35 ness of indebtedness or amounts owed. 36 (14) "State" means the state of Idaho. 37 61-1403. DIRECTOR. (1) Subject to confirmation by the senate in the man- 38 ner provided by section 6, article IV of the constitution of the state of 39 Idaho, the governor shall appoint the director of the Idaho electricity 40 authority in whom shall repose all the powers and duties of the authority. The 41 director shall serve for a term of four (4) years at the pleasure of the gov- 42 ernor. 43 (2) The director shall: 44 (a) Serve as the administrative head of the authority and shall supervise 45 its day-to-day functions; 46 (b) Have authority, within applicable budget limitations and substan- 47 tially in accordance with chapter 53, title 67, Idaho Code, to hire, 48 assign, reassign and coordinate personnel within the authority and to fix 49 their compensation; 50 (c) Contract for or procure on a fee or part-time basis, or both, such 51 expert, technical or other professional services as he may require for the 52 discharge of his duties; 53 (d) Be authorized to participate or intervene in any proceeding before 4 1 any public officer, commission, court or body of the United States or any 2 state or political subdivision thereof for the purpose of representing the 3 interests of the authority's power consumers which relate to the purposes 4 for which the authority is created; 5 (e) Be authorized to delegate to any employees of the authority the exer- 6 cise or discharge, in the director's name, of any power, duty or function 7 vested in or imposed by law upon the director; provided however, the power 8 to make contracts obligating the authority for payment in an amount 9 greater than fifty thousand dollars ($50,000) and to establish rates for 10 sales of electric energy shall not be delegated; and 11 (f) Adopt rules and issue orders to carry out his duties and those of the 12 authority substantially in accordance with chapter 52, title 67, Idaho 13 Code. 14 (3) The official act of any person acting in the director's name and by 15 his authority pursuant to paragraph (e) of subsection (2) of this section 16 shall be considered to be an official act of the director. 17 61-1404. CREATION OF AND DUTIES OF AUTHORITY. There is hereby created the 18 Idaho electricity authority, an independent body corporate politic which shall 19 have the following powers and duties: 20 (1) To make timely application for, and to purchase power from, the Bon- 21 neville power administration or Canadian power generating entities, and to 22 purchase power from public utilities and other sources; 23 (2) To purchase generation, transmission and distribution lines and to 24 generate electric power; 25 (3) To provide for the transfer of power marketing or transmission func- 26 tions of the Bonneville power administration to the authority; 27 (4) To sell power at retail to electricity consumers as provided in sec- 28 tion 61-1405, Idaho Code; 29 (5) If power acquired under subsections (1) and (2) of this section tem- 30 porarily is surplus to the needs of the authority's consumers, to sell power 31 at wholesale to any person within the terms of the agreements by which the 32 authority obtained the power; 33 (6) Sell power to, or exchange power with, any other entity or person if 34 such sale or exchange results in a greater, more economical or more reliable 35 supply of power to the authority; 36 (7) To contract with any person for management, consulting, rate design, 37 economic analysis and other similar services as the authority considers neces- 38 sary and convenient to carry out the policies and purposes of this chapter; 39 (8) To establish rates for its sale of power to its consumers in the man- 40 ner set forth in section 61-1409, Idaho Code, and to collect receipts from its 41 consumers for its sales and other services; 42 (9) Within the limitations set forth in section 61-1408, Idaho Code, to 43 acquire by purchase or lease real and personal property necessary for the 44 operation of the authority; and 45 (10) To perform any function or service that is considered necessary to 46 carry out the policies and purposes of this chapter including, but not limited 47 to, organizing consumers or groups of consumers within the state or areas of 48 the state into buying consortiums for purposes of purchasing electric power. 49 61-1405. REGULATIONS FOR SALE OF POWER. (1) The authority may sell elec- 50 tric energy to consumers within the territory served by or allocated to a pub- 51 lic utility. If a publicly owned utility providing electric utility service 52 requests the authority to sell power for consumption by its consumers, the 53 director in his discretion may authorize power sales for such purpose to those 5 1 consumers or to the publicly owned utility after finding that the power 2 requirements of the consumers of the authority are satisfied. 3 (2) Except as provided in subsection (1) of this section and subsections 4 (4) and (5) of section 61-1404, Idaho Code, the authority shall sell electric 5 energy only to consumers within the service area acquired pursuant to this 6 section. 7 (3) At least one hundred twenty (120) days before commencing exclusive 8 electric utility service to consumers within the territory served by or allo- 9 cated to a public utility or other entity when such ability has been acquired 10 pursuant to contract or agreement, the authority and the utility shall prepare 11 a notice. The notice shall state the time and date when the authority will 12 commence service and shall describe generally the area in which the authority 13 shall provide service. A copy of the notice shall be also served on each com- 14 missioner of the public utilities commission. Service of the notice shall be 15 carried out by mailing a certified copy thereof, return receipt requested, 16 addressed to the registered agent of the utility and to each commissioner of 17 the public utilities commission. 18 (4) Except as provided in subsection (1) of this section, and notwith- 19 standing sections 61-332B and 61-332C, Idaho Code, or rules adopted thereun- 20 der, upon commencement of service by the authority, no person other than the 21 authority may provide electric utility service to a consumer within the area 22 served by the authority unless written authorization to serve the consumer or 23 consumers described therein is obtained from the authority. 24 61-1406. CONDITIONS TO CONTRACT POWER. Before executing a contract for 25 purchase of power from an entity other than the United States, the director 26 shall: 27 (1) Determine the amount of power sold by each public utility or other 28 entity to consumers in the state in the year last preceding; 29 (2) Determine for each public utility the ratio that the amount deter- 30 mined pursuant to subsection (1) of this section bears to the total amount of 31 power sold by public utilities to consumers in the state in that year and con- 32 vert that ratio to a percentage; and 33 (3) Offer to purchase from each public utility that percentage of the 34 requirements of the authority to be obtained from entities other than the 35 United States which is equal to the percentage determined pursuant to subsec- 36 tion (2) of this section, up to the amount determined pursuant to subsection 37 (1) of this section. 38 61-1407. FINDING BY DIRECTOR. (1) Before executing a contract for pur- 39 chase of power from any entity other than the United States or any entity 40 other than a public utility, the director shall find that the people of the 41 state of Idaho would receive a greater benefit from that purchase than if that 42 purchase would be made from a public utility. 43 (2) For the purposes of subsection (1) of this section, "public utility" 44 shall mean a public utility, or its corporate successor, which on January 1, 45 2001, provided electric service to consumers in the state. 46 61-1408. PURCHASE OF FACILITIES. (1) The authority may purchase or 47 acquire facilities, structures, land or equipment used by a public utility to 48 generate, transform, distribute or measure the use of power as set out in sub- 49 section (2) of this section. 50 (2) In order to qualify as a preference consumer in sales of electric 51 energy from the United States or to provide lower power costs to the state's 52 residents, the authority may acquire real and personal property of the follow- 6 1 ing types and descriptions by purchase or lease: 2 (a) Electric use meters for measurement of the amount of power consumed 3 by any consumer of the authority or for measuring power deliveries to the 4 authority; 5 (b) Transformers and associated land, materials and equipment used to 6 reduce current from voltages suitable for transmission or distribution to 7 voltage or voltages suitable for household or farm use; and 8 (c) Such land, conduits, lines, poles and associated material or equip- 9 ment used to carry current from the point of transformance to voltage or 10 voltages suitable for household or farm use to the consumer's electric use 11 meter. 12 61-1409. RATES. (1) All schedules of rates for sales of power by the 13 authority shall be approved by the public utilities commission in the same 14 manner as set forth in chapter 5, title 61, Idaho Code, for public utilities. 15 (2) The rates for sales of power shall recover the costs to the authority 16 of operating and providing service to its consumers and shall be sufficient 17 for the authority to be self-supporting without need for continuing support 18 from the general account in the state operating fund. 19 (3) The authority shall not be operated for gain or profit or as a source 20 of general revenue for the state. 21 61-1410. ADMINISTRATION OF CONTRACTS. (1) Except in an emergency, each 22 contract executed by the authority in an amount greater than fifty thousand 23 dollars ($50,000) for the services to be performed for the authority by a pub- 24 lic utility shall be submitted to the commission for review prior to execu- 25 tion. 26 (2) Upon receipt of a proposed contract, the commission shall within 27 sixty (60) days thereof: 28 (a) If in the commission's opinion it meets the requirements set forth in 29 section 61-1411, Idaho Code, favorably recommend the proposed contract; or 30 (b) If it fails to meet such requirements, return it to the director with 31 the commission's suggestions for modification of the contract or reasons 32 why the contract should not be executed. 33 (3) If the contract is returned by the commission, the director, after 34 considering the commission's stated reasons for the return and any suggestions 35 for improvement, may either execute the contract as originally proposed, exe- 36 cute a modified contract or refuse to execute a contract. 37 (4) The action of the director pursuant to subsection (3) of this section 38 shall be final. 39 61-1411. RETURN ON INVESTMENT. (1) All contracts for utility services 40 rendered to the authority shall be fair and reasonable and shall provide a 41 reasonable return on investment. 42 (2) The authority shall not enter into a contract with a public utility 43 for use of and delivery of energy over the distribution or transmission system 44 of the public utility which provides compensation to the public utility in an 45 amount greater than the allocated cost to the public utility providing the 46 service, including a reasonable return on investment. For determining cost to 47 the public utility, the director, to the extent practicable and consistent 48 with the terms of this chapter, shall use or require the use of accounting 49 procedures and methods consistent with those promulgated by the federal energy 50 regulatory commission. 51 61-1412. CONTRACTING WITH PUBLIC UTILITIES. (1) Before selling electric 7 1 power to consumers pursuant to this chapter, the director shall contract with 2 each public utility providing electric utility service to consumers for per- 3 formance by the public utility of the services of power transmission, power 4 distribution, and system maintenance in the service area of the authority pre- 5 viously served by each public utility. 6 (2) If a public utility and the director cannot agree on terms of a con- 7 tract for any of the services described in subsection (1) of this section, the 8 director or the public utility may petition the public utilities commission to 9 arbitrate further negotiations between the authority and the public utility. 10 (3) The decision of the commission on the terms of the contract shall 11 conform to the standards set forth in section 61-1411, Idaho Code, and shall 12 be binding on the director and the public utility. 13 (4) In substantial compliance with chapter 52, title 67, Idaho Code, the 14 commission shall adopt rules for the conduct of arbitration proceedings. These 15 rules may include provisions for appointment of an arbitration panel by the 16 commission or for the parties to the contract negotiations by mutual agreement 17 to exercise the authority of the commission set forth in subsections (2) and 18 (3) of this section. 19 61-1413. RULES FOR EXTENSION OF CONTRACT. Before expiration of a contract 20 between the authority and a public utility for performance by the public util- 21 ity of the utility services set out in section 61-1412, Idaho Code, either 22 party to the contract may petition the public utilities commission for an 23 order amending the terms of the contract. If the commission finds that condi- 24 tions since the execution of the contract have so changed that the contract no 25 longer conforms to the standards set forth in section 61-1411, Idaho Code, it 26 may order amendment of the contract. In exercising the powers granted by this 27 section, the commission shall follow the procedures outlined in section 28 61-1412, Idaho Code, and the rules adopted thereunder. 29 61-1414. PROCUREMENT OF POWER FROM PUBLIC UTILITIES. (1) To the extent of 30 its authority under applicable federal law, the public utilities commission 31 may order any public utility engaged in the business of generating, transmit- 32 ting, or distributing power in this state to furnish, upon demand of the 33 authority, power to the authority at points on the public utility's genera- 34 tion, transmission or distribution system at such rates and upon such fair and 35 reasonable terms and conditions as may be prescribed by the commission. For 36 the purpose of such delivery, any such public utility shall install at a fair 37 and reasonable cost to the authority, on its demand, suitable substations, 38 switches, transformers and other line and like apparatus. 39 (2) Notwithstanding subsection (1) of this section, the commission shall 40 not require any public utility to furnish to the authority a greater portion 41 of the requirements of the authority for power from sources other than the 42 United States than the ratio that the amount of power it supplied in calendar 43 year 2000 to its consumers in Idaho bears to the total amount of power sup- 44 plied by public utilities in calendar year 2000 to consumers in Idaho. 45 (3) For the purpose of subsection (2) of this section, the ratio calcu- 46 lated pursuant to subsection (2) of this section may be converted to a per- 47 centage and rounded to the next highest integer. The ratio may also be calcu- 48 lated for power supplied during any period of calendar year 2000 and may be 49 expressed as total power to be supplied over any period of time or as peaking 50 capacity to be made available to the authority. 51 61-1415. IDAHO ELECTRICITY AUTHORITY FUND. (1) There is hereby created 52 the Idaho electricity authority fund within the authority. 8 1 (2) All moneys received by the authority pursuant to law shall be col- 2 lected by the authority and paid into the state treasury pursuant to a con- 3 tract with the state treasurer and credited to the Idaho electricity authority 4 fund. All moneys in the fund shall be used by the authority for payment of 5 expenses of the authority pursuant to this chapter. 6 (3) Except as otherwise authorized or provided in this chapter, all 7 moneys of the authority shall be deposited as soon as practicable in the Idaho 8 electricity authority fund with the state treasurer, to be invested in such 9 manner as the idle moneys of the state may be invested. 10 61-1416. REGULATION BY PUBLIC UTILITIES COMMISSION. For the purposes of 11 sections 61-332 through 61-333C, Idaho Code, and sections 61-531 through 12 61-537, Idaho Code, the authority shall be considered a utility and an entity 13 providing utility service to its consumers and shall therefore be considered 14 subject to regulation by the public utilities commission under chapter 5, 15 title 61, Idaho Code. 16 61-1417. ASSISTANCE TO THE IDAHO ELECTRICITY AUTHORITY. Upon request of 17 the director, the office of the attorney general, the public utilities commis- 18 sion and the department of water resources shall furnish such assistance to 19 the director as he may require. 20 61-1418. PUBLIC UTILITIES' EXPANSION OF SERVICE AREAS. This chapter shall 21 not apply to, nor in any way restrict, the formation, acquisition, ownership, 22 operation or extension or expansion of service areas of facilities, or any 23 other function of a publicly owned utility as prescribed by law. 24 61-1419. ELIGIBILITY OF AUTHORITY FOR TAXATION. In the same manner as a 25 public utility, the authority shall be liable for and pay real and personal 26 property taxes, business license fees, user charges, franchise fees and other 27 fees and charges assessed or levied by a municipality, county or taxing dis- 28 trict. The authority shall be allowed as a credit against any tax, charge or 29 fee assessed on its receipts or income, any amounts similarly assessed on the 30 receipts or income received by a public utility from the authority. For pur- 31 poses of the constitution of the state of Idaho, the authority shall not be 32 considered to be the state or a political subdivision of the state for pur- 33 poses of taxation. 34 61-1420. COMMENCEMENT OF ACTIVITIES. Exercise of functions and powers 35 granted to the authority under this chapter shall commence at such time as the 36 legislature adopts a concurrent resolution finding that such exercise will 37 result in substantial benefits to the citizens of Idaho. 38 61-1421. CESSATION OF ACTIVITIES. All the powers and duties of the 39 authority shall cease when the commission has determined on the basis of a 40 hearing on the record, pursuant to chapter 6, title 61, Idaho Code, that oper- 41 ation of the authority no longer results in substantial benefits to the citi- 42 zens of Idaho. Such hearing may be held at the request of any interested per- 43 son, but no more frequently than once in two (2) years. If the commission 44 finds that operation of the authority no longer results in substantial bene- 45 fits to the citizens of Idaho, the commission may prescribe time periods for 46 the phasing out of the operation of the authority and such other matters as 47 are necessary to achieve sufficient cessation of the powers and duties of the 48 authority. 9 1 61-1422. BONDING PROVISIONS. 2 (1) (a) The authority shall have power and is hereby authorized to issue 3 from time to time its notes and bonds in such principal amounts as the 4 authority shall determine to be necessary to provide sufficient funds for 5 achieving any of its corporate purposes including, but not limited to: 6 payment of interest on notes and bonds of the authority; establishment of 7 reserves to secure such notes and bonds; and all other expenditures of the 8 authority incident to and necessary or convenient to carry out its corpo- 9 rate purposes and powers. 10 (b) The authority shall have the power, from time to time: (i) to issue 11 notes; (ii) to renew notes; (iii) to issue bonds; (iv) to pay notes, 12 including the interest thereon; and (v) whenever it deems refunding expe- 13 dient, to refund any bonds by the issuance of new bonds, whether the bonds 14 to be refunded have or have not matured, and to issue bonds partly to 15 refund bonds then outstanding and matured and partly for any of its corpo- 16 rate purposes. The refunding bonds may be exchanged for bonds to be 17 refunded or sold and the proceeds applied to the purchase, redemption or 18 payment of such bonds. 19 (c) Except as may otherwise be expressly provided by the authority, every 20 issue of its notes and bonds shall be general obligations of the authority 21 payable out of any revenues or moneys of the authority, subject only to 22 any agreements with the holders of particular notes or bonds pledging any 23 particular revenues. 24 (2) The notes and bonds shall be authorized by resolution or resolutions 25 of the authority, shall bear such date or dates and shall mature at such time 26 or times as such resolution or resolutions may provide, except that no bond 27 shall mature more than fifty (50) years from the date of its issue. The bonds 28 may be issued as serial bonds payable in annual installments or as term bonds 29 or as a combination thereof. The notes and bonds shall bear interest at such 30 rate or rates, be in such denominations, be in such form, either coupon or 31 registered, carry such registration privileges, be executed in such manner, be 32 payable in such medium of payment, at such place or places, and be subject to 33 such terms of redemption as such resolution or resolutions may provide. The 34 notes and bonds of the authority may be sold by the authority, at public or 35 private sale, at such price or prices as the authority shall determine. 36 (3) Any resolution or resolutions authorizing any notes or bonds or any 37 issue thereof may contain provisions, which shall be a part of the contract or 38 contracts with the holders thereof, as to: 39 (a) Pledging all or any part of the revenues to secure the payment of the 40 notes or bonds or of any issue thereof, subject to such agreements with 41 noteholders or bondholders as may then exist; 42 (b) Pledging all or any part of the assets of the authority to secure the 43 payment of the notes or bonds or of any issue of notes or bonds, subject 44 to such agreements with noteholders or bondholders as may then exist; 45 (c) The setting aside of reserves or sinking funds and the regulation and 46 disposition thereof; 47 (d) Limitations on the purpose to which the proceeds of sale of notes or 48 bonds may be applied and pledging such proceeds to secure the payment of 49 the notes or bonds or any issue thereof; 50 (e) Limitations on the issuance of additional notes or bonds, the terms 51 upon which additional notes or bonds may be issued and secured, and the 52 refunding of outstanding other notes and bonds; 53 (f) The procedure, if any, by which the terms of any contract with 54 noteholders or bondholders may be amended or abrogated, the amount of 55 notes or bonds the holders of which must consent thereto, and the manner 10 1 in which such consent may be given; 2 (g) Limitations on the amount of moneys to be expended by the authority 3 for operating expenses of the authority; 4 (h) Vesting in a trustee or trustees, such property, rights, powers and 5 duties in trust as the authority may determine which may include any or 6 all of the rights, powers and duties of the trustee appointed by the bond- 7 holders pursuant to this chapter and limiting or abrogating the right of 8 the bondholders to appoint a trustee under this chapter or limiting the 9 rights, powers and duties of such trustee; 10 (i) Defining the acts or omissions to act which shall constitute a 11 default in the obligations and duties of the Idaho electricity authority 12 to the holders of the notes or bonds in the event of such default, includ- 13 ing as a matter of right the appointment of a receiver; provided however, 14 that such rights and remedies shall not be inconsistent with the general 15 laws of the state and the other provisions of this chapter; and 16 (j) Any other matters, of like or different character, which in any way 17 affect the security or protection of the holders of the notes or bonds. 18 (4) Any pledge made by the authority shall be valid and binding from the 19 time the pledge is made; the revenues, moneys or property so pledged and 20 thereafter received by the authority shall immediately be subject to the lien 21 of such pledge without any physical delivery thereof or further act, and the 22 lien of any such pledge shall be valid and binding as against all parties hav- 23 ing claims of any kind in tort, contract or otherwise against the authority, 24 irrespective of whether such parties have notice thereof. Neither the resolu- 25 tion nor any other instrument by which a pledge is created need be recorded. 26 (5) Neither the director of the authority nor any other person executing 27 such notes or bonds shall be subject to any personal liability or accountabil- 28 ity by reason of issuance thereof. 29 (6) The authority, subject to such agreements with noteholders or bond- 30 holders as may then exist, shall have power out of any funds available there- 31 fore to purchase notes or bonds of the authority, which shall thereupon be 32 canceled, at a price not exceeding: 33 (a) If the notes or bonds are then redeemable, the redemption price then 34 applicable plus accrued interest to the next interest payment thereon; or 35 (b) If the notes or bonds are not then redeemable, the redemption price 36 applicable on the first date after such purchase upon which the notes or 37 bonds become subject to redemption plus accrued interest to such date. 38 (7) In the discretion of the authority, the bonds may be secured by a 39 trust indenture by and between the authority and a corporate trustee which may 40 be any trust company or bank having the power of a trust company in the state. 41 Such trust indenture may contain such provisions for protecting and enforcing 42 the rights and remedies of the bondholders as may be reasonable and proper and 43 not in violation of law, including covenants setting forth the duties of the 44 authority in relation to the exercise of its corporate powers and the custody, 45 safeguarding and application of all moneys. The authority may provide by such 46 trust indenture for the payment of the proceeds of the bonds and the revenues 47 to the trustee under such trust indenture or other depository, and for the 48 method of disbursement thereof, with such safeguards and restrictions as it 49 may determine. All expenses incurred in carrying out such trust indenture may 50 be treated as a part of the operating expense of the authority. If the bonds 51 shall be secured by a trust indenture, the bondholders shall have no authority 52 to appoint a separate trustee to represent them. 53 (8) Whether or not the notes and bonds are of such form and character as 54 to be negotiable instruments under the terms of the uniform commercial code, 55 the notes and bonds of the authority are hereby made negotiable instruments 11 1 within the meaning of and for all the purposes of the uniform commercial code, 2 subject only to the provisions of the notes and bonds for registration. 3 (9) If any officers of the authority whose signatures appear on any notes 4 or bonds or coupons shall cease to be such officers before the delivery of 5 such notes or bonds, such signatures shall nevertheless continue to be valid 6 and sufficient for all purposes and to the same extent as if such officers had 7 remained in office until such delivery. 8 61-1423. SEVERABILITY. If any provision of this chapter is declared 9 unconstitutional or ineffective, in whole or in part, to the extent that other 10 provisions of this chapter are not unconstitutional or ineffective, the other 11 provisions shall be valid and effective, and no other provision on account of 12 the finding of unconstitutionality or ineffectiveness shall be considered 13 invalid or ineffective.
STATEMENT OF PURPOSE RS 1099002 To set up the mechanism for creation of an Idaho electricity authority. The legislature finds and declares that the power system on the Columbia River and its tributaries is a resource of low-cost hydroelectric power of which Idaho citizens should enjoy the benefits and it is incumbent upon the legislature of the state of Idaho to protect the interests of the people of the state of Idaho by protecting the benefits of the Columbia River power system and all rivers tributary thereto. The legislature further finds and declares that it is the purpose of this chapter to: a) Provide, through the Idaho electricity authority established by this chapter, low power rates to customers in Idaho who might be deleteriously impacted by electric utility deregulation at the federal and regional levels or by rising power costs generally; b) Make possible rates for power consumers in Idaho at the lowest generating costs consistent with good business principles and protection of the environment; and c) Distribute power obtained by the Idaho electricity authority from the Columbia River system and other sources at cost to Idaho consumers. FISCAL IMPACT None. Contact Name: Senator Sandy Phone:332 1305 STATEMENT OF PURPOSE/FISCAL NOTE S 1249