SENATE BILL REPORT

SB 5881

BYSenators Benitz, Owen, Smitherman, Wojahn, Stratton and Bailey

Revising provisions on public service companies.

Senate Committee on Commerce & Labor

Senate Hearing Date(s):March 5, 1987

Senate Staff:Patrick Woods (786-7430)

AS OF MARCH 5, 1987

BACKGROUND:

It has been asserted that certain public service companies regulated by the Utilities and Transportation Commission are subsidizing non-regulated business activities which adversely affect rate payers and competing businesses.  The activities of public service corporations that are regulated by the Utilities and Transportation Commission are exempt from the provisions of the Consumer Protection Act.

SUMMARY:

The Legislature states its intent to prevent utilities or public service companies from subsidizing unregulated business activities which adversely affect rate payers and competing businesses.

Only activities of public service companies regulated by the Utilities and Transportation Commission are exempt from the Consumer Protection Act.

The penalty for violation by a public service company or its agents under the Public Utility Title is increased from $100 to $500.  Public service companies are required to bear the burden of proof when an investigation is initiated by the Utilities and Transportation Commission.  The Commission is to take the following action whenever it determines that a public service company is unfairly subsidizing its unregulated activities: (1) order the public service company to refund all monies to rate payers; and (2) order the company to pay fines which will compensate injured businesses.

The Commission is to hold a hearing when a business claims injury due to cross subsidization and any fines levied by the Commission are transmitted to the injured party.

Fiscal Note:      none requested