SF 92

1st Engrossment - 88th Legislature (2013 - 2014) Posted on 09/11/2013 02:45pm

A bill for an act
relating to public utilities; revising process and standard for approval of interim
rates; amending Minnesota Statutes 2012, section 216B.16, subdivision 3.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2012, section 216B.16, subdivision 3, is amended to read:

Subd. 3.

Interim rate.

(a) Notwithstanding any order of suspension of a proposed
increase in rates, the commission shall order an interim rate schedule into effect not later
than 60 days after the initial filing date. The commission shall order the interim rate
schedule ex parte without a public hearing. Notwithstanding the provisions of sections
216.25, 216B.27, and 216B.52, no interim rate schedule ordered by the commission
pursuant to this subdivision shall be subject to an application for a rehearing or an appeal
to a court until the commission has rendered its final determination.

(b) Unless the commission finds that exigent circumstances exist, the interim rate
schedule shall be calculated using the proposed test year cost of capital, rate base, and
expenses, except that it shall include: (1) a rate of return on common equity for the utility
equal to that authorized by the commission in the utility's most recent rate proceeding; (2)
rate base or expense items the same in nature and kind as those allowed by a currently
effective order of the commission in the utility's most recent rate proceeding; and (3) no
change in the existing rate design. In the case of a utility which has not been subject to a
prior commission determination, the commission shall base the interim rate schedule on
its most recent determination concerning a similar utility.

(c) If, at the time of its final determination, the commission finds that the interim
rates are in excess of the rates in the final determination, the commission shall order the
utility to refund the excess amount collected under the interim rate schedule, including
interest on it which shall be at the deleted text begin rate of interest determined by the commission deleted text end new text begin average
prime interest rate plus two percent, unless the commission determines a different rate is in
the public interest new text end . The utility shall commence distribution of the refund to its customers
within 120 days of the final order, not subject to rehearing or appeal. If, at the time of its
final determination, the commission finds that the interim rates are less than the rates in
the final determination, the commission shall prescribe a method by which the utility will
recover the difference in revenues between the date of the final determination and the date
the new rate schedules are put into effect. In addition, when an extension is granted for
settlement discussions under subdivision 1a, the commission shall allow the utility to also
recover the difference in revenues for a length of time equal to the length of the extension.

(d) If the public utility fails to make refunds within the period of time prescribed
by the commission, the commission shall sue therefor and may recover on behalf of all
persons entitled to a refund. In addition to the amount of the refund and interest due,
the commission shall be entitled to recover reasonable attorney's fees, court costs and
estimated cost of administering the distribution of the refund to persons entitled to it. No
suit under this subdivision shall be maintained unless instituted within two years after the
end of the period of time prescribed by the commission for repayment of refunds.

(e) The commission shall not order an interim rate schedule in a general rate case
into effect as provided by this subdivision until at least four months after it has made a
final determination concerning any previously filed change of the rate schedule or the
change has otherwise become effective under subdivision 2, unless:

(1) the commission finds that a four-month delay would unreasonably burden the
utility, its customers, or its shareholders and that an earlier imposition of interim rates
is therefore necessary; or

(2) the utility files a second general rate case at least 12 months after it has filed a
previous general rate case for which the commission has extended the suspension period
under subdivision 2.