Senate Bill 1034
CODING: Words stricken are deletions; words underlined are additions.
Florida Senate - 1998 SB 1034
By Senator Horne
6-771-98 See HB 3185
1 A bill to be entitled
2 An act relating to the Public Service
3 Commission; amending s. 367.081, F.S.;
4 prohibiting the commission from considering
5 prospective future
6 contributions-in-aid-of-construction for
7 certain purposes; providing construction;
8 requiring the commission to approve rates for
9 certain services under certain circumstances;
10 providing construction; providing an effective
11 date.
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13 Be It Enacted by the Legislature of the State of Florida:
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15 Section 1. Paragraph (a) of subsection (2) of section
16 367.081, Florida Statutes, is amended to read:
17 367.081 Rates; procedure for fixing and changing.--
18 (2)(a)1. The commission shall, either upon request or
19 upon its own motion, fix rates which are just, reasonable,
20 compensatory, and not unfairly discriminatory. In every such
21 proceeding, the commission shall consider the value and
22 quality of the service and the cost of providing the service,
23 which shall include, but not be limited to, debt interest; the
24 requirements of the utility for working capital; maintenance,
25 depreciation, tax, and operating expenses incurred in the
26 operation of all property used and useful in the public
27 service; and a fair return on the investment of the utility in
28 property used and useful in the public service. However, the
29 commission shall not allow the inclusion of
30 contributions-in-aid-of-construction in the rate base of any
31 utility during a rate proceeding, nor shall it impute
1
CODING: Words stricken are deletions; words underlined are additions.
Florida Senate - 1998 SB 1034
6-771-98 See HB 3185
1 prospective future contributions-in-aid-of-construction
2 against the utility's investment in property used and useful
3 in the public service; and accumulated depreciation on such
4 contributions-in-aid-of-construction shall not be used to
5 reduce the rate base, nor shall depreciation on such
6 contributed assets be considered a cost of providing utility
7 service.
8 2. For purposes of such proceedings, the commission
9 shall consider utility property, including land acquired or
10 facilities constructed or to be constructed, to be used and
11 useful in the public service, if:
12 a. Such property is needed to serve current customers;
13 b. Such property is needed to serve customers 5 years
14 after the expected date of the commission's entry of a final
15 order on a rate request as provided in subsection (6); or
16 c. Such property is needed to serve customers more
17 than 5 full years after the expected date of the commission's
18 entry of a final order on a rate request as provided in
19 subsection (6) only to the extent the utility presents clear
20 and convincing evidence to justify such consideration.
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22 Notwithstanding the provisions of this paragraph, the
23 commission shall approve rates for service that allow a
24 utility to recover from customers the full amount of
25 environmental compliance costs. Such rates shall not include
26 charges for allowances for funds prudently invested or similar
27 charges. For purposes of this requirement, the term
28 "environmental compliance costs" includes all reasonable
29 expenses and fair return on any prudent investment incurred by
30 a utility in complying with the requirements or conditions
31 contained in any permitting, enforcement, or similar decisions
2
CODING: Words stricken are deletions; words underlined are additions.
Florida Senate - 1998 SB 1034
6-771-98 See HB 3185
1 of the United States Environmental Protection Agency, the
2 Department of Environmental Protection, a water management
3 district, or any other governmental entity with similar
4 regulatory jurisdiction. The commission shall also consider
5 the investment of the utility in land acquired or facilities
6 constructed or to be constructed in the public interest within
7 a reasonable time in the future, not to exceed, unless
8 extended by the commission, 24 months from the end of the
9 historical test period used to set final rates.
10 Section 2. This act shall take effect upon becoming a
11 law.
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14 LEGISLATIVE SUMMARY
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Prohibits the Public Service Commission from imputing
16 future contributions-in-aid-of-construction against a
utility's investment in property. Construes the term
17 "used and useful in public service" as applied to utility
property for purposes of rate proceedings. Requires the
18 commission to approve rates which allow a utility to
recover environmental compliance costs. (See bill for
19 details.)
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