Bill Text: IL SB2885 | 2023-2024 | 103rd General Assembly | Introduced

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Bill Title: Amends the Public Utilities Act. Provides that the Illinois Commerce Commission shall not consider as an expense of any public utility, for the purpose of determining any rate or charge, any amount expended for contributions or gifts to political candidates, political parties, political or legislative committees, or any committee or organization working to influence referendum petitions or elections or contributions to a trade association, chamber of commerce, or public charity, including, but not limited to, a charity managed by the public utility or affiliated interest. Provides that the Commission shall not consider as an expense of any public utility, for the purpose of determining any rate or charge, any amount expended by the public utility for director and officers liability insurance and fiduciary liability insurance. Provides that in determining whether other types of insurance purchased by the public utility are recoverable, the Commission shall determine whether the insurance is of financial benefit to ratepayers of the public utility or its shareholders. Provides that if the Commission determines the insurance purchased by the public utility is of benefit to its shareholders, then it shall not be a recoverable expense. Provides that, if a gas, electric, water, or sewer utility requests a general rate increase, the Commission shall hold at least one public hearing for the public to provide input on the proposed increase in rates. Provides that the public hearing shall be held in the service area of the public utility that is requesting the general rate increase at a time and location determined by the Commission. Makes changes in provisions definitions; donations made by a public utility for energy assistance; consideration of attorney and expert compensation as an expense; and the Consumer Intervenor Compensation Fund.

Spectrum: Moderate Partisan Bill (Democrat 4-1)

Status: (Introduced) 2024-02-28 - Added as Co-Sponsor Sen. Laura Fine [SB2885 Detail]

Download: Illinois-2023-SB2885-Introduced.html

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103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB2885 Introduced 1/24/2024, by Sen. Suzy Glowiak Hilton SYNOPSIS AS INTRODUCED:
220 ILCS 5/9-224 from Ch. 111 2/3, par. 9-224
220 ILCS 5/9-224.1 new
220 ILCS 5/9-225 from Ch. 111 2/3, par. 9-225
220 ILCS 5/9-227 from Ch. 111 2/3, par. 9-227
220 ILCS 5/9-229
220 ILCS 5/9-231 new
Amends the Public Utilities Act. Provides that the Illinois Commerce Commission shall not consider as an expense of any public utility, for the purpose of determining any rate or charge, any amount expended for contributions or gifts to political candidates, political parties, political or legislative committees, or any committee or organization working to influence referendum petitions or elections or contributions to a trade association, chamber of commerce, or public charity, including, but not limited to, a charity managed by the public utility or affiliated interest. Provides that the Commission shall not consider as an expense of any public utility, for the purpose of determining any rate or charge, any amount expended by the public utility for director and officers liability insurance and fiduciary liability insurance. Provides that in determining whether other types of insurance purchased by the public utility are recoverable, the Commission shall determine whether the insurance is of financial benefit to ratepayers of the public utility or its shareholders. Provides that if the Commission determines the insurance purchased by the public utility is of benefit to its shareholders, then it shall not be a recoverable expense. Provides that, if a gas, electric, water, or sewer utility requests a general rate increase, the Commission shall hold at least one public hearing for the public to provide input on the proposed increase in rates. Provides that the public hearing shall be held in the service area of the public utility that is requesting the general rate increase at a time and location determined by the Commission. Makes changes in provisions definitions; donations made by a public utility for energy assistance; consideration of attorney and expert compensation as an expense; and the Consumer Intervenor Compensation Fund.
LRB103 37455 SPS 67577 b
A BILL FOR
SB2885 LRB103 37455 SPS 67577 b
AN ACT concerning regulation.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Public Utilities Act is amended by changing
Sections 9-224, 9-225, 9-227, and 9-229 and by adding Sections
9-224.1 and 9-231 as follows:
(220 ILCS 5/9-224) (from Ch. 111 2/3, par. 9-224)
Sec. 9-224. The Commission shall not consider as an
expense of any public utility company, for the purpose of
determining any rate or charge, any amount expended for
political activity or lobbying as defined in the "Lobbyist
Registration Act". The Commission shall also not consider as
an expense of any public utility, for the purpose of
determining any rate or charge, any amount expended for
contributions or gifts to political candidates, political
parties, political or legislative committees, or any committee
or organization working to influence referendum petitions or
elections or contributions to a trade association, chamber of
commerce, or public charity, including, but not limited to, a
charity managed by the public utility or affiliated interest.
(Source: P.A. 84-617.)
(220 ILCS 5/9-224.1 new)

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Sec. 9-224.1. Insurance expenses. The Commission shall not
consider as an expense of any public utility, for the purpose
of determining any rate or charge, any amount expended by the
public utility for director and officers liability insurance
and fiduciary liability insurance. In determining whether
other types of insurance purchased by the public utility are
recoverable, the Commission shall determine whether the
insurance is of financial benefit to ratepayers of the public
utility or its shareholders. If the Commission determines the
insurance purchased by the public utility is of benefit to its
shareholders, then it shall not be a recoverable expense.
(220 ILCS 5/9-225) (from Ch. 111 2/3, par. 9-225)
Sec. 9-225. (1) For the purposes of this Section:
(a) "Advertising" means the commercial use, by an
electric, gas, water, or sewer utility, of any media,
including newspapers, printed matter, radio and
television, in order to transmit a message to a
substantial number of members of the public or to such
utility's consumers;
(b) "Political advertising" means any advertising for
the purpose of influencing public opinion with respect to
legislative, administrative or electoral matters, or with
respect to any controversial issue of public importance;
(c) "Promotional advertising" means any advertising
for the purpose of encouraging any person to select or use

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the service or additional service of a utility or the
selection or installation of any appliance or equipment
designed to use such utility's service; and
(d) "Goodwill or institutional advertising" means any
advertising either on a local or national basis designed
primarily to bring the utility's name before the general
public in such a way as to improve the image of the utility
or to promote controversial issues for the utility or the
industry.
(2) In any general rate increase requested by any gas,
electric, water, or sewer utility company under the provisions
of this Act, the Commission shall not consider, for the
purpose of determining any rate, charge or classification of
costs, any direct or indirect expenditures for promotional,
political, or institutional advertising or goodwill
advertising, unless the Commission finds the advertising to be
in the best interest of the Consumer or authorized as provided
pursuant to subsection 3 of this Section.
(3) The following categories of advertising shall be
considered allowable operating expenses for gas, electric,
water, or sewer utilities:
(a) Advertising which informs consumers how they can
conserve energy or water, reduce peak demand for electric
or gas energy, or reduce demand for water;
(b) Advertising required by law or regulations,
including advertising required under Part I of Title II of

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the National Energy Conservation Policy Act;
(c) Advertising regarding service interruptions,
safety measures or emergency conditions;
(d) Advertising concerning employment opportunities
with such utility;
(e) Advertising which promotes the use of energy
efficient appliances, equipment or services;
(f) Explanations of existing or proposed rate
schedules or notifications of hearings thereon;
(g) Advertising that identifies the location and
operating hours of company business offices;
(h) Advertising which promotes the shifting of demand
from peak to off-peak hours or which encourages the
off-peak usage of the service; and
(i) "Other" categories of advertisements not
includable in paragraphs (a) through (h), but which are
not political, promotional, institutional or goodwill
advertisements.
(4) Notwithstanding subsections (2) and (3) of this
Section, goodwill or institutional advertising is not a
recoverable expense.
(Source: P.A. 95-814, eff. 8-13-08.)
(220 ILCS 5/9-227) (from Ch. 111 2/3, par. 9-227)
Sec. 9-227. It shall be proper for the Commission to
consider as an operating expense, for the purpose of

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determining whether a rate or other charge or classification
is sufficient, donations made by a public utility for energy
assistance. Donations to the public welfare or for charitable
scientific, religious or educational purposes shall be
nonrecoverable shareholder expenses , provided that such
donations are reasonable in amount. In determining the
reasonableness of such donations, the Commission may not
establish, by rule, a presumption that any particular portion
of an otherwise reasonable amount may not be considered as an
operating expense. The Commission shall be prohibited from
disallowing by rule, as an operating expense, any portion of a
reasonable donation for public welfare or charitable purposes.
(Source: P.A. 85-122.)
(220 ILCS 5/9-229)
Sec. 9-229. Consideration of attorney and expert
compensation as an expense and intervenor compensation fund.
(a) The Commission shall deem as a nonrecoverable expense
by a public utility specifically assess the justness and
reasonableness of any amount expended by a public utility to
compensate attorneys or technical experts to prepare and
litigate a general rate case filing. This issue shall be
expressly addressed in the Commission's final order.
(b) The State of Illinois shall create a Consumer
Intervenor Compensation Fund subject to the following:
(1) Provision of compensation for Consumer Interest

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Representatives that intervene in Illinois Commerce
Commission proceedings will increase public engagement,
encourage additional transparency, expand the information
available to the Commission, and improve decision-making.
(2) As used in this Section, "Consumer interest
representative" means:
(A) a residential utility customer or group of
residential utility customers represented by a
not-for-profit group or organization registered with
the Illinois Attorney General under the Solicitation
for of Charity Act;
(B) representatives of not-for-profit groups or
organizations whose membership is limited to
residential utility customers; or
(C) representatives of not-for-profit groups or
organizations whose membership includes Illinois
residents and that address the community, economic,
environmental, or social welfare of Illinois
residents, except government agencies or intervenors
specifically authorized by Illinois law to participate
in Commission proceedings on behalf of Illinois
consumers.
(3) A consumer interest representative is eligible to
receive compensation from the consumer intervenor
compensation fund if its participation included lay or
expert testimony or legal briefing and argument concerning

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the expenses, investments, rate design, rate impact, or
other matters affecting the pricing, rates, costs or other
charges associated with utility service, the Commission
adopts a material recommendation related to a significant
issue in the docket, and participation caused a
significant financial hardship to the participant;
however, no consumer interest representative shall be
eligible to receive an award pursuant to this Section if
the consumer interest representative receives any
compensation, funding, or donations, directly or
indirectly, from parties that have a financial interest in
the outcome of the proceeding.
(4) Within 30 days after the effective date of this
amendatory Act of the 102nd General Assembly, each utility
that files a request for an increase in rates under
Article IX or Article XVI shall deposit an amount equal to
one half of the rate case attorney and expert expense
reported to allowed by the Commission, but not to exceed
$500,000, into the fund within 35 days of the date of the
Commission's final Order in the rate case or 20 days after
the denial of rehearing under Section 10-113 of this Act,
whichever is later. The Consumer Intervenor Compensation
Fund shall be used to provide payment to consumer interest
representatives as described in this Section and shall not
be a recoverable expense by the public utility.
(5) An electric public utility with 3,000,000 or more

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retail customers shall contribute $450,000 to the Consumer
Intervenor Compensation Fund within 60 days after the
effective date of this amendatory Act of the 102nd General
Assembly. A combined electric and gas public utility
serving fewer than 3,000,000 but more than 500,000 retail
customers shall contribute $225,000 to the Consumer
Intervenor Compensation Fund within 60 days after the
effective date of this amendatory Act of the 102nd General
Assembly. A gas public utility with 1,500,000 or more
retail customers that is not a combined electric and gas
public utility shall contribute $225,000 to the Consumer
Intervenor Compensation Fund within 60 days after the
effective date of this amendatory Act of the 102nd General
Assembly. A gas public utility with fewer than 1,500,000
retail customers but more than 300,000 retail customers
that is not a combined electric and gas public utility
shall contribute $80,000 to the Consumer Intervenor
Compensation Fund within 60 days after the effective date
of this amendatory Act of the 102nd General Assembly. A
gas public utility with fewer than 300,000 retail
customers that is not a combined electric and gas public
utility shall contribute $20,000 to the Consumer
Intervenor Compensation Fund within 60 days after the
effective date of this amendatory Act of the 102nd General
Assembly. A combined electric and gas public utility
serving fewer than 500,000 retail customers shall

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contribute $20,000 to the Consumer Intervenor Compensation
Fund within 60 days after the effective date of this
amendatory Act of the 102nd General Assembly. A water or
sewer public utility serving more than 100,000 retail
customers shall contribute $80,000, and a water or sewer
public utility serving fewer than 100,000 but more than
10,000 retail customers shall contribute $20,000.
(6)(A) Prior to the entry of a Final Order in a
docketed case, the Commission Administrator shall provide
a payment to a consumer interest representative that
demonstrates through a verified application for funding
that the consumer interest representative's participation
or intervention without an award of fees or costs imposes
a significant financial hardship based on a schedule to be
developed by the Commission. The Administrator may require
verification of costs incurred, including statements of
hours spent, as a condition to paying the consumer
interest representative prior to the entry of a Final
Order in a docketed case.
(B) If the Commission adopts a material recommendation
related to a significant issue in the docket and
participation caused a financial hardship to the
participant, then the consumer interest representative
shall be allowed payment for some or all of the consumer
interest representative's reasonable attorney's or
advocate's fees, reasonable expert witness fees, and other

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reasonable costs of preparation for and participation in a
hearing or proceeding. Expenses related to travel or meals
shall not be compensable.
(C) The consumer interest representative shall submit
an itemized request for compensation to the Consumer
Intervenor Compensation Fund, including the advocate's or
attorney's reasonable fee rate, the number of hours
expended, reasonable expert and expert witness fees, and
other reasonable costs for the preparation for and
participation in the hearing and briefing within 30 days
of the Commission's final order after denial or decision
on rehearing, if any.
(7) Administration of the Fund.
(A) The Consumer Intervenor Compensation Fund is
created as a special fund in the State treasury. All
disbursements from the Consumer Intervenor Compensation
Fund shall be made only upon warrants of the Comptroller
drawn upon the Treasurer as custodian of the Fund upon
vouchers signed by the Executive Director of the
Commission or by the person or persons designated by the
Director for that purpose. The Comptroller is authorized
to draw the warrant upon vouchers so signed. The Treasurer
shall accept all warrants so signed and shall be released
from liability for all payments made on those warrants.
The Consumer Intervenor Compensation Fund shall be
administered by an Administrator that is a person or

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entity that is independent of the Commission. The
administrator will be responsible for the prudent
management of the Consumer Intervenor Compensation Fund
and for recommendations for the award of consumer
intervenor compensation from the Consumer Intervenor
Compensation Fund. The Commission shall issue a request
for qualifications for a third-party program administrator
to administer the Consumer Intervenor Compensation Fund.
The third-party administrator shall be chosen through a
competitive bid process based on selection criteria and
requirements developed by the Commission. The Illinois
Procurement Code does not apply to the hiring or payment
of the Administrator. All Administrator costs may be paid
for using monies from the Consumer Intervenor Compensation
Fund, but the Program Administrator shall strive to
minimize costs in the implementation of the program.
(B) The computation of compensation awarded from the
fund shall take into consideration the market rates paid
to persons of comparable training and experience who offer
similar services, but may not exceed the comparable market
rate for services paid by the public utility as part of its
nonrecoverable rate case expense reported to the
Commission.
(C)(1) Recommendations on the award of compensation by
the administrator shall include consideration of whether
the Commission adopted a material recommendation related

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to a significant issue in the docket and whether
participation caused a financial hardship to the
participant and the payment of compensation is fair, just
and reasonable.
(2) Recommendations on the award of compensation by
the administrator shall be submitted to the Commission for
approval. Unless the Commission initiates an investigation
within 45 days after the notice to the Commission, the
award of compensation shall be allowed 45 days after
notice to the Commission. Such notice shall be given by
filing with the Commission on the Commission's e-docket
system, and keeping open for public inspection the award
for compensation proposed by the Administrator. The
Commission shall have power, and it is hereby given
authority, either upon complaint or upon its own
initiative without complaint, at once, and if it so
orders, without answer or other formal pleadings, but upon
reasonable notice, to enter upon a hearing concerning the
propriety of the award.
(c) The Commission may adopt rules to implement this
Section.
(Source: P.A. 102-662, eff. 9-15-21.)
(220 ILCS 5/9-231 new)
Sec. 9-231. Public hearings. If a gas, electric, water, or
sewer utility requests a general rate increase, the Commission

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