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October 26, 2010

     
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State Regulatory Relations


Indiana Governor Appoints New URC Chairman

Chairman Jim Atterholt

Indiana Governor Mitch Daniels recently appointed Commissioner Jim Atterholt as chairman of the Indiana Utility Regulatory Commission following the departure of Chairman David Hardy.

Atterholt was appointed by Daniels on June 22, 2009, to the Indiana Utility Regulatory Commission. Prior to joining the Commission, he was the State Insurance Commissioner for more than four years, where he also served as a member of the Governor’s Cabinet. Chairman Atterholt worked as director of government affairs for AT&T--Indiana from 2003 to 2004.

Atterholt served two terms as a member of the Indiana General Assembly from 1998 to 2002. As a State Representative he served on the House Commerce, Economic Development and Technology Committee, which has jurisdiction over all utility-related legislation. Atterholt also served on the Environmental Affairs Committee as well as the Labor Committee, and has also worked on energy issues as chief of staff in Washington, D.C., and later as district director in Indiana for a member of the United States Congress.

A native of Fort Wayne, Ind., Atterholt received his bachelor’s degree from the University of Wisconsin in 1986. He is a member of the National Association of Regulatory Utility Commissioners (NARUC), where he serves on the Committee on Gas. He also serves on the Board of Directors of the Saint Florian Center for at-risk-children.

 

NARUC to Host Annual Meeting

Don’t forget to register now for NARUC’s 122nd Annual Meeting to be held Nov. 14-17 in Atlanta, Ga. Online registration is available through Oct. 29 on NARUC’s website.

 

California PUC Concludes Two Rulemaking Proceedings

On Oct. 14, 2010, the California Public Utilities Commission issued two important rulemaking decisions. The first sets forth rules and policies to govern the accounting and ratemaking treatment of local and federal government grants, public loans and damage awards received by an investor-owned water utility following contamination of its water supplies. As summarized by the PUC: "[G]overnment loan proceeds, as well as proceeds from damage awards, settlements, government orders (i.e., proceeds derived via government order from public or private funding sources) or insurance that fund replacement plant should be treated as CIAC rather than being included in rate base and earning a return.” [Decision 10-10-018, p. 2] Although the decision anticipates a possible sharing of contamination awards between shareholders and customers, it is believed to be quite unlikely that, following the necessary remediation, any "net proceeds," as defined by the PUC, will remain available for allocation.

In its second decision, the Commission adopted standard rules for Class A and Class B water and sewer utilities governing affiliate transactions and the use of regulated assets for non-tariffed utility services. [Decision No. 10-10-019] Heretofore, affiliate transaction rules for water and wastewater companies were developed on a utility-specific basis, frequently in the context of approving applications to form holding companies. The new rules, according to the PUC, reflect a combination of existing water utility holding company rules and affiliate transaction rules adopted for the energy industry, and are designed to ensure the financial health of the utility while "preventing anti-competitive behavior in the competition marketplace." Among other provisions, the new rules require each utility with a parent company to file an advice letter with the PUC "proposing provisions that are sufficient to prevent the utility from being pulled into the bankruptcy of its parent company."