CHAPTER 14. JURISDICTION AND POWERS OF COMMISSION AND OTHER REGULATORY AUTHORITIES - Texas Statutes

UTILITIES CODE

TITLE 2. PUBLIC UTILITY REGULATORY ACT

SUBTITLE A. PROVISIONS APPLICABLE TO ALL UTILITIES

CHAPTER 14. JURISDICTION AND POWERS OF COMMISSION AND OTHER

REGULATORY AUTHORITIES

SUBCHAPTER A. GENERAL POWERS OF COMMISSION

Sec. 14.001. POWER TO REGULATE AND SUPERVISE. The commission

has the general power to regulate and supervise the business of

each public utility within its jurisdiction and to do anything

specifically designated or implied by this title that is

necessary and convenient to the exercise of that power and

jurisdiction.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.002. RULES. The commission shall adopt and enforce

rules reasonably required in the exercise of its powers and

jurisdiction.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.0025. NEGOTIATED RULEMAKING AND ALTERNATIVE DISPUTE

RESOLUTION. (a) The commission shall develop and implement a

policy to encourage the use of:

(1) negotiated rulemaking procedures under Chapter 2008,

Government Code, for the adoption of commission rules; and

(2) appropriate alternative dispute resolution procedures under

Chapter 2009, Government Code, to assist in the resolution of

internal and external disputes under the commission's

jurisdiction.

(b) The commission's procedures relating to alternative dispute

resolution must conform, to the extent possible, to any model

guidelines issued by the State Office of Administrative Hearings

for the use of alternative dispute resolution by state agencies.

(c) The commission shall designate a trained person to:

(1) coordinate the implementation of the policy adopted under

Subsection (a);

(2) serve as a resource for any training needed to implement the

procedures for negotiated rulemaking or alternative dispute

resolution; and

(3) collect data concerning the effectiveness of those

procedures, as implemented by the commission.

Added by Acts 2005, 79th Leg., Ch.

797, Sec. 5, eff. September 1, 2005.

Sec. 14.003. COMMISSION POWERS RELATING TO REPORTS. The

commission may:

(1) require a public utility to report to the commission

information relating to:

(A) the utility; and

(B) a transaction between the utility and an affiliate inside or

outside this state, to the extent that the transaction is subject

to the commission's jurisdiction;

(2) establish the form for a report;

(3) determine the time for a report and the frequency with which

the report is to be made;

(4) require that a report be made under oath;

(5) require the filing with the commission of a copy of:

(A) a contract or arrangement between a public utility and an

affiliate;

(B) a report filed with a federal agency or a governmental

agency or body of another state; and

(C) an annual report that shows each payment of compensation,

other than salary or wages subject to federal income tax

withholding:

(i) to residents of this state;

(ii) with respect to legal, administrative, or legislative

matters in this state; or

(iii) for representation before the legislature of this state or

any governmental agency or body; and

(6) require that a contract or arrangement described by

Subdivision (5)(A) that is not in writing be reduced to writing

and filed with the commission.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.004. REPORT OF SUBSTANTIAL INTEREST. The commission may

require disclosure of the identity and respective interests of

each owner of at least one percent of the voting securities of a

public utility or its affiliate.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.005. CRITERIA AND GUIDELINES GOVERNING TERMINATION OF

SERVICES TO ELDERLY AND DISABLED. The commission may establish

criteria and guidelines with the utility industry relating to

industry procedures used in terminating services to the elderly

and disabled.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.006. INTERFERENCE WITH TERMS OR CONDITIONS OF

EMPLOYMENT; PRESUMPTION OF REASONABLENESS. The commission may

not interfere with employee wages and benefits, working

conditions, or other terms or conditions of employment that are

the product of a collective bargaining agreement recognized under

federal law. An employee wage rate or benefit that is the product

of the collective bargaining is presumed to be reasonable.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.007. ASSISTANCE TO MUNICIPALITY. On request by the

governing body of a municipality, the commission may provide

commission employees as necessary to advise and consult with the

municipality on a pending matter.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.008. MUNICIPAL FRANCHISES. (a) This title does not

restrict the rights and powers of a municipality to grant or

refuse a franchise to use the streets and alleys in the

municipality or to make a statutory charge for that use.

(b) A franchise agreement may not limit or interfere with a

power conferred on the commission by this title.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

SUBCHAPTER B. PRACTICE AND PROCEDURE

Sec. 14.051. PROCEDURAL POWERS. The commission may:

(1) call and hold a hearing;

(2) administer an oath;

(3) receive evidence at a hearing;

(4) issue a subpoena to compel the attendance of a witness or

the production of a document; and

(5) make findings of fact and decisions to administer this title

or a rule, order, or other action of the commission.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.052. RULES. (a) The commission shall adopt and enforce

rules governing practice and procedure before the commission and,

as applicable, practice and procedure before the utility division

of the State Office of Administrative Hearings.

(b) The commission shall adopt rules that authorize an

administrative law judge to:

(1) limit the amount of time that a party may have to present

its case;

(2) limit the number of requests for information that a party

may make in a contested case;

(3) require a party to a contested case to identify contested

issues and facts before the hearing begins;

(4) limit cross-examination to only those issues and facts

identified before the hearing and to any new issues that may

arise as a result of the discovery process; and

(5) group parties, other than the office, that have the same

position on an issue to facilitate cross-examination on that

issue.

(c) A rule adopted under Subsection (b)(5) must permit each

party in a group to present that party's witnesses for

cross-examination during the hearing.

(d) A rule adopted under this section must ensure that each

party receives due process.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.053. POWERS AND DUTIES OF STATE OFFICE OF ADMINISTRATIVE

HEARINGS. (a) The utility division of the State Office of

Administrative Hearings shall conduct each hearing in a contested

case that is not conducted by one or more commissioners.

(b) The commission may delegate to the utility division of the

State Office of Administrative Hearings the authority to make a

final decision and to issue findings of fact, conclusions of law,

and other necessary orders in a proceeding in which there is not

a contested issue of fact or law.

(c) The commission by rule shall define the procedures by which

it delegates final decision-making authority under Subsection

(b).

(d) For review purposes an administrative law judge's final

decision under Subsection (b) has the same effect as a final

decision of the commission unless a commissioner requests formal

review of the decision.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.054. SETTLEMENTS. (a) The commission by rule shall

adopt procedures governing the use of settlements to resolve

contested cases.

(b) Rules adopted under this section must ensure that:

(1) each party retains the right to:

(A) a full hearing before the commission on issues that remain

in dispute; and

(B) judicial review of issues that remain in dispute;

(2) an issue of fact raised by a nonsettling party may not be

waived by a settlement or stipulation of the other parties; and

(3) a nonsettling party may use an issue of fact raised by that

party as the basis for judicial review.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.055. RECORD OF PROCEEDINGS. The regulatory authority

shall keep a record of each proceeding before the authority.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.056. RIGHT TO BE HEARD. Each party to a proceeding

before a regulatory authority is entitled to be heard by attorney

or in person.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.057. ORDERS OF COMMISSION; TRANSCRIPTS AND EXHIBITS;

PUBLIC RECORDS. (a) A commission order must be in writing and

contain detailed findings of the facts on which it is passed.

(b) The commission shall retain a copy of the transcript and the

exhibits in any matter in which the commission issues an order.

(c) Subject to Chapter 552, Government Code, each file

pertaining to a matter that was at any time pending before the

commission or to a record, report, or inspection required by

Section 14.003, 14.151, 14.152, 14.153, 14.201, or 14.203-14.207

or by Subtitle B or C is public information.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.058. FEES FOR ELECTRONIC ACCESS TO INFORMATION. The

fees charged by the commission for electronic access to

information that is stored in the system established by the

commission using funds from the Texas Public Finance Authority

and approved by the Department of Information Resources shall be

established:

(1) by the commission in consultation with the comptroller; and

(2) in an amount reasonable and necessary to retire the debt to

the Texas Public Finance Authority associated with establishing

the electronic access system.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 18.01(a), eff. Sept.

1, 1999.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.115, eff. September 1, 2007.

Sec. 14.059. TECHNOLOGY POLICY. The commission shall implement

a policy requiring the commission to use appropriate

technological solutions to improve the commission's ability to

perform its functions. The policy must ensure that the public is

able to interact with the commission on the Internet.

Added by Acts 2005, 79th Leg., Ch.

797, Sec. 6, eff. September 1, 2005.

SUBCHAPTER C. RESTRICTIONS ON CERTAIN TRANSACTIONS

Sec. 14.101. REPORT OF CERTAIN TRANSACTIONS; COMMISSION

CONSIDERATION. (a) Unless a public utility reports the

transaction to the commission within a reasonable time, the

public utility may not:

(1) sell, acquire, or lease a plant as an operating unit or

system in this state for a total consideration of more than

$100,000; or

(2) merge or consolidate with another public utility operating

in this state.

(b) A public utility shall report to the commission within a

reasonable time each transaction that involves the sale of at

least 50 percent of the stock of the utility. On the filing of a

report with the commission, the commission shall investigate the

transaction, with or without a public hearing, to determine

whether the action is consistent with the public interest. In

reaching its determination, the commission shall consider:

(1) the reasonable value of the property, facilities, or

securities to be acquired, disposed of, merged, transferred, or

consolidated;

(2) whether the transaction will:

(A) adversely affect the health or safety of customers or

employees;

(B) result in the transfer of jobs of citizens of this state to

workers domiciled outside this state; or

(C) result in the decline of service;

(3) whether the public utility will receive consideration equal

to the reasonable value of the assets when it sells, leases, or

transfers assets; and

(4) whether the transaction is consistent with the public

interest.

(c) If the commission finds that a transaction is not in the

public interest, the commission shall take the effect of the

transaction into consideration in ratemaking proceedings and

disallow the effect of the transaction if the transaction will

unreasonably affect rates or service.

(d) This section does not apply to:

(1) the purchase of a unit of property for replacement;

(2) an addition to the facilities of a public utility by

construction; or

(3) transactions that facilitate unbundling, asset valuation,

minimization of ownership or control of generation assets, or

other purposes consistent with Chapter 39.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 405, Sec. 9, eff. Sept. 1,

1999.

Sec. 14.102. REPORT OF PURCHASE OF VOTING STOCK IN PUBLIC

UTILITY. A public utility may not purchase voting stock in

another public utility doing business in this state unless the

utility reports the purchase to the commission.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.103. REPORT OF LOAN TO STOCKHOLDERS. A public utility

may not loan money, stocks, bonds, notes, or other evidence of

indebtedness to a person who directly or indirectly owns or holds

any stock of the public utility unless the public utility reports

the transaction to the commission within a reasonable time.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

SUBCHAPTER D. RECORDS

Sec. 14.151. RECORDS OF PUBLIC UTILITY. (a) Each public

utility shall keep and provide to the regulatory authority, in

the manner and form prescribed by the commission, uniform

accounts of all business transacted by the utility.

(b) The commission may prescribe the form of books, accounts,

records, and memoranda to be kept by a public utility, including:

(1) the books, accounts, records, and memoranda of:

(A) the provision of and capacity for service; and

(B) the receipt and expenditure of money; and

(2) any other form, record, and memorandum that the commission

considers necessary to carry out this title.

(c) For a public utility subject to regulation by a federal

regulatory agency, compliance with the system of accounts

prescribed for the particular class of utilities by the federal

agency may be considered sufficient compliance with the system

prescribed by the commission. The commission may prescribe the

form of books, accounts, records, and memoranda covering

information in addition to that required by the federal agency.

The system of accounts and the form of books, accounts, records,

and memoranda prescribed by the commission for a public utility

or class of utilities may not be inconsistent with the systems

and forms established by a federal agency for that public utility

or class of utilities.

(d) Each public utility shall:

(1) keep and provide its books, accounts, records, and memoranda

accurately in the manner and form prescribed by the commission;

and

(2) comply with the directions of the regulatory authority

relating to the books, accounts, records, and memoranda.

(e) In this section, "public utility" includes a municipally

owned utility.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.152. MAINTENANCE OF OFFICE AND RECORDS IN THIS STATE.

(a) Each public utility shall maintain an office in this state

in a county in which some part of the utility's property is

located. The utility shall keep in this office all books,

accounts, records, and memoranda required by the commission to be

kept in this state.

(b) A book, account, record, or memorandum required by the

regulatory authority to be kept in this state may not be removed

from this state, except as:

(1) provided by Section 52.255; and

(2) prescribed by the commission.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.153. COMMUNICATIONS WITH REGULATORY AUTHORITY. (a) The

regulatory authority shall adopt rules governing communications

with the regulatory authority or a member or employee of the

regulatory authority by:

(1) a public utility;

(2) an affiliate; or

(3) a representative of a public utility or affiliate.

(b) A record of a communication must contain:

(1) the name of the person contacting the regulatory authority

or member or employee of the regulatory authority;

(2) the name of the business entity represented;

(3) a brief description of the subject matter of the

communication; and

(4) the action, if any, requested by the public utility,

affiliate, or representative.

(c) Records compiled under Subsection (b) shall be available to

the public monthly.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.154. JURISDICTION OVER AFFILIATE. (a) The commission

has jurisdiction over an affiliate that has a transaction with a

public utility under the commission's jurisdiction to the extent

of access to a record of the affiliate relating to the

transaction, including a record of joint or general expenses, any

portion of which may be applicable to the transaction.

(b) A record obtained by the commission relating to sale of

electrical energy at wholesale by an affiliate to the public

utility is confidential and is not subject to disclosure under

Chapter 552, Government Code.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

SUBCHAPTER E. AUDITS AND INSPECTIONS

Sec. 14.201. INQUIRY INTO MANAGEMENT AND AFFAIRS. A regulatory

authority may inquire into the management and affairs of each

public utility and shall keep itself informed as to the manner

and method in which each public utility is managed and its

affairs are conducted.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.202. MANAGEMENT AUDITS BY COMMISSION. (a) The

commission shall:

(1) inquire into the management of the business of each public

utility under its jurisdiction;

(2) keep itself informed as to the manner and method in which

the utility's business is managed; and

(3) obtain from the public utility any information necessary to

enable the commission to perform a management audit.

(b) The commission may audit a utility under its jurisdiction as

frequently as needed. Six months after an audit, the utility

shall report to the commission on the status of the

implementation of the recommendations of the audit and shall file

subsequent reports at times the commission considers appropriate.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.203. AUDIT OF ACCOUNTS. A regulatory authority may

require the examination and audit of the accounts of a public or

municipally owned utility.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.204. INSPECTION. (a) A regulatory authority and, to

the extent authorized by the regulatory authority, its counsel,

agent, or employee, may:

(1) inspect and obtain copies of the papers, books, accounts,

documents, and other business records of a public utility within

its jurisdiction; and

(2) inspect the plant, equipment, and other property of a public

utility within its jurisdiction.

(b) An action under this section must be conducted at a

reasonable time for a reasonable purpose.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.205. EXAMINATIONS UNDER OATH. In connection with an

action taken under Section 14.204, the regulatory authority may:

(1) examine under oath an officer, agent, or employee of a

public utility; or

(2) authorize the person conducting the action to make the

examination under oath.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.206. ENTERING PREMISES OF PUBLIC UTILITY. (a) A

member, agent, or employee of a regulatory authority may enter

the premises occupied by a public utility to conduct an

inspection, examination, or test or to exercise any other

authority provided by this title.

(b) A member, agent, or employee of the regulatory authority may

act under this section only during reasonable hours and after

reasonable notice to the public utility.

(c) A public utility is entitled to be represented when an

inspection, examination, or test is conducted on its premises.

The utility is entitled to a reasonable time to secure a

representative before the inspection, examination, or test

begins.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.

Sec. 14.207. PRODUCTION OF OUT-OF-STATE RECORDS. (a) A

regulatory authority may require, by order or subpoena served on

a public utility, the production, at the time and place in this

state that the regulatory authority designates, of any books,

accounts, papers, or records kept by that public utility outside

this state or, if ordered by the commission, verified copies of

the books, accounts, papers, or records.

(b) A public utility that fails or refuses to comply with an

order or subpoena under this section violates this title.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.