Chapter 82 Oregon Laws 2003

AN ACT

HB 2226

Relating to water utilities; creating new provisions; and amending ORS 757.005, 757.007, 757.009 and 757.061.

Be It Enacted by the People of the State of Oregon:

SECTION 1. ORS 757.061 is amended to read:

757.061. (1) For the purposes of this section, “financial regulation” means regulation under ORS 757.105 to 757.110, 757.135, 757.140, 757.205 to 757.220, 757.400 to 757.460 and 757.480 to 757.495.

(2) Except as provided in this section, water utilities that serve fewer than 500 customers are not subject to regulation under this chapter or required to pay the fee provided for in ORS 756.310.

(3) A water utility that serves fewer than 500 customers and that provides wastewater services to the public inside the boundaries of a city is subject to regulation under this chapter and must pay the fee provided for in ORS 756.310.

(4) A water utility that serves fewer than 500 customers and that is found by the Public Utility Commission to have provided inadequate or discriminatory service at any time is thereafter subject to regulation under this chapter and must pay the fee provided for in ORS 756.310.

(5) A water utility that serves fewer than 500 customers and that at any time charges an average annual residential rate of $18 per month or more is thereafter subject to regulation under this chapter, other than financial regulation, and must pay the fee provided for in ORS 756.310.

[(1)] (6) [ORS 757.105 to 757.110, 757.135, 757.140, 757.205 to 757.220, 757.400 to 757.460 and 757.480 to 757.495 do not apply to] A water utility [serving] that serves fewer than 500 customers [unless] is subject to financial regulation under this chapter, and must pay the fee provided for in ORS 756.310, if:

(a) The Public Utility Commission grants a petition from a water utility requesting that the water utility be subject to financial regulation; or

[(a)] (b) [Twenty] The water utility charges a rate for water service that exceeds a maximum rate established by the commission under subsection (7) of this section and 20 percent or more of the customers of the water utility file a petition with the [Public Utility] commission requesting that the water utility [not be exempt from regulation under the statutes set forth in this subsection] be subject to financial regulation under this chapter[; and]

[(b) A rate charged by the water utility for water service exceeds maximum rates established by the commission under subsection (2) of this section].

[(2)] (7) The commission shall adopt rules establishing maximum rates for water utilities serving fewer than 500 customers for the purpose of determining whether [such utilities are subject to regulation under the statutes set forth in subsection (1) of this section] a petition may be filed under subsection (6)(b) of this section.

[(3)] (8) Not less than 60 days before a water utility [serving] that serves fewer than 500 customers increases any rate to exceed any maximum rate prescribed under subsection [(2)] (7) of this section, [it] the water utility shall provide written notice to all of its customers advising the customers of their right to file a petition under subsection [(1)(a)] (6)(b) of this section. The commission shall adopt rules prescribing the content of the written notice.

[(4) Notwithstanding subsection (1) of this section, ORS 757.105 to 757.110, 757.135, 757.140, 757.205 to 757.220, 757.400 to 757.460 and 757.480 to 757.495 shall apply to a privately owned water utility that provides wastewater services to the public inside the boundaries of a city, either directly or through an affiliate, regardless of the number of customers receiving wastewater services.]

SECTION 2. Section 3 of this 2003 Act is added to and made a part of ORS chapter 757.

SECTION 3. (1) Any association of individuals that furnishes water to members of the association is subject to regulation in the same manner as provided by this chapter for public utilities, and must pay the fee provided for in ORS 756.310, if 20 percent or more of the members of the association file a petition with the Public Utility Commission requesting that the association be subject to such regulation.

(2) The provisions of this section apply to an association of individuals even if the association does not furnish water directly to or for the public. The provisions of this section do not apply to any cooperative formed under ORS chapter 62 or to any public body as defined by ORS 174.109.

SECTION 4. ORS 757.005 is amended to read:

757.005. (1)(a) As used in this chapter, except as provided in paragraph (b) of this subsection, “public utility” means:

(A) Any corporation, company, individual, association of individuals, or its lessees, trustees or receivers, that owns, operates, manages or controls all or a part of any plant or equipment in this state for the production, transmission, delivery or furnishing of heat, light, water or power, directly or indirectly to or for the public, whether or not such plant or equipment or part thereof is wholly within any town or city. [“Public utility” includes a privately owned water utility that provides wastewater services to the public inside the boundaries of a city, either directly or through an affiliate, regardless of the number of customers receiving wastewater services.]

(B) Any corporation, company, individual or association of individuals, which is party to an oral or written agreement for the payment by a public utility, for service, managerial construction, engineering or financing fees, and having an affiliated interest with the public utility.

(b) As used in this chapter, “public utility” does not include:

(A) Any plant owned or operated by a municipality.

(B) Any railroad, as defined in ORS 824.020, or any industrial concern by reason of the fact that it furnishes, without profit to itself, heat, light, water or power to the inhabitants of any locality where there is no municipal or public utility plant to furnish the same.

(i) From any energy resource to fewer than 20 customers, if it began providing service to a customer prior to July 14, 1985;

(ii) From any energy resource to fewer than 20 residential customers so long as the corporation, company, individual or association of individuals serves only residential customers;

(iii) From solar or wind resources to any number of customers; or

(iv) From biogas, waste heat or geothermal resources for nonelectric generation purposes to any number of customers.

(D) A qualifying facility on account of sales made under the provisions of ORS 758.505 to 758.555.

[(E) Any water utility serving less than 300 customers at an average annual residential rate of $18 per month or less that provides adequate and nondiscriminatory service and that does not provide wastewater services.]

[(F)] (E) Any person furnishing heat, but not delivering electricity or natural gas to its customers, except:

(i) As provided in ORS 757.007 and 757.009; or

(ii) With respect to heat furnished in municipalities which on January 1, 1989, had a municipally owned system that was furnishing steam or other thermal forms of heat to its customers.

[(G)] (F) Notwithstanding subparagraph [(F)] (E) of this paragraph, any corporation, company, partnership, individual or association of individuals furnishing heat to a single thermal end user from an electric generating facility, plant or equipment that is physically interconnected with the single thermal end user.

[(H)] (G) Any corporation, company, partnership, individual or association of individuals that furnishes natural gas, electricity, ethanol, methanol, methane, biodiesel or other alternative fuel to any number of customers for use in motor vehicles and does not furnish any utility service described in paragraph (a) of this subsection.

[(I)] (H) An electricity service supplier, as defined in ORS 757.600.

(2) Nothing in subsection (1)(b)(C) of this section shall prohibit third party financing of acquisition or development by a utility customer of energy resources to meet the heat, light or power requirements of that customer.

SECTION 5. ORS 757.007 is amended to read:

757.007. (1) Every person exempt from regulation under ORS 757.005 [(1)(b)(F)] (1)(b)(E) shall file with the Public Utility Commission, not later than 30 days prior to their effective date, all contracts and schedules establishing rates, terms and conditions for the provision of heating services.

(2) Prior to the effective date, the commission may suspend the effective date of such contracts or schedules for an additional period of not more than 120 days in order to determine the reasonableness of such contracts or schedules, taking into consideration the services being provided, the costs and risks of service, the availability and costs of alternative forms of service and other reasonable considerations, including the impact on existing customers of the utilities furnishing electricity and natural gas and on the public generally.

(3) If the contract or schedule is not suspended, or if the contract or schedule is determined reasonable by the commission after suspension, the contract or schedule shall not be subject to further commission review during its term or such other period as the commission may specify, except as provided in ORS 757.009.

(4) In any proceeding before the commission to determine the reasonableness of contracts or schedules proposed under this section, the burden shall be upon the proponent of the contract or schedule to establish its reasonableness.

SECTION 6. ORS 757.009 is amended to read:

757.009. (1) Except as provided in subsection (2) of this section, the Public Utility Commission may, upon written complaint or upon the commission’s own motion, regulate, under ORS 757.205 to 757.240, or any part thereof, any person otherwise exempt from regulation under ORS 757.005 [(1)(b)(F)] (1)(b)(E) as follows:

(a) With respect to any or all customers, if the commission finds that the activities of such person have an adverse effect upon the customers of public utilities furnishing electricity or natural gas and the benefits of such regulation outweigh any adverse effect on the public generally; or

(b) With respect to any customer receiving service not exceeding 500 million British thermal units per year or any residential customer, if the commission finds that such person has engaged in unjust or unreasonable practices with respect to the services or rates available to the customer and the customer has no reasonable alternative to the services provided.

(2) The commission shall not regulate persons under subsection (1)(a) of this section with respect to contracts that became effective prior to the date of service of the complaint or with respect to heating systems already in place on the date of service of the complaint if the commission determines that continued expansion will increase the efficiency of those systems.

Approved by the Governor May 24, 2003

Filed in the office of Secretary of State May 27, 2003

Effective date January 1, 2004

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