1.1 	A bill for an act
1.2 	relating to utilities; modifying provisions relating to deadline for rate 
1.3 	determination by Public Utilities Commission; making clarifying correction;
1.4 	amending Minnesota Statutes 2008, section 216B.16, subdivisions 2, 7b.
1.5 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.6 	Section 1. Minnesota Statutes 2008, section 216B.16, subdivision 2, is amended to read:
1.7 		Subd. 2.Suspension of proposed rate; hearing; final determination defined. (a) 
1.8 	Whenever there is filed with the commission a schedule modifying or resulting in a change 
1.9 	in any rates then in force as provided in subdivision 1, the commission may suspend the 
1.10 	operation of the schedule by filing with the schedule of rates and delivering to the affected 
1.11 	utility a statement in writing of its reasons for the suspension at any time before the rates 
1.12 	become effective. The suspension shall not be for a longer period than ten months beyond 
1.13 	the initial filing date except as provided in this subdivision or subdivision 1a.
1.14 	(b) During the suspension the commission shall determine whether all questions of 
1.15 	the reasonableness of the rates requested raised by persons deemed interested or by the 
1.16 	department can be resolved to the satisfaction of the commission. If the commission 
1.17 	finds that all significant issues raised have not been resolved to its satisfaction, or upon 
1.18 	petition by ten percent of the affected customers or 250 affected customers, whichever is 
1.19 	less, it shall refer the matter to the Office of Administrative Hearings with instructions 
1.20 	for a public hearing as a contested case pursuant to chapter 14, except as otherwise 
1.21 	provided in this section.
1.22 	(c) The commission may order that the issues presented by the proposed rate 
1.23 	changes be bifurcated into two separate hearings as follows: (1) determination of the 
1.24 	utility's revenue requirements and (2) determination of the rate design. Upon issuance of 
2.1 	both administrative law judge reports, the issues shall again be joined for consideration 
2.2 	and final determination by the commission.
2.3 	(d) All prehearing discovery activities of state agency intervenors shall be 
2.4 	consolidated and conducted by the Department of Commerce.
2.5 	(e) If the commission does not make a final determination concerning a schedule of 
2.6 	rates within ten months after the initial filing date, the schedule shall be deemed to have 
2.7 	been approved by the commission; except if:
2.8 	(1) an extension of the procedural schedule has been granted under paragraph (f) or 
2.9 	subdivision 1a, in which case the schedule of rates is deemed to have been approved by 
2.10 	the commission on the last day of the extended period of suspension; or
2.11 	(2) a settlement has been submitted to and rejected by the commission and the 
2.12 	commission does not make a final determination concerning the schedule of rates, the 
2.13 	schedule of rates is deemed to have been approved 60 days after the initial or, if applicable, 
2.14 	the extended period of suspension.
2.15 	(f) If the commission finds that it has insufficient time during the suspension period 
2.16 	to make a final determination of a case involving changes in general rates because of the 
2.17 	need to make a final determination of another previously filedany pending case involving 
2.18 	changes in general rates under this section or section 237.075, the commission may extend 
2.19 	the suspension period to the extent necessaryup to an additional 90 days to allow itself 20 
2.20 	working days to make the final determination after it has made a final determination in the 
2.21 	previously filed case. An extension of the suspension period under this paragraph does 
2.22 	not alter the setting of interim rates under subdivision 3. 
2.23 	(g) For the purposes of this section, "final determination" means the initial decision 
2.24 	of the commission and not any order which may be entered by the commission in response 
2.25 	to a petition for rehearing or other further relief. The commission may further suspend 
2.26 	rates until it determines all those petitions.

2.27 	Sec. 2. Minnesota Statutes 2008, section 216B.16, subdivision 7b, is amended to read:
2.28 		Subd. 7b. Transmission cost adjustment. (a) Notwithstanding any other provision 
2.29 	of this chapter, the commission may approve a tariff mechanism for the automatic annual 
2.30 	adjustment of charges for the Minnesota jurisdictional costs of (i) new transmission 
2.31 	facilities that have been separately filed and reviewed and approved by the commission 
2.32 	under section 216B.243or are certified as a priority project or deemed to be a priority 
2.33 	transmission project under section 216B.2425; and (ii) charges incurred by a utility that 
2.34 	accrue from other transmission owners' regionally planned transmission projects that have 
3.1 	been determined by the Midwest Independent System Operator to benefit the utility, as 
3.2 	provided for under a federally approved tariff. 
3.3 	(b) Upon filing by a public utility or utilities providing transmission service, the 
3.4 	commission may approve, reject, or modify, after notice and comment, a tariff that: 
3.5 	(1) allows the utility to recover on a timely basis the costs net of revenues of 
3.6 	facilities approved under section 216B.243 or certified or deemed to be certified under 
3.7 	section 216B.2425 or exempt from the requirements of section 216B.243; 
3.8 	(2) allows the charges incurred by a utility that accrue from other transmission 
3.9 	owners' regionally planned transmission projects that have been determined by the 
3.10 	Midwest Independent System Operator to benefit the utility, as provided for under a 
3.11 	federally approved tariff. These charges must be reduced or offset by revenues received 
3.12 	by the utility and by amounts the utility charges to other regional transmission owners, to 
3.13 	the extent those revenues and charges have not been otherwise offset; 
3.14 	(3) allows a return on investment at the level approved in the utility's last general 
3.15 	rate case, unless a different return is found to be consistent with the public interest; 
3.16 	(4) provides a current return on construction work in progress, provided that 
3.17 	recovery from Minnesota retail customers for the allowance for funds used during 
3.18 	construction is not sought through any other mechanism; 
3.19 	(5) allows for recovery of other expenses if shown to promote a least-cost project 
3.20 	option or is otherwise in the public interest; 
3.21 	(6) allocates project costs appropriately between wholesale and retail customers; 
3.22 	(7) provides a mechanism for recovery above cost, if necessary to improve the 
3.23 	overall economics of the project or projects or is otherwise in the public interest; and 
3.24 	(8) terminates recovery once costs have been fully recovered or have otherwise 
3.25 	been reflected in the utility's general rates. 
3.26 	(c) A public utility may file annual rate adjustments to be applied to customer bills 
3.27 	paid under the tariff approved in paragraph (b). In its filing, the public utility shall provide: 
3.28 	(1) a description of and context for the facilities included for recovery; 
3.29 	(2) a schedule for implementation of applicable projects; 
3.30 	(3) the utility's costs for these projects; 
3.31 	(4) a description of the utility's efforts to ensure the lowest costs to ratepayers for 
3.32 	the project; and 
3.33 	(5) calculations to establish that the rate adjustment is consistent with the terms 
3.34 	of the tariff established in paragraph (b). 
3.35 	(d) Upon receiving a filing for a rate adjustment pursuant to the tariff established in 
3.36 	paragraph (b), the commission shall approve the annual rate adjustments provided that, 
4.1 	after notice and comment, the costs included for recovery through the tariff were or are 
4.2 	expected to be prudently incurred and achieve transmission system improvements at the 
4.3 	lowest feasible and prudent cost to ratepayers.