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SF 1490

as introduced - 88th Legislature (2013 - 2014) Posted on 03/21/2013 09:36am

KEY: stricken = removed, old language. underscored = added, new language.

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Current Version - as introduced

1.1A bill for an act
1.2relating to local government; providing for public utility franchise agreements;
1.3authorizing municipalities to charge certain public utility fees;amending
1.4Minnesota Statutes 2012, section 216B.36.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.6    Section 1. Minnesota Statutes 2012, section 216B.36, is amended to read:
1.7216B.36 MUNICIPAL REGULATORY AND TAXING POWERS.
1.8    Subdivision 1. Fees authorized. Any public utility furnishing the utility services
1.9enumerated in section 216B.02 or occupying streets, highways, or other public property
1.10within a municipality may be required to obtain a license, permit, right, or franchise
1.11in accordance with the terms, conditions, and limitations of regulatory acts of the
1.12municipality, including the placing of distribution lines and facilities underground. Under
1.13the license, permit, right, or franchise, the utility may be obligated by any municipality to
1.14pay to the municipality fees to raise revenue or defray increased municipal costs accruing
1.15as a result of utility operations, or both. The fee may include but is not limited to a sum
1.16of money based upon gross operating revenues or gross earnings from its operations in
1.17the municipality so long as the public utility shall continue to operate in the municipality,
1.18unless upon request of the public utility it is expressly released from the obligation at any
1.19time by such municipality. Notwithstanding the definition of "public utility" in section
1.20216B.02, subdivision 4 , a municipality may require payment of a fee under this section
1.21by a cooperative electric association organized under chapter 308A that furnishes utility
1.22services within the municipality. All existing licenses, permits, franchises, and other
1.23rights acquired by any public utility or municipality prior to April 11, 1974, including the
1.24payment of existing franchise fees, shall not be impaired or affected in any respect by the
2.1passage of this chapter, except with respect to matters of rate and service regulation,
2.2service area assignments, securities, and indebtedness that are vested in the jurisdiction
2.3of the commission by this chapter. However, in the event that a court of competent
2.4jurisdiction determines, or the parties by mutual agreement determine, that an existing
2.5license, permit, franchise, or other right has been abrogated or impaired by this chapter, or
2.6its execution, the municipality affected shall impose and the public utility shall collect
2.7an excise tax on the utility charges which from year to year yields an amount which is
2.8reasonably equivalent to that amount of revenue which then would be due as a fee, charges
2.9or other thing or service of value to the municipality under the franchise, license, or
2.10permit. The authorization shall be over and above taxing limitations including, but not
2.11limited to, those of section 477A.016. Franchises granted pursuant to this section shall be
2.12exempt from the provisions of chapter 80C. For purposes of this section, a public utility
2.13shall include a cooperative electric association.
2.14    Subd. 2. Franchise agreements; public utility plan and municipal energy goals.
2.15(a) Notwithstanding any conflicting provisions of this chapter, unless the municipality
2.16affirmatively agrees otherwise, a franchise agreement must include:
2.17(1) a specific written commitment to energy-efficiency measures to be undertaken
2.18by the public utility that will reduce the amount of energy consumed in the municipality.
2.19The efficiency measures may be, but are not limited to, transmission/delivery efficiency
2.20within the municipality and end-use efficiency. Energy use reductions must not be offset
2.21by increased rates or special tariffs designed to recover the amounts lost as a result of the
2.22new efficiency measures. Energy use reductions achieved through the efficiency measures
2.23taken must be reflected in reduced bills to ratepayers;
2.24(2) the policies and procedures of the public utility relating to the connection of
2.25alternative energy sources within the municipality to the transmission/delivery system of
2.26the public utility. These policies and procedures must be designed to make alternative
2.27energy connections as simple, timely, and cost-effective as possible;
2.28(3) a commitment to annually establish and follow a written energy system
2.29maintenance schedule for the public utility's infrastructure within the municipality that
2.30provides for sufficient measures by the public utility to ensure reasonable reliability within
2.31the municipality. The energy system maintenance schedule shall sufficiently anticipate
2.32infrastructure demands and improvements within the time frame of the agreement
2.33and shall facilitate the connection of alternative energy sources. The energy system
2.34maintenance schedule shall be provided to the municipality within one month of execution
2.35and acceptance of the franchise and thereafter on an annual basis within one month of
2.36each anniversary date of the franchise;
3.1(4) a specific written commitment to prepare, on an annual basis, a written analysis
3.2of the relationship between energy use within the municipality and the utility's obligation
3.3to meet state energy goals; and
3.4(5) a commitment to make quarterly reports to the municipality on system reliability
3.5that details service continuity and quality within the municipality, including for electricity,
3.6a ranking of circuit reliability that identifies the most unreliable circuit or circuits within
3.7the municipality.
3.8(b) If a municipality and a public utility do not enter into a franchise agreement, or
3.9a franchise agreement expires without timely renewal, the municipality may charge the
3.10public utility fees in-lieu of franchise fees in an amount not to exceed five percent of the
3.11public utility's total gross revenue from service provided within or to the municipality.
3.12(c) A municipality or a public utility that believes that the other is not negotiating the
3.13franchise in good faith may seek injunctive relief in an appropriate district court.
3.14EFFECTIVE DATE.This section is effective for franchise agreements entered into
3.15after July 1, 2013.

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