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H0557......................................................by STATE AFFAIRS
PUBLIC UTILITIES COMMISSION - Amends existing law to provide that, except
upon its finding that the public interest will be served thereby, the
Public Utilities Commission is prohibited in any order from setting rates
for any utility that grants a return on construction work in progress or on
property held for future use and which is not currently used and useful in
providing utility service; to delete reference to short-term construction
work in progress; and to provide that if the Public Utilities Commission
sets rates for any utility including a return on property held for future
use and subsequently determines that such property is not needed to provide
utility service, then any gain or loss occurring from the sale or other
disposition of the property will be included in the utility's rates.
02/06 House intro - 1st rdg - to printing
02/07 Rpt prt - to St Aff
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature Second Regular Session - 2006
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 557
BY STATE AFFAIRS COMMITTEE
1 AN ACT
2 RELATING TO PUBLIC UTILITY PROPERTY NOT PROVIDING UTILITY SERVICE; AMENDING
3 SECTION 61-502A, IDAHO CODE, TO PROVIDE THAT, EXCEPT UPON ITS FINDING THAT
4 THE PUBLIC INTEREST WILL BE SERVED THEREBY, THE PUBLIC UTILITIES COMMIS-
5 SION IS PROHIBITED IN ANY ORDER FROM SETTING RATES FOR ANY UTILITY THAT
6 GRANTS A RETURN ON CONSTRUCTION WORK IN PROGRESS OR ON PROPERTY HELD FOR
7 FUTURE USE AND WHICH IS NOT CURRENTLY USED AND USEFUL IN PROVIDING UTILITY
8 SERVICE, TO DELETE REFERENCE TO SHORT-TERM CONSTRUCTION WORK IN PROGRESS
9 AND TO PROVIDE IF THE COMMISSION SETS RATES FOR ANY UTILITY INCLUDING A
10 RETURN ON PROPERTY HELD FOR FUTURE USE AND SUBSEQUENTLY DETERMINES THAT
11 SUCH PROPERTY IS NOT NEEDED TO PROVIDE UTILITY SERVICE, THEN ANY GAIN OR
12 LOSS OCCURRING FROM THE SALE OR OTHER DISPOSITION OF THE PROPERTY WILL BE
13 INCLUDED IN THE UTILITY'S RATES.
14 Be It Enacted by the Legislature of the State of Idaho:
15 SECTION 1. That Section 61-502A, Idaho Code, be, and the same is hereby
16 amended to read as follows:
17 61-502A. RESTRICTION ON RATES AUTHORIZING RETURN ON PROPERTY NOT PROVID-
18 ING UTILITY SERVICE. Except upon its explicit finding of an extreme emergency
19 that the public interest will be served thereby, the commission is hereby pro-
20 hibited in any order issued after the effective date of this act, from setting
21 rates for any utility that grants a return on construction work in progress
22 (except short-term construction work in progress) or property held for future
23 use and which is not currently used and useful in providing utility service.
24 As used in this section, short-term construction work in progress means con-
25 struction work that has begun and will be completed in not more than twelve
26 (12) months. Except as authorized by this section, any rates granting a return
27 on construction work in progress (except short-term construction work in prog-
28 ress) or property held for future use are hereby declared to be unjust, unrea-
29 sonable, unfair, unlawful and illegal. When construction work in progress is
30 excluded from the rate base, the commission must allow a just, fair and rea-
31 sonable allowance for funds used during construction or similar account to be
32 accumulated, computed in accordance with generally accepted accounting princi-
33 ples. If the commission sets rates for any utility including a return on prop-
34 erty held for future use and subsequently determines that such property is not
35 needed to provide utility service, then any gain or loss occurring from the
36 sale or other disposition of the property will be included in the utility's
37 rates.
STATEMENT OF PURPOSE
RS 15862
The purpose of this legislation is to provide the Public
Utilities Commission with the authority to approve and set just,
reasonable and fair rates for energy and other utility facilities
under construction and for property that is acquired by a utility
and held for future use, such as a substation location. The
Public Utilities Commission, upon its explicit finding that the
public interest will be served, may grant a utility a return on
construction work in progress or property held for future use
which is not currently used in providing utility service. This
legislation will help ensure the development of energy and other
utility facilities meet the growing needs of Idaho citizens at a
reasonable cost. Additionally, property needed for future
utility infrastructure can be acquired early in the planning
process, which will reduce costs for utility customers.
FISCAL NOTE
There is no impact on the general fund. The Idaho Public
Utilities Commission is a self-sufficient regulatory agency which
derives its funding from the annual fees assessed against the
public utilities it regulates.
Contact
Name: Representative Max Black
Phone: (208) 332-1000
Name: Rich Hahn, Idaho Power Company
Phone: (208) 388-2513
STATEMENT OF PURPOSE/FISCAL NOTE H 557