SF 2336

as introduced - 87th Legislature (2011 - 2012) Posted on 03/16/2012 08:57am

A bill for an act
relating to energy; utilities; joint ventures; Indian tribes; expanding joint venture
authority to include Indian tribes; amending Minnesota Statutes 2010, section
452.25, subdivisions 2, 3, 5, 6.

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

Section 1.

Minnesota Statutes 2010, section 452.25, subdivision 2, is amended to read:

Subd. 2.

Definitions.

For purposes of this section:

(a) "City" means a statutory or home rule charter city, section 410.015 to the
contrary notwithstanding.

(b) "Cooperative association" means a cooperative association organized under
chapter 308A.

(c) "Governing body" means (1) the city council in a city that operates a municipal
utility, or (2) a board, commission, or body empowered by law, city charter, or ordinance
or resolution of the city council to control and operate the municipal utility.

(d) "Investor-owned utility" means an entity that provides utility services to the
public under chapter 216B and that is owned by private persons.

(e) "Municipal power agency" means an organization created under sections 453.51
to 453.62.

(f) "Municipal utility" means a utility owned, operated, or controlled by a city to
provide utility services.

(g) "Public utility" or "utility" means a provider of electric new text begin , gas, new text end or water facilities
or services or an entity engaged in other similar or related operations authorized by law
or charter.

Sec. 2.

Minnesota Statutes 2010, section 452.25, subdivision 3, is amended to read:

Subd. 3.

Authority.

(a) Upon the approval of its elected utilities commission or, if
there be none, its city council, a municipal utility may enter into a joint venture with other
municipal utilities, municipal power agencies, cooperative associations, deleted text begin or deleted text end investor-owned
utilities new text begin , or federally recognized Indian tribes new text end to provide utility services. Retail electric
utility services provided by a joint venture must be within the boundaries of each utility's
exclusive electric service territory as shown on the map of service territories maintained
by the department of commerce. The terms and conditions of the joint venture are
subject to ratification by the governing bodies of the respective utilities and may include
the formation of a corporate or other separate legal entity with an administrative and
governance structure independent of the respective utilities.

(b) A corporate or other separate legal entity, if formed:

(1) has the authority and legal capacity and, in the exercise of the joint venture, the
powers, privileges, responsibilities, and duties authorized by this section;

(2) is subject to the laws and rules applicable to the organization, internal
governance, and activities of the entity;

(3) in connection with its property and affairs and in connection with property within
its control, may exercise any and all powers that may be exercised by a natural person
or a private corporation or other private legal entity in connection with similar property
and affairs;

(4) a joint venture that does not include an investor-owned utility may elect to be
deemed a municipal utility or a cooperative association for purposes of chapter 216B or
other federal or state law regulating utility operations; and

(5) for a joint venture that includes an investor-owned utility, the commission has
authority over the activities, services, and rates of the joint venture, and may exercise that
authority, to the same extent the commission has authority over the activities, services,
and rates of the investor-owned utility itself.

(c) Any corporation, if formed, must comply with section 465.719, subdivisions 9,
10, 11, 12, 13, and 14. The term "political subdivision," as it is used in section 465.719,
shall refer to the city council of a city.

Sec. 3.

Minnesota Statutes 2010, section 452.25, subdivision 5, is amended to read:

Subd. 5.

Powers.

(a) A joint venture under this section has the powers, privileges,
responsibilities, and duties of the separate utilities entering into the joint venture as the
joint venture agreement may provide, including the powers under paragraph (c), except
that:

(1) with respect to retail electric utility services, a joint venture shall not enlarge or
extend the service territory served by the joint venture by virtue of the authority granted in
sections 216B.44, 216B.45, and 216B.47;

(2) a joint venture may extend service to an existing connected load of 2,000
kilowatts or more, pursuant to section 216B.42, when the load is outside of the assigned
service area of the joint venture, or of the electric utilities party to the joint venture, only if
the load is already being served by one of the electric utilities party to the joint venture; and

(3) a privately owned utility, as defined in section 216B.02, may extend service
to an existing connected load of 2,000 kilowatts or more, pursuant to section 216B.42,
when the load is located within the assigned service territory of the joint venture, or of
the electric utilities party to the joint venture, only if the load is already being served
by that privately owned utility.

(b) The limitations of paragraph (a), clauses (1) to (3), do not apply if written
consent to the action is obtained from the electric utility assigned to and serving the
affected service territory or connected load.

(c) Joint venture powers include, but are not limited to, the authority to:

(1) finance, own, acquire, construct, and operate facilities necessary to provide
utility services to retail customers of the joint venture, including generation, transmission,
new text begin storage new text end and distribution facilities, and like facilities used in other utility services;

(2) combine assigned service territories, in whole or in part, upon notice to, hearing
by, and approval of the public utilities commission;

(3) serve customers in the utilities' service territories or in the combined service
territory;

(4) combine, share, or employ administrative, managerial, operational, or other staff
if combining or sharing will not degrade safety, reliability, or customer service standards;

(5) provide for joint administrative functions, such as meter reading and billings;

(6) purchase or sell utility services at wholesale for resale to customers;

(7) provide conservation programs, other utility programs, and public interest
programs, such as cold weather shutoff protection and conservation spending programs,
as required by law and rule; and

(8) participate as the parties deem necessary in providing utility services with other
municipal utilities, cooperative utilities, investor-owned utilities, new text begin federally recognized
Indian tribes, new text end or other entities, public or private.

(d) Notwithstanding any contrary provision within this section, a joint venture
formed under this section may engage in wholesale utility services unless the municipal
utility, municipal power agency, cooperative association, deleted text begin or deleted text end investor-owned utility new text begin , or
federally recognized Indian tribe new text end party to the joint venture is prohibited under current law
from conducting that activity; but, in any case, the joint venture may provide wholesale
services to a municipal utility, a cooperative association, deleted text begin or deleted text end an investor-owned utility new text begin , or a
federally recognized Indian tribe new text end that is party to the joint venture.

(e) This subdivision does not limit the authority of a joint venture to exercise powers
of eminent domain for other utility purposes to the same extent as is permitted of those
utilities party to the joint venture.

Sec. 4.

Minnesota Statutes 2010, section 452.25, subdivision 6, is amended to read:

Subd. 6.

Construction.

(a) The powers conferred by this section are in addition
to the powers conferred by other law or charter. A joint venture under this section, and
a municipal utility with respect to any joint venture under this section, have the powers
necessary to effect the intent and purpose of this section, including, but not limited to, the
expenditure of public funds and the transfer of real or personal property in accordance
with the terms and conditions of the joint venture and the joint venture agreement. This
section is complete in itself with respect to the formation and operation of a joint venture
under this section and with respect to a municipal utility, a cooperative association, or an
investor-owned utility party to a joint venture related to their creation of and dealings
with the joint venture, without regard to other laws or city charter provisions that do not
specifically address or refer to this section or a joint venture created under this section.

(b) This section must not be construed to supersede or modify:

(1) the power of a city council conferred by charter to overrule or override any action
of a governing body other than the actions of the joint venture;

(2) chapter 216B;

(3) any referendum requirements applicable to the creation of a new electric utility
by a municipality under section 216B.46 or 216B.465; or

(4) any powers, privileges, or authority or any duties or obligations of a municipal
utility, municipal power agency, deleted text begin or deleted text end cooperative association new text begin , or federally recognized
Indian tribe new text end acting as a separate legal entity without reference to a joint venture created
under this section.