First Regular Session
Sixty-second General Assembly
LLS NO. 99-0229.01 Jane Brown SENATE BILL 99-207
STATE OF COLORADO
BY SENATOR Tebedo;
also REPRESENTATIVE McPherson.
STATE, VETERANS, & MILITARY AFFAIRS
APPROPRIATIONS
A BILL FOR AN ACT
101 CONCERNING RATEPAYER PROTECTION FOR CUSTOMERS OF ENERGY
102 PUBLIC UTILITIES THAT CONDUCT ACTIVITIES UNRELATED TO
103 PROVIDING GAS OR ELECTRIC ENERGY.
Bill Summary
(Note: This summary applies to this bill as introduced and does
not necessarily reflect any amendments that may be subsequently
adopted.)
States that all natural gas and electric public utilities, including
cooperative electric associations, electrical and gas corporations, and
municipal gas and electric public utilities, shall be subject to the
following PUC regulatory actions with respect to their nonutility
activities:
The commission shall determine which activities not
subject to cost allocation constitute nonutility activities;
The nonutility activities of a gas or electric public utility
shall be excluded from its filed tariff rates; and
The commission shall adopt fair standards to govern the
relationship between such utilities and their nonutility
activities to prevent discrimination. Such standards shall
prevent unfair competition and protect ratepayers.
Requires cooperative associations actually engaged in nonutility
activities to pay into the fixed utility fund.
Requires the commission to ensure that no gas or electric public
utilities use ratepayer funds to subsidize nonutility activities.
1 Be it enacted by the General Assembly of the State of Colorado:
[ ] denotes HOUSE amendment. { } denotes SENATE amendment.
Capital letters indicate new material to be added to existing statute.
Dashes through the words indicate material to be deleted from existing statute.
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1 SECTION 1. Legislative declaration. (1) The general assembly
2 finds, determines, and declares that:
3 (a) In recent years, gas and electric public utilities have begun to
4 diversify into businesses other than the provision of "public utility"
5 service as traditionally defined and understood. Such nonutility activities
6 can include area or site lighting on private areas and grounds, electrical
7 construction contracting, appliance repair and retail sale of products,
8 services, and special fuels. This act is intended to further the purposes of
9 and extend the existing provisions of section 40-3-114, Colorado Revised
10 Statutes, prohibiting the subsidization of nonutility activities and shall not
11 replace or diminish such section in any way.
12 (b) It is in the public interest and it is the intention of this act to
13 promote free and fair competition in the provision of such goods and
14 services, protect ratepayers from paying improper charges, and continue
15 product choice for consumers.
16 (c) The nonutility activities of gas and electric public utilities are
17 a matter of statewide concern and require uniform applications of the
18 provisions of this act. It is the intent of the general assembly that the
19 provisions of this act be in place whether or not any gas or electric public
20 utility is deregulated.
21 SECTION 2. Article 1 of title 40, Colorado Revised Statutes, is
22 amended BY THE ADDITION OF A NEW SECTION to read:
23 40-1-103.2. Nonutility activities of gas and electric public
24 utilities - definition - role of commission. (1) AS USED IN THIS SECTION,
25 UNLESS THE CONTEXT OTHERWISE REQUIRES:
26 (a) "GAS AND ELECTRIC PUBLIC UTILITY" MEANS THE FOLLOWING
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1 ENTITIES THAT SUPPLY NATURAL GAS, ELECTRICITY, OR BOTH TO THE
2 GENERAL PUBLIC:
3 (I) PUBLIC UTILITIES SUPPLYING NATURAL GAS AND ELECTRICITY;
4 (II) COOPERATIVE ELECTRIC ASSOCIATIONS, AS DEFINED IN
5 SECTION 40-9.5-102;
6 (III) ELECTRICAL CORPORATIONS;
7 (IV) GAS CORPORATIONS;
8 (V) MUNICIPAL GAS AND ELECTRIC PUBLIC UTILITIES THAT
9 OPERATE OUTSIDE THE CITY LIMITS OF A HOME RULE CITY.
10 (b) "NONUTILITY ACTIVITY" MEANS ANY NONREGULATED SERVICE
11 OR LINE OF BUSINESS THAT IS NOT EXCLUSIVELY OFFERED AS A PUBLIC
12 UTILITY SERVICE, AS DEFINED IN ARTICLES 1 TO 7 OF THIS TITLE.
13 "NONUTILITY ACTIVITY" DOES NOT MEAN STREET, HIGHWAY, TRAFFIC, AND
14 OTHER LIGHTING SERVICES FOR CITIES AND COUNTIES, WHETHER OR NOT
15 SUCH SERVICES ARE PART OF INDIVIDUAL FRANCHISE AGREEMENTS.
16 (2) THE NONUTILITY ACTIVITIES OF A GAS AND ELECTRIC PUBLIC
17 UTILITY SHALL BE EXEMPT FROM REGULATION BY THE COMMISSION AND
18 FROM THE REQUIREMENTS OF ARTICLES 1 TO 7 OF THIS TITLE, EXCEPT AS
19 FOLLOWS:
20 (a) NO LATER THAN JULY 15, 1999, THE COMMISSION SHALL
21 COMMENCE A PROCEEDING TO DETERMINE WHICH ACTIVITIES NOT SUBJECT
22 TO SECTION 40-3-114 ARE WITHIN THE DEFINITION OF NONUTILITY
23 ACTIVITIES SET FORTH IN PARAGRAPH (b) OF SUBSECTION (1) OF THIS
24 SECTION.
25 (b) NO LATER THAN JULY 15, 2000, THE COMMISSION SHALL
26 ENSURE THAT PUBLIC UTILITY TARIFFS SHALL EXCLUDE ALL RATES, TOLLS,
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1 FARES, RENTALS, CHARGES, AND CLASSIFICATIONS RELATING TO
2 NONUTILITY ACTIVITIES.
3 (c) THE COMMISSION SHALL ADOPT FAIR STANDARDS TO PREVENT
4 UNFAIR COMPETITION AND PROTECT RATEPAYERS. SUCH FAIR STANDARDS
5 SHALL GOVERN THE RELATIONSHIP BETWEEN GAS AND ELECTRIC PUBLIC
6 UTILITIES AND THEIR NONUTILITY ACTIVITIES TO PREVENT DISCRIMINATION
7 BY SUCH UTILITIES. SUCH FAIR STANDARDS SHALL BE EFFECTIVE NO LATER
8 THAN JANUARY 1, 2000.
9 SECTION 3. 40-2-109, Colorado Revised Statutes, is amended
10 to read:
11 40-2-109. Report to executive director of the department of
12 revenue. On March 1 of each year, the public utilities commission shall
13 furnish the executive director of the department of revenue with a list of
14 those public utilities AND COOPERATIVE ASSOCIATIONS ACTUALLY
15 ENGAGED IN NONUTILITY ACTIVITIES subject to its jurisdiction,
16 supervision, and regulation on January 1 of each year, excepting those
17 motor vehicle carriers subject to the passenger-mile tax imposed by the
18 provisions of section 42-3-134, C.R.S., (but only so long as the cost of
19 regulation of such motor vehicle carriers shall be defrayed from the
20 proceeds of such passenger-mile tax).
21 SECTION 4. 40-2-110 (1), Colorado Revised Statutes, is
22 amended to read:
23 40-2-110. Appropriation and fees. (1) At each regular session,
24 the general assembly shall determine the amounts to be expended by the
25 public utilities commission for its administrative expenses in supervising
26 and regulating the public utilities which AND COOPERATIVE ASSOCIATIONS
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1 ACTUALLY ENGAGED IN NONUTILITY ACTIVITIES THAT are under its
2 jurisdiction, a list of which the commission is required by section
3 40-2-109 to furnish to the department of revenue, and shall appropriate
4 to the public utilities commission from the public utilities commission
5 fixed utility fund, established in section 40-2-114, the full amount so
6 determined, and such amount shall be defrayed out of the fees to be paid
7 by such public utilities AND COOPERATIVE ASSOCIATIONS ACTUALLY
8 ENGAGED IN NONUTILITY ACTIVITIES, as provided in section 40-2-112.
9 SECTION 5. 40-2-112 (1), Colorado Revised Statutes, is
10 amended to read:
11 40-2-112. Computation of fees. (1) On or before June 1 of each
12 year, the executive director of the department of revenue shall ascertain
13 the aggregate amount of gross operating revenues of all public utilities
14 AND COOPERATIVE ASSOCIATIONS ACTUALLY ENGAGED IN NONUTILITY
15 ACTIVITIES filing returns as provided in section 40-2-111. The executive
16 director shall then compute the percentage which THAT the full amount
17 determined by the general assembly for administrative expenses of the
18 public utilities commission for the supervision and regulation of such
19 public utilities AND COOPERATIVE ASSOCIATIONS is of the aggregate
20 amount of gross operating revenues of such public utilities AND
21 COOPERATIVE ASSOCIATIONS derived from intrastate utility business
22 transacted during the preceding calendar year, and the percentage so
23 computed shall be the basis upon which fees for the ensuing year shall be
24 fixed.
25 SECTION 6. 40-2-113, Colorado Revised Statutes, is amended
26 to read:
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1 40-2-113. Collection of fees, limitation. On or before June 15 of
2 each year, the department of revenue shall notify each public utility AND
3 COOPERATIVE ASSOCIATION ACTUALLY ENGAGED IN NONUTILITY
4 ACTIVITIES subject to the provisions of this article of the amount of its fee
5 for the ensuing fiscal year beginning July 1, computed by multiplying its
6 gross intrastate utility operating revenues for the preceding calendar year,
7 as set forth in its return filed for such purpose, by the percentage
8 determined in accordance with section 40-2-112; but no public utility OR
9 COOPERATIVE ASSOCIATION ACTUALLY ENGAGED IN NONUTILITY
10 ACTIVITIES shall be required to pay a fee in excess of one-fifth of one
11 percent of its gross intrastate utility operating revenues for the preceding
12 calendar year. Such fee shall be paid to the department of revenue in
13 equal quarterly installments on or before July 15, October 15, January 15,
14 and April 15 in each fiscal year. If payment is not made on or before said
15 dates, there shall be added as a penalty ten percent of the installment due,
16 together with interest at the rate of one percent per month on the amount
17 of the unpaid installment until such time as the full amount of the
18 installment, penalty, and interest has been paid. Upon failure, refusal, or
19 neglect of any public utility OR COOPERATIVE ASSOCIATION ACTUALLY
20 ENGAGED IN NONUTILITY ACTIVITIES to pay such fee, or any penalty or
21 interest, the attorney general shall bring suit in the name of the state to
22 collect the same.
23 SECTION 7. 40-2-114, Colorado Revised Statutes, is amended
24 to read:
25 40-2-114. Disposition of fees collected. All fees collected under
26 section 40-2-113 by the department of revenue shall be remitted to the
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1 state treasurer and credited by him as follows: Three percent to the
2 general fund and ninety-seven percent to the public utilities commission
3 fixed utility fund, which fund is hereby created and shall be expended
4 only to defray the full amount determined by the general assembly for the
5 administrative expenses of the commission for the supervision and
6 regulation of the public utilities AND COOPERATIVE ASSOCIATIONS
7 ACTUALLY ENGAGED IN NONUTILITY ACTIVITIES paying such fees and for
8 the financing of the office of consumer counsel created in article 6.5 of
9 this title. Any unexpended balance remaining in said fund at the end of
10 any fiscal year shall be retained by the state treasurer to defray such
11 administrative expenses of the commission during subsequent fiscal
12 years, and the executive director of the department of revenue shall take
13 any such unexpended balance into account when computing the
14 percentage upon which fees for the ensuing fiscal year shall be based.
15 SECTION 8. 40-3-114, Colorado Revised Statutes, is amended
16 to read:
17 40-3-114. Cost allocation - effect on competitive markets. The
18 commission shall ensure that regulated electric and gas NO GAS OR
19 ELECTRIC PUBLIC utilities do not use UTILITY USES ratepayer funds to
20 subsidize nonregulated NONUTILITY activities.
21 SECTION 9. 40-3.5-101 (1), Colorado Revised Statutes, is
22 amended to read:
23 40-3.5-101. Application - reasonable charges - adequate
24 service. (1) This article shall be applicable within the authorized electric
25 and natural gas service areas of each municipal utility which lie THAT ARE
26 outside the jurisdictional limits of such municipality. Insofar as
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1 municipal utilities establish rates, charges, and tariffs and any regulations
2 pertaining thereto in accordance with the provisions of this article, the
3 provisions of section 40-1-104 and articles 4, 6, 4 and 7 of this title shall
4 not apply. Nothing in this article shall be construed as limiting the
5 applicability of article 5 of this title.
6 SECTION 10. 40-9.5-103, Colorado Revised Statutes, is
7 amended to read:
8 40-9.5-103. Exemption from "Public Utilities Law" - exception
9 for nonutility activities. (1) Except as otherwise provided in this part
10 1, the provisions of the "Public Utilities Law", articles 1 to 7 1, 3, 4, 5,
11 AND 7 of this title, shall not apply to cooperative electric associations
12 which THAT have, by an affirmative vote of the members and consumers
13 pursuant to section 40-9.5-104, voted to exempt themselves from such
14 provisions and to be subject to the provisions of this part 1. The period
15 of exemption shall begin on the date the election results are filed with the
16 public utilities commission.
17 (2) NOTWITHSTANDING THE PROVISIONS OF SUBSECTION (1) OF
18 THIS SECTION, THE COMMISSION SHALL DETERMINE WHICH ACTIVITIES OF
19 GAS AND ELECTRIC PUBLIC UTILITIES, AS DEFINED IN SECTION 40-1-103.2
20 (1) (a), ARE NONUTILITY ACTIVITIES AND SUBJECT TO SECTION 40-3-114.
21 SUCH DETERMINATION SHALL BE MADE PURSUANT TO SECTION 40-1-103.2
22 (2) (b).
23 SECTION 11. Effective date - applicability. This act shall take
24 effect upon passage and shall apply to nonutility activities that gas and
25 electric public utilities are engaged in on or after said date.
26 SECTION 12. Safety clause. The general assembly hereby
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1 finds, determines, and declares that this act is necessary for the immediate
2 preservation of the public peace, health, and safety.