Printable Format66-117. Change of rates or schedules; procedure; effective date; higher rates of return on investment in certain cases; hearing; property tax surcharge authorized; assessment of regional rate competitiveness and economic development impact of rate change. (a) Unless the state corporation commission otherwise orders, no common carrier or public utility over which the commission has control shall make effective any changed rate, joint rate, toll, charge or classification or schedule of charges, or any rule or regulation or practice pertaining to the service or rates of such public utility or common carrier except by filing the same with the commission at least 30 days prior to the proposed effective date. The commission, for good cause, may allow such changed rate, joint rate, toll, charge or classification or schedule of charges, or rule or regulation or practice pertaining to the service or rates of any such public utility or common carrier to become effective on less than 30 days' notice. If the commission allows a change to become effective on less than 30 days' notice, the effective date of the allowed change shall be the date established in the commission order approving such change, or the date of the order if no effective date is otherwise established. Any such proposed change shall be shown by filing with the state corporation commission a schedule showing the changes, and such changes shall be plainly indicated by proper reference marks in amendments or supplements to existing tariffs, schedules or classifications, or in new issues thereof.
(b) Whenever any common carrier or public utility governed by the provisions of this act files with the state corporation commission a schedule showing the changes desired to be made and put in force by such public utility or common carrier, the commission either upon complaint or upon its own motion, may give notice and hold a hearing upon such proposed changes. Pending such hearing, the commission may suspend the operation of such schedule and defer the effective date of such change in rate, joint rate, toll, charge or classification or schedule of charges, or any rule or regulation or practice pertaining to the service or rates of any such public utility or common carrier by delivering to such public utility or common carrier a statement in writing of its reasons for such suspension.
(c) The commission shall not delay the effective date of the proposed change in rate, joint rate, toll, charge or classification or schedule of charges, or in any rule or regulation or practice pertaining to the service or rates of any such public utility or common carrier, more than 240 days beyond the date the public utility or common carrier filed its application requesting the proposed change. If the commission does not suspend the proposed schedule within 30 days of the date the same is filed by the public utility or common carrier, such proposed schedule shall be deemed approved by the commission and shall take effect on the proposed effective date. If the commission has not issued a final order on the proposed change in any rate, joint rate, toll, charge or classification or schedule of charges, or any rule or regulation or practice pertaining to the service or rates of any such public utility or common carrier, within 240 days after the carrier or utility files its application requesting the proposed change, then the schedule shall be deemed approved by the commission and the proposed change shall be effective immediately, except that:
(1) For purposes of the foregoing provisions regarding the period of time within which the commission shall act on an application, any amendment to an application for a proposed change in any rate, which increases the amount sought by the public utility or common carrier or substantially alters the facts used as a basis for such requested change of rate, shall, at the option of the commission, be deemed a new application and the 240-day period shall begin again from the date of the filing of the amendment;
(2) if hearings are in process before the commission on a proposed change requested by the public utility or common carrier on the last day of such 240-day period, such period shall be extended to the end of such hearings plus 20 days to allow the commission to prepare and issue its final order; and
(3) nothing in this subsection shall preclude the public utility or common carrier and the commission from agreeing to a waiver or an extension of the 240-day period.
(d) Except as provided in subsection (c), no change shall be made in any rate, toll, charge, classification or schedule of charges or joint rates, or in any rule or regulation or practice pertaining to the service or rates of any such public utility or common carrier, without the consent of the commission. Within 30 days after such changes have been authorized by the state corporation commission or become effective as provided in subsection (c), copies of all tariffs, schedules and classifications, and all rules and regulations, except those determined to be confidential under rules and regulations adopted by the commission, shall be filed in every station, office or depot of every such public utility and every common carrier in this state, for public inspection.
(e) Upon a showing by a public utility before the state corporation commission at a public hearing and a finding by the commission that such utility has invested in projects or systems that can be reasonably expected to produce energy from a renewable resource other than nuclear for the use of its customers, cause the conservation of energy used by its customers or bring about the more efficient use of energy by its customers, the commission may allow a return on such investment equal to an increment of from 0.5% to 2% plus an amount equal to the rate of return fixed for the utility's other investment in property found by the commission to be used or required to be used in its services to the public. The commission may also allow such higher rate of return on investments by a public utility in experimental projects, such as load management devices, which it determines after public hearing to be reasonably designed to cause more efficient utilization of energy and in energy conservation programs or measures which it determines after public hearing provides a reduction in energy usage by its customers in a cost-effective manner.
(f) Whenever, after the effective date of this act, an electric public utility, a natural gas public utility or a combination thereof, files tariffs reflecting a surcharge on the utility's bills for utility service designed to collect the annual increase in expense charged on its books and records for ad valorem taxes, such utility shall report annually to the state corporation commission the changes in expense charged for ad valorem taxes. For purposes of this section, such amounts charged to expense on the books and records of the utility may be estimated once the total property tax payment is known. If found necessary by the commission or the utility, the utility shall file tariffs which reflect the change as a revision to the surcharge. Upon a showing that the surcharge is applied to bills in a reasonable manner and is calculated to substantially collect the increase in ad valorem tax expense charged on the books and records of the utility, or reduce any existing surcharge based upon a decrease in ad valorem tax expense incurred on the books and records of the utility, the commission shall approve such tariffs within 30 days of the filing. Any over or under collection of the actual ad valorem tax increase charged to expense on the books of the utility shall be either credited or collected through the surcharge in subsequent periods. The establishment of a surcharge under this section shall not be deemed to be a rate increase for purposes of this act. The net effect of any surcharges established under this section shall be included by the commission in the establishment of base rates in any subsequent rate case filed by the utility.
(g) Except as to the time limits prescribed in subsection (c), proceedings under this section shall be conducted in accordance with the provisions of the Kansas administrative procedure act.
(h) In any general rate proceeding of an electric public utility serving more than 20,000 customers conducted pursuant to this section, the electric public utility shall evaluate and include in its application for a rate change an assessment of the following: (1) The regional rate competitiveness of the electric public utility's current and proposed rates; and (2) the impact of the electric public utility's current and proposed rates upon economic development within the state.
History: L. 1911, ch. 238, § 20; R.S. 1923, 66-117; L. 1978, ch. 264, § 1; L. 1980, ch. 201, § 2; L. 1980, ch. 200, § 1; L. 1988, ch. 356, § 225; L. 1995, ch. 21, § 2; L. 1995, ch. 70, § 1; L. 1997, ch. 132, § 19; L. 2023, ch. 22, § 1; July 1.
Law Review and Bar Journal References:
Review of history of regulations, Marion Beatty, 27 J.B.A.K. 186, 191 (1958).
"Corporation Commission Practice," John E. Davis, 37 J.B.A.K. 87, 88 (1968).
"Wolf Creek and The Rate-Making Process," Brian J. Moline, 33 K.L.R. 509, 510 (1985).
Attorney General's Opinions:
Public utilities; powers of KCC over municipal franchises and ordinances. 84-54.
CASE ANNOTATIONS
1. Telegraph station cannot be discontinued without permission of utilities commission. The State, ex rel., v. Postal Telegraph Co., 96 Kan. 298, 150 P. 544.
2. Special privilege cannot be granted unless tariff filed, etc. Mollohan v. Railway Co., 97 Kan. 51, 154 P. 248.
3. Change in rates not made without consent of utilities commission. Telephone Co. v. Utilities Commission, 97 Kan. 136, 137, 154 P. 262.
4. Nonfeasance primarily under control of commission; mandamus refused. City of Scammon v. Gas Co., 98 Kan. 812, 815, 160 P. 316.
5. Change in rates, rules, regulations; consent of commission necessary. The State, ex rel., v. Gas Co., 100 Kan. 593, 595, 165 P. 1111.
6. Rates filed with commission cannot be changed without assent of tribunal. Milling Co. v. Postal Telegraph Co., 101 Kan. 307, 309, 166 P. 493.
7. Section does not supersede provision relating to control by cities. City of Wilson v. Electric Light Co., 101 Kan. 425, 428, 166 P. 512.
8. Power to cities to regulate utility; powers of utilities commission. Street Light Co. v. Utilities Commission, 101 Kan. 774, 778, 169 P. 205.
9. Telephone service discontinued; restoration; order not enforced by mandamus. The State, ex rel., v. Telephone Co., 102 Kan. 318, 322, 170 P. 26.
10. Discount allowed by water company; discontinued; consent of city commission. City of Great Bend v. Water Co., 106 Kan. 553, 555, 189 P. 146.
11. Changes and modification of rates must be filed with commission. Railroad and Light Co. v. Court of Industrial Relations, 113 Kan. 217, 230, 214 P. 797, 804; State, ex rel., v. Telephone Co., 115 Kan. 236, 274, 223 P. 790.
12. Statute is valid exercise of police power. State, ex rel., v. Telegraph Co., 117 Kan. 651, 232 P. 1038.
13. Special rate to landowner changed only on compliance with section. Empire Natural Gas Co. v. Thorp, 121 Kan. 116, 245 P. 1058.
14. Provision has no application to interstate rate. Missouri Pac. Rld. Co. v. Red Star Milling Co., 122 Kan. 122, 125, 251 P. 417.
15. Cited in construing reparations statute. State, ex rel., v. Public Service Comm., 135 Kan. 491, 493, 11 P.2d 999.
16. Charges for hotel private telephone exchanges upheld though no tariff filed; individual contracts. Tri-State Hotel Co., Inc., v. Southwestern Bell Telephone Co., 155 Kan. 358, 370, 371, 125 P.2d 728.
17. Nature and scope of appellate review of commission's judicial orders determined. Union Pac. Rld. Co. v. State Corporation Commission, 165 Kan. 368, 370, 194 P.2d 939.
18. Injunction enjoining commission from interfering with collection of increased telephone rates improperly granted. Southwestern Bell Tel. Co. v. State Corporation Commission, 169 Kan. 509, 515, 219 P.2d 377.
19. Mentioned; authority of city to grant to utility right to use streets determined. Kansas Power & Light Co. v. City of Great Bend, 172 Kan. 126, 128, 238 P.2d 544.
20. Hearing to determine rate base for increase requested hereunder not mandatory. City of McPherson v. State Corporation Commission, 174 Kan. 407, 408, 412, 413, 432, 257 P.2d 123.
21. Existing rates must adversely affect public interest to justify rate change. Central Kansas Power Co. v. State Corporation Commission, 181 Kan. 817, 821, 822, 824, 825, 826, 827, 828, 829, 831, 316 P.2d 277.
22. Commission cannot by approval limit liability of telegraph company for error in intrastate message. McNally Pittsburg Mfg. Corp. v. Western Union Telegraph Co., 186 Kan. 709, 713, 353 P.2d 199.
23. Mentioned in construing electrical energy purchase contract between government and utility. United States v. Kansas Gas and Electric Company, 215 F. Supp. 532, 534, 535.
24. Mentioned; changes in private contract rates discussed. Kansas Power & Light Co. v. Mobil Oil Co., 198 Kan. 556, 560, 561, 426 P.2d 60.
25. Word "within" limits, rather than extends effective date of order. Secretary of the Army v. State Corporation Commission, 206 Kan. 139, 141, 476 P.2d 629.
26. Customers of utility companies had remedy in state courts and could not bring action in federal court; action challenging legality of late assessment charges. Tennyson v. Gas Service Co., 506 F.2d 1135, 1136, 1141.
27. Commission findings supported by evidence; court could not substitute its judgment for that of commission on appeal. Kansas-Nebraska Natural Gas Co. v. State Corporation Commission, 217 Kan. 604, 612, 538 P.2d 702.
28. Cited; subsequent order fixing future effective date for a previously authorized rate increase found reasonable and lawful. Sunflower Pipeline Co. v. Kansas Corporation Commission, 3 Kan. App. 2d 683, 685, 687, 600 P.2d 794.
29. Change in contract rates charged not filed with K.C.C.; order requiring utility to make full refund, affirmed. Sunflower Pipeline Co. v. Kansas Corporation Commission, 5 Kan. App. 2d 715, 716, 719, 624 P.2d 466.
30. Rules of construction of public utility tariff; judicial review of order of KCC. Southwestern Bell Tel. Co. v. Kansas Corporation Comm'n, 233 Kan. 375, 377, 664 P.2d 798 (1983).
31. KCC may not allow motor carriers to charge less than maximum rates without filing new tariff. Oilfield Fluid Motor Carriers v. Kansas Corporation Comm'n, 234 Kan. 983, 988, 990, 677 P.2d 982 (1984).
32. Any proceeding in which proposed new tariff will result in rate and revenue increase is "rate hearing." MAPCO Intrastate Pipeline Co. v. Kansas Corporation Comm'n, 10 Kan. App. 2d 527, 530, 704 P.2d 989 (1985).
33. Under facts, relief sought by pipeline company was deemed approved when KCC failed to timely take action on application. Kansas Pipeline Partnership v. Kansas Corporation Comm'n, 22 Kan. App. 2d 410, 415, 916 P.2d 76 (1996).
34. KCC orders changing nature of consolidation and voiding decision applying time limit herein erroneous and unreasonable application of law. Western Resources, Inc. v. Kansas Corporation Comm'n, 23 Kan. App. 2d 664, 667, 937 P.2d 964 (1997).
35. Not necessary to furnish additional notice following amendment of rate application where description of proceeding did not become misleading. Farmland Industries, Inc. v. Kansas Corporation Comm'n, 24 Kan. App. 2d 172, 174, 943 P.2d 470 (1997).
36. KCC may not reduce carrier's Kansas Universal Service Fund support as an offset to future revenues to be produced by revised tariff. Rural Telephone Service Co. v. Kansas Corporation Comm'n, 31 Kan. App. 2d 740, 72 P.3d 937 (2003).
37. Full-blown rate hearing not required for every rate change. Kansas Industrial Consumers Group, Inc. v. Kansas Corporation Comm'n, 36 Kan. App. 2d 83, 92, 138 P.3d 338 (2006).
38. The 30-day time limit found in 66-117(c) setting time for Kansas Corporation Commission to respond to a request for relief does not apply to fund-audit proceedings initiated by KCC. S & T Tel. Co-op Ass'n, Inc. v. Kansas Corporation Comm'n, 48 Kan. App. 2d 290, 291 P.3d 490 (2012).