Bill Amendment: IL SB3051 | 2017-2018 | 100th General Assembly
NOTE: For additional amemendments please see the Bill Drafting List
Bill Title: UTILITY-ENERGY SAVING PROGRAMS
Status: 2018-12-14 - Public Act . . . . . . . . . 100-1151 [SB3051 Detail]
Download: Illinois-2017-SB3051-House_Amendment_002.html
Bill Title: UTILITY-ENERGY SAVING PROGRAMS
Status: 2018-12-14 - Public Act . . . . . . . . . 100-1151 [SB3051 Detail]
Download: Illinois-2017-SB3051-House_Amendment_002.html
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1 | AMENDMENT TO SENATE BILL 3051
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2 | AMENDMENT NO. ______. Amend Senate Bill 3051 by replacing | ||||||
3 | everything after the enacting clause with the following:
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4 | "Section 5. The Public Utilities Act is amended by adding | ||||||
5 | Section 9-210.6 as follows:
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6 | (220 ILCS 5/9-210.6 new) | ||||||
7 | Sec. 9-210.6. Continuation of Section 9-210.5 of this Act; | ||||||
8 | validation. | ||||||
9 | (a) The General Assembly finds and declares that: | ||||||
10 | (1) Public Act 100-751, which took effect on August 10, | ||||||
11 | 2018, contained provisions that would have changed the | ||||||
12 | repeal date for Section 9-210.5 of this Act from June 1, | ||||||
13 | 2018 to June 1, 2028. | ||||||
14 | (2) The Statute on Statutes sets forth general rules on | ||||||
15 | the repeal of statutes and the construction of multiple | ||||||
16 | amendments, but Section 1 of that Act also states that |
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1 | these rules will not be observed when the result would be | ||||||
2 | "inconsistent with the manifest intent of the General | ||||||
3 | Assembly or repugnant to the context of the statute". | ||||||
4 | (3) This amendatory Act of the 100th General Assembly | ||||||
5 | manifests the intention of the General Assembly to extend | ||||||
6 | the repeal date for Section 9-210.5 of this Act and have | ||||||
7 | Section 9-210.5 of this Act, as amended by Public Act | ||||||
8 | 100-751, continue in effect until June 1, 2028. | ||||||
9 | (b) Any construction of this Act that results in the repeal | ||||||
10 | of Section 9-210.5 of this Act on June 1, 2018 would be | ||||||
11 | inconsistent with the manifest intent of the General Assembly | ||||||
12 | and repugnant to the context of this Act. | ||||||
13 | (c) It is hereby declared to have been the intent of the | ||||||
14 | General Assembly that Section 9-210.5 of this Act shall not be | ||||||
15 | subject to repeal on June 1, 2018. | ||||||
16 | (d) Section 9-210.5 of this Act shall be deemed to have | ||||||
17 | been in continuous effect since August 9, 2013 (the effective | ||||||
18 | date of Public Act 98-213), and it shall continue to be in | ||||||
19 | effect, as amended by Public Act 100-751, until it is otherwise | ||||||
20 | lawfully amended or repealed. All previously enacted | ||||||
21 | amendments to the Section taking effect on or after August 9, | ||||||
22 | 2013, are hereby validated. | ||||||
23 | (e) In order to ensure the continuing effectiveness of | ||||||
24 | Section 9-210.5 of this Act, that Section is set forth in
full | ||||||
25 | and reenacted by this amendatory Act of the 100th General
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26 | Assembly. In this amendatory Act of the 100th General Assembly, |
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1 | the base text of the reenacted Section is set forth as amended | ||||||
2 | by Public Act 100-751. | ||||||
3 | (f) All actions of the Commission or any other person or | ||||||
4 | entity taken in reliance on or pursuant to Section 9-210.5 are | ||||||
5 | hereby validated. | ||||||
6 | (g) Section 9-210.5 of this Act applies to all proceedings | ||||||
7 | pending on or filed on or before the effective date of this | ||||||
8 | amendatory Act of the 100th General Assembly.
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9 | Section 10. The Public Utilities Act is amended by | ||||||
10 | reenacting Section 9-210.5 as follows:
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11 | (220 ILCS 5/9-210.5) | ||||||
12 | Sec. 9-210.5. Valuation of water and sewer utilities. | ||||||
13 | (a) In this Section: | ||||||
14 | "Disinterested" means that the person directly | ||||||
15 | involved (1) is not a director, officer, or an employee of | ||||||
16 | the large public utility or the water or sewer utility or | ||||||
17 | its direct affiliates or subsidiaries for at least 12 | ||||||
18 | months before becoming engaged under this Section; (2) | ||||||
19 | shall not derive a material financial benefit from the sale | ||||||
20 | of the water or sewer utility other than fees for services | ||||||
21 | rendered, and (3) shall not have a member of the person's | ||||||
22 | immediate family, including a spouse, parents or spouse's | ||||||
23 | parents, children or spouses of children, or siblings and | ||||||
24 | their spouses or children, be a director, officer, or |
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1 | employee of either the large public utility or water or | ||||||
2 | sewer utility or the water or sewer utility or its direct | ||||||
3 | affiliates or subsidiaries for at least 12 months before | ||||||
4 | becoming engaged under this Section or receive a material | ||||||
5 | financial benefit from the sale of the water or sewer | ||||||
6 | utility other than fees for services rendered. | ||||||
7 | "District" means a service area of a large public | ||||||
8 | utility whose customers are subject to the same rate | ||||||
9 | tariff. | ||||||
10 | "Large public utility" means an investor-owned public | ||||||
11 | utility that: | ||||||
12 | (1) is subject to regulation by the Illinois | ||||||
13 | Commerce Commission under this Act; | ||||||
14 | (2) regularly provides water or sewer service to | ||||||
15 | more than 30,000 customer connections; | ||||||
16 | (3) provides safe and adequate service; and | ||||||
17 | (4) is not a water or sewer utility as defined in | ||||||
18 | this subsection (a). | ||||||
19 | "Next rate case" means a large public utility's first | ||||||
20 | general rate case after the date the large public utility | ||||||
21 | acquires the water or sewer utility where the acquired | ||||||
22 | water or sewer utility's cost of service is considered as | ||||||
23 | part of determining the large public utility's resulting | ||||||
24 | rates. | ||||||
25 | "Prior rate case" means a large public utility's | ||||||
26 | general rate case resulting in the rates in effect for the |
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1 | large public utility at the time it acquires the water or | ||||||
2 | sewer utility. | ||||||
3 | "Utility service source" means the water or sewer | ||||||
4 | utility or large public utility from which the customer | ||||||
5 | receives its utility service type. | ||||||
6 | "Utility service type" means water utility service or | ||||||
7 | sewer utility service or water and sewer utility service. | ||||||
8 | "Water or sewer utility" means any of the following: | ||||||
9 | (1) a public utility that regularly provides water | ||||||
10 | or sewer service to 6,000 or fewer customer | ||||||
11 | connections; | ||||||
12 | (2) a water district, including, but not limited | ||||||
13 | to, a public water district, water service district, or | ||||||
14 | surface water protection district, or a sewer district | ||||||
15 | of any kind established as a special district under the | ||||||
16 | laws of this State that regularly provides water or | ||||||
17 | sewer service; | ||||||
18 | (3) a waterworks system or sewerage system | ||||||
19 | established under the Township Code that regularly | ||||||
20 | provides water or sewer service; or | ||||||
21 | (4) a water system or sewer system owned by a | ||||||
22 | municipality that regularly provides water or sewer | ||||||
23 | service; and | ||||||
24 | (5) any other entity that is not a public utility | ||||||
25 | that regularly provides water or sewer service. | ||||||
26 | (b) Notwithstanding any other provision of this Act, a |
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1 | large public utility that acquires a water or sewer utility may | ||||||
2 | request that the Commission use, and, if so requested, the | ||||||
3 | Commission shall use, the procedures set forth under this | ||||||
4 | Section to establish the ratemaking rate base of that water or | ||||||
5 | sewer utility at the time when it is acquired by the large | ||||||
6 | public utility. | ||||||
7 | (c) If a large public utility elects the procedures under | ||||||
8 | this Section to establish the rate base of a water or sewer | ||||||
9 | utility that it is acquiring, then 3 appraisals shall be | ||||||
10 | performed. The average of these 3 appraisals shall represent | ||||||
11 | the fair market value of the water or sewer utility that is | ||||||
12 | being acquired. The appraisals shall be performed by 3 | ||||||
13 | appraisers approved by the Commission's Executive Director or | ||||||
14 | designee and engaged by either the water or sewer utility being | ||||||
15 | acquired or by the large public utility. Each appraiser shall | ||||||
16 | be engaged on reasonable terms approved by the Commission. Each | ||||||
17 | appraiser shall be a disinterested person licensed as a State | ||||||
18 | certified general real estate appraiser under the Real Estate | ||||||
19 | Appraiser Licensing Act of 2002. | ||||||
20 | Each appraiser shall: | ||||||
21 | (1) be sworn to determine the fair market value of the | ||||||
22 | water or sewer utility by establishing the amount for which | ||||||
23 | the water or sewer utility would be sold in a voluntary | ||||||
24 | transaction between a willing buyer and willing seller | ||||||
25 | under no obligation to buy or sell; | ||||||
26 | (2) determine fair market value in compliance with the |
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1 | Uniform Standards of Professional Appraisal Practice; | ||||||
2 | (3) engage one disinterested engineer who is licensed | ||||||
3 | in this State, and who may be the same engineer that is | ||||||
4 | engaged by the other appraisers, to prepare an assessment | ||||||
5 | of the tangible assets of the water or sewer utility, which | ||||||
6 | is to be incorporated into the appraisal under the cost | ||||||
7 | approach; | ||||||
8 | (4) request from the manager of the Accounting | ||||||
9 | Department, if the water or sewer utility is a public | ||||||
10 | utility that is regulated by the Commission, a list of | ||||||
11 | investments made by the water or sewer utility that had | ||||||
12 | been disallowed previously and that shall be excluded from | ||||||
13 | the calculation of the large public utility's rate base in | ||||||
14 | its next rate case; and | ||||||
15 | (5) return their appraisal, in writing, to the water or | ||||||
16 | sewer utility and large public utility in a reasonable and | ||||||
17 | timely manner. | ||||||
18 | If the appraiser cannot engage an engineer, as described in | ||||||
19 | paragraph (3) of this subsection (c), within 30 days after the | ||||||
20 | appraiser is engaged, then the Commission's Executive Director | ||||||
21 | or designee shall recommend the engineer the appraiser should | ||||||
22 | engage. The Commission's Executive Director or designee shall | ||||||
23 | provide his or her recommendation within 30 days after he or | ||||||
24 | she is officially notified of the appraiser's failure to engage | ||||||
25 | an engineer and the appraiser shall promptly work to engage the | ||||||
26 | recommended engineer. If the appraiser is unable to negotiate |
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1 | reasonable engagement terms with the recommended engineer | ||||||
2 | within 15 days after the recommendation by the Commission's | ||||||
3 | Executive Director or designee, then the appraiser shall notify | ||||||
4 | the Commission's Executive Director or designee and the process | ||||||
5 | shall be repeated until an engineer is successfully engaged. | ||||||
6 | (d) The lesser of (i) the purchase price or (ii) the fair | ||||||
7 | market value determined under subsection (c) of this Section | ||||||
8 | shall constitute the rate base associated with the water or | ||||||
9 | sewer utility as acquired by and incorporated into the rate | ||||||
10 | base of the district designated by the acquiring large public | ||||||
11 | utility under this Section, subject to any adjustments that the | ||||||
12 | Commission deems necessary to ensure such rate base reflects | ||||||
13 | prudent and useful investments in the provision of public | ||||||
14 | utility service. The reasonable transaction and closing costs | ||||||
15 | incurred by the large public utility shall be treated | ||||||
16 | consistent with the applicable accounting standards under this | ||||||
17 | Act. The total amount of all of the appraisers' fees to be | ||||||
18 | included in the transaction and closing costs shall not exceed | ||||||
19 | the greater of $15,000 or 5% of the appraised value of the | ||||||
20 | water or sewer utility being acquired. This rate base treatment | ||||||
21 | shall not be deemed to violate this Act, including, but not | ||||||
22 | limited to, any Sections in Articles VIII and IX of this Act | ||||||
23 | that might be affected by this Section. Any acquisition of a | ||||||
24 | water or sewer utility that affects the cumulative base rates | ||||||
25 | of the large public utility's existing ratepayers in the tariff | ||||||
26 | group into which the water or sewer utility is to be combined |
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1 | by less than (1) 2.5% at the time of the acquisition for any | ||||||
2 | single acquisition completed under this Section or (2) 5% for | ||||||
3 | all acquisitions completed under this Section before the | ||||||
4 | Commission's final order in the next rate case shall not be | ||||||
5 | deemed to violate Section 7-204 or any other provision of this | ||||||
6 | Act. | ||||||
7 | In the Commission's order that approves the large public | ||||||
8 | utility's acquisition of the water or sewer utility, the | ||||||
9 | Commission shall issue its decision establishing (1) the | ||||||
10 | ratemaking rate base of the water or sewer utility; (2) the | ||||||
11 | district or tariff group with which the water or sewer utility | ||||||
12 | shall be combined for ratemaking purposes, if such combination | ||||||
13 | has been proposed by the large public utility; and (3) the | ||||||
14 | rates to be charged to customers in the water or sewer utility. | ||||||
15 | (e) If the water or sewer utility being acquired is owned | ||||||
16 | by the State or any political subdivision thereof, then the | ||||||
17 | water or sewer utility must inform the public of the terms of | ||||||
18 | its acquisition by the large public utility by (1) holding a | ||||||
19 | public meeting prior to the acquisition and (2) causing to be | ||||||
20 | published, in a newspaper of general circulation in the area | ||||||
21 | that the water or sewer utility operates, a notice setting | ||||||
22 | forth the terms of its acquisition by the large public utility | ||||||
23 | and options that shall be available to assist customers to pay | ||||||
24 | their bills after the acquisition. | ||||||
25 | (f) The large public utility may recommend the district or | ||||||
26 | tariff group of which the water or sewer utility shall, for |
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1 | ratemaking purposes, become a part after the acquisition, or | ||||||
2 | may recommend a lesser rate for the water or sewer utility. If | ||||||
3 | the large public utility recommends a lesser rate, it shall | ||||||
4 | submit to the Commission its proposed rate schedule and the | ||||||
5 | proposed final tariff group for the acquired water or sewer | ||||||
6 | utility. The Commission's approved district or tariff group or | ||||||
7 | rates shall be consistent with the large public utility's | ||||||
8 | recommendation, unless such recommendation can be shown to be | ||||||
9 | contrary to the public interest. | ||||||
10 | (g) From the date of acquisition until the date that new | ||||||
11 | rates are effective in the acquiring large public utility's | ||||||
12 | next rate case, the customers of the acquired water or sewer | ||||||
13 | utility shall pay the approved then-existing rates of the | ||||||
14 | district or tariff group as ordered by the Commission, or some | ||||||
15 | lesser rates as recommended by the large public utility and | ||||||
16 | approved by the Commission under subsection (f); provided, | ||||||
17 | that, if the application of such rates of the large public | ||||||
18 | utility to customers of the acquired water or sewer utility | ||||||
19 | using 54,000 gallons annually results in an increase to the | ||||||
20 | total annual bill of customers of the acquired water or sewer | ||||||
21 | utility, exclusive of fire service or related charges, then the | ||||||
22 | large public utility's rates charged to the customers of the | ||||||
23 | acquired water or sewer utility shall be uniformly reduced, if | ||||||
24 | any reduction is required, by the percent that results in the | ||||||
25 | total annual bill, exclusive of fire services or related | ||||||
26 | charges, for the customers of the acquired water or sewer |
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1 | utility using 54,000 gallons being equal to 1.5% of the latest | ||||||
2 | median household income as reported by the United States Census | ||||||
3 | Bureau for the most applicable community or county. For each | ||||||
4 | customer of the water or sewer utility with potable water usage | ||||||
5 | values that cannot be reasonably obtained, a value of 4,500 | ||||||
6 | gallons per month shall be assigned. These rates shall not be | ||||||
7 | deemed to violate this Act including, but not limited to, | ||||||
8 | Section 9-101 and any other applicable Sections in Articles | ||||||
9 | VIII and IX of this Act. The Commission shall issue its | ||||||
10 | decision establishing the rates effective for the water or | ||||||
11 | sewer utility immediately following an acquisition in its order | ||||||
12 | approving the acquisition. | ||||||
13 | (h) In the acquiring large public utility's next rate case, | ||||||
14 | the water or sewer utility and the district or tariff group | ||||||
15 | ordered by the Commission and their costs of service may be | ||||||
16 | combined under the same rate tariff. This rate tariff shall be | ||||||
17 | based on allocation of costs of service of the acquired water | ||||||
18 | or sewer utility and the large public utility's district or | ||||||
19 | tariff group ordered by the Commission and utilizing a rate | ||||||
20 | design that does not distinguish among customers on the basis | ||||||
21 | of utility service source or type. This rate tariff shall not | ||||||
22 | be deemed to violate this Act including, but not limited to, | ||||||
23 | Section 9-101 of this Act. In the acquiring large public | ||||||
24 | utility's 2 rate cases after an acquisition, but in no | ||||||
25 | subsequent rate case, the large public utility may file a rate | ||||||
26 | tariff for a water or sewer utility acquired under this Section |
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1 | that establishes lesser rates than the district or tariff group | ||||||
2 | into which the water or sewer utility is to be combined. Those | ||||||
3 | lesser rates shall not be deemed to violate Section 7-204 or | ||||||
4 | any other provision of this Act if they affect the cumulative | ||||||
5 | base rates of the large public utility's existing rate payers | ||||||
6 | in the district or tariff by less than 2.5%. | ||||||
7 | (i) Any post-acquisition improvements made by the large | ||||||
8 | public utility in the water or sewer utility shall accrue a | ||||||
9 | cost for financing set at the large public utility's determined | ||||||
10 | rate for allowance for funds used during construction, | ||||||
11 | inclusive of the debt, equity, and income tax gross up | ||||||
12 | components, after the date on which the expenditure was | ||||||
13 | incurred by the large public utility until the investment has | ||||||
14 | been in service for a 4-year period or, if sooner, until the | ||||||
15 | time the rates are implemented in the large public utility's | ||||||
16 | next rate case. | ||||||
17 | Any post-acquisition improvements made by the large public | ||||||
18 | utility in the water or sewer utility shall not be depreciated | ||||||
19 | for ratemaking purposes from the date on which the expenditure | ||||||
20 | was incurred by the large public utility until the investment | ||||||
21 | has been in service for a 4-year period or, if sooner, until | ||||||
22 | the time the rates are implemented in the large public | ||||||
23 | utility's next rate case. | ||||||
24 | (j) This Section shall be exclusively applied to large | ||||||
25 | public utilities in the voluntary and mutually agreeable | ||||||
26 | acquisition of water or sewer utilities. Any petitions filed |
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1 | with the Commission related to the acquisitions described in | ||||||
2 | this Section, including petitions seeking approvals or | ||||||
3 | certificates required by this Act, shall be deemed approved | ||||||
4 | unless the Commission issues its final order within 11 months | ||||||
5 | after the date the large public utility filed its initial | ||||||
6 | petition. This Section shall only apply to utilities providing | ||||||
7 | water or sewer service and shall not be construed in any manner | ||||||
8 | to apply to electric corporations, natural gas corporations, or | ||||||
9 | any other utility subject to this Act. | ||||||
10 | (k) Nothing in this Section shall prohibit a party from | ||||||
11 | declining to proceed with an acquisition or be deemed as | ||||||
12 | establishing the final purchase price of an acquisition. | ||||||
13 | (l) In the Commission's order that approves the large | ||||||
14 | utility's acquisition of the water or sewer utility, the | ||||||
15 | Commission shall address each aspect of the acquisition | ||||||
16 | transaction for which approval is required under the Act. | ||||||
17 | (m) Any contractor or subcontractor that performs work on a | ||||||
18 | water or sewer utility acquired by a large public utility under | ||||||
19 | this Section shall be a responsible bidder as described in | ||||||
20 | Section 30-22 of the Illinois Procurement Code. The contractor | ||||||
21 | or subcontractor shall submit evidence of meeting the | ||||||
22 | requirements to be a responsible bidder as described in Section | ||||||
23 | 30-22 to the water or sewer utility. Any new water or sewer | ||||||
24 | facility built as a result of the acquisition shall require the | ||||||
25 | contractor to enter into a project labor agreement. The large | ||||||
26 | public utility acquiring the water or sewer utility shall offer |
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1 | employee positions to qualified employees of the acquired water | ||||||
2 | or sewer utility. | ||||||
3 | (n) This Section is repealed on June 1, 2028.
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4 | (Source: P.A. 100-751, eff. 8-10-18.)
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5 | Section 99. Effective date. This Act takes effect upon | ||||||
6 | becoming law.".
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