Florida Senate - 2009 SB 1608
By Senator Fasano
11-00660A-09 20091608__
1 A bill to be entitled
2 An act relating to the financing of nuclear plants;
3 creating s. 366.8270, F.S.; providing legislative
4 finding and intent; defining terms; providing that
5 after the Public Service Commission grants a petition
6 for determination of need, an electric utility may
7 petition the commission for a financing order for
8 developing a nuclear plant; requiring the electric
9 utility to provide specified information in the
10 petition for a financing order; requiring that the
11 proceedings to consider a petition for a financing
12 order be completed in accordance with the provisions
13 of ch. 120, F.S., and other specified rules; requiring
14 the commission to include specified information in the
15 financing order issued to the electric utility;
16 requiring the electric utility to file with the
17 commission an annual letter that applies the formula
18 based mechanism applicable to nuclear plant
19 development charges; authorizing an adversely affected
20 party to petition for judicial review in the Supreme
21 Court under certain circumstances; providing that a
22 financing order remains in effect until the nuclear
23 plant development bonds issued pursuant to the order
24 have been paid in full and the commission-approved
25 financing costs of such bonds have been recovered in
26 full; providing for exceptions to commission
27 jurisdiction; specifying duties for an electric
28 utility that has obtained a financing order; requiring
29 the electric utility to include specified information
30 in electric bills; providing that intangible property
31 of a nuclear plant development constitutes a property
32 right or interest; providing that intangible property
33 of the nuclear plant development continues to exist
34 until the nuclear plant development bonds issued under
35 a financing order, and all financing costs and other
36 costs of the bonds, are paid in full; providing that
37 the Uniform Commercial Code does not apply to
38 intangible property of the nuclear plant development;
39 providing exceptions; providing that intangible
40 property of the nuclear plant development may be sold,
41 assigned, or transferred; requiring that all
42 referenced financing statements are subject to the
43 Uniform Commercial Code; providing an exception;
44 providing that the state law governs nuclear plant
45 developments; providing that nuclear plant development
46 bonds are not a debt or a general obligation of the
47 state or any of its political subdivisions; providing
48 that certain designated entities may legally invest in
49 nuclear plant development bonds; providing that the
50 state pledges to and agrees with specified parties
51 that the state will refrain from taking certain
52 actions; providing that an assignee or financing party
53 is not an electric utility or person providing
54 electric service when it engages in the transactions
55 described in this section; providing that certain
56 occurrences do not affect the validity of any action
57 taken by an electric utility, assignee, or financing
58 party; providing for penalties if the utility violates
59 the financing order or applicable provisions of the
60 act; providing an effective date.
61
62 Be It Enacted by the Legislature of the State of Florida:
63
64 Section 1. Section 366.8270, Florida Statutes, is created
65 to read:
66 366.8270 Nuclear plant financing.—
67 (1) LEGISLATIVE FINDINGS.—The Legislature finds and
68 declares that:
69 (a) The construction of nuclear power plants will result in
70 public health and economic benefits to the State of Florida and
71 its residents, including, but not limited to, reduction of
72 emissions, economic development, and job growth.
73 (b) Electric utilities in this state face the need to
74 construct nuclear power plants, including new, expanded, or
75 relocated electrical transmission lines or facilities that are
76 necessary in order to meet the need for increased generation
77 capacity, reduce dependence on fuel oil and natural gas, reduce
78 the costs of complying with air-emission standards, and
79 contribute to the long-term stability and reliability of the
80 electric grid.
81 (c) The capital costs associated with the construction of
82 nuclear power plants are significant.
83 (d) Electric utilities may find it difficult to use
84 traditional utility financing mechanisms to finance the
85 construction of nuclear power plants, which may cause the
86 utilities to defer construction of nuclear power plants, to
87 incur higher financing costs, or to use other financing
88 approaches that are less favorable to the state and its
89 residents.
90 (e) Customers of electric utilities have an interest in the
91 construction of nuclear power plants in the state using new
92 financing mechanisms that reduce the volatility of costs
93 associated with traditional utility financing mechanisms.
94 (f) Alternative financing mechanisms exist which may result
95 in lower costs or mitigate rate impacts to customers.
96 (g) In order to use such alternative financing mechanisms,
97 the Public Service Commission must be authorized to adopt a
98 financing order that advances these goals. The Legislature,
99 therefore, finds that it is in the interest of the state and the
100 public to encourage and facilitate the use of alternative
101 financing mechanisms that will enable certain electric utilities
102 to finance the construction of nuclear power plants in this
103 state to help lower costs or mitigate rate impacts to customers,
104 and to authorize the commission to review and approve such
105 alternative financing mechanisms as being consistent with the
106 public interest, as set forth in this section.
107 (2) DEFINITIONS.—As used in this section, the term:
108 (a) “Adjustment mechanism” means a formula-based mechanism
109 as described in a financing order for making annual or more
110 frequent adjustments to the amount of the nuclear plant
111 development charges which are necessary to correct for any
112 overcollection or undercollection of nuclear plant development
113 charges or to otherwise ensure the timely and complete payment
114 of nuclear plant development bonds and associated financing
115 costs.
116 (b) “Ancillary agreement” means any bond, insurance policy,
117 letter of credit, reserve account arrangement, surety bond, swap
118 arrangement, hedging arrangement, liquidity or credit support
119 arrangement, or other financial arrangement entered into in
120 connection with the issuance of nuclear plant development bonds.
121 (c) “Assignee” means any entity, including, but not limited
122 to, a corporation, limited liability company, partnership or
123 limited partnership, public authority, trust, financing entity,
124 financing party, or other legally recognized entity to which an
125 electric utility assigns, sells, or transfers, other than as
126 security, all or a portion of its interest in or right to
127 intangible property of a nuclear plant development. The term
128 also includes any entity or financing party to which an assignee
129 assigns, sells, or transfers, other than as security, its
130 interest in or right to intangible property of a nuclear plant
131 development.
132 (d) “Commission” means the Florida Public Service
133 Commission.
134 (e) “Electric utility” or “utility” has the same meaning as
135 in s. 366.8255.
136 (f) “Financing costs” means:
137 1. Interest and acquisition, defeasance, or redemption
138 premiums that are payable on nuclear plant development bonds;
139 2. Any payment required under an ancillary agreement and
140 any amount required to fund or replenish a reserve account or
141 other accounts established under the terms of any indenture,
142 ancillary agreement, or other financing documents pertaining to
143 nuclear plant development bonds;
144 3. Any other costs related to issuing, supporting,
145 repaying, and servicing nuclear plant development bonds,
146 including, but not limited to, servicing fees, accounting and
147 auditing fees, trustee fees, legal fees, consulting fees,
148 administrative fees, placement and underwriting fees,
149 capitalized interest, rating agency fees, stock exchange listing
150 and compliance fees, and filing fees, including costs related to
151 obtaining the financing order;
152 4. Any taxes and license fees imposed on the revenues
153 generated from the collection of nuclear plant development
154 charges;
155 5. Any income taxes resulting from the collection of
156 nuclear plant development charges in any such case whether paid,
157 payable, or accrued;
158 6. Any state and local taxes or franchise, gross receipts,
159 and other similar taxes or charges, including, but not limited
160 to, regulatory assessment fees, in any such case whether paid,
161 payable, or accrued; or
162 7. Any other costs, charges, and amounts approved by the
163 commission in a financing order.
164 (g) “Financing order” means an irrevocable order under
165 subsection (3) which allows for the issuance of nuclear plant
166 development bonds; the imposition, collection, and periodic
167 adjustments of nuclear plant development charges; recovery of
168 financing costs; and the creation of intangible property of a
169 nuclear plant development.
170 (h) “Financing party” means holders of nuclear plant
171 development bonds and trustees, collateral agents, or other
172 persons acting for the benefit of holders of nuclear plant
173 development bonds.
174 (i) “Financing statement” has the same meaning as in
175 Article 9 of the Uniform Commercial Code.
176 (j) “Intangible property of a nuclear plant development”
177 means:
178 1. All rights and interests of an electric utility or
179 successor or assignee of the electric utility under a financing
180 order, including the right to impose, bill, collect, and receive
181 nuclear plant development charges authorized in the financing
182 order and to obtain periodic adjustments to such charges as
183 provided in the financing order.
184 2. All revenues, collections, claims, rights to payments,
185 payments, money, or proceeds arising from the rights and
186 interests specified in subparagraph 1., regardless of whether
187 such revenues, collections, claims, rights to payment, payments,
188 money, or proceeds are imposed, billed, received, collected, or
189 maintained together with or commingled with other revenues,
190 collections, rights to payment, payments, money, or proceeds.
191 (k) “Pledgee” means a financing party to which an electric
192 utility or its successors or assignees mortgage, negotiate,
193 hypothecate, pledge, or create a security interest or lien on
194 all or any portion of their interests in or rights to intangible
195 property of a nuclear plant development.
196 (l) “Nuclear plant” or “plant” means an electrical power
197 plant, as defined in s. 403.503, which uses nuclear materials
198 for fuel.
199 (m) “Nuclear plant development activity” means any activity
200 or activities that an electric utility has taken or will take in
201 connection with the development of a nuclear plant in the state,
202 including, but not limited to, the siting, licensing, design,
203 construction, or operation of the nuclear plant, including any
204 necessary new, expanded, or relocated electrical transmission
205 lines or facilities of any size.
206 (n) “Nuclear plant development bonds” means bonds,
207 debentures, notes, interim financing arrangements, certificates
208 of participation, certificates of beneficial interest,
209 certificates of ownership, or other evidences of indebtedness or
210 ownership which are issued by an electric utility or an assignee
211 pursuant to a financing order, the proceeds of which are used
212 directly or indirectly to recover, finance, or refinance
213 commission-approved nuclear plant development costs and
214 financing costs and which are secured by or payable from
215 intangible property of the nuclear plant development.
216 (o) “Nuclear plant development charge” means the amounts
217 authorized by the commission to recover, finance, or refinance
218 nuclear plant development costs and financing costs, or as
219 provided for in a financing order to be imposed on all customer
220 bills and collected by an electric utility or its successors or
221 assignees, or a collection agent, in full through a charge that
222 is separate and apart from the electric utility's base rates.
223 Such charge shall be adjusted periodically pursuant to an
224 adjustment mechanism and paid by all existing and future
225 customers in the electric utility's historic service territory
226 or as such service territory may be expanded, receiving
227 transmission or distribution services from the electric utility
228 or its successors or assignees under commission-approved rate
229 schedules or under special contracts, even if the customer
230 elects to purchase electricity from an alternative electricity
231 supplier following a fundamental change in regulation of public
232 utilities in this state. Such nuclear plant development charges
233 shall remain in effect until all associated nuclear plant
234 development bonds and financing costs are paid in full.
235 (p) “Nuclear plant development costs” means costs as
236 defined in s. 366.93(1), including, but not limited to, any
237 interim financing costs accrued at the electric utility's
238 weighted cost-of-capital as determined by the commission in the
239 utility's most recent base rate proceeding; and costs of
240 retiring any existing debt or equity relating to nuclear plant
241 development activities.
242 (q) “Uniform Commercial Code” has the same meaning as in s.
243 671.101.
244 (3) FINANCING ORDERS.—
245 (a) After a petition for determination of need is granted,
246 an electric utility or any party to a previous years proceeding
247 brought pursuant to s. 366.96, may petition the commission for a
248 financing order as authorized by this section. Each petition
249 must contain the following information:
250 1. Describe the nuclear plant development activities that
251 the electric utility has undertaken or proposes to undertake and
252 describe the reasons for undertaking the activities.
253 2. Set forth the known nuclear plant development costs.
254 3. Estimate the costs of any nuclear plant development
255 activities that are not completed, or for which the costs are
256 not yet known, as identified and requested by the electric
257 utility.
258 4. Indicate whether the electric utility proposes to
259 finance all or a portion of the nuclear plant development costs
260 using nuclear plant development bonds. If the electric utility
261 proposes to finance a portion of the costs, the electric utility
262 shall identify that portion in the petition.
263 5. Estimate the financing costs related to the nuclear
264 plant development bonds.
265 6. Estimate the nuclear plant development charges necessary
266 to recover the nuclear plant development costs and financing
267 costs and the period for recovery of the costs.
268 7. Estimate any cost savings or mitigation of rate impacts
269 to customers resulting from financing nuclear plant development
270 costs with nuclear plant development bonds as opposed to the
271 traditional utility financing methods or traditional methods of
272 recovering such costs from customers.
273 8. Describe the adjustment mechanism.
274 9. File direct testimony supporting the petition.
275 This paragraph does not prohibit the commission, after
276 determining that the best interests of the utility and the
277 ratepayers will be served, from directing the utility to file a
278 petition. If the commission so orders the utility, all other
279 provisions of this section apply and the commission's order does
280 not eliminate the need for the commission to make all other
281 determinations as required by this section.
282 (b)1. Proceedings on a petition submitted pursuant to
283 paragraph (a) shall begin with a petition and shall be disposed
284 of in accordance with the provisions of chapter 120 and
285 applicable rules, except that the provisions of this section, to
286 the extent applicable, shall control.
287 a. Within 7 days after the filing of a petition, the
288 commission shall publish a case schedule, which must place the
289 matter before the commission on an agenda that will permit a
290 commission decision no later than 180 days after the date the
291 petition is filed.
292 b. No later than 200 days after the date the petition is
293 filed, the commission shall issue a financing order or an order
294 rejecting the petition. A party to the commission proceeding may
295 petition the commission for reconsideration of the financing
296 order within 5 days after the date of its issuance. The
297 commission shall issue a financing order authorizing financing
298 of reasonable and prudent nuclear plant development costs and
299 financing costs if the commission finds that the issuance of the
300 nuclear plant development bonds and the imposition of nuclear
301 plant development charges authorized by the order are reasonably
302 expected to result in lower costs or mitigation of rate impacts
303 to customers as compared with traditional utility methods of
304 financing or recovering nuclear plant development costs. Any
305 determination of whether nuclear plant development costs are
306 reasonable and prudent must be made with reference to the public
307 interest.
308 2. In a financing order issued to the electric utility, the
309 commission shall:
310 a. Except as provided in sub-subparagraph d. and in
311 subparagraph 5., specify the amount of nuclear plant development
312 costs, taking into consideration to the extent the commission
313 deems appropriate any other methods used to recover these costs;
314 describe and estimate the amount of financing costs which may be
315 recovered through nuclear plant development charges; and specify
316 the period over which such costs may be recovered.
317 b. Determine that the proposed structuring, expected
318 pricing, and financing costs of the nuclear plant development
319 bonds are reasonably expected to result in lower costs or
320 mitigation of rate impacts to customers as compared with
321 traditional utility methods of financing or recovering nuclear
322 plant development costs.
323 c. Provide that, for the periods specified pursuant to sub
324 subparagraph a., the imposition and collection of nuclear plant
325 development charges authorized in the financing order may not be
326 bypassed and must be paid by all existing and future customers
327 in the electric utility's historic service territory, or as such
328 service territory may be expanded, receiving transmission or
329 distribution service from the electric utility or its successors
330 or assignees under commission-approved rate schedules or under
331 special contracts, even if the customer elects to purchase
332 electricity from an alternative electric supplier following a
333 fundamental change in regulation of public utilities in the
334 state.
335 d. Include and describe an adjustment mechanism for making
336 expeditious annual or more frequent adjustments in the nuclear
337 plant development charges that customers are required to pay
338 under the financing order, and any adjustments that are
339 necessary to correct for any overcollection or undercollection
340 of the charges or to otherwise ensure the timely payment of
341 nuclear plant development bonds and financing costs and other
342 required amounts and charges payable in connection with the
343 nuclear plant development bonds.
344 e. Specify that the adjustment mechanism included in the
345 order is reasonable and just.
346 f. Specify the intangible property of the nuclear plant
347 development which is, or shall be, created in favor of an
348 electric utility or its successors or assignees and which shall
349 be used to pay or secure nuclear plant development bonds and
350 financing costs.
351 g. Provide sufficient flexibility to the electric utility
352 in establishing the terms and conditions of the nuclear plant
353 development bonds, including, but not limited to, repayment
354 schedules, interest rates, and other financing costs.
355 h. Provide that nuclear plant development charges be
356 allocated to customer classes, using the criteria set out in s.
357 366.06(1), in the manner in which these costs or their
358 equivalent were allocated in the utility's most recently
359 approved the cost-of-service study used.
360 i. Provide that, after the final terms of an issuance of
361 nuclear plant development bonds have been established, and
362 before the issuance of nuclear plant development bonds, the
363 electric utility shall determine the resulting initial nuclear
364 plant development charge in accordance with the financing order,
365 and such initial nuclear plant development charge shall be final
366 and effective upon the issuance of such nuclear plant
367 development bonds without further commission action.
368 j. Include any other provisions not otherwise inconsistent
369 with this section which the commission considers appropriate.
370 In performing the responsibilities of this subparagraph and
371 subparagraph 5., the commission may engage outside consultants
372 or counsel. Any expense associated with such services must be
373 included as part of financing costs and included in the nuclear
374 plant development charges.
375 3. A financing order issued to an electric utility may
376 provide that creation of the electric utility's intangible
377 property of the nuclear plant development pursuant to sub
378 subparagraph 2.f. is conditioned upon, and shall be simultaneous
379 with, the sale or other transfer of the intangible property to
380 an assignee and the pledge of the intangible property of the
381 nuclear plant development to secure nuclear plant development
382 bonds.
383 4. A financing order issued to an electric utility may
384 authorize the electric utility to issue more than one series of
385 nuclear plant development bonds. In this case, the electric
386 utility is not subsequently required to secure a separate
387 financing order for each issuance of nuclear plant development
388 bonds.
389 5. If the commission issues a financing order, the electric
390 utility or its successor or assignee shall file with the
391 commission at least annually a petition or a letter applying the
392 formula-based mechanism pursuant to sub-subparagraph 2.d. and,
393 based on estimates of consumption for each rate class and other
394 mathematical factors, requesting administrative approval to make
395 the adjustments described in sub-subparagraph 2.d. The review of
396 such a request shall be limited to determining whether there is
397 any mathematical error in the application of the formula-based
398 mechanism relating to the appropriate amount of any
399 overcollection or undercollection of nuclear plant development
400 charges and the amount of an adjustment. Such adjustments shall
401 ensure the collection of revenues sufficient to provide for the
402 timely payment of principal, interest, acquisition, defeasance,
403 financing costs, or redemption premium and other fees, costs,
404 and charges in respect of nuclear plant development bonds
405 approved under the financing order. Within 45 days after
406 receiving an electric utility's request pursuant to this
407 paragraph, the commission shall approve the request or inform
408 the electric utility of any mathematical errors in its
409 calculation. If the commission informs the utility of
410 mathematical errors in its calculation, the utility may correct
411 its error and refile its request. The timeframes previously
412 described in this paragraph apply to a refiled request.
413 6. Within 120 days after issuing the nuclear plant
414 development bonds, the electric utility shall file with the
415 commission information on the actual costs of the nuclear plant
416 development bond issuance. The commission shall review this
417 information to determine if the costs incurred when issuing the
418 bonds resulted in the lowest overall costs that were reasonably
419 consistent with market conditions at the time the bonds were
420 issued and the terms of the financing order. The commission may
421 disallow any incremental issuing cost in excess of the lowest
422 overall costs by requiring the utility to make a contribution in
423 aid of construction for the nuclear plant in an amount equal to
424 the excess of actual issuance costs incurred, and paid for out
425 of nuclear plant development bond proceeds, and the lowest
426 overall issuance costs as determined by the commission. The
427 commission may not make adjustments to the nuclear plant
428 development bond charges for any such excess issuance costs.
429 7. Subsequent to the earlier of the transfer of intangible
430 property of the nuclear plant development to an assignee or the
431 issuance of nuclear plant development bonds authorized thereby,
432 a financing order is irrevocable and, except as provided in
433 subparagraph 4. and paragraph (c), the commission may not amend,
434 modify, or terminate the financing order by any subsequent
435 action or reduce, impair, postpone, terminate, or otherwise
436 adjust nuclear plant development charges approved in the
437 financing order. After the issuance of a financing order, the
438 electric utility retains sole discretion regarding whether to
439 assign, sell, or otherwise transfer intangible property of the
440 nuclear plant development or to cause the nuclear plant
441 development bonds to be issued, including the right to defer or
442 postpone such assignment, sale, transfer, or issuance.
443 (c) At the request of an electric utility, the commission
444 may commence a proceeding and issue a subsequent financing order
445 that provides for retiring and refunding nuclear plant
446 development bonds issued pursuant to the original financing
447 order if the commission finds that the subsequent financing
448 order satisfies all of the criteria specified in paragraph (b).
449 Effective on retirement of the refunded nuclear plant
450 development bonds and the issuance of new nuclear plant
451 development bonds, the commission shall adjust the related
452 nuclear plant development charges accordingly.
453 (d) Within 30 days after the commission issues an order
454 pursuant to paragraph (b) or a decision denying a request for
455 reconsideration or, if the request for reconsideration is
456 granted, within 30 days after the commission issues its decision
457 on reconsideration, an adversely affected party may petition for
458 judicial review in the Supreme Court. The petition for review
459 shall be served upon the executive director of the commission
460 personally or by service at the office of the commission. Review
461 on appeal shall be based solely on the record before the
462 commission and briefs to the court and shall be limited to
463 determining whether the order issued pursuant to paragraph (b),
464 or the order on reconsideration, conforms to the State
465 Constitution and laws of this state and the United States and is
466 within the authority of the commission under this section.
467 Inasmuch as delay in the determination of the appeal of a
468 financing order will delay the issuance of nuclear plant
469 development bonds, thereby diminishing the savings or rate
470 mitigation benefits to customers which might be achieved if such
471 bonds were issued as contemplated by a financing order, the
472 Supreme Court shall proceed to hear and determine the action as
473 expeditiously as practicable and give the action precedence over
474 other matters not accorded similar precedence by law.
475 (e)1. A financing order remains in effect until the nuclear
476 plant development bonds issued pursuant to the order have been
477 paid in full and the commission-approved financing costs of such
478 bonds have been recovered in full.
479 2. A financing order issued to an electric utility shall
480 remain in effect and unabated notwithstanding the
481 reorganization, bankruptcy, or other insolvency proceedings of
482 the electric utility or its successors or assignees.
483 (4) EXCEPTIONS TO COMMISSION JURISDICTION.—If the
484 commission issues a financing order to an electric utility
485 pursuant to this section, the commission may not, other than for
486 federal income tax purposes, in exercising its powers and
487 carrying out its duties regarding any matter within its
488 authority under this chapter, consider the nuclear plant
489 development bonds issued under the order or any debt associated
490 with the issuance of the bonds to be the debt of the electric
491 utility, consider the nuclear plant development charges paid
492 under the order to be the revenue of the electric utility for
493 any purpose, or consider the nuclear plant development costs or
494 financing costs specified in the order to be the costs of the
495 electric utility, nor may the commission determine any action
496 taken by an electric utility which is consistent with the order
497 to be unjust or unreasonable.
498 (5) ELECTRIC UTILITY DUTIES.—
499 (a) The electric bills of an electric utility that has
500 obtained a financing order and sponsored nuclear plant
501 development bonds must reflect that a portion of the charges on
502 such bills represents nuclear plant development charges approved
503 in a financing order and, if the intangible property of the
504 nuclear plant development has been transferred to an assignee,
505 must include a statement to the effect that the assignee is the
506 owner of the intangible property and of the rights to the
507 nuclear plant development charges, and that the electric utility
508 or any other entity, if applicable, is acting as a billing and
509 collection agent or servicer for the assignee. The tariff
510 applicable to customers must indicate the nuclear plant
511 development and the ownership of that charge.
512 (b) An electric utility for which a financing order has
513 been issued shall place the proceeds of any nuclear plant
514 development bonds issued under a financing order in a separate
515 account. An electric utility may use the proceeds of the nuclear
516 plant development bonds only for the purposes of paying nuclear
517 plant development and financing costs and retiring any existing
518 debt or equity used to finance the costs.
519 (c) The failure of an electric utility to comply with this
520 subsection does not invalidate, impair, or affect any financing
521 order, intangible property of the nuclear plant development,
522 nuclear plant development charge, or nuclear plant development
523 bonds, but shall subject the electric utility to penalties under
524 s. 366.095.
525 (6) INTANGIBLE PROPERTY OF A NUCLEAR PLANT DEVELOPMENT.—
526 (a)1. All intangible property of a nuclear plant
527 development which is specified in a financing order constitutes
528 an existing, present property right or interest therein,
529 notwithstanding that the imposition and collection of nuclear
530 plant development charges depends on the electric utility to
531 which the order is issued performing its servicing functions
532 relating to the collection of nuclear plant development charges
533 and on future electricity consumption. The intangible property
534 exists whether or not the revenues or proceeds arising from the
535 property have been billed, have accrued, or have been collected,
536 and notwithstanding the fact that the value or amount of the
537 property is dependent on the future provision of service to
538 customers by the electric utility or its successors or
539 assignees.
540 2. Intangible property of a nuclear plant development
541 specified in a financing order shall continue to exist until the
542 nuclear plant development bonds issued pursuant to the order,
543 and all financing costs and other costs of the bonds, have been
544 paid in full.
545 3. All or any portion of intangible property of the nuclear
546 plant development specified in a financing order issued to an
547 electric utility may be transferred, sold, conveyed, or assigned
548 to a successor or assignee, which is wholly owned, directly or
549 indirectly, by the electric utility, and is created for the
550 limited purpose of acquiring, owning, or administering
551 intangible property of the nuclear plant development or issuing
552 nuclear plant development bonds under the financing order. All
553 or any portion of intangible property of the nuclear plant
554 development may be pledged to secure nuclear plant development
555 bonds issued pursuant to the order, amounts payable to financing
556 parties and to counterparties under any ancillary agreements,
557 and other financing costs. Each such transfer, sale, conveyance,
558 assignment, or pledge by an electric utility or affiliate of an
559 electric utility is considered to be a transaction in the
560 ordinary course of business.
561 4. If an electric utility or its successor defaults on any
562 required payment of charges arising from intangible property of
563 the nuclear plant development and specified in a financing
564 order, a court, upon application by an interested party, and
565 without limiting any other remedies available to the applying
566 party, shall order the sequestration and payment of the revenues
567 arising from the intangible property of the nuclear plant
568 development to the financing parties or assignees. Any such
569 order must remain in full force and effect notwithstanding any
570 reorganization, bankruptcy, or other insolvency proceedings with
571 respect to the electric utility or its successors or assignees.
572 5. The interest of a transferee, purchaser, acquirer,
573 assignee, financing party, or pledgee in intangible property of
574 the nuclear plant development property specified in a financing
575 order issued to an electric utility, and in the revenue and
576 collections arising from that intangible property, is not
577 subject to setoff, counterclaim, surcharge, or defense by the
578 electric utility or any other person or in connection with the
579 reorganization, bankruptcy, or other insolvency of the electric
580 utility or any other entity.
581 6. Any successor to an electric utility, whether pursuant
582 to any reorganization, bankruptcy, or other insolvency
583 proceeding; any municipalization, merger or acquisition, sale,
584 or other business combination; or transfer by operation of law,
585 as a result of electric utility restructuring or otherwise,
586 shall perform and satisfy all obligations of, and have the same
587 rights to the same extent under a financing order as, the
588 electric utility, including collecting and paying to the person,
589 assignee, or financing party the revenues, collections,
590 payments, or proceeds of the intangible property of the nuclear
591 plant development.
592 (b)1. Except as specified in this section, the Uniform
593 Commercial Code does not apply to intangible property of the
594 nuclear plant development or to any right, title, or interest of
595 a utility, assignee, or financing party described in paragraph
596 (2)(h), whether before or after the issuance of the financing
597 order. In addition, such right, title, or interest pertaining to
598 a financing order, including, but not limited to, the associated
599 intangible property of the nuclear plant development, and any
600 revenues, collections, claims, rights to payment, payments,
601 money, or proceeds of or arising from nuclear plant development
602 charges pursuant to such order, shall not be deemed proceeds of
603 any right or interest other than in the financing order and the
604 intangible property of the nuclear plant development arising
605 from the order.
606 2. The creation, attachment, granting, perfection,
607 priority, and enforcement of liens and security interests in
608 intangible property of a nuclear plant development to secure
609 nuclear plant development bonds shall be governed solely by this
610 section and not by the Uniform Commercial Code.
611 3. A valid, enforceable, and attached lien and security
612 interest in intangible property of a nuclear plant development
613 may be created only upon the later of:
614 a. The issuance of a financing order;
615 b. The execution and delivery of a security agreement with
616 a financing party in connection with the issuance of nuclear
617 plant development bonds; or
618 c. The receipt of value for the nuclear plant development
619 bonds.
620 A valid, enforceable, and attached security interest shall be
621 perfected against third parties as of the date of filing of a
622 financing statement in the Florida Secured Transaction Registry,
623 as such registry is defined in Article 9 of the Uniform
624 Commercial Code, in accordance with subparagraph 4., and shall
625 thereafter be a continuously perfected lien. Such security
626 interest in the intangible property of the nuclear plant
627 development, and all proceeds, whether billed, accrued, or
628 collected, however evidenced, shall have priority in accordance
629 with subparagraph 8. and take precedence over any subsequent
630 judicial or other lien creditor. A continuation statement need
631 not be filed to maintain such perfection.
632 4. Financing statements required to be filed under this
633 section shall be filed, maintained, and indexed in the same
634 manner and in the same system of records maintained for the
635 filing of financing statements in the Florida Secured
636 Transaction Registry under Article 9 of the Uniform Commercial
637 Code. The filing of such a financing statement is the only
638 method of perfecting a lien or security interest on intangible
639 property of the nuclear plant development.
640 5. The priority of a lien and security interest perfected
641 under this paragraph is not impaired by any later modification
642 of the financing order or intangible property of the nuclear
643 plant development or by the commingling of funds arising from
644 intangible property with other funds. Any other security
645 interest that may apply to those funds shall be terminated as to
646 all funds transferred to a segregated account for the benefit of
647 an assignee or a financing party or to an assignee or financing
648 party directly.
649 6. If a default or termination occurs under the terms of
650 the nuclear plant development bonds, the financing parties or
651 their representatives may foreclose on or otherwise enforce
652 their lien and security interest in any intangible property of
653 the nuclear plant development as if they were a secured party
654 under Article 9 of the Uniform Commercial Code. A court may
655 order that amounts arising from intangible property of the
656 nuclear plant development be transferred to a separate account
657 for the financing parties' benefit, to which their lien and
658 security interest apply. On application by or on behalf of the
659 financing parties to a circuit court of this state, such court
660 shall order the sequestration and payment to the financing
661 parties of revenues arising from the intangible property of the
662 nuclear plant development.
663 7. The interest of a pledgee of an interest or any rights
664 in any intangible property of a nuclear plant development is not
665 perfected until filing as provided in subparagraph 4.
666 8. The priority of the conflicting interests of pledgees in
667 the same interest or rights in any intangible property of the
668 nuclear plant development shall be determined as follows:
669 a. Conflicting perfected interests or rights of pledgees
670 rank according to priority in time of perfection. Priority dates
671 from the time a filing covering the interest or right is made in
672 accordance with this paragraph.
673 b. A perfected interest or right of a pledgee has priority
674 over a conflicting unperfected interest or right of a pledgee.
675 c. A perfected interest or right of a pledgee has priority
676 over a person who becomes a lien creditor after the perfection
677 of such pledgee's interest or right.
678 (c) The sale, assignment, or transfer of intangible
679 property of a nuclear plant development shall be governed by
680 this paragraph. All of the following apply to a sale,
681 assignment, or transfer under this paragraph:
682 1. The sale, conveyance, assignment, or other transfer of
683 intangible property of the nuclear plant development by an
684 electric utility to an assignee or financing party which the
685 parties have, in the governing documentation, expressly stated
686 to be a sale or other absolute transfer is an absolute transfer
687 and true sale of, and not a pledge of or secured transaction
688 relating to, the transferor's right, title, and interest in, to,
689 and under the intangible property of the nuclear plant
690 development, other than for federal and state income and
691 franchise tax purposes. After such a transaction, the intangible
692 property of the nuclear plant development is not subject to any
693 claims of the transferor or the transferor's creditors, other
694 than creditors holding a prior security interest in the
695 intangible property of the nuclear plant development perfected
696 under paragraph (b).
697 2. The characterization of the sale, conveyance,
698 assignment, or other transfer as a true sale or other absolute
699 transfer under subparagraph 1., and the corresponding
700 characterization of the transferee's property interest, is not
701 affected by:
702 a. Commingling of funds associated with the intangible
703 property of the nuclear plant development with other funds.
704 b. The retention by the transferor of a partial or residual
705 interest, including an equity interest, in the intangible
706 property of the nuclear plant development, whether direct or
707 indirect, or whether subordinate or otherwise.
708 c. Any recourse that the transferee may have against the
709 transferor other than a recourse created which is contingent
710 upon, or otherwise occurring or resulting from, the inability of
711 one or more of the transferor's customers to timely pay all or a
712 portion of the nuclear plant development charge.
713 d. Any indemnifications, obligations, or repurchase rights
714 made or provided by the transferor, other than indemnity or
715 repurchase rights based solely upon the inability of a
716 transferor's customers to timely pay all or a portion of the
717 nuclear plant development charge.
718 e. The responsibility of the transferor to collect nuclear
719 plant development charges.
720 f. The treatment of the sale, conveyance, assignment, or
721 other transfer for tax, financial reporting, or other purposes.
722 g. Granting or providing to holders of the nuclear plant
723 development bonds a preferred right to the intangible property
724 of the nuclear plant development, or credit enhancement by the
725 electric utility or its affiliates with respect to the nuclear
726 plant development bonds.
727 3. Any right that an electric utility has in the intangible
728 property of the nuclear plant development before its pledge,
729 sale, or transfer, or any other right created under this section
730 or created in the financing order and assignable under this
731 section or assignable pursuant to a financing order shall be
732 property in the form of a contract right. Transfer of an
733 interest in intangible property of the nuclear plant development
734 to an assignee is enforceable only upon the later of the
735 issuance of a financing order, the execution and delivery of
736 transfer documents to the assignee in connection with the
737 issuance of nuclear plant development bonds, and the receipt of
738 value. An enforceable transfer of an interest in intangible
739 property of the nuclear plant development to an assignee shall
740 be perfected against all third parties, including subsequent
741 judicial or other lien creditors, when a notice of that transfer
742 has been given by the filing of a financing statement in
743 accordance with subparagraph 4. The transfer shall be perfected
744 against third parties as of the date of filing.
745 4. Financing statements required to be filed under this
746 section shall be maintained and indexed in the same manner and
747 in the same system of records maintained for the filing of
748 financing statements in the Florida Secured Transaction Registry
749 under Article 9 of the Uniform Commercial Code. The filing of
750 such a financing statement is the only method of perfecting a
751 transfer of intangible property of the nuclear plant
752 development.
753 5. The priority of a transfer perfected under this section
754 is not impaired by any later modification of the financing order
755 or intangible property of the nuclear plant development or by
756 the commingling of funds arising from intangible property of the
757 nuclear plant development with other funds. Any other security
758 interest that may apply to those funds shall be terminated when
759 they are transferred to a segregated account for the assignee or
760 a financing party. If intangible property of the nuclear plant
761 development is transferred to an assignee or financing party,
762 any proceeds of that property shall be held in trust for the
763 assignee or financing party.
764 6. The priority of the conflicting interests of assignees
765 in the same interest or rights in any intangible property of the
766 nuclear plant development shall be determined as follows:
767 a. Conflicting perfected interests or rights of assignees
768 rank according to priority in time of perfection. Priority dates
769 from the time a filing covering the transfer is made in
770 accordance with subparagraph 4.
771 b. A perfected interest or right of an assignee has
772 priority over a conflicting unperfected interest or right of an
773 assignee.
774 c. A perfected interest or right of an assignee has
775 priority over a person who becomes a lien creditor after the
776 perfection of such assignee's interest or right.
777 (7) DESCRIPTION OR INDICATION OF PROPERTY.—In any sale
778 agreement, purchase agreement, or other transfer agreement,
779 granted or pledged to a pledgee in any security agreement,
780 pledge agreement, or other security document, or indicated in
781 any financing statement, the description of intangible property
782 of the nuclear plant development being transferred to an
783 assignee or financing party is sufficient only if it describes
784 the financing order that created the intangible property of the
785 nuclear plant development and states that such agreement or
786 financing statement covers all or part of such property
787 described in the financing order. This subsection applies to all
788 purported transfers of, and all purported grants or liens or
789 security interests in, intangible property of the nuclear plant
790 development, regardless of whether the related sale agreement,
791 purchase agreement, other transfer agreement, security
792 agreement, pledge agreement, or other security document was
793 entered into, or any financing statement was filed, before or
794 after July 1, 2009.
795 (8) FINANCING STATEMENTS.—All financing statements
796 referenced in this section are subject to Part 5 of Article 9 of
797 the Uniform Commercial Code except that the requirement as to
798 continuation statements does not apply.
799 (9) CHOICE OF LAW.—The law governing the validity,
800 enforceability, attachment, perfection, priority, and exercise
801 of remedies with respect to the transfer of an interest or right
802 or the pledge or creation of a security interest in any
803 intangible property of a nuclear plant development shall be the
804 laws of this state, and exclusively, the provisions of this
805 section.
806 (10) NUCLEAR PLANT DEVELOPMENT BONDS NOT PUBLIC DEBT.—The
807 state or its political subdivisions are not liable for any
808 nuclear plant development bonds, and the bonds are not a debt or
809 a general obligation of the state or any of its political
810 subdivisions, agencies, or instrumentalities. An issue of
811 nuclear plant development bonds does not, directly, indirectly
812 or contingently, obligate the state or any agency, political
813 subdivision, or instrumentality of the state to levy any tax or
814 make any appropriation for payment of the bonds, other than in
815 its capacity as a consumer of electricity. This subsection does
816 not preclude bond guarantees or enhancements pursuant to this
817 section. All bonds must contain on the face thereof a statement
818 to the following effect: “Neither the full faith and credit nor
819 the taxing power of the State of Florida is pledged to the
820 payment of the principal of, or interest on, this bond.”
821 (11) NUCLEAR PLANT DEVELOPMENT BONDS AS LEGAL INVESTMENTS
822 WITH RESPECT TO INVESTORS THAT REQUIRE STATUTORY AUTHORITY
823 REGARDING LEGAL INVESTMENT.—The following entities may legally
824 invest in nuclear plant development bonds:
825 (a) The state, the investment board, municipal
826 corporations, political subdivisions, public bodies, and public
827 officers, except for members of the commission.
828 (b) Banks and bankers, savings and loan associations,
829 credit unions, trust companies, savings banks and institutions,
830 investment companies, insurance companies, insurance
831 associations, and other persons carrying on a banking or
832 insurance business.
833 (c) Personal representatives, guardians, trustees, and
834 other fiduciaries.
835 (d) All other persons whatsoever who are now or may
836 hereafter be authorized to invest in bonds or other obligations
837 of a similar nature.
838 (12) STATE PLEDGE.—
839 (a) For purposes of this subsection, the term “bondholder”
840 means a person who holds a nuclear plant development bond.
841 (b) The state pledges to and agrees with bondholders, the
842 owners of the intangible property of a nuclear plant
843 development, and other financing parties that the state will
844 not:
845 1. Alter the provisions of this section which make the
846 nuclear plant development charges imposed by a financing order
847 irrevocable, binding, and nonbypassable charges;
848 2. Take or permit any action that impairs or would impair
849 the value of intangible property of the nuclear plant
850 development; or
851 3. Except as allowed under this section, reduce, alter, or
852 impair nuclear plant development charges that are to be imposed,
853 collected, and remitted for the benefit of the bondholders and
854 other financing parties until any and all principal, interest,
855 premium, financing costs and other fees, expenses, or charges
856 incurred, and any contracts to be performed, in connection with
857 the related nuclear plant development bonds have been paid and
858 performed in full.
859 This paragraph does not preclude limitation or alteration if
860 full compensation is made for the protection of the nuclear
861 plant development charges collected under a financing order.
862 (c) Any person or entity that issues nuclear plant
863 development bonds may include the pledge specified in paragraph
864 (b) in the bonds and related documentation.
865 (13) NOT AN ELECTRIC UTILITY.—An assignee or financing
866 party is not an electric utility or person providing electric
867 service by virtue of engaging in the transactions described in
868 this section.
869 (14) CONFLICTS.—In the event of conflict between this
870 section and any other law regarding the attachment, assignment,
871 or perfection, the effect of perfection, or the priority or
872 transfer of assignment or security interest in intangible
873 property of a nuclear plant development, this section governs to
874 the extent of the conflict.
875 (15) EFFECT OF INVALIDITY ON ACTIONS.—Effective on the date
876 that nuclear plant development bonds are first issued under this
877 section, if any provision of this section is held to be invalid,
878 is invalidated, superseded, replaced, or repealed, or expires
879 for any reason, that occurrence shall not affect the validity of
880 any action allowed under this section which is taken by an
881 electric utility, an assignee, a financing party, a collection
882 agent, or a party to an ancillary agreement. Any such action
883 shall remain in full force and effect with respect to all
884 nuclear plant development bonds issued or authorized in a
885 financing order issued under this section before the date that
886 such provision is held to be invalid; is invalidated,
887 superseded, replaced, or repealed; or expires for any reason.
888 (16) PENALTIES.—A violation of this section or of a
889 financing order issued under this section subjects the utility
890 that obtained the order to penalties under s. 366.095 and to any
891 other penalties or remedies that the commission determines are
892 necessary to achieve the intent of this section and the intent
893 and terms of the financing order, and to prevent any increase in
894 financial impact to the utility's ratepayers above that set
895 forth in the financing order. If the commission orders a penalty
896 or a remedy for a violation, the monetary penalty or remedy and
897 the costs of defending against the proposed penalty or remedy
898 may not be recovered from ratepayers. The commission may not
899 make adjustments to nuclear plant development charges for any
900 such penalties or remedies.
901 Section 2. This act shall take effect July 1, 2009.