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

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I SUBURBAN RATE AUTHO TY ANNUAIJ REVIEW 1994 I JHS87296 SU160-3 The following is a brief summary intended for the city councils of Suburban Rate Authority ("SRA") member cities. It highlights the major activities and achievements of the SRA during 1994. The SRA is a joint powers association of 32 Twin Cities suburban municipalities that monitors rates and rate design issues of electric, gas, telephone utilities and Metropolitan Council Wastewater Services. The SRA was very active and successful in several far-reaching issues affecting member city ratepayers and Minnesota cities generally. Telecommunications Legislation In the fall of 1994, the SRA Board authorized counsel to participate in legislative issues affecting cities relating to the alternative telephone regulation bill (local service de-regulation) then expected to be offered in the 1995 legislative session. The SPA assisted the lobbying efforts of the League of Minnesota Cities in two important issues relating to that legislation: clarifying and broadening the police power of cities in the new competitive environment for a local telephone service and addressing cities rights to compensation for telecommunications utility use of public property. As of the date of this report, those SPA supported issues have been incorporated into the bill which passed out of both the Senate and House Committees and is being debated in the legislature at the time of this Review. The Department of Public Service will be authorized by this bill to issue a comprehensive report by February 15, 1996 recommending a uniform state policy on franchise fees for use of public property by utilities. Currently no telecommunications companies to pay franchise fees to Minnesota cities and the law is unclear regarding the rights of cities to require fees over and above regulatory cost. The SRA advocated a clarification on this issue and actively assisted in the inclusion of this study, in lieu of the right to require franchise fees in the current bill. The SRA will be actively involved in the DPS study if this bill passes. Model Telecommunications Permit Ordinance The SRA also drafted a model telecommunications permit ordinance to establish uniform requirements regarding important issues to cities in the new competitive telecommunications environment: permit fees, location and relocation requirements, repair requirements, performance bonds, Gopher State One information and other provisions. The telephone deregulation bill language broadening city police power would further ensure the enforceability of these telecommunications permit ordinances. The Minnesota League of Cities has requested that the model permit ordinance be used as a basis for the League's model ordinance for distribution to its members. Minnegasco 1994 Rate Case The SRA won a significant victory for residential ratepayers served by Minnegasco in limiting increases in the fixed customer service charge Minnegasco sought. In 1993 Minnegasco won a 67% increase (from $3 to $5) in a fixed non-usage based customer charge for its residential customers. Tiffs increase was augmented by the elimination of a credit for gas usage. In the 1994 filing, Minnegasco sought again to increase its $5 charge to $6, stating that it intended to continue these increases in subsequent rate filings. The SRA was the sole party to criticize this increase as contrary to conservation goals established by the legislature and otherwise unsupported by evidence in the record. The DPS supported the increase. The PUC agreed with the SRA and denied Minnegasco's increase, citing conservation concerns and lack of customer acceptance, This PUC decision has ramifications for both gas and electric utilities and places a greater burden on the utilities in future rate filings to justify an increase in non-usage based charges. I I I I I I I I I I I I I I I I