ORS Chapter 225 - Oregon Statutes

Chapter 225 — MunicipalUtilities

 

2009 EDITION

 

 

MUNICIPALUTILITIES

 

CITIES

 

MUNICIPALOWNERSHIP AND OPERATION OF PUBLIC UTILITIES GENERALLY

 

225.010     Definition

 

225.020     Authorityof cities to acquire, own and operate utilities within and without city limits

 

225.030     Utilitymay provide services outside city limits

 

225.040     Validationof prior municipal contracts

 

225.050     Jointacquisition, ownership and operation of waterworks; joint financing

 

225.060     Jointownership, operation and financing of municipal utilities with another state

 

225.070     Useof surplus city waters for federal military purposes

 

225.080     Financingcosts of municipal waterworks or water system; benefit assessments

 

225.085     KlamathCogeneration Project; service contracts; prohibited transactions

 

TELEPHONESYSTEM

 

225.110     Ownershipand operation of telephone system within or without city limits

 

225.120     Interconnections;cooperation with state

 

225.130     Rightto acquire property

 

225.140     Condemnationof private property for telephone system

 

225.150     Compensation

 

225.160     Alternatecondemnation proceeding

 

MUNICIPALLIGHT AND POWER SYSTEM

 

225.210     Compliancewith rate regulations

 

225.220     Enforcementof statutory requirements

 

225.230     Ratesset in accordance with estimates of annual expenses

 

225.240     Exclusiveauthority to set rates

 

225.250     Applicationof earnings

 

225.260     Useof proceeds of bond issues

 

225.270     Useof surplus earnings

 

225.280     Warrantson future income; limitations; retirement

 

225.290     Useof unappropriated state waters

 

225.300     Privilegeof filing for use of state waters; limitations; determination of reasonableneeds

 

IRRIGATIONAND FIRE PROTECTION SYSTEM

 

225.310     Definitionsfor ORS 225.310 to 225.400

 

225.320     Ownershipand operation of irrigation and fire protection facilities

 

225.330     Acquisitionof property for the facilities

 

225.340     Fixingof rates

 

225.350     Recoveryand collection of service charges

 

225.360     Approval,issuance, payment of bonds

 

225.370     Character,maturities, sale price of bonds

 

225.380     Applicationof debt limitations

 

225.390     Preparationand examination of plans

 

225.400     Scopeof municipal authority

 

MUNICIPALOWNERSHIP OF POWER FACILITIES

 

225.450     Definitionsfor ORS 225.450 to 225.490

 

225.460     Policy

 

225.470     Authorityof city to acquire interest in power facilities

 

225.480     Cityliability; application of moneys; use of power of eminent domain prohibited

 

225.490     Useof municipal money or property; revenue bonds

 

MUNICIPALOWNERSHIP AND OPERATION OF PUBLIC UTILITIES GENERALLY

 

      225.010Definition.As used in this chapter, unless the context requires otherwise, “city” meansany incorporated city or town.

 

      225.020Authority of cities to acquire, own and operate utilities within and withoutcity limits.(1) When the power to do so is conferred by or contained in its charter or actof incorporation, any city may build, own, operate and maintain waterworks,water systems, railways and railroads, electric light and power plants, withinand without its boundaries for the benefit and use of its inhabitants and forprofit. To that end it may:

      (a)Acquire water systems and use, sell and dispose of its water for domestic,recreational, industrial, and public use and for irrigation and other purposeswithin and without its boundaries.

      (b)Build, acquire, own and operate railways operated by steam, electric or otherpower within and without its boundaries and running from such city to othertowns, cities and points without its boundaries.

      (c)Acquire right of way, easements or real property within and without itsboundaries for any such purpose.

      (2)In exercising such powers, any city may bring actions for the condemnation ortaking of private property for public use in the same manner as privatecorporations are now authorized or permitted by law to do. [Amended by 1967c.306 §1]

 

      225.030Utility may provide services outside city limits. Any cityowning, controlling or operating a system of waterworks or electric light andpower system for supplying water or electricity for its inhabitants and forgeneral municipal purposes, and any person controlling or operating any watersystem or electric light and power system under contract, lease or privateownership, may sell, supply and dispose of water or electricity from suchsystem to any person within or without the limits of the city in which thewater or electric light and power system is operated, and may make contracts inreference to the sale and disposal of water or electricity from such system,for use within or without the corporate limits. [Amended by 2005 c.22 §167]

 

      225.040Validation of prior municipal contracts. All contracts or agreements made priorto May 20, 1911, and in effect as of that date, for sale and disposal of wateror electricity by any city or person operating, controlling or owning water orelectric light and power systems, to any person within or without the limits ofthe city in which the system is operated, are ratified and declared legal andvalid contracts in so far as the right of the city to contract with referenceto same is concerned. [Amended by 2005 c.22 §168]

 

      225.050Joint acquisition, ownership and operation of waterworks; joint financing. (1) Any or allcities may construct, own or operate jointly, in such proportion as they mayagree, waterworks and water pipelines, water rights and water.

      (2)For the purposes of subsection (1) of this section, the cities may:

      (a)Purchase, own, hold, appropriate and condemn land, rights of way, water orwater rights in their own names or in the name of a joint or other commissionor agency.

      (b)Purchase one from the other or others waterworks, water pipelines, water rightsor water or any interest therein or in either of them.

      (c)Provide joint or other commissions or agencies for construction, operation orcontrol of the matters listed in this section.

      (d)Issue, sell or otherwise dispose of bonds or other securities of the city forthe purpose of carrying out any of the provisions of this section.

 

      225.060Joint ownership, operation and financing of municipal utilities with anotherstate.(1) Whenever authorized by their charter or incorporation law, cities and othermunicipal corporations may, either severally or in joint agreement, purchase,own, operate and maintain any works in an adjoining state necessary orpertinent to the furnishing of water supply or electric power, or both, for thebenefit and use of their inhabitants and for profit, in so far as authorizedand permitted by the laws of the adjoining state.

      (2)For the purposes stated in subsection (1) of this section, and subject to itslimitations, cities and other municipal corporations may purchase, own,appropriate and condemn land, rights of way, and water or water rights or both.

      (3)Cities and other municipal corporations may also issue, sell and otherwisedispose of their bonds or other securities for the purposes of this section.

 

      225.070Use of surplus city waters for federal military purposes. The governingbody of any city may contract with and permit the United States of America touse for military purposes within or without the boundaries of such city thesurplus waters thereof and such use shall be deemed to be for municipalpurposes.

 

      225.080Financing costs of municipal waterworks or water system; benefit assessments. (1) In order tofinance the cost of installing any improvement for waterworks or water systemsauthorized by ORS 225.020, a city council may provide for and make a localassessment for benefits, for all or part of the cost of such construction,against any and all property whether within or without the city or partiallywithin or partially without the city and enforce collection of suchassessments. An assessment shall not be levied under this section againstproperty located outside the city, however, unless the governing body of thecounty where such property is located, by resolution, approved the assessmentof the property to be assessed.

      (2)ORS 224.010 to 224.170, applying to assessments for construction of sewersystems, apply to assessments authorized by this section. [1971 c.269 §2]

 

      225.085Klamath Cogeneration Project; service contracts; prohibited transactions. Notwithstandingany other law, the City of Klamath Falls, acting solely in connection with theownership and operation of the Klamath Cogeneration Project, may enter intotransactions with other persons or entities for the production, supply ordelivery of electricity or fuel on an economic, dependable and cost-effectivebasis, including financial products contracts and other service contracts thatreduce the risk of economic losses in the transactions. This section does notauthorize any transaction that:

      (1)Constitutes the investment of surplus funds for the purpose of receivinginterest or other earnings from the investment; or

      (2)Is intended or useful for any purpose other than the production, supply ordelivery of electricity or fuel on a cost-effective basis. [1999 c.683 §2]

 

      Note: 225.085 wasenacted into law by the Legislative Assembly but was not added to or made apart of ORS chapter 225 or any series therein by legislative action. SeePreface to Oregon Revised Statutes for further explanation.

 

TELEPHONESYSTEM

 

      225.110Ownership and operation of telephone system within or without city limits. When authorizedby its charter or act of incorporation, a city may purchase, build, own,operate and maintain telephone or telegraph systems within or without itsboundaries, for the benefit and use of its inhabitants at cost or for profit. [Amendedby 2005 c.22 §169]

 

      225.120Interconnections; cooperation with state. For the purposes of ORS 225.110,a city may interconnect by agreement or otherwise with other public or privatetelephone systems and conduct both a local and long distance telephone businessor it may cooperate with the state at any time that the state undertakes tohandle the long distance telephone service for its cities, telephone districtsor both.

 

      225.130Right to acquire property. For any of the purposes of ORS 225.110 and 225.120,a city may acquire rights of way, easements and real property within or withoutits boundaries.

 

      225.140Condemnation of private property for telephone system. Except asprovided in ORS 225.150 and 225.160, in exercising the powers granted by ORS225.110 to 225.130, a city may bring actions for condemnation or taking of anyprivate property necessary for such public use, in the manner provided orpermitted by law for private corporations, notwithstanding that the propertymay already be devoted to a public use.

 

      225.150Compensation.The city shall pay compensation by deposit in court of an order drawn on thecity treasurer for the amount of compensation fixed by the court in thecondemnation proceeding.

 

      225.160Alternate condemnation proceeding. In lieu of proceeding under ORS225.140, a city may elect to proceed with condemnation in the manner providedby law for condemnation of land for highway or other purposes by this state.

 

MUNICIPALLIGHT AND POWER SYSTEM

 

      225.210Compliance with rate regulations. Each city which owns and operates anelectric light and power system or which distributes electric energy for hire,shall charge such rates therefor as meet the requirements of ORS 225.220 to225.300.

 

      225.220Enforcement of statutory requirements. (1) The requirements of ORS 225.210 to225.300 shall be enforced and observed by that officer who by the charter ischarged with the administration of any electric light and power plant ordistributing system owned or operated by the city.

      (2)As used in this section, “officer” includes board or other public authority ofthe city.

 

      225.230Rates set in accordance with estimates of annual expenses. (1) The officerreferred to in ORS 225.220 shall annually before January 1, make a writtenestimate of the probable expense of maintaining and conducting the electriclight plant or distributing system during the next ensuing year, including thecost of any contemplated alterations, improvements, additions or extensions,together with the probable amount necessary for redemption of any unpaidwarrants and the interest thereon, as well as the amount required for paymentof interest and maturing principal on any outstanding bonds of the city issuedfor or in connection with any such electric light plant or distributing system.

      (2)The officer shall thereupon ascertain and prescribe as near as can convenientlybe done an electric current rate or rates for the ensuing year which willcreate a fund sufficient to meet all requirements in subsection (1) of thissection.

      (3)The officer may also include a further amount sufficient to create such fund,as in the judgment of the officer may be desirable or necessary to meetrequirements of future contemplated additions, improvements or extensions tothe plant or system.

 

      225.240Exclusive authority to set rates. The officer referred to in ORS 225.220 shallbe the sole judge of what rates or charges shall be exacted for the electriccurrent furnished for use of street lighting and other public purposes for thecity.

 

      225.250Application of earnings. The earnings of the electric plant or distributingsystem shall be applied and used in payment of warrants and interest thereonissued in connection with operation of any such plant or system, and also inpayment for alterations, improvements, additions or extensions and forredemption and retirement of outstanding bonds, together with interest thereon,and shall be expended only in connection with and for improving such plant orsystem and not for other municipal purposes, except as otherwise provided inORS 225.270.

 

      225.260Use of proceeds of bond issues. The proceeds of bond issues issuedafter June 6, 1931, by authority of charter provisions of the city for thepurpose of creating, acquiring, building, improving, enlarging, altering orrepairing the plant or system referred to by ORS 225.210 shall be usedexclusively for the purposes for which such bonds were authorized and issued.

 

      225.270Use of surplus earnings. When any city which owns or operates a municipalelectric power plant or system or distributing system, has paid principal andinterest to date on all indebtedness incurred in connection therewith, and hascreated and accumulated an adequate depreciation and replacement reserve in thejudgment of the officer having control of such plant or system, the city shall,for the purpose of reducing general property taxes within such city, pay toitself not less than three percent of the annual gross operating revenue ofsuch plant or system, or a volumetric charge based upon the amounts ofelectricity delivered, transmitted or distributed to retail electricityconsumers regardless of the source. The volumetric charge shall not be lessthan the equivalent of three percent of the gross operating revenues of themunicipality utility in 1999. The city shall adjust a volumetric charge to endusers such that charges established for different customer classes bear thesame approximate relationship as the gross revenues per kilowatt hour paid bythe classes in 1999. [Amended by 1999 c.865 §32]

 

      225.280Warrants on future income; limitations; retirement. (1) Whenauthorized by the city charter, the officer referred to in ORS 225.220 ashaving charge of the electric plant or distributing system may execute itswarrants upon the city treasurer, drawn against the funds created by and forthe benefit of such plant or system in excess of the current cash on hand butnot in an amount exceeding one-half of the estimated annual income for the nextensuing year, from such plant or system. The estimate of annual income shall bemade by the officer referred to in ORS 225.220.

      (2)Warrants so drawn in excess of the cash on hand in any such fund shall bestamped “Not Paid for Want of Funds” by the city treasurer, shall bear thelegal interest from the date of such indorsement until the date of payment andshall be paid from the current receipts of the plant or system. The warrantindebtedness shall not be considered or construed to be within the charterlimitations respecting any municipal debt.

      (3)Warrants issued pursuant to this section shall be retired in the order of theirpresentation for indorsement “Not Paid for Want of Funds” as funds areavailable.

 

      225.290Use of unappropriated state waters. Any city which is authorized by itscharter or by law to construct, acquire, maintain or operate an electricgenerating plant or distributing system may acquire in its own name the rightto use the unappropriated waters of this state in accordance with laws of thisstate. [Amended by 1955 c.707 §32]

 

      225.300Privilege of filing for use of state waters; limitations; determination ofreasonable needs.Any filing made by any city upon the unappropriated waters of this state foruse in the future development of a hydroelectric plant by such city shall bereserved to such city and shall not be subject to appropriation by any otherperson, municipality or corporation unless it is judicially determined that thefiling exceeds the reasonable present and future requirements of such city. Inthat event the surplus or excess may, by judgment of a court of competentjurisdiction, be released and discharged from the filing. Proceedings in courtfor the determination of whethe