Agenda - Council - 08/27/1996 - Laserfiche WebLink

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before the Minnesota PUC in several years--FAS 106. A post retirement medical health care benefits "transition obligation" was sought by Minnegasco and NSP as a result of the accounting standard known as FAS 106 which required a change from cash basis to accrual accounting for such benefits. This change involves millions of dollars (Minnegasco $24 million; NSP $160 million) to be borne currently either by the utility shareholders or utility ratepayers. The PUC originally voted in May 1993 to disallow one-half of Minnegasco's transition obligation, but ultimately reversed its decision and allowed those expenses. These expenses will be spread out over a twenty year period in rates. This issue is an example of the millions of dollars at stake in utility rates the SRA fights to limit for ratepayers. 1992 US West Telephone Rate Savinqs. As of November 1, 1992, residential and business telephone rates for US West Twin City local calling area became equal by class of service throughout the metropolitan area. This PUC action eliminated the tiered teleDhone rates that was in existence since 1980. The US West Tier System charged higher rates for residential and business customers living in the suburban areas. In 1984 the SRA achieved a reduction of one half of the tier ratios. This elimination of the Tier System is a direct result of SRA's intervention and arguments against differentiating telephone rates by geographic location. 1992 Municipal Pu~pinq Rate Savinqs. Together with the City of St. Paul and the Municipal Pumpers Association, SRA efforts have consistently maintained pumDing class rates at 2-3% below qeneral service class and have continued the municipal pumping exemption from the eleven-month demand ratchet rate imposed on commercial-industrial users. The SRA's expert consultant has estimated that avoiding the eleven-month demand ratchet charge alone saves 7.5-10% in annual municipal pumping charges paid to NSP. 1991 NSP General Rate Filinq. The SRA actively intervened in this NSP filing, wherein the PUC rejected NSP's $120,000,000 rate increase request. The SRA focused on the municipal pumpers' rate and street lighting. The SRA is traditionally the only intervenor seeking reduced increases in the municipal pumping rate and has seen consistent success in that effort. 1990 US West Incentive Requlation Plan. We actively intervened in the case involving US West's request to be partially deregulated in its local service to residential and business customers. The final order established stable rates for Twin City local telephone customers of US West through August of 1994. US West will share 50% of its revenues above a 13.5% return on equity. JM$105177 SU160-3 3 I I I I I I I I I I I I I i I I I I