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H0333......................................................by STATE AFFAIRS
UTILITIES - COST REDUCTION FINANCING - Adds to existing law to provide for
cost reduction orders by the Public Utilities Commission for electric and
natural gas utilities; to limit aggregate amount of cost reduction
financing; to provide cost reduction rates; and to provide procedures for
issuance of cost reduction bonds.
03/14 House intro - 1st rdg - to printing
03/15 Rpt prt - to 2nd rdg
03/16 2nd rdg - to 3rd rdg
03/17 3rd rdg - PASSED - 69-0-1
AYES -- Anderson, Andrus, Barraclough, Barrett, Bastian, Bayer,
Bedke, Bell, Bilbao, Black, Block, Boe, Bolz, Bradford, Cannon,
Chadderdon, Clark, Collins, Deal, Denney, Edmunson, Ellsworth,
Eskridge, Field(18), Field(23), Garrett, Hart, Harwood, Henbest,
Henderson, Jaquet, Jones, Kemp, Lake, LeFavour, Loertscher, Martinez,
Mathews, McGeachin, McKague, Miller, Mitchell, Moyle, Nielsen,
Nonini, Pasley-Stuart, Pence, Raybould, Ring, Ringo, Roberts, Rusche,
Rydalch, Sali, Sayler, Schaefer, Shepherd(2), Shepherd(8), Shirley,
Skippen, Smith(30), Smith(24), Smylie, Snodgrass, Stevenson, Trail,
Wills, Wood, Mr. Speaker
NAYS -- None
Absent and excused -- Crow
Floor Sponsor - Eskridge
Title apvd - to Senate
03/18 Senate intro - 1st rdg - to St Aff
03/25 Rpt out - rec d/p - to 2nd rdg
03/29 2nd rdg - to 3rd rdg
Rls susp - PASSED - 35-0-0
AYES -- Andreason, Brandt, Broadsword, Bunderson, Burkett,
Burtenshaw, Cameron, Coiner, Compton, Corder, Darrington, Davis,
Fulcher, Gannon, Geddes, Goedde, Hill, Jorgenson, Kelly, Keough,
Langhorst, Little, Lodge, Malepeai, Marley, McGee, McKenzie, Pearce,
Richardson, Schroeder, Stegner, Stennett, Sweet, Werk, Williams
NAYS -- None
Absent and excused -- None
Floor Sponsor - Stegner
Title apvd - to House
03/30 To enrol
03/31 Rpt enrol - Sp signed - Pres signed
04/04 To Governor
04/13 Governor signed
Session Law Chapter 372
Effective: 07/01/05
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature First Regular Session - 2005
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 333
BY STATE AFFAIRS COMMITTEE
1 AN ACT
2 RELATING TO PUBLIC UTILITY COST REDUCTION BONDS; AMENDING TITLE 61, IDAHO
3 CODE, BY THE ADDITION OF A NEW CHAPTER 16, TITLE 61, IDAHO CODE, TO PRO-
4 VIDE LEGISLATIVE INTENT, TO DEFINE TERMS, TO PROVIDE FOR COST REDUCTION
5 ORDERS OF THE PUBLIC UTILITIES COMMISSION, TO LIMIT THE AGGREGATE AMOUNT
6 OF COST REDUCTION FINANCING, TO PROVIDE COST REDUCTION RATES, TO PROVIDE
7 PROCEDURES FOR ISSUANCE OF COST REDUCTION BONDS, TO PROVIDE FOR SECURITY
8 INTERESTS, TO PROVIDE FOR TRANSFERS IN INTEREST, TO PROVIDE FOR SUCCES-
9 SORS, TO PROVIDE DISCLAIMER OF STATE FULL FAITH AND CREDIT AND TO PROVIDE
10 SEVERABILITY.
11 Be It Enacted by the Legislature of the State of Idaho:
12 SECTION 1. That Title 61, Idaho Code, be, and the same is hereby amended
13 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap-
14 ter 16, Title 61, Idaho Code, and to read as follows:
15 CHAPTER 16
16 UTILITY COST REDUCTION BONDS
17 61-1601. LEGISLATIVE INTENT. It is the intent of the legislature in
18 enacting this chapter to authorize the public utilities commission to approve
19 certain cost reduction charges or rates as a method of financing or refinanc-
20 ing costs incurred or to be incurred by electric and gas utilities that will
21 accrue benefits to Idaho consumers through reduced utility rates. The legis-
22 lature believes that this type of securities legislation is in the public
23 interest but should not be considered as endorsement of, or intended to pro-
24 vide, a mechanism for restructuring of the utility industry in the state of
25 Idaho.
26 61-1602. DEFINITIONS. For purposes of this chapter, the following terms
27 shall have the following meanings, unless the context clearly requires other-
28 wise:
29 (1) "Approved costs" means the amounts that a public utility or assignee
30 has been authorized to recover by the commission pursuant to a cost reduction
31 order including, without limitation:
32 (a) Amounts incurred or to be incurred for purposes for which a public
33 utility may issue stock and stock certificates or other evidences of
34 interest or ownership, or bonds, notes or other evidences of indebtedness
35 under chapter 9, title 61, Idaho Code;
36 (b) Amounts necessary to recover federal or state taxes actually paid by
37 a public utility, which tax liability is modified by the transactions
38 approved in a cost reduction order issued by the commission pursuant to
39 this chapter; and
40 (c) Reasonable costs, as approved by the commission, relating to the
41 issuance, servicing or refinancing of cost reduction instruments under the
2
1 provisions of this chapter including, without limitation, principal,
2 interest or other payments and accruals, sinking fund payments, debt ser-
3 vice and other reserves, costs of credit enhancement, indemnities, if
4 any, owed to an assignee or the trustee for the cost reduction instrument,
5 issuance costs and redemption premiums, if any, and all other reasonable
6 fees, costs and charges with respect to the cost reduction instrument.
7 (2) "Assignee" means any corporation, limited liability company, trust,
8 partnership or other entity to which a public utility assigns, sells or trans-
9 fers, other than as security, all or a portion of the public utility's inter-
10 est in or right to cost reduction property. The term also includes any such
11 entity to which an assignee assigns, sells or transfers, other than as secu-
12 rity, the assignee's interest in or right to cost reduction property.
13 (3) "Chapter 9" means chapter 9, title 28, Idaho Code, as from time to
14 time amended, including any successor provisions.
15 (4) "Cost reduction instrument" means any instrument, pass-through cer-
16 tificate, note, bond, debenture, certificate of participation, collateral
17 trust certificate, beneficial interest or other evidence of indebtedness or
18 ownership issued by a public utility or an assignee pursuant to a cost reduc-
19 tion order and an executed indenture, security agreement or other similar
20 instrument that is secured by or payable from cost reduction rates or cost
21 reduction property.
22 (5) "Cost reduction instrument holder" means any holder of a cost reduc-
23 tion instrument or any trustee, collateral agent or other entity acting for
24 the benefit of or on behalf of any such holder.
25 (6) "Cost reduction order" means an order of the commission issued in
26 accordance with this chapter that authorizes the imposition and collection of
27 approved costs.
28 (7) "Cost reduction property" means the irrevocable, vested property
29 right created pursuant to this chapter and one (1) or more cost reduction
30 orders including, without limitation, the right, title and interest of a pub-
31 lic service company or assignee to all revenues, collections, claims, pay-
32 ments, money or proceeds of or arising from a cost reduction rate, and all
33 rights to obtain adjustments to such cost reduction rate pursuant to the terms
34 of this chapter and any cost reduction order.
35 (8) "Cost reduction rate" means a charge or rate that the commission
36 authorizes in a cost reduction order, whether such amounts are billed and/or
37 collected by the public utility, an assignee, any subsidiary or affiliate
38 thereof, or any third party that may assume the responsibility for billing or
39 collecting such cost reduction charges.
40 (9) "Public utility" means any electric or gas corporation subject to the
41 jurisdiction, regulation and control of the public utilities commission as
42 contained in chapter 1, title 61, Idaho Code.
43 61-1603. COST REDUCTION ORDER. (1) A public utility may apply to the com-
44 mission for a cost reduction order authorizing the recovery of approved costs
45 through the imposition and collection of a cost reduction rate.
46 (2) A public utility may apply to the commission from time to time for a
47 cost reduction order in a manner prescribed by the commission, in separate
48 proceedings for this purpose or in connection with a general rate case. Such
49 application may also include a request for authority to issue and sell cost
50 reduction instruments to be secured by or payable from the cost reduction rate
51 that results from such cost reduction order or the cost reduction property
52 created by this chapter and the cost reduction order related to such cost
53 reduction rate. Upon such an application, if the commission finds that the
54 public interest would be served if the approved costs were recovered through a
3
1 cost reduction rate, the commission shall issue a cost reduction order to
2 allow the public utility to recover the approved costs through a cost reduc-
3 tion rate and may also provide authority to issue and sell cost reduction
4 instruments.
5 (3) A cost reduction order shall detail the approved costs to be recov-
6 ered and the period of time in which recovery of the approved costs is to
7 occur. A cost reduction order shall specify the amount of the cost reduction
8 rate and the method for determining the amount of the cost reduction rate that
9 from time to time will be sufficient to recover all approved costs. Cost
10 reduction rates shall remain in effect until all approved costs have been paid
11 in full.
12 (4) A cost reduction order may be issued only upon the application of a
13 public utility and shall become effective only in accordance with its terms
14 and conditions. A public utility may withdraw its application for a cost
15 reduction order if it disagrees with any of the terms and conditions of the
16 order within fourteen (14) days of service of a final order on the public
17 utility. A public utility shall effect the withdrawal of its application by
18 filing a written notice of withdrawal with the commission within such time
19 period. Nothing in this section shall be construed to limit or preclude other
20 remedies that may be available to the public utility under applicable law.
21 (5) No public utility shall be treated as having acted unreasonably or
22 imprudently by reason of its failure to apply for a cost reduction order, by
23 reason of its withdrawal of an application for a cost reduction order, or by
24 reason of its failure to arrange for the issuance of cost reduction instru-
25 ments pursuant to a cost reduction order.
26 (6) Upon issuance of a cost reduction order, a public utility may sell,
27 assign or otherwise transfer or pledge cost reduction property created by this
28 chapter and the applicable cost reduction order, and if authorized by the par-
29 ticular cost reduction order, a public utility or an assignee may issue or
30 cause to be issued cost reduction instruments.
31 (7) Any cost reduction order, and the approved costs and the cost reduc-
32 tion rates that have been authorized by the commission in such cost reduction
33 order, shall be irrevocable and binding upon the commission. The commission
34 shall not have authority either by rescinding, altering or amending a cost
35 reduction order or otherwise to, either directly or indirectly, revalue or
36 revise for ratemaking purposes the approved costs or the cost reduction rates.
37 Once the commission authorizes a cost reduction rate, it cannot determine in a
38 later proceeding that the cost reduction rate is unjust or unreasonable, or in
39 any way reduce or impair the value of related cost reduction property, either
40 directly or indirectly, by taking the cost reduction rate into account when
41 setting other rates for the public utility; nor shall the amount of revenues
42 arising with respect thereto be subject to reduction, impairment, postponement
43 or termination. The state of Idaho does hereby pledge to and agree with the
44 owners of cost reduction property and with any cost reduction instrument hold-
45 ers that neither the state nor any of its agencies, including the commission,
46 shall (by administrative or legislative action, ballot initiative or other
47 similar process) limit, alter, restrict or impair the approved costs, the cost
48 reduction rate, the cost reduction property, the cost reduction orders or any
49 rights thereunder or ownership thereof or security interest therein or in any
50 way impair the rights or remedies of any cost reduction instrument holders.
51 The state does hereby acknowledge that any cost reduction instrument holders
52 may and will rely on this pledge and agreement and that they would be irrepa-
53 rably harmed by any such limitation, alteration, restriction or impairment
54 without such adequate provision.
55 (8) Notwithstanding any other provision of this chapter, the commission
4
1 will from time to time, and no less frequently than annually, approve adjust-
2 ments to the cost reduction rates as may be necessary to ensure timely and
3 complete recovery of all approved costs that are the subject of the pertinent
4 cost reduction order.
5 (9) Subject to the foregoing limitations, the commission has the same
6 authority with respect to a proposed cost reduction rate as it has with
7 regard to any other tariff, schedule or classification the effect of which is
8 to change any rate or charge, including, without limitation, the power granted
9 by chapter 6, title 61, Idaho Code, to conduct a hearing concerning a proposed
10 cost reduction rate and the reasonableness and justness thereof.
11 (10) The commission shall establish procedures for the expeditious proc-
12 essing of any application for cost reduction orders and adjustments thereto,
13 including the approval or disapproval of any such orders within forty-five
14 (45) days of the application therefor.
15 61-1604. LIMITATION ON AGGREGATE AMOUNT OF COST REDUCTION FINANCING. The
16 amount of approved costs in a cost reduction order, either individually or in
17 the aggregate with previously approved costs included in cost reduction orders
18 that remain outstanding, may not exceed an amount equal to forty percent (40%)
19 of the public utility's total capitalization, including both debt and equity,
20 as of the end of the fiscal year of such public utility preceding the applica-
21 tion for such cost reduction order.
22 61-1605. COST REDUCTION RATE. (1) Each cost reduction order shall specify
23 a procedure for making adjustments to the cost reduction rate that is the sub-
24 ject of the order.
25 (2) Upon application by a public utility the commission may:
26 (a) Authorize the making of adjustments to the cost reduction rate at
27 more frequent intervals than those specified in such order; and/or
28 (b) Authorize a change in the method for calculating the cost reduction
29 rate from that specified in such order so as to better ensure the timely
30 and complete recovery of all approved costs.
31 (3) The cost reduction rate shall be treated as a charge for utility ser-
32 vices for purposes of determining both the credit and collection standards and
33 the remedies for nonpayment that are available to a public utility.
34 (4) A cost reduction rate shall constitute cost reduction property when,
35 and to the extent that, a cost reduction order authorizing such cost reduction
36 rate has become effective in accordance with this chapter, and the cost reduc-
37 tion property shall thereafter continuously exist as property for all purposes
38 with all of the rights and privileges of this chapter for the period and to
39 the extent provided in the cost reduction order, but in any event until the
40 approved costs are paid in full.
41 (5) Any surplus cost reduction rate collections in excess of the amounts
42 necessary to pay approved costs shall be used in such manner as the commission
43 may reasonably determine.
44 (6) The obligation to pay amounts in respect of a cost reduction rate
45 cannot be avoided by the formation of a local publicly owned utility or other
46 entity, or by annexation of any portion of the service territory of the public
47 utility by a local publicly owned electric utility or other entity.
48 61-1606. COST REDUCTION INSTRUMENTS. (1) Public utilities and assignees
49 may issue and sell cost reduction instruments upon approval by the commission
50 of such action in a cost reduction order.
51 (2) Public utilities and assignees may sell and assign all or portions of
52 their interest in cost reduction property that is the basis for the issuance
5
1 of cost reduction instruments to the extent approved in the pertinent cost
2 reduction order. To the extent approved in the pertinent cost reduction
3 orders, public utilities and assignees may also pledge cost reduction property
4 as collateral, directly or indirectly, for cost reduction instruments provid-
5 ing for a security interest in the cost reduction property, in the manner as
6 set forth in this chapter. Cost reduction property may also be sold or
7 assigned by:
8 (a) A public utility, an assignee or a trustee for the holders of cost
9 reduction instruments in connection with the exercise of remedies upon a
10 default; or
11 (b) Any person acquiring the cost reduction property after a sale or
12 assignment pursuant to this subsection.
13 (3) To the extent that any interest in cost reduction property is so sold
14 or assigned, or is so pledged as collateral, the commission may authorize the
15 public utility to contract with an assignee that it will continue to operate
16 its system to provide service to its customers, will collect amounts with
17 respect to the cost reduction rates for the benefit and account of the
18 assignee, and will account for and remit these amounts to or for the account
19 of the assignee. Contracting with the assignee in accordance with that autho-
20 rization shall not impair or negate the characterization of the sale, assign-
21 ment or pledge as an absolute transfer, a true sale or security interest, as
22 applicable.
23 (4) Upon approval by the commission of a cost reduction order, any issu-
24 ance of cost reduction instruments approved therein, any related transfer or
25 pledge of cost reduction property and any other transactions incidental to
26 such issuance shall be exempt from the requirements of 61-901 through 61-908,
27 Idaho Code. The commission may include in any cost reduction order any addi-
28 tional approvals that may be required in connection with such issuance under
29 applicable law.
30 (5) An assignee shall not be considered to be an electric or gas corpora-
31 tion solely by virtue of the transactions described in this chapter.
32 61-1607. SECURITY INTEREST. (1) To the extent the provisions of this sec-
33 tion conflict with chapter 9 as from time to time in effect, including any
34 successor provisions, this section shall apply.
35 (2) A security interest in cost reduction property is valid, is enforce-
36 able against the pledgor and third parties, subject to the rights of any third
37 parties holding security interests in the cost reduction property perfected in
38 the manner described in this section, and attaches when all of the following
39 have occurred:
40 (a) The commission has issued a cost reduction order authorizing a cost
41 reduction rate, the right to the imposition and collection of which is
42 included in the cost reduction;
43 (b) Value has been given by the pledgees of the cost reduction property;
44 and
45 (c) The pledgor has signed a security agreement covering the cost reduc-
46 tion property.
47 (3) A valid and enforceable security interest in cost reduction property
48 is perfected when it has attached and when a financing statement has been
49 filed in accordance with chapter 9, naming the pledgor of the cost reduction
50 property as "debtor" and identifying the cost reduction property. Any
51 description of the cost reduction property shall be sufficient if it refers to
52 the cost reduction order creating the cost reduction property. A copy of the
53 financing statement shall be filed with the commission by the pledgor or
54 transferor of the cost reduction property, and the commission may require the
6
1 pledgor or transferor to make other filings with respect to the security
2 interest in accordance with procedures it may establish, provided that the
3 filings shall not affect the perfection of the security interest. A financing
4 statement filed pursuant to this section shall remain effective until a termi-
5 nation statement is filed.
6 (4) A perfected security interest in cost reduction property is a contin-
7 uously perfected security interest in all revenues and proceeds arising with
8 respect thereto, whether or not the revenues or proceeds have accrued. Con-
9 flicting security interests shall rank according to priority in time of per-
10 fection. Cost reduction property shall constitute property for all purposes,
11 including for contracts securing cost reduction instruments, whether or not
12 the revenues and proceeds arising with respect thereto have accrued.
13 (5) Subject to the terms of the security agreement covering the cost
14 reduction property and the rights of any third parties holding security inter-
15 ests in the cost reduction property perfected in the manner described in this
16 section, the validity and relative priority of a security interest created
17 under this section is not defeated or adversely affected by the commingling of
18 revenues arising with respect to the cost reduction property with other funds
19 of the public utility that is the pledgor or transferor of the cost reduction
20 property, or by any security interest in a deposit account of that public
21 utility perfected under chapter 9, into which the revenues are deposited.
22 Subject to the terms of the security agreement, the pledgees of the cost
23 reduction property shall have a perfected security interest in all cash and
24 deposit accounts of the public utility in which revenues arising with respect
25 to the cost reduction property have been commingled with other funds, but the
26 perfected security interest shall be limited to an amount not greater than the
27 amount of the revenues with respect to the cost reduction property received by
28 the public utility within twelve (12) months before: (a) any default under the
29 security agreement, or (b) the institution of insolvency proceedings by or
30 against the public utility, less payments from the revenues to the pledgees
31 during that twelve (12) month period.
32 (6) If an event of default occurs under the security agreement covering
33 the cost reduction property, the pledgees of the cost reduction property, sub-
34 ject to the terms of the security agreement, shall have all rights and reme-
35 dies of a secured party upon default under chapter 9, and shall be entitled
36 to foreclose or otherwise enforce their security interest in the cost reduc-
37 tion property, subject to the rights of any third parties holding prior secu-
38 rity interests in the cost reduction property perfected in the manner provided
39 in this section. In addition, the commission may require, in the cost reduc-
40 tion order creating the cost reduction property, that, in the event of default
41 by the public utility in payment of revenues arising with respect to the cost
42 reduction property, the commission and any successor thereto, upon the appli-
43 cation by the pledgees or transferees, including transferees under section
44 61-1608, Idaho Code, of the cost reduction property, and without limiting any
45 other remedies available to the pledgees or transferees by reason of the
46 default, shall order the sequestration and payment to the pledgees or trans-
47 ferees of revenues arising with respect to the cost reduction property. Any
48 order shall remain in full force and effect notwithstanding any bankruptcy,
49 reorganization, or other insolvency proceedings with respect to the debtor,
50 pledgor or transferor of the cost reduction property.
51 (7) Cost reduction property shall constitute a payment intangible as that
52 term is defined under chapter 9.
53 (8) Sections 28-9-204 and 28-9-205, Idaho Code, as from time to time
54 amended, including any successor provisions, shall apply to a pledge of cost
55 reduction property by a public utility, assignee or other issuer.
7
1 (9) This section sets forth the terms by which a consensual security
2 interest can be created and perfected in cost reduction property. Unless
3 otherwise ordered by the commission with respect to any series of cost reduc-
4 tion instruments on or prior to the issuance of the series, there shall exist
5 a statutory lien as provided in this section. Upon the effective date of the
6 cost reduction order, there shall exist a first priority lien on all cost
7 reduction property then existing or thereafter arising pursuant to the terms
8 of the cost reduction order. This lien shall arise by operation of this sec-
9 tion automatically without any action on the part of the public utility, any
10 assignee or other issuer, or any other person. This lien shall secure all
11 obligations, then existing or subsequently arising, to the holders of the cost
12 reduction instruments issued pursuant to the cost reduction order, the trustee
13 or representative for the holders, and any other entity specified in the cost
14 reduction order. The persons for whose benefit this lien is established
15 shall, upon the occurrence of any defaults specified in the pertinent cost
16 reduction order, have all rights and remedies of a secured party upon default
17 under chapter 9, and shall be entitled to foreclose or otherwise enforce this
18 statutory lien in the cost reduction property. This lien shall attach to the
19 cost reduction property regardless of who shall own, or shall subsequently be
20 determined to own, the cost reduction property including any public utility,
21 any assignee or other issuer, or any other person. This lien shall be valid,
22 perfected, and enforceable against the owner of the cost reduction property
23 and all third parties upon the effectiveness of the cost reduction order with-
24 out any further public notice; provided however, that any person may, but
25 shall not be required to, file a financing statement in accordance with sub-
26 section (3) of this section. Financing statements so filed may be "protective
27 filings" and shall not be evidence of the ownership of the cost reduction
28 property. A perfected statutory lien in cost reduction property is a continu-
29 ously perfected lien in all revenues and proceeds arising with respect
30 thereto, whether or not the revenues or proceeds have accrued. Conflicting
31 liens shall rank according to priority in time of perfection. In addition,
32 the commission may require, in the cost reduction order creating the cost
33 reduction property, that, in the event of default by the public utility in
34 payment of revenues arising with respect to cost reduction property, the com-
35 mission and any successor thereto, upon the application by the beneficiaries
36 of the statutory lien, and without limiting any other remedies available to
37 the beneficiaries by reason of the default, shall order the sequestration and
38 payment to the beneficiaries of revenues arising with respect to the cost
39 reduction property.
40 61-1608. TRANSFERS IN INTEREST. (1) A transfer of cost reduction property
41 by a public utility to an assignee, or by an assignee to another assignee,
42 that the parties have in the governing documentation expressly stated to be a
43 sale or other absolute transfer, in a transaction approved in a cost reduction
44 order, shall be treated as an absolute transfer of all of the transferor's
45 right, title and interest, as in a true sale, and not as a pledge or other
46 financing, of the cost reduction property, in each case notwithstanding any
47 contrary treatment for federal or state income and franchise taxes, accounting
48 or other purposes.
49 (2) A transfer of cost reduction property shall be deemed perfected as
50 against third persons and shall vest title in the transferee when both of the
51 following have taken place:
52 (a) The commission has issued the cost reduction order authorizing the
53 cost reduction rate included in the cost reduction property; and
54 (b) A written assignment of the cost reduction property has been executed
8
1 and delivered to the transferee.
2 (3) As between bona fide assignees of the same right for value without
3 notice, the assignee first filing a financing statement in accordance with
4 chapter 9, naming the assignor of the cost reduction property as debtor and
5 identifying the cost reduction property has priority. Any description of cost
6 reduction property shall be sufficient if it refers to the cost reduction
7 order creating the cost reduction property. A copy of the financing statement
8 shall be filed by the assignee with the commission, and the commission may
9 require the assignor or the assignee to make other filings with respect to the
10 transfer in accordance with procedures it may establish, but these filings
11 shall not affect the perfection of the transfer.
12 (4) The interest of an assignee or pledgee in cost reduction property and
13 in the revenues and collections arising from such property are not subject to
14 set-off, counterclaim, surcharge or defense by the public utility or any other
15 person or in connection with the bankruptcy of the public utility or any other
16 person.
17 61-1609. SUCCESSORS. Any successor to the public utility, whether pursu-
18 ant to any bankruptcy, reorganization or other insolvency proceeding, or pur-
19 suant to any merger, sale or transfer, by operation of law or otherwise, shall
20 perform and satisfy all obligations of the public utility pursuant to this
21 chapter in the same manner and to the same extent as was required of the pub-
22 lic utility before such proceeding or merger, sale or transfer including, but
23 not limited to, billing, collecting and paying to the cost reduction instru-
24 ment holders, or their representatives or the applicable financing entity,
25 cost reduction rates and any other revenues arising with respect to the cost
26 reduction property sold to the applicable financing entity or pledged to
27 secure cost reduction instruments and seeking cost reduction rate adjust-
28 ments, as necessary and permitted by the pertinent cost reduction order, to
29 recover all approved costs designated in such cost reduction order.
30 61-1610. DISCLAIMER OF STATE FULL FAITH AND CREDIT. Cost reduction rates,
31 cost reduction property, and any related cost reduction instruments issued
32 under this chapter and any applicable cost reduction orders do not constitute
33 a debt or liability of this state or of any political subdivision thereof and
34 do not constitute a pledge of the full faith and credit of this state or any
35 of its political subdivisions, but are payable solely from the funds provided
36 therefor. Any cost reduction instruments shall contain on the face thereof a
37 statement to the following effect: "Neither the full faith and credit nor the
38 taxing power of the state of Idaho is pledged to the payment of the principal
39 of, or interest on, this instrument."
40 61-1611. SEVERABILITY. If any provision of this act or its application to
41 any person or circumstance is held invalid, the remainder of the act or the
42 application of the provision to other persons or circumstances is not
43 affected.
STATEMENT OF PURPOSE
RS 15152
The purpose of this legislation is to provide the public
utilities commission with a method to approve certain cost
reduction charges or rates as a method of financing or
refinancing costs incurred or to be incurred by electric and gas
utilities that will accrue benefits to Idaho consumers through
reduced utility rates. This legislation should not be construed
as endorsement of, or intended to provide a mechanism for,
restructuring of the utility industry in Idaho.
FISCAL NOTE
There should be no fiscal impact to a fund of the state or a
local unit of government.
Contact
Name: Rep. George Eskridge
Name: Rep. Eric Anderson
Phone: 208-332-1000
Name: Neil Colwell, Avista Corporation
Phone: 208-343-3821
STATEMENT OF PURPOSE/FISCAL NOTE H 333