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91_SB0413
LRB9101818JSpcA
1 AN ACT to amend the Public Utilities Act by changing
2 Sections 5-104, 6-102, 13-301, 13-506.1, and 13-507 and
3 adding Section 10-114.
4 Be it enacted by the People of the State of Illinois,
5 represented in the General Assembly:
6 Section 5. The Public Utilities Act is amended by
7 changing Sections 5-104, 6-102, 13-301, 13-506.1, and 13-507
8 and adding Section 10-114 as follows:
9 (220 ILCS 5/5-104) (from Ch. 111 2/3, par. 5-104)
10 Sec. 5-104. Depreciation accounts.
11 (a) The Commission shall have power, after hearing, to
12 require any or all public utilities, except electric public
13 utilities and telecommunications carriers as defined by
14 Section 13-202 of this Act, to keep such accounts as will
15 adequately reflect depreciation, obsolescence and the
16 progress of the arts. The Commission may, from time to time,
17 ascertain and determine and by order fix the proper and
18 adequate rate of depreciation of the several classes of
19 property for each public utility; and each public utility
20 shall conform its depreciation accounts to the rates so
21 ascertained, determined and fixed.
22 (b) The Commission shall have the power, after hearing,
23 to require any or all electric public utilities and
24 telecommunications carriers to keep such accounts as will
25 adequately reflect depreciation, obsolescence, and the
26 progress of the arts. The Commission may, from time to time,
27 ascertain and determine and by order fix the proper and
28 adequate rate of depreciation of the several classes of
29 property for an each electric public utility and a
30 telecommunications carrier; and each electric public utility
31 and telecommunications carrier shall thereafter, absent
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1 further order of the Commission, conform its depreciation
2 accounts to the rates so ascertained, determined and fixed
3 until at least the end of the first full calendar year
4 following the date of such determination.
5 (c) An electric public utility or a telecommunications
6 carrier may from time to time alter the annual rates of
7 depreciation, which for purposes of this subsection (c) and
8 subsection (d) shall include amortization, that it applies to
9 its several classes of assets so long as the rates are
10 consistent with generally accepted accounting principles.
11 The electric public utility or telecommunications carrier
12 shall file a statement with the Commission which shall set
13 forth the new rates of depreciation and which shall contain a
14 certification by an independent certified public accountant
15 that the new rates of depreciation are consistent with
16 generally accepted accounting principles. Upon the filing of
17 such statement, the new rates of depreciation shall be deemed
18 to be approved by the Commission as the rates of depreciation
19 to be applied thereafter by the electric public utility or
20 telecommunications carrier as though an order had been
21 entered pursuant to subsection (b).
22 (d) In any proceeding conducted pursuant to Section
23 9-201 or 9-202 to set an electric public utility's or
24 telecommunications carrier's rates for service, the
25 Commission may determine not to use, in determining the
26 depreciation expense component of the public utility's or
27 telecommunications carrier's rates for service, the rates of
28 depreciation established pursuant to subsection (c), if the
29 Commission in that proceeding finds based on the record that
30 different rates of depreciation are required to adequately
31 reflect depreciation, obsolescence and the progress of the
32 arts, and fixes by order and uses for purposes of that
33 proceeding new rates of depreciation to be thereafter
34 employed by the electric public utility or telecommunications
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1 carrier until the end of the first full calendar year
2 following the date of the determination and thereafter until
3 altered in accordance with subsection (b) or (c) of this
4 Section.
5 (Source: P.A. 90-561, eff. 12-16-97.)
6 (220 ILCS 5/6-102) (from Ch. 111 2/3, par. 6-102)
7 Sec. 6-102. Authorization of issues of stock.
8 (a) Subject to the provisions of this Act and of the
9 order of the Commission issued as provided in this Act, a
10 public utility may issue stocks and stock certificates, and
11 bonds, notes and other evidences of indebtedness payable at
12 periods of more than 12 months after the date thereof for any
13 lawful purpose. However, such public utility shall first have
14 secured from the Commission an order authorizing such issue
15 and stating the amount thereof and the purpose or purposes to
16 which the issue or the proceeds thereof are to be applied,
17 and that in the opinion of the Commission, the money,
18 property or labor to be procured or paid for by such issue is
19 reasonably required for the purpose or purposes specified in
20 the order.
21 (b) The provisions of this subsection (b) shall apply
22 only to (1) any issuances of stock in a cumulative amount,
23 exclusive of any issuances referred to in item (3), that are
24 10% or more in a calendar year or 20% or more in a 24-month
25 period of the total common stockholders' equity or of the
26 total amount of preferred stock outstanding, as the case may
27 be, of the public utility, and (2) to any issuances of bonds,
28 notes or other evidences of indebtedness in a cumulative
29 principal amount, exclusive of any issuances referred to in
30 item (3), that are 10% or more in a calendar year or 20% or
31 more in a 24-month period of the aggregate principal amount
32 of bonds, notes and other evidences of indebtedness of the
33 public utility outstanding, all as of the date of the
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1 issuance, but shall not apply to (3) any issuances of stock
2 or of bonds, notes or other evidences of indebtedness 90% or
3 more of the proceeds of which are to be used by the public
4 utility for purposes of refunding, redeeming or refinancing
5 outstanding issues of stock, bonds, notes or other evidences
6 of indebtedness. To enable it to determine whether it will
7 issue the order required by subsection (a) of this Section,
8 the Commission may hold a hearing and may make such
9 additional inquiry or investigation, and examine such
10 witnesses, books, papers, accounts, documents and contracts
11 and require the filing of such data as it may deem of
12 assistance. The public utility may be required by the
13 Commission to disclose every interest of the directors of
14 such public utility in any transaction under investigation.
15 The Commission shall have power to investigate all such
16 transactions and to inquire into the good faith thereof, to
17 examine books, papers, accounts, documents and contracts of
18 public utilities, construction or other companies or of firms
19 or individuals with whom the public utility shall have had
20 financial transactions, for the purpose of enabling it to
21 verify any statements furnished, and to examine into the
22 actual value of property acquired by or services rendered to
23 such public utility. Before issuing its order, the
24 Commission, when it is deemed necessary by the Commission,
25 shall make an adequate physical valuation of all property of
26 the public utility, but a valuation already made under proper
27 public supervision may be adopted, either in whole or in
28 part, at the discretion of the Commission; and shall also
29 examine all previously authorized or outstanding securities
30 of the public utility, and fixed charges attached thereto. A
31 statement of the results of such physical valuation, and a
32 statement of the character of all outstanding securities,
33 together with the conditions under which they are held, shall
34 be included in the order. The Commission may require that
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1 such information or such part thereof as it thinks proper,
2 shall appear upon the stock, stock certificate, bond, note or
3 other evidence of indebtedness authorized by its order. The
4 Commission may by its order grant permission for the issue of
5 such stock certificates, or bonds, notes or other evidences
6 of indebtedness in the amount applied for, or in a lesser
7 amount, or not at all, and may attach to the exercise of its
8 permission such condition or conditions as it may deem
9 reasonable and necessary. Nothing in this Section shall
10 prevent a public utility from seeking, nor the Commission
11 from approving, a shelf registration plan for issuing
12 securities over a reasonable period in accordance with
13 regulations established by the United States Securities and
14 Exchange Commission. Any securities issued pursuant to an
15 approved shelf registration plan need not be further approved
16 by the Commission so long as they are in compliance with the
17 approved shelf registration plan. The Commission shall have
18 the power to refuse its approval of applications to issue
19 securities, in whole or in part, upon a finding that the
20 issue of such securities would be contrary to public
21 interest. The Commission may also require the public utility
22 to compile for the information of its shareholders such facts
23 in regard to its financial transactions, in such form as the
24 Commission may direct.
25 No public utility shall, without the consent of the
26 Commission, apply the issue of any stock or stock
27 certificates, or bond, note or other evidence of
28 indebtedness, which was issued pursuant to an order of the
29 Commission entered pursuant to this subsection (b), or any
30 part thereof, or any proceeds thereof, to any purpose not
31 specified in the Commission's order or to any purpose
32 specified in the Commission's order in excess of the amount
33 authorized for such purpose; or issue or dispose of the same
34 on any terms less favorable than those specified in such
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1 order, or a modification thereof. The Commission shall have
2 the power to require public utilities to account for the
3 disposition of the proceeds of all sales of stocks and stock
4 certificates, and bonds, notes and other evidences of
5 indebtedness, which were issued pursuant to an order of the
6 Commission entered pursuant to this subsection (b), in such
7 form and detail as it may deem advisable, and to establish
8 such rules and regulations as it may deem reasonable and
9 necessary to insure the disposition of such proceeds for the
10 purpose or purposes specified in its order.
11 (c) A public utility may issue notes, for proper
12 purposes, and not in violation of any provision of this Act
13 or any other Act, payable at periods of not more than 12
14 months after the date of issuance of the same, without the
15 consent of the Commission; but no such note shall, in whole
16 or in part, be renewed or be refunded from the proceeds of
17 any other such note or evidence of indebtedness from time to
18 time without the consent of the Commission for an aggregate
19 period of longer than 2 years. A "telecommunications carrier"
20 as that term is defined by Section 13-202 of this Act is
21 exempt from the requirements of this subsection (c).
22 (d) Any issuance of stock or of bonds, notes or other
23 evidences of indebtedness, other than issuances of notes
24 pursuant to subsection (c) of this Section, which is not
25 subject to subsection (b) of this Section, shall be regulated
26 by the Commission as follows: the public utility shall file
27 with the Commission, at least 15 days before the date of the
28 issuance, an informational statement setting forth the type
29 and amount of the issue and the purpose or purposes to which
30 the issue or the proceeds thereof are to be applied. Prior
31 to the date of the issuance specified in the public utility's
32 filing, the Commission, if it finds that the issuance is not
33 subject to subsection (b) of this Section, shall issue a
34 written order in conformance with subsection (a) of this
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1 Section authorizing the issuance. Notwithstanding any other
2 provisions of this Act, the Commission may delegate its
3 authority to enter the order required by this subsection (d)
4 to a hearing examiner.
5 (e) The Commission shall have no power to authorize the
6 capitalization of the right to be a corporation, or to
7 authorize the capitalization of any franchise, license, or
8 permit whatsoever or the right to own, operate or enjoy any
9 such franchise, license, or permit, in excess of the amount
10 (exclusive of any tax or annual charge) actually paid to the
11 State or to a political subdivision thereof as the
12 consideration for the grant of such franchise, license,
13 permit or right; nor shall any contract for consolidation or
14 lease be capitalized, nor shall any public utility hereafter
15 issue any bonds, notes or other evidences of indebtedness
16 against or as a lien, upon any contract for consolidation or
17 merger.
18 (f) The provisions of this Section shall not apply to
19 public utilities which are not corporations duly incorporated
20 under the laws of this State to the extent that any such
21 public utility may issue stock, bonds, notes or other
22 evidences of indebtedness not directly or indirectly
23 constituting or creating a lien or charge on, or right to
24 profits from, any property used or useful in rendering
25 service within this State. Nothing in this Section or in
26 Section 6-104 of this Act shall be construed to require a
27 common carrier by railroad subject to Part I of the
28 Interstate Commerce Act, being part of an Act of the 49th
29 Congress of the United States entitled "An Act to Regulate
30 Commerce", as amended, to secure from the Commission
31 authority to issue or execute or deliver any conditional
32 sales contract or similar contract or instrument reserving or
33 retaining title in the seller for all or part of the purchase
34 price of equipment or property used or to be used for or in
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1 connection with the transportation of persons or property.
2 (Source: P.A. 90-561, eff. 12-16-97.)
3 (220 ILCS 5/10-114 new)
4 Sec. 10-114. Resolution of proceedings. Notwithstanding
5 any other provision of this Act, the Commission shall resolve
6 all proceedings on the basis of written pleadings and
7 submissions that are verified or supported by affidavit with
8 the exception of proceedings arising under Section 13-515 of
9 this Act. Nothing herein shall preclude the Commission from
10 hearing oral argument in any proceeding.
11 (220 ILCS 5/13-301) (from Ch. 111 2/3, par. 13-301)
12 (Section scheduled to be repealed on July 1, 2001)
13 Sec. 13-301. Duties of the Commission. Consistent with
14 the findings and policy established in paragraph (a) of
15 Section 13-102 and paragraph (a) of Section 13-103, and in
16 order to ensure the attainment of such policies, the
17 Commission shall:
18 (a) participate in all federal programs intended to
19 preserve or extend universal telecommunications service,
20 unless such programs would place cost burdens on Illinois
21 customers of telecommunications services in excess of the
22 benefits they would receive through participation, provided,
23 however, the Commission shall not approve or permit the
24 imposition of any surcharge or other fee designed to
25 subsidize or provide a waiver for subscriber line charges;
26 and shall report on such programs together with an assessment
27 of their adequacy and the advisability of participating
28 therein in its annual report to the General Assembly, or more
29 often as necessary;
30 (b) establish a program to monitor the level of
31 telecommunications subscriber connection within each exchange
32 in Illinois, and shall report the results of such monitoring
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1 and any actions it has taken or recommends be taken to
2 maintain and increase such levels in its annual report to the
3 General Assembly, or more often if necessary;
4 (c) order all telecommunications carriers offering or
5 providing local exchange telecommunications service to
6 propose low-cost or budget service tariffs and any other rate
7 design or pricing mechanisms designed to facilitate customer
8 access to such telecommunications service, and shall after
9 notice and hearing, implement any such proposals which it
10 finds likely to achieve such purpose;
11 (d) investigate the necessity of and create, if
12 necessary, feasibility of establishing a fund or funds from
13 which eligible telecommunications carriers offering or
14 providing local exchange telecommunications service, whose
15 costs of providing telecommunications services such service
16 exceed the affordable rate average cost of providing such
17 services service in Illinois, can could receive revenues
18 intended to mitigate the price impact on customers resulting
19 from the high or rising cost of such services service;
20 provided, however, that to the extent such a fund or funds
21 are established, the Commission shall require that the costs
22 of such funds be recovered from all telecommunications
23 carriers on a competitively neutral basis and shall include
24 the results and findings of such investigation together with
25 any recommendations for legislative action in its first
26 annual report to the General Assembly in 1986;
27 (e) Any telecommunications carrier providing local
28 exchange telecommunications service which offers to its local
29 exchange customers a choice of two or more local exchange
30 telecommunications service offerings shall provide, to any
31 such customer requesting it, once a year without charge, a
32 report describing which local exchange telecommunications
33 service offering would result in the lowest bill for such
34 customer's local exchange service, based on such customer's
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1 calling pattern and usage for the previous 6 months. At
2 least once a year, each such carrier shall provide a notice
3 to each of its local exchange telecommunications service
4 customers describing the availability of this report and the
5 specific procedures by which customers may receive it. Such
6 report shall only be available to current and future
7 customers who have received at least 6 months of continuous
8 local exchange service from such carrier.
9 (Source: P.A. 87-445.)
10 (220 ILCS 5/13-506.1) (from Ch. 111 2/3, par. 13-506.1)
11 (Section scheduled to be repealed on July 1, 2001)
12 Sec. 13-506.1. Alternative forms of regulation for
13 noncompetitive services.
14 (a) Notwithstanding any of the rate-making provisions of
15 this Article or Article IX that are deemed to require rate of
16 return regulation, the Commission may implement alternative
17 forms of regulation in order to establish just and reasonable
18 rates for noncompetitive telecommunications services
19 including, but not limited to, price regulation, earnings
20 sharing, rate moratoria, or a network modernization plan.
21 The Commission is authorized to adopt different forms of
22 regulation to fit the particular characteristics of different
23 telecommunications carriers and their service areas.
24 In addition to the public policy goals declared in
25 Section 13-103, the Commission shall consider, in determining
26 the appropriateness of any alternative form of regulation,
27 whether it will:
28 (1) reduce regulatory delay and costs over time;
29 (2) encourage innovation in services;
30 (3) promote efficiency;
31 (4) facilitate the broad dissemination of technical
32 improvements to all classes of ratepayers;
33 (5) enhance economic development of the State; and
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1 (6) provide for fair, just, and reasonable rates.
2 (b) A telecommunications carrier providing
3 noncompetitive telecommunications services may petition the
4 Commission to regulate the rates or charges of its
5 noncompetitive services under an alternative form of
6 regulation. The telecommunications carrier shall submit with
7 its petition its plan for an alternative form of regulation.
8 The Commission shall review and may modify or reject the
9 carrier's proposed plan. The Commission also may initiate
10 consideration of alternative forms of regulation for a
11 telecommunications carrier on its own motion. The Commission
12 may approve the plan or modified plan and authorize its
13 implementation only if it finds, after notice and hearing,
14 that the plan or modified plan at a minimum:
15 (1) is in the public interest;
16 (2) will produce fair, just, and reasonable rates
17 for telecommunications services;
18 (3) responds to changes in technology and the
19 structure of the telecommunications industry that are, in
20 fact, occurring;
21 (4) constitutes a more appropriate form of
22 regulation based on the Commission's overall
23 consideration of the policy goals set forth in Section
24 13-103 and this Section;
25 (5) specifically identifies how ratepayers will
26 benefit from any efficiency gains, cost savings arising
27 out of the regulatory change, and improvements in
28 productivity due to technological change;
29 (6) will maintain the quality and availability of
30 telecommunications services; and
31 (7) will not unduly or unreasonably prejudice or
32 disadvantage any particular customer class, including
33 telecommunications carriers.
34 (c) The initial An alternative regulation plan
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1 applicable to a telecommunications carrier and approved under
2 this Section shall provide, as a condition for Commission
3 approval of the plan, that for the first 3 years the plan is
4 in effect with respect to the carrier, basic residence
5 service rates shall be no higher than those rates in effect
6 180 days before the filing of the plan. This provision shall
7 not be used as a justification or rationale for an increase
8 in basic service rates for any other customer class. For
9 purposes of this Section, "basic residence service rates"
10 shall mean monthly recurring charges for the
11 telecommunications carrier's lowest priced primary residence
12 network access lines, along with any associated untimed or
13 flat rate local usage charges. Nothing in this subsection
14 (c) shall preclude the Commission from approving an
15 alternative regulation plan that results in rate reductions
16 provided all the requirements of subsection (b) are satisfied
17 by the plan.
18 (d) Any alternative form of regulation granted for a
19 multi-year period under this Section shall provide for annual
20 or more frequent reporting to the Commission to document that
21 the requirements of the plan are being properly implemented.
22 (e) Upon petition by the telecommunications carrier or
23 any other person or upon its own motion, the Commission may
24 rescind its approval of an alternative form of regulation if,
25 after notice and hearing, it finds that the conditions set
26 forth in subsection (b) of this Section can no longer be
27 satisfied. Any person may file a complaint alleging that the
28 rates charged by a telecommunications carrier under an
29 alternative form of regulation are unfair, unjust,
30 unreasonable, unduly discriminatory, or are otherwise not
31 consistent with the requirements of this Article; provided,
32 that the complainant shall bear the burden of proving the
33 allegations in the complaint.
34 (f) Nothing in this Section shall be construed to
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1 authorize the Commission to render Sections 9-241, 9-250, and
2 13-505.2 inapplicable to noncompetitive services.
3 (Source: P.A. 87-856.)
4 (220 ILCS 5/13-507) (from Ch. 111 2/3, par. 13-507)
5 (Section scheduled to be repealed on July 1, 2001)
6 Sec. 13-507. Noncompetitive services. In any proceeding
7 permitting, approving, investigating, or establishing rates,
8 charges, classifications, or tariffs for telecommunications
9 services offered or provided by a telecommunications carrier
10 that offers or provides both noncompetitive and competitive
11 services, the Commission shall not allow any subsidy of
12 competitive services or nonregulated activities by
13 noncompetitive services. In the event that facilities are
14 utilized or expenses are incurred for the provision of both
15 competitive and noncompetitive services, the Commission shall
16 apportion the facilities and expenses between noncompetitive
17 services in the aggregate and competitive services in the
18 aggregate and shall allow or establish rates or charges for
19 the noncompetitive services which reflect only that portion
20 of the facilities or expenses that it finds to be properly
21 and reasonably apportioned to noncompetitive services. An
22 apportionment of facilities or expenses between competitive
23 and noncompetitive services, together with any corresponding
24 rate changes, shall be made in general rate proceedings and
25 in other proceedings, including service classification
26 proceedings, that are necessary to ensure against any subsidy
27 of competitive services by noncompetitive services. The
28 Commission shall have the power to take or require such
29 action as is necessary to ensure that rates or charges for
30 noncompetitive services reflect only the value of facilities,
31 or portion thereof, used and useful, and the expenses or
32 portion thereof reasonably and prudently incurred, for the
33 provision of the noncompetitive services. The Commission may,
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1 in such event, also establish, by rule, any additional
2 procedures, rules, regulations, or mechanisms necessary to
3 identify and properly account for the value or amount of such
4 facilities or expenses.
5 The Commission may establish, by rule, appropriate
6 methods for ensuring against cross-subsidization between
7 competitive services and noncompetitive services as required
8 under this Article, including appropriate methods for
9 calculating the long-run service incremental costs of
10 providing any telecommunications service and, when
11 appropriate, group of services and methods for apportioning
12 between noncompetitive services in the aggregate and
13 competitive services in the aggregate the value of facilities
14 utilized and expenses incurred to provide both competitive
15 and noncompetitive services, for example, common overheads
16 that are not accounted for in the long-run service
17 incremental costs of individual services or groups of
18 services. The Commission may order any telecommunications
19 carrier to conduct a long-run service incremental cost study
20 and to provide the results thereof to the Commission. Any
21 cost study provided to the Commission pursuant to the
22 provisions of this Section may, in the Commission's
23 discretion, be accorded proprietary treatment. In addition
24 to the requirements of subsection (c) of Section 13-502 and
25 of Section 13-505.1 applicable to the rates and charges for
26 individual competitive services, the aggregate gross revenues
27 of all competitive services shall be equal to or greater than
28 the sum of the long-run service incremental costs for all
29 competitive services as a group and the value of other
30 facilities and expenses apportioned to competitive services
31 as a group under this Section.
32 Notwithstanding any other provision of this Act, such
33 revenues and costs, including the value of other facilities
34 and expenses so apportioned to competitive services, shall
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1 not be considered by the Commission in any review of a
2 telecommunications carrier's rate of return or rate base.
3 Any such review shall be confined to the telecommunications
4 carrier's noncompetitive services and the revenues, cost, and
5 value of other facilities and expenses apportioned to those
6 noncompetitive services.
7 (Source: P.A. 87-856.)
8 Section 99. Effective date. This Act takes effect upon
9 becoming law.