House Bill 0925
CODING: Words stricken are deletions; words underlined are additions.
Florida House of Representatives - 1999 HB 925
By Representatives Arnall, Wasserman Schultz and Logan
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 imputing
5 prospective future
6 contributions-in-aid-of-construction against
7 certin utility investments in certain rate
8 proceedings; providing construction; requiring
9 the commission to approve rates for certain
10 services under certain circumstances; providing
11 construction; deleting a requirement that the
12 commission consider a utility's investments in
13 certain lands or facilities in setting final
14 rates; providing an effective date.
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16 Be It Enacted by the Legislature of the State of Florida:
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18 Section 1. Paragraph (a) of subsection (2) of section
19 367.081, Florida Statutes, is amended to read:
20 367.081 Rates; procedure for fixing and changing.--
21 (2)(a)1. The commission shall, either upon request or
22 upon its own motion, fix rates which are just, reasonable,
23 compensatory, and not unfairly discriminatory. In every such
24 proceeding, the commission shall consider the value and
25 quality of the service and the cost of providing the service,
26 which shall include, but not be limited to, debt interest; the
27 requirements of the utility for working capital; maintenance,
28 depreciation, tax, and operating expenses incurred in the
29 operation of all property used and useful in the public
30 service; and a fair return on the investment of the utility in
31 property used and useful in the public service. However, the
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CODING: Words stricken are deletions; words underlined are additions.
Florida House of Representatives - 1999 HB 925
54-347A-99
1 commission shall not allow the inclusion of
2 contributions-in-aid-of-construction in the rate base of any
3 utility during a rate proceeding, nor shall the commission
4 impute prospective future contributions-in-aid-of-construction
5 against the utility's investment in property used and useful
6 in the public service; and accumulated depreciation on such
7 contributions-in-aid-of-construction shall not be used to
8 reduce the rate base, nor shall depreciation on such
9 contributed assets be considered a cost of providing utility
10 service.
11 2. For purposes of such proceedings, the commission
12 shall consider utility property, including land acquired or
13 facilities constructed or to be constructed, to be used and
14 useful in the public service, if:
15 a. Such property is needed to serve current customers;
16 b. Such property is needed to serve customers 5 years
17 after the end of the test year used in the commission's final
18 order on a rate request as provided in subsection (6); or
19 c. Such property is needed to serve customers more
20 than 5 full years after the end of the test year used in the
21 commission's final order on a rate request as provided in
22 subsection (6) only to the extent the utility presents clear
23 and convincing evidence to justify such consideration.
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25 Notwithstanding the provisions of this paragraph, the
26 commission shall approve rates for service that allow a
27 utility to recover from customers the full amount of
28 environmental compliance costs. Such rates shall not include
29 charges for allowances for funds prudently invested or similar
30 charges. For purposes of this requirement, the term
31 "environmental compliance costs" includes all reasonable
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CODING: Words stricken are deletions; words underlined are additions.
Florida House of Representatives - 1999 HB 925
54-347A-99
1 expenses and fair return on any prudent investment incurred by
2 a utility in complying with the requirements or conditions
3 contained in any permitting, enforcement, or similar decisions
4 of the United States Environmental Protection Agency, the
5 Department of Environmental Protection, a water management
6 district, or any other governmental entity with similar
7 regulatory jurisdiction. The commission shall also consider
8 the investment of the utility in land acquired or facilities
9 constructed or to be constructed in the public interest within
10 a reasonable time in the future, not to exceed, unless
11 extended by the commission, 24 months from the end of the
12 historical test period used to set final rates.
13 Section 2. This act shall take effect upon becoming a
14 law.
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17 HOUSE SUMMARY
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Prohibits the Public Service Commission from imputing
19 prospective future contributions-in-aid-of-construction
against the utility's investment in property used and
20 useful in the public service. Construes the term "used
and useful in public service" as applied to utility
21 property for purposes of rate proceedings. Requires the
commission to approve rates which allow a utility to
22 recover environmental compliance costs and defines the
term "environmental compliance costs." Deletes a
23 requirement the the commission consider, in setting final
rates, a utility's investment in lands acquired or
24 facilities constructed or to be constructed in the public
interest. See bill for details.
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