State of Illinois
91st General Assembly
Legislation

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91_HB0614

 
                                               LRB9102392JSpc

 1        AN  ACT  to  amend  the  Public Utilities Act by changing
 2    Section 6-102.

 3        Be it enacted by the People of  the  State  of  Illinois,
 4    represented in the General Assembly:

 5        Section  5.   The  Public  Utilities  Act  is  amended by
 6    changing Section 6-102 as follows:

 7        (220 ILCS 5/6-102) (from Ch. 111 2/3, par. 6-102)
 8        Sec. 6-102. Authorization of issues of stock.
 9        (a)  Subject to the provisions of this  Act  and  of  the
10    order  of  the  Commission  issued as provided in this Act, a
11    public utility may issue stocks and stock  certificates,  and
12    bonds,  notes  and other evidences of indebtedness payable at
13    periods of more than 12 months after the date thereof for any
14    lawful purpose. However, such public utility shall first have
15    secured from the Commission an order authorizing  such  issue
16    and stating the amount thereof and the purpose or purposes to
17    which  the  issue  or the proceeds thereof are to be applied,
18    and that  in  the  opinion  of  the  Commission,  the  money,
19    property or labor to be procured or paid for by such issue is
20    reasonably  required for the purpose or purposes specified in
21    the order.
22        (b)  The provisions of this subsection  (b)  shall  apply
23    only  to  (1)  any issuances of stock in a cumulative amount,
24    exclusive of any issuances referred to in item (3), that  are
25    10%  or  more in a calendar year or 20% or more in a 24-month
26    period of the total common stockholders'  equity  or  of  the
27    total  amount of preferred stock outstanding, as the case may
28    be, of the public utility, and (2) to any issuances of bonds,
29    notes or other evidences  of  indebtedness  in  a  cumulative
30    principal  amount,  exclusive of any issuances referred to in
31    item (3), that are 10% or more in a calendar year or  20%  or
 
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 1    more  in  a 24-month period of the aggregate principal amount
 2    of bonds, notes and other evidences of  indebtedness  of  the
 3    public  utility  outstanding,  all  as  of  the  date  of the
 4    issuance, but shall not apply to (3) any issuances  of  stock
 5    or  of bonds, notes or other evidences of indebtedness 90% or
 6    more of the proceeds of which are to be used  by  the  public
 7    utility  for  purposes of refunding, redeeming or refinancing
 8    outstanding issues of stock, bonds, notes or other  evidences
 9    of  indebtedness.  To  enable it to determine whether it will
10    issue the order required by subsection (a) of  this  Section,
11    the   Commission  may  hold  a  hearing  and  may  make  such
12    additional  inquiry  or  investigation,  and   examine   such
13    witnesses,  books,  papers, accounts, documents and contracts
14    and require the filing  of  such  data  as  it  may  deem  of
15    assistance.  The  public  utility  may  be  required  by  the
16    Commission  to  disclose  every  interest of the directors of
17    such public utility in any transaction  under  investigation.
18    The  Commission  shall  have  power  to  investigate all such
19    transactions and to inquire into the good faith  thereof,  to
20    examine  books,  papers, accounts, documents and contracts of
21    public utilities, construction or other companies or of firms
22    or individuals with whom the public utility  shall  have  had
23    financial  transactions,  for  the  purpose of enabling it to
24    verify any statements furnished,  and  to  examine  into  the
25    actual  value of property acquired by or services rendered to
26    such  public  utility.  Before   issuing   its   order,   the
27    Commission,  when  it  is deemed necessary by the Commission,
28    shall make an adequate physical valuation of all property  of
29    the public utility, but a valuation already made under proper
30    public  supervision  may  be  adopted,  either in whole or in
31    part, at the discretion of the  Commission;  and  shall  also
32    examine  all  previously authorized or outstanding securities
33    of the public utility, and fixed charges attached thereto.  A
34    statement  of  the  results of such physical valuation, and a
 
                            -3-                LRB9102392JSpc
 1    statement of the character  of  all  outstanding  securities,
 2    together with the conditions under which they are held, shall
 3    be  included  in  the  order. The Commission may require that
 4    such information or such part thereof as  it  thinks  proper,
 5    shall appear upon the stock, stock certificate, bond, note or
 6    other  evidence  of indebtedness authorized by its order. The
 7    Commission may by its order grant permission for the issue of
 8    such stock certificates, or bonds, notes or  other  evidences
 9    of  indebtedness  in  the  amount applied for, or in a lesser
10    amount, or not at all, and may attach to the exercise of  its
11    permission  such  condition  or  conditions  as  it  may deem
12    reasonable and  necessary.  Nothing  in  this  Section  shall
13    prevent  a  public  utility  from seeking, nor the Commission
14    from  approving,  a  shelf  registration  plan  for   issuing
15    securities  over  a  reasonable  period  in  accordance  with
16    regulations  established  by the United States Securities and
17    Exchange Commission.  Any securities issued  pursuant  to  an
18    approved shelf registration plan need not be further approved
19    by  the Commission so long as they are in compliance with the
20    approved shelf registration plan. The Commission  shall  have
21    the  power  to  refuse  its approval of applications to issue
22    securities, in whole or in part,  upon  a  finding  that  the
23    issue   of  such  securities  would  be  contrary  to  public
24    interest. The Commission may also require the public  utility
25    to compile for the information of its shareholders such facts
26    in  regard to its financial transactions, in such form as the
27    Commission may direct.
28        No public utility  shall,  without  the  consent  of  the
29    Commission,   apply   the   issue   of  any  stock  or  stock
30    certificates,  or   bond,   note   or   other   evidence   of
31    indebtedness,  which  was  issued pursuant to an order of the
32    Commission entered pursuant to this subsection  (b),  or  any
33    part  thereof,  or  any  proceeds thereof, to any purpose not
34    specified  in  the  Commission's  order  or  to  any  purpose
 
                            -4-                LRB9102392JSpc
 1    specified in the Commission's order in excess of  the  amount
 2    authorized  for such purpose; or issue or dispose of the same
 3    on any terms less favorable  than  those  specified  in  such
 4    order,  or  a modification thereof. The Commission shall have
 5    the power to require public  utilities  to  account  for  the
 6    disposition  of the proceeds of all sales of stocks and stock
 7    certificates,  and  bonds,  notes  and  other  evidences   of
 8    indebtedness,  which  were issued pursuant to an order of the
 9    Commission entered pursuant to this subsection (b),  in  such
10    form  and  detail  as it may deem advisable, and to establish
11    such rules and regulations as  it  may  deem  reasonable  and
12    necessary  to insure the disposition of such proceeds for the
13    purpose or purposes specified in its order.
14        (c)  A  public  utility  may  issue  notes,  for   proper
15    purposes,  and  not in violation of any provision of this Act
16    or any other Act, payable at periods  of  not  more  than  12
17    months  after  the  date of issuance of the same, without the
18    consent of the Commission; but no such note shall,  in  whole
19    or  in  part,  be renewed or be refunded from the proceeds of
20    any other such note or evidence of indebtedness from time  to
21    time  without  the consent of the Commission for an aggregate
22    period of longer than 2 years. A "telecommunications carrier"
23    as that term is defined by Section  13-202  of  this  Act  is
24    exempt from the requirements of this subsection (c).
25        (d)  Any  issuance  of  stock or of bonds, notes or other
26    evidences of indebtedness,  other  than  issuances  of  notes
27    pursuant  to  subsection  (c)  of  this Section, which is not
28    subject to subsection (b) of this Section, shall be regulated
29    by the Commission as follows:  the public utility shall  file
30    with  the Commission, at least 15 days before the date of the
31    issuance, an informational statement setting forth  the  type
32    and  amount of the issue and the purpose or purposes to which
33    the issue or the proceeds thereof are to be  applied.   Prior
34    to the date of the issuance specified in the public utility's
 
                            -5-                LRB9102392JSpc
 1    filing,  the Commission, if it finds that the issuance is not
 2    subject to subsection (b) of  this  Section,  shall  issue  a
 3    written  order  in  conformance  with  subsection (a) of this
 4    Section authorizing the issuance.  Notwithstanding any  other
 5    provisions  of  this  Act,  the  Commission  may delegate its
 6    authority to enter the order required by this subsection  (d)
 7    to a hearing examiner.
 8        (e)  The  Commission shall have no power to authorize the
 9    capitalization of the  right  to  be  a  corporation,  or  to
10    authorize  the  capitalization  of any franchise, license, or
11    permit whatsoever or the right to own, operate or  enjoy  any
12    such  franchise,  license, or permit, in excess of the amount
13    (exclusive of any tax or annual charge) actually paid to  the
14    State   or   to   a  political  subdivision  thereof  as  the
15    consideration for  the  grant  of  such  franchise,  license,
16    permit  or right; nor shall any contract for consolidation or
17    lease be capitalized, nor shall any public utility  hereafter
18    issue  any  bonds,  notes  or other evidences of indebtedness
19    against or as a lien, upon any contract for consolidation  or
20    merger.
21        (f)  The  provisions  of  this Section shall not apply to
22    public utilities which are not corporations duly incorporated
23    under the laws of this State to  the  extent  that  any  such
24    public  utility  may  issue  stock,  bonds,  notes  or  other
25    evidences   of   indebtedness   not  directly  or  indirectly
26    constituting or creating a lien or charge  on,  or  right  to
27    profits  from,  any  property  used  or  useful  in rendering
28    service within this State. Nothing  in  this  Section  or  in
29    Section  6-104  of  this  Act shall be construed to require a
30    common  carrier  by  railroad  subject  to  Part  I  of   the
31    Interstate  Commerce  Act,  being  part of an Act of the 49th
32    Congress of the United States entitled "An  Act  to  Regulate
33    Commerce",   as   amended,  to  secure  from  the  Commission
34    authority to issue or  execute  or  deliver  any  conditional
 
                            -6-                LRB9102392JSpc
 1    sales contract or similar contract or instrument reserving or
 2    retaining title in the seller for all or part of the purchase
 3    price  of  equipment or property used or to be used for or in
 4    connection with the transportation of persons or property.
 5    (Source: P.A. 90-561, eff. 12-16-97.)

 6        Section 99.  Effective date.  This Act takes effect  upon
 7    becoming law.

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