Part 2.
PUBLIC UTILITY COMMISSION OF TEXAS
Chapter 23.
SUBSTANTIVE RULES
Subchapter F. QUALITY OF SERVICE
16 TAC §23.68
(Editor's note: The text of the following section proposed for
repeal will not be published. The section may be examined in the offices of
the Public Utility Commission of Texas or in the Texas Register office, Room
245, James Earl Rudder Building, 1019 Brazos Street, Austin.)
The Public Utility Commission of Texas (PUC) proposes
the repeal of §23.68 relating to Embedded Customer Premises Equipment.
This section was required in 1985 by mandate of the Federal Communications
Commission (FCC) which required state commissions to establish guidelines
for incumbent local exchange companies (ILECs) to follow in the detariffing,
transfer and valuation of embedded customer premises equipment. After reviewing
this section, the commission believes that it is no longer relevant as the
ILECs have fulfilled the requirements of the rule and the FCC Order that required
the rule. Project Number 17709 has been assigned to this proceeding.
Martin Wilson, attorney, Legal Division, Office of Regulatory Affairs has
determined that for each year of the first five-year period this repeal is
in effect there will be no fiscal implications for state or local government
as a result of enforcing or administering the repeal.
Mr. Wilson has determined that for each year of the first five years the
repeal is in effect, the public benefit anticipated as a result of the repeal
will be elimination of a rule that is no longer relevant. There will be no
effect on small businesses or micro-businesses as a result of repealing this
section. There is no anticipated economic cost to persons as a result of repealing
this section.
Mr. Wilson has also determined that for each year of the first five years
the proposed repeal is in effect there should be no effect on a local economy,
and therefore no local employment impact statement is required under Administrative
Procedure Act §2001.022.
Comments on the proposed repeal (16 copies) may be submitted to the Filing
Clerk, Public Utility Commission of Texas, 1701 North Congress Avenue, P.O.
Box 13326, Austin, Texas 78711-3326, within 30 days after publication. All
comments should refer to Project Number 17709 - Repeal of §23.68.
This repeal is proposed under the Public Utility Regulatory Act,
Texas Utilities Code Annotated §14.002 (Vernon 1998) (PURA), which provides
the Public Utility Commission with the authority to make and enforce rules
reasonably required in the exercise of its powers and jurisdiction.
Cross Reference to Statutes: Public Utility Regulatory Act §14.002.
§23.68. Embedded Customer Premises Equipment.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed with the Office of
the Secretary of State, on April 13, 2000.
TRD-200002619
Rhonda Dempsey
Rules Coordinator
Public Utility Commission of Texas
Earliest possible date of adoption: May 28, 2000
For further information, please call: (512) 936-7308
The Public Utility Commission of Texas (commission) proposes new §25.90
relating to Market Power Mitigation Plans, new §25.91 relating to Generating
Capacity Reports, and new §25.401 relating to Share of Installed Generation
Capacity. The proposed new rules will implement provisions of the Public Utility
Regulatory Act (PURA) §§39.154, 39.155, 39.156, and 39.157. Section
25.90 establishes requirements and procedures for utilities and power generation
companies that own and control more than 20% of the installed generation capacity
located in, or capable of delivering electricity to, a power region to file
market power mitigation plans. Section 25.91 establishes reporting requirements
and procedures for each person, power generation company, municipally owned
utility, electric cooperative, and river authority that owns generation facilities
and offers electricity for sale in the state to file annual generating capacity
reports. Section 25.401 establishes initial filing requirements and components
of the calculation method to be used in determining if a power generation
company owns and controls more than 20% of the installed generation capacity
located in, or capable of delivering electricity to, a power region. Project
Number 21081 has been assigned to this proceeding.
Project Number 21081,
Market Power Mitigation
Plans and Generating Capacity Reports
, was established in July 1999
as part of the plan for implementing Senate Bill 7, Act of May 21, 1999, 76th
Legislature, Regular Session, chapter 405, 1999 Texas Session Law Service
2543, 2591 (Vernon) (codified as an amendment to the Public Utility Regulatory
Act, Texas Utilities Code Annotated §§39.154, 39.155, 39.156, and
39.157). Senate Bill 7, the Electric Restructuring Act, amended several sections
of the Public Utility Regulatory Act (Vernon 1998 & Supplement 2000) (PURA)
and became effective September 1, 1999. The commission staff posted questions
for comment on its Internet site on December 7, 1999, and published an invitation
to comment in the
Texas Register
on December
3, 1999 (24 TexReg 11035). The staff prepared drafts of §25.90 and §25.91
in January 1999, which were discussed at a workshop held on January 31, 2000.
After the workshop, new §25.401 relating to Share of Installed Generation
Capacity was added to Project Number 21081 to provide a means to address the
calculation that will be made to determine the share of installed generation
capacity that a power generation owns and controls in a power region. Proposed §25.90
and §25.91 are primarily reporting requirements and do not have adequate
scope to address the calculation issues. Proposed §25.91 requires the
reporting of data that will be used in determining the share of installed
generation capacity and assessing market power, and proposed §25.90 requires
the filing of market power mitigation plans after it has been determined that
a utility or power generation company has more than 20% of the installed generation
capacity.
The commission seeks comments on the proposed rules from interested persons.
Parties should organize their comments in a manner that parallels the organization
of the proposed rules.
When commenting on specific subsections of the proposed rules, parties
are encouraged to describe "best practice" examples of regulatory policies,
and their rationale, that have been proposed or implemented successfully in
other states already undergoing electric industry restructuring, if the parties
believe that Texas would benefit from application of the same policies. The
commission is only interested in receiving "leading edge" examples which are
specifically related and directly applicable to the Texas statute, rather
than broad citations to other state restructuring efforts.
In addition, the commission requests that interested parties specifically
address the following issue pertaining to §25.401, Share of Installed
Generation Capacity: PURA §39.154(d) defines the term "installed generation
capacity" in terms of generation capacity that is "potentially marketable."
Subsection (e)(2) of the proposed rule identifies several categories of generation
capacity that are not considered to be potentially marketable. The commission
invites comments on whether these categories of generation capacity should
be excluded from the denominator.
Mr. Richard Greffe, Senior Economist, Office of Regulatory Affairs, has
determined that for each year of the first five-year period the proposed sections
are in effect there will be no fiscal implications for state or local government
as a result of enforcing or administering the sections.
Mr. Greffe has determined that for each year of the first five years the
proposed sections are in effect the public benefit anticipated as a result
of enforcing the section will be the protection of public interest and the
implementation of a process to mitigate market power that may result from
the ownership and control of more than 20% of the installed generation capacity
in a power region. There will be no effect on small businesses or micro-businesses
as a result of enforcing these sections. There is no anticipated economic
cost to persons who are required to comply with the sections as proposed.
Mr. Greffe has also determined that for each year of the first five years
the proposed sections are in effect there should be no effect on a local economy,
and therefore no local employment impact statement is required under Administrative
Procedure Act §2001.022.
The commission staff will conduct a public hearing on this rulemaking under
Government Code §2001.029 at the commission's offices, located in the
William B. Travis Building, 1701 North Congress Avenue, Austin, Texas 78701,
on Thursday, June 1, 2000, at 9:30 a.m. in the Commissioners' Hearing Room.
Comments on the proposed new sections (16 copies) may be submitted to the
Filing Clerk, Public Utility Commission of Texas, 1701 North Congress Avenue,
P.O. Box 13326, Austin, Texas 78711-3326, within 25 days after publication.
Reply comments may be submitted within 35 days after publication. Parties
are also requested to e-mail an electronic copy of comments to richard.greffe@puc.state.tx.us,
if possible.
The commission invites specific comments regarding the costs associated
with, and benefits that will be gained by, implementation of the proposed
section. The commission will consider the costs and benefits in deciding whether
to adopt the section. All comments should refer to Project Number 21081.
Subchapter D. RECORDS, REPORTS, AND OTHER REQUIRED INFORMATION
16 TAC §25.90, §25.91
The new sections are proposed under the Public Utility Regulatory
Act, Texas Utilities Code Annotated §14.002 (Vernon 1998 & Supplement
2000) (PURA), which provides the Public Utility Commission with the authority
to make and enforce rules reasonably required in the exercise of its powers
and jurisdiction; and specifically, PURA §39.154, which requires the
commission to determine the percentage shares of installed generation capacity
that are owned and controlled by a utility or a power generation company; §39.155,
which grants the commission the authority to assess market power and to require
the filing of generation capacity reports; §39.156, which grants the
commission the authority to require the filing of market power mitigation
plans; and §39.157, which grants the commission the authority to address
market power and to monitor the market shares of installed generation capacity
to ensure that the limitations in PURA §39.154 (relating to Limitation
of Ownership of Installed Capacity) are not exceeded.
Cross Reference to Statutes: Public Utility Regulatory Act §§14.002,
14.003, 31.002, 39.154, 39.155, 39.156, 39.157, and 39.264.
§25.90. Market Power Mitigation Plans.
(a)
Application. An electric utility or power generation company
owning and controlling more than 20% of the installed generation capacity
located in, or capable of delivering electricity to, a power region prior
to December 1, 2000, shall file a market power mitigation plan with the commission
not later than December 1, 2000. An electric utility or power generation company
owning and controlling more than 20% of the installed generation capacity
located in, or capable of delivering electricity to, a power region after
December 1, 2000, shall file a market power mitigation plan as directed by
the commission.
(b)
Initial information filing. Each utility or power generation
company that owns and controls, either separately or in combination with its
affiliates, more than 10,000 megawatts (MW) of electric generation capacity
located in a power region that is partly or entirely within the state shall
file a calculation by September 1, 2000, showing its percentage share of the
installed generation capacity in the power region. The calculation shall be
made pursuant to the requirements of §25.401 of this title (relating
to Share of Installed Generation Capacity). The filing must include detailed
information that will allow the commission to replicate the calculation. At
a minimum, the filing must include an itemized list of all generating units
owned in whole or in party by the utility or power generation company and
its affiliates. Generating units should be identified by name, capacity rating,
ownership, location, and reliability council. The filing must also include
the transmission import capacity amounts that are to be included in the numerator
and the denominator of the calculation and an explanation of how the transmission
capacity amounts were determined.
(c)
Market power mitigation plan. A market power mitigation
plan is a written proposal by an electric utility or a power generation company
for reducing its ownership and control of installed generation capacity as
required by the Public Utility Regulatory Act (PURA) §39.154. A market
power mitigation plan may provide for:
(1)
the sale of generation assets to a nonaffiliated person;
(2)
the exchange of generation assets with a nonaffiliated
person located in a different power region;
(3)
the auctioning of generation capacity entitlements
as part of a capacity auction required by PURA §39.153;
(4)
the sale of the right to capacity to a nonaffiliated
person for at least four years; or
(5)
any reasonable method of mitigation.
(d)
Filing requirements. The plan shall be in a form prescribed
by the commission, and it shall include all supporting information necessary
for the commission to fully understand and evaluate the plan. On a case-by-case
basis, the commission will require the electric utility or power generation
company to provide any additional information the commission finds necessary
to evaluate the plan.
(e)
Procedure. The commission shall approve, modify, or reject
a plan within 180 days after the date of filing. The commission may not modify
the plan to require divestiture by the electric utility or power generation
company.
(f)
Commission determinations. In reaching its determination
under subsection (e) of this section, the commission shall consider:
(1)
the degree to which the electric utility's or power generation
company's stranded costs, if any, are minimized;
(2)
whether on disposition of the generation assets the
reasonable value is likely to be received;
(3)
the effect of the plan on the electric utility's
or power generation company's federal income taxes;
(4)
the effect of the plan on current and potential competitors
in the generation market;
(5)
whether the plan provides adequate mitigation of
market power; and
(6)
whether the plan is consistent with the public interest.
(g)
Request to amend or repeal mitigation plan. An electric
utility or power generation company with an approved mitigation plan may request
to amend or repeal its plan. On a showing of good cause, the commission shall
modify or repeal the mitigation plan.
(h)
Approval date. If an electric utility's or power generation
company's market power mitigation plan is not approved before January 1 of
the year it is to take effect, the commission may order the electric utility
or power generation company to auction generation capacity entitlements according
to PURA §39.153, subject to commission approval, of any capacity exceeding
the maximum allowable capacity prescribed by PURA §39.154 until the time
the mitigation plan is approved. An auction held under this subsection shall
be held not later than 60 days after the date the order is entered.
§25.91. Generating Capacity Reports.
(a)
Application. This section applies to each person, power
generation company, municipally owned utility, electric cooperative, and river
authority that owns generation facilities and offers electricity for sale
in this state.
(b)
Definitions. The following words and terms, when used
in this section, shall have the following meanings unless the context clearly
indicates otherwise.
(1)
Nameplate rating - The full-load continuous rating of
a generator under specified conditions as designated by the manufacturer.
(2)
Summer net dependable capability - The capacity rating
in megawatts (MW) or kilowatts (KW) for a generating unit that reflects the
maximum capacity that the unit can sustain over a specified period of time
as modified for summer season limitations and reduced by the capacity required
for station services and auxiliaries.
(c)
Filing requirements. Reporting parties shall file reports
with the commission by the last working day of February each year, for the
immediately preceding calendar year. Filings shall be made using a form prescribed
by the commission.
(d)
Report attestation. A report submitted pursuant to this
section shall be attested to by an owner, partner, or officer of the reporting
party under whose direction the report was prepared.
(e)
Confidentiality. The reporting party may designate information
that it considers to be confidential. Information designated as confidential
will be treated in accordance with the standard protective order issued by
the commission applicable to generating capacity reports.
(f)
Capacity ratings. Generating unit capacity will be reported
at the summer net dependable capability rating as determined by the requirements
of the applicable reliability council or independent organization, except
as follows:
(1)
Renewable resource generating units that are not dispatchable,
will be reported at the actual capacity value during the most recent peak
season, and the report will include data supporting the determination of the
actual capacity value;
(2)
Generating units that will be connected to a transmission
and distribution system and operating within 12 months will be rated at the
nameplate rating.
(g)
Reporting requirements.
(1)
Each reporting party shall provide its information concerning
generation capacity (in MW) and sales (in megawatt-hours (MWh)) on a power
region-wide basis and for that portion of a power region in the state:
(A)
total capacity of installed generating facilities that
are connected with a transmission and distribution system;
(B)
total capacity of generating facilities that will be connected
with a transmission and distribution system and operating within 12 months;
(C)
total affiliate installed generation capacity;
(D)
total amount of capacity available for sale to others;
(E)
total amount of capacity under contract to others;
(F)
total amount of capacity dedicated to its own use;
(G)
total amount of capacity that has been subject to auction
as approved by the commission;
(H)
total amount of capacity that will be retired within 12
months;
(I)
annual capacity sales to affiliated retail electric providers
(REPs);
(J)
annual wholesale energy sales;
(K)
annual retail energy sales; and
(L)
annual energy sales to affiliate REPS;
(2)
Each reporting party shall provide the following
information for each generating unit it owns in whole or in part:
(A)
Name;
(B)
Location by county, utility service area, power region,
reliability council, and, if applicable, transmission zone;
(C)
Capacity rating (MW) as specified in subsection (f) of
this section;
(D)
Annual generation (MWh);
(E)
Type of fuel or nonfuel resource;
(F)
Technology of natural gas generator;
(G)
Date of commercial operation;
(H)
Annual heat rate;
(I)
Annual availability factor;
(J)
Annual capacity factor;
(K)
Annual outage rate;
(L)
Annual hours connected to load; and
(M)
Planned retirement date if within 12 months.
(3)
Each reporting party shall identify the name
and capacity rating of each generating unit that does not generate electricity
sold at wholesale.
(4)
Each reporting party shall identify the name and
capacity rating of each generating unit that is partly owned by other parties.
For each such unit, it shall identify the other owners and their respective
ownership percentages.
(5)
Each reporting party shall identify the name and
capacity rating of each generating unit that it owns but does not control.
For each such unit, it shall identify the controlling party and explain the
nature of the other party's control of the unit.
(6)
Each reporting party shall identify the name and
capacity rating of each generating unit that is located on the boundary between
two power regions and able to deliver electricity directly into either power
region; and the party shall report the total sales from each such unit for
the preceding year by power region.
(7)
Each reporting party that is subject to the Public
Utility Regulatory Act (PURA) §39.154(e) shall identify the name and
capacity rating of each "grandfathered" generating unit that it owns, and
it shall also provide copies of any applications to the Texas Natural Resources
Conservation Commission (TNRCC) for a permit for the emission of air contaminants
related to the grandfathered units.
(8)
Each reporting party shall identify the name of the
generating unit and the amount of capacity that has been designated "must-run"
by the independent organization in the power region.
(9)
Each reporting party shall identify the amount of
transmission import capacity that it has reserved during the summer peak period
for the purpose of importing electricity into the power region.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed with the Office of
the Secretary of State, on April 14, 2000.
TRD-200002652
Rhonda Dempsey
Rules Coordinator
Public Utility Commission of Texas
Earliest possible date of adoption: May 28, 2000
For further information, please call: (512) 936-7308
4.
OTHER MARKET POWER ISSUES
16 TAC §25.401
This new section is proposed under the Public Utility Regulatory
Act, Texas Utilities Code Annotated §14.002 (Vernon 1998 & Supplement
2000) (PURA), which provides the Public Utility Commission with the authority
to make and enforce rules reasonably required in the exercise of its powers
and jurisdiction; and specifically, PURA §39.154, which requires the
commission to determine the percentage shares of installed generation capacity
that are owned and controlled by a utility or a power generation company; §39.155,
which grants the commission the authority to assess market power and to require
the filing of generation capacity reports; §39.156, which grants the
commission the authority to require the filing of market power mitigation
plans; and §39.157, which grants the commission the authority to address
market power and to monitor the market shares of installed generation capacity
to ensure that the limitations in PURA §39.154 (relating to Limitation
of Ownership of Installed Capacity) are not exceeded.
Cross Reference to Statutes: Public Utility Regulatory Act §§14.002,
14.003, 31.002, 39.154, 39.155, 39.156, 39.157, and 39.264.
§25.401. Share of Installed Generation Capacity.
(a)
Application. The provisions of this section apply to power
generation companies.
(b)
Share of installed generation capacity. The percentage
share of installed generation capacity for a power generation company will
be determined by dividing the capacity owned and controlled by the power generation
company in a power region by the total installed generation located in, or
capable of delivering electricity to, the power region.
(c)
Capacity ratings. For purposes of this section, generating
unit capacity ratings will be consistent with the requirements of §25.91(f)
of this title (relating to Generating Capacity Reports). The commission may
revise reported capacity ratings if they are found to be incorrect.
(d)
Installed generation capacity of a power generation company.
(1)
In determining the percentage shares of installed generation
capacity under the Public Utility Regulatory Act (PURA) §39.154, the
commission shall combine capacity owned and controlled by a power generation
company and any entity that is affiliated with that power generation company
within the power region, reduced by the installed generation capacity of those
facilities that are made subject to capacity auctions under PURA §39.153(a)
and (d).
(2)
In determining the percentage shares of installed
generation capacity, the commission shall increase the installed generation
capacity owned and controlled by a power generation company by the transmission
import capacity that the power generation company reserves during the summer
peak period for the purpose of importing electricity into the power region.
(3)
In determining the percentage shares of installed
generation capacity owned and controlled by a power generation company under
PURA §39.154 and §39.156, the commission shall, for purposes of
calculating the numerator, reduce the installed generation capacity owned
and controlled by that power generation company by the installed generation
capacity of any "grandfathered facility" within an ozone nonattainment area
as of September 1, 1999, for which that power generation company has commenced
complying or made a binding commitment to comply with PURA §39.264. This
subsection applies only to a power generation company that is affiliated with
an electric utility that owned and controlled more than 27% of the installed
generation capacity in the power region on January 1, 1999. The commission
will consider a permit application to the Texas Natural Resource Conservation
Commission (TNRCC) to be adequate evidence that the power generation company
has commenced complying or made a binding commitment to comply with PURA §39.264.
(e)
Total installed generation. The total installed generation
will consist of the installed generation capacity that is located in, or capable
of delivering electricity to, a power region.
(1)
Installed generation capacity will include all potentially
marketable electric generation capacity. Except as provided in paragraph (2)
of this subsection, installed generation capacity will include:
(A)
generating facilities that are connected with a transmission
and distribution system;
(B)
generating facilities used to generate electricity for
consumption by the person owning or controlling the facility;
(C)
generating facilities that will be connected with a transmission
and distribution system and operating within 12 months; and
(D)
generating facilities that are located on the boundary
between two power regions and are able to deliver electricity directly into
either power region, except that the capacity of such facility shall be allocated
between the power regions based on the share of its total electric energy
that the facility sold in each power region during the preceding year.
(2)
Installed generation capacity will not include:
(A)
generating facilities that have a nameplate rating equal
to or less than 1 megawatt (MW);
(B)
generating facilities that are used for backup purposes
and do not generate electricity that is sold at wholesale;
(C)
generating facilities that are used to generate electricity
for consumption by the person owning or controlling the facility and do not
generate electricity that is sold at wholesale;
(D)
cogeneration facilities that do not generate electricity
that is sold at wholesale;
(E)
generating facilities that will be retired within 12 months;
(F)
generating facilities that have been designated as "grandfathered"
facilities pursuant to subsection (d)(3) of this section; and
(G)
generating capacity that has been designated "must-run"
by the independent organization in the power region.
(3)
The amount of installed generation capacity
that is capable of delivering electricity to a power region will be determined
by:
(A)
the import transmission capacity during the summer peak
period of the alternating current (AC) transmission interconnections between
the power region at issue and other power regions; and
(B)
the import capacity during the summer peak period of the
reliable direct current (DC) interconnections between the power region at
issue and other power regions.
This agency hereby certifies that the proposal
has been reviewed by legal counsel and found to be within the agency's legal
authority to adopt.
Filed
with the Office of the Secretary of State, on April 14, 2000.
TRD-200002653
Rhonda Dempsey
Rules Coordinator
Public Utility Commission of Texas
Earliest possible date of adoption: May 28, 2000
For further information, please call: (512) 936-7308
Subchapter E. CERTIFICATION, LICENSING AND REGISTRATION
16 TAC §25.107, §25.108
The Public Utility Commission of Texas (commission) proposes
new §25.107, relating to Certification of Retail Electric Providers,
and new §25.108, relating to Financial Standards for Retail Electric
Providers Regarding the Billing and Collection of Transition Charges. The
proposed new §25.107 establishes requirements for certification of retail
electric providers (REPs), application procedures, requirements for maintaining
certificates, and provisions for suspension and revocation of certificates,
as well as related administrative penalties. The proposed new §25.108
imposes additional financial requirements on REPs who will be billing and
collecting transition charges resulting from securitization by utilities.
Project Number 21082 has been assigned to this proceeding.
Project Number 21082,
Certification of Retail
Electric Providers and Registration of Power Generation Companies and Aggregators;
Forms
, was established in July 1999 as one of many projects to implement
Senate Bill 7, Act of May 21, 1999, 76th Legislature, Regular Session, chapter
405, 1999 Texas Session Law Service 2543 (Vernon) (codified as an amendment
to the Public Utility Regulatory Act (PURA), Texas Utilities Code Annotated §§39.351,
39.353, 39.354, 39.3545, 39.356, and 39.357). Senate Bill 7, the Electric
Restructuring Act, amends several sections of the Public Utility Regulatory
Act and became effective September 1, 1999. In Project Number 21082, the commission
staff posted questions for comment on its Internet site on October 20, 1999
and published an invitation to comment in the
Texas
Register
on October 22, 1999 (24 TexReg 9434). The staff prepared a
draft of §25.107 in December 1999, which was discussed at a workshop
held on December 15, 1999. Written comments were received and used to prepare
a second draft of §25.107, which was discussed at a workshop held on
January 28, 2000.
The commission discussed a staff recommendation for publication at its
open meeting on March 23, 2000. On that occasion, written comments from parties
were invited on that recommendation and staff was directed to prepare a revised
recommendation for publication of rules. A revised staff recommendation was
filed on April 6, 2000, and considered and amended at the open meeting held
on April 12, 2000.
Although also a part of this project, the commission's proposed rules concerning
the registration of aggregators and power marketers have been published on
a different timeline. For more information on those proposed rules, see the
March 17, 2000
Texas Register
(25 TexReg 2240).
The commission seeks comments on the proposed rules from interested persons.
Parties should organize their comments in a manner that parallels the organization
of the proposed rules. The rule is written in the form of a list of requirements
for REPS to obtain and maintain certification. Provisions are stated as ongoing
standards and subsequently differentiated for the application stage only when
necessary. Comments proposing alternate language should work within this structure
as much as possible.
When commenting on specific subsections of the proposed rules, parties
are encouraged to describe "best practice" examples of regulatory policies,
and their rationale, that have been proposed or implemented successfully in
other states already undergoing electric industry restructuring, if the parties
believe that Texas would benefit from application of the same policies. The
commission is only interested in receiving "leading edge" examples which are
specifically related and directly applicable to the Texas statute, rather
than broad citations to other state restructuring efforts.
The subject of financial requirements necessary for the certification of
a REP dominated discussion of staff drafts of the proposed rule in workshops
and in written comments. However, detailed discussion was constrained on the
topic of standards that the REPs should meet for the purposes of billing and
collecting transition charges due to the fact that several securitization
dockets were open when public comment was invited (See Docket Number 21527,
The financial standards proposed in these rules are designed to grant all
qualified REPs a readily accessible opportunity to obtain certification and
conduct business with the transmission and distribution utilities on a statewide
basis, while protecting customer deposits and advance payments, and protecting
all payments of transition charges resulting from securitization.
The scheme of financial standards proposed in these rules to accomplish
the above stated purposes has three additive components that are found in
the first three paragraphs of §25.107(f): (1) three alternative credit
quality standards for certification as a REP; (2) a financial standard for
protecting customer deposits and other advance payments made to the REP; and
(3) a financial standard and procedure for REPs to bill and collect any transition
charges resulting from securitization. These credit standards apply to a REP's
business with transmission and distribution utilities serving Texas, as well
as to any electric cooperatives or municipal utilities electing customer choice.
A discussion of each standard follows below.
The first financial component of this scheme is found in §25.107(f)(1)
and addresses the credit quality standards for a REP to be certificated to
provide retail electric service in Texas. This credit quality component provides
three alternative tests for certification: (1) demonstration of $50 million
of net assets or equity; (2) demonstration of an investment grade credit rating;
or (3) demonstration of $100,000 in cash resources.
The second component of the financial standards of these proposed rules
is financial backing for customer payments. The proposed rules require that
the REP maintain the cash resources necessary to cover all customer deposits
and other advance payments outstanding at any given time in case the REP is
unable or unwilling to meet its financial obligations. This standard requires
that the REP maintain on-going records for all such payments received from
and outstanding to its customers.
For the third financial component of standards proposed in these rules,
the commission proposes §25.108, relating to Financial Standards for
Retail Electric Providers Regarding the Billing and Collection of Transition
Charges. The proposed section is referred to as a certification criterion
in §25.107 and replicates the terms and conditions for activities that
have been approved in Docket Number 21528. The commission proposes that these
standards be applied statewide for all REPs that engage in the billing and
collection of transition charges. The commission invites comment on whether
the statewide standards established by rule might differ from those adopted
in financing orders. If standards are adopted in this rulemaking that differ
from any financing orders issued prior to the adoption of rules in this rulemaking,
the REPs that are subject to those financing orders will continue to be subject
to those orders until the written confirmation required by the financing orders
is received from each of the credit rating agencies that have rated the transition
bonds that the rule's different standards will not cause a suspension, withdrawal,
or downgrade of the ratings on the transition bonds.
The extent to which any customer protection provisions, beyond the protection
of customer deposits and advance payments, should be addressed in this rule
is another issue that prompted considerable debate. Instead of eliminating
all mention of such protections, and instead of articulating specific terms
and conditions on a select few protection topics, these proposed rules state
several customer protection provisions in the form of key principles. Each
provision states a tenet of customer protection as a baseline that also allows
for more specificity to be decided elsewhere. The existence of such a list
in these rules implementing PURA §39.352 serves several functions. First,
it briefly indicates the scope of the requirements a prospective REP must
prepare to meet under the statute pertaining to the certification of REPs.
Second, it allows the commission flexibility to address the details of the
provisions in other rulemakings pertaining to customer protection. Third,
it provides a baseline that can be used to address complaints by affected
parties that occur before other customer protection rules are complete or
in the absence of adequate detail in any relevant commission rules.
In addition to comments on other provisions of the rules, the commission
requests that parties specifically address the following two issues relating
to the financial scheme described in the previous paragraphs, a third issue
related to technical and managerial requirements, and a fourth issue related
to reporting requirements for REPs.
1. Concerning §25.107(f)(1), relating to financial resources required
for credit quality:
(A) To what extent does the approach of this provision, and the three credit
quality alternatives in particular, achieve the goals of sufficient financial
creditworthiness to promote fair competition and minimal financial barriers
to entry to the market place?
(B) How do the credit quality standards that are set in this rule integrate
with the expected credit quality standards to be established by an independent
organization, as defined in PURA §31.151(b), and how should any differences
be addressed?
2. Concerning §25.107(f)(2), Financial resources required for customer
protection, do the financial standards set in paragraph (2) adequately protect
the customers of small REPs against potential harmful effects of financial
derivatives that may arise from buyer speculation in or seller default of
these securities? If not, how should they be addressed?
3. Concerning §25.107(g), should the commission further distinguish
between the continuing requirements for certified REPs and the application
requirements, especially before retail choice begins?
4. Finally, concerning the annual report required by §25.107(i), Requirements
for updating or changing the terms of a REP certificate: What circumstances
should the commission consider in establishing a reporting period and due
date for the report?
Ms. Jan Bargen, Senior Policy Analyst, Office of Policy Development, has
determined that for each year of the first five-year period the proposed sections
are in effect there will be no fiscal implications for state or local government
as a result of enforcing or administering the section.
Ms. Bargen has determined that for each year of the first five years the
proposed sections are in effect the public benefit anticipated as a result
of enforcing the sections will be protecting Texas electric customers from
REPs who do not have adequate resources or experience to provide retail electric
service. There will be no effect on small businesses or micro-businesses as
a result of enforcing these sections. There is no anticipated economic cost
to persons who are required to comply with the sections as proposed.
Ms. Bargen has also determined that for each year of the first five years
the proposed sections are in effect there should be no affect on a local economy,
and therefore no local employment impact statement is required under Administrative
Procedure Act §2001.022.
The commission staff will conduct a public hearing on this rulemaking under
Government Code §2001.029 at the commission's offices located in the
William B. Travis Building, 1701 North Congress Avenue, Austin, Texas 78701,
on Thursday, June 15, 2000, at 9:30 a.m. in the Commissioners' Hearing Room.
Comments on the proposed amendment and new rules (16 copies) may be submitted
to the Filing Clerk, Public Utility Commission of Texas, 1701 North Congress
Avenue, P.O. Box 13326, Austin, Texas 78711-3326, within 28 days after publication.
Reply comments may be submitted within 41 days after publication. Parties
are also requested to e-mail an electronic copy of comments to
jan.bargen@puc.state.tx.us
, if possible.
The commission invites specific comments regarding the costs associated
with, and benefits that will be gained by, implementation of the proposed
section. The commission will consider the costs and benefits in deciding whether
to adopt the section. All comments should refer to Project Number 21082.
These new rules are proposed under the Public Utility Regulatory
Act, Texas Utilities Code Annotated §14.002 (Vernon 1998 and Supplement
2000) (PURA), which provides the Public Utility Commission with the authority
to make and enforce rules reasonably required in the exercise of its powers
and jurisdiction, and specifically, PURA §39.352 which requires the commission
to grant certificates to applicants who demonstrate sufficient qualification
to provide retail electric service; §39.356, which grants the commission
authority to establish terms under which the commission may suspend or revoke
a retail electric provider's certification, and §39.357, which grants
the commission authority to impose an administrative penalty for violations
of §39.356.
Cross Reference to Statutes: Public Utility Regulatory Act §§14.002,
15.023, 39.352, 39.356, and 39.357.
§25.107. Certification of Retail Electric Providers (REPs).
(a)
Application. This section applies to all persons who seek
to provide electric service to retail customers in Texas on or after the date
of customer choice, as established by Public Utility Regulatory Act (PURA)
Chapter 39, or as a provider of retail electric service in the Customer Choice
Pilot Projects, as established under PURA §39.104 and §39.405. This
section does not apply to the state, political subdivisions of the state,
electric cooperatives or municipal corporations. An electric cooperative or
municipally owned utility participating in customer choice may offer electric
energy and related services at unregulated prices directly to retail customers
who have customer choice without obtaining certification as a REP.
(b)
Definitions. The following words and terms when used in
this section shall have the following meaning unless the context indicates
otherwise:
(1)
Continuous and reliable electric service - Electric power
service provided at retail by a retail electric provider (REP), consistent
with the customer's terms and conditions of service, uninterrupted by unlawful
or unjustified action or inaction of the REP.
(2)
Customer - Any entity who has applied for, has been
accepted, or is receiving retail electric service from a REP for use on an
end-use basis.
(3)
Person - Includes an individual, a partnership of
two or more persons having a joint or common interest, a mutual or cooperative
association, and a corporation, but does not include an electric cooperative
or a municipal corporation.
(4)
Retail electric provider - A person that sells electric
energy to retail customers in this state. As provided in PURA §31.002(17),
a retail electric provider may not own or operate generation assets. As provided
in PURA §39.353(b), a REP is not an aggregator.
(5)
Residential customer - An end user consuming power
for personal, family or household purposes, as defined in statewide transmission
and distribution utility tariffs.
(6)
Revocation - The cessation of all REP business operations
in the state of Texas, pursuant to commission order.
(7)
Suspension - The cessation of all REP business operation
in the state of Texas associated with obtaining new customers, pursuant to
commission order.
(c)
Application for REP certification.
(1)
After the date of customer choice, or as a participant
in the Customer Choice Pilot Projects, a person, including an affiliate of
an electric utility, may not provide retail electric service in the state
unless the person is certified by the commission as a retail electric provider
in accordance with PURA §39.352 and this section.
(2)
A retail electric provider may apply for certification
any time after September 1, 2000. A certificate granted pursuant to this section
is not transferable without prior approval by the commission.
(3)
An application for certification shall be made on
a form approved by the commission, verified by oath or affirmation, and signed
by an applicant's owner or partner, or an officer of the applicant. Applications
may be obtained in the Central Records division of the Public Utility Commission
of Texas during normal business hours, or from the commission's Internet site.
Each applicant shall file its application with the commission's Filing Clerk
in accordance with the commission's Procedural Rules, Chapter 22, Subchapter
E, of this title (relating to Pleadings and Other Documents).
(4)
The applicant may identify certain information or
documents submitted that it believes to contain proprietary or confidential
information. Applicants may not designate the entire application as confidential.
Information designated as proprietary or confidential will be treated in accordance
with the standard protective order issued by the commission for use with applications
for certification as a REP. If and when a public information request is received
for information designated as confidential, the applicant or REP has the burden
of establishing that information filed pursuant to this rule is proprietary
or confidential.
(5)
Except where good cause exists to extend the time
for review, the presiding officer shall issue an order stating whether an
application is deficient or complete within 20 days of filing. Deficient applications
and those without necessary supporting documentation will be rejected without
prejudice to the applicant's right to reapply.
(6)
While the application is pending, an applicant shall
inform the commission of any material change in the information provided in
the application within ten days of any such change.
(7)
The commission will make an effort, where the facts
of the case permit, to insure that applications filed simultaneously are resolved
simultaneously. Except where good cause exists to extend the time for review,
the commission shall enter an order approving, rejecting, or approving an
application with modifications within 90 days of filing an application.
(8)
A certificate granted pursuant to this section shall
continue in force until further order of the commission.
(9)
A certificate granted pursuant to this section shall
not be construed to vest exclusive service or property rights in and to the
area for which the certificate is granted.
(d)
REP certification requirements based on service area.
As a requisite for obtaining and maintaining certification, a REP must designate
a service area defined by either paragraph (1) or (2) of this subsection,
and meet the certification requirements designated therein.
(1)
Option 1. For REPs defining service areas by geography:
(A)
A REP must designate one of the following categories as
its geographical service area:
(i)
The geographic area of the city limits of a municipality
and its extra-territorial jurisdiction, (indicating the zip codes applicable
to that area); or
(ii)
The geographic area of an entire county, (indicating
the zip codes applicable to that area); or
(iii)
A combination of the geographic areas described in clause
(i) and (ii) of this subparagraph; or
(iv)
The geographic area of the entire state of Texas; (indicating
the zip codes applicable to that area); or
(v)
The service area of specific transmission and distribution
utilities, and/or municipal utilities or electric cooperatives in which competition
is offered; or
(vi)
The geographic area of Electric Reliability Council of
Texas (ERCOT) or territory of another independent organization to the extent
it is within Texas.
(B)
A REP with a geographical service area is subject to all
subsections of this section, including those pertaining to administration,
financial, technical and managerial, customer protection, and reporting requirements,
as applicable.
(C)
The commission shall decide whether to grant a certificate
to an applicant proposing to provide retail electric service to a geographical
service area in Texas based on:
(i)
Provision of all of the information required of the applicant
in the form,
Application for a Certificate to Provide
Retail Electric Service
, approved by the commission.
(ii)
Whether the applicant has met the business name, office,
and threshold residential service level requirements specified in subsection
(e) of this section.
(iii)
Whether the applicant has demonstrated that it possesses
the financial and technical resources to provide continuous and reliable electric
service to its customers in the area for which certification is sought and
the technical and managerial ability to supply electricity at retail in accordance
with customer contracts, pursuant to subsections (f) and (g) of this section.
(iv)
Whether the applicant has demonstrated that it possesses
the resources needed to meet the customer protection requirements, disclosure
requirements, and marketing guidelines as specified in subsection (h) of this
section.
(v)
Whether the configuration of the proposed geographic area,
if any, would discriminate in the provision of electric service to any customer
because of race, creed, color, national origin, or any other basis prohibited
by law or by subsection (h)(1) of this section.
(D)
If the presiding officer determines that an applicant
does not possess resources sufficient to serve the geographical area designated
by the applicant, the presiding officer shall notify the applicant of the
deficiencies and allow the applicant to designate a different geographical
service area commensurate with its resources. If the applicant designates
no suitable area within a reasonable time, the application shall be denied.
(2)
Option 2 - For REPs defining service areas by
customers. As an alternative to a geographical service area, a REP may define
a service area by a specific list of customers, each of whom contract for
one megawatt or more of capacity. The applicant shall be certified as a REP
only for purposes of serving the named customers.
(A)
To obtain certification under this paragraph, an applicant
must file with the commission a signed, notarized affidavit from each individual
retail customer with which it has contracted to provide one megawatt or more
of capacity. The affidavit shall state that the customer is satisfied that
the REP meets the financial, technical and managerial, and customer protection
standards prescribed in subsections (f)(2), (g), and (h) of this section.
The one-megawatt threshold may not be met by aggregation of individual electricity
customers.
(B)
A REP whose service area is defined by customers shall
meet the administrative requirements specified in subsection (e) of this section.
(C)
A REP whose service area is defined by customers shall
meet the financial requirements for billing and collection of transition charges
pursuant to subsection (f)(3) of this section, if applicable.
(D)
The commission will grant a certificate to an applicant
under this paragraph upon a finding that the affidavits for each designated
customer have been received and that all requirements of this paragraph are
met.
(E)
A REP certified pursuant to this paragraph may be authorized
to serve additional customers by amending its certificate pursuant to subsection
(i)(6) of this section.
(F)
A REP certified pursuant to this paragraph is subject
to reporting requirements specified in this section.
(e)
Administrative requirements. As a requisite for obtaining
and maintaining certification, a REP must meet the following requirements
concerning business names, office access, and percentage of electricity sold
to residential customers.
(1)
Names on certificates. All retail electric service shall
be provided in the names under which the certificate was granted. If the applicant
is a corporation, the commission shall issue the certificate in the corporate
name of the applicant.
(A)
No more than two assumed names may be authorized for use
by any one REP at one time.
(B)
Business names shall not be deceptive, misleading, vague,
otherwise contrary to §25.272 of this title (relating to Code of Conduct
for Electric Utilities and Their Affiliates), or duplicative of a name previously
approved for use by an existing REP certificate holder.
(C)
The commission shall review any names in which the applicant
proposes to do business. If the commission determines that any requested name
does not meet the requirements of subparagraph (B) of this paragraph, it shall
notify the applicant that the requested name may not be used by the REP. A
REP will be required to amend its application to provide at least one suitable
name in order to be certificated.
(2)
Office requirements. A REP shall continuously
maintain an office located within Texas for the purpose of providing customer
service, accepting service of process, and making available in that office
books and records sufficient to establish the retail electric provider's compliance
with the requirements of PURA Chapter 39, Subchapter H, and applicable commission
rules. The office satisfying this requirement for a REP shall have a physical
address that is not a post office box and shall be a location where the above
three functions can occur. To evaluate compliance with requirements in this
paragraph, the commission's authorized representative may visit the office
of a certificated REP at any time during normal business hours on the same
basis available to an electric customer. An applicant shall submit the following
information with an application:
(A)
Evidence that it has made arrangements for an office located
in Texas, including the physical address of the office; or
(B)
An affidavit stating that the applicant will obtain an
office located within Texas meeting the requirements of this paragraph, and
will notify the commission of its physical address, after certification but
before providing retail electric service to customers in Texas.
(3)
Threshold residential service requirement. For
36 months after retail competition begins, if a REP serves an aggregate load
in excess of 300 megawatts within Texas during a given year, not less than
5.0% of the REP's load for the year in megawatt hours must consist of residential
customers, pursuant to PURA §39.352(g).
(A)
The 300 megawatt aggregate load threshold shall be calculated
by the "4CP" method, which consists of the average of the highest aggregate
coincident peak demand occurrences in each of the months of June, July, August,
and September of the annual reporting period, in megawatts, of all the REP's
customers served in Texas.
(B)
If the 4CP calculation made under subparagraph (A) of
this paragraph is in excess of 300 megawatts, the certificate holder shall:
(i)
demonstrate that not less than 5.0% of the total quantity
of megawatt hours it sold in the calendar year was supplied to residential
customers, or
(ii)
demonstrate that another REP served sufficient qualifying
residential load on its behalf, or
(iii)
make the necessary calculations and pay an amount into
the system benefit fund equal to $1 multiplied by a number equal to the difference
between the number of megawatt hours it sold to residential customers and
the number of megawatt hours it was required to sell to such customers.
(C)
The calculations in subparagraph (B) of this paragraph
are subject to the following limitations:
(i)
An affiliated REP shall pay $1 multiplied by a number
equal to the difference between the number of megawatt hours sold to residential
customers outside of the electric utility's service area and the number of
megawatt hours it was required to sell to such customers outside of the electric
utility's service area.
(ii)
For purposes of subparagraph (B)(ii) of this paragraph,
"qualifying residential load" may not include customers served by an affiliated
retail electric provider in its affiliated electric utility's service area.
(iii)
The requirements of this paragraph apply only to the
portion of an affiliated REP's load that is outside the electric utility's
service area. With respect to that "outside" load, any residential customers
counted to meet the 5.0% threshold of residential customers must also be outside
the electric utility's service area.
(iv)
Where several REPs belong to a common owner, their loads
will be combined for purposes of evaluation under this subsection. If the
common owner is an electric utility, only loads served outside the electric
utility's service area will be used in the calculations under this paragraph.
(f)
Financial requirements. As a requisite for obtaining and
maintaining certification, a REP must meet the financial resource standards
established by this subsection. The standards established by paragraphs (1),
(2), and (3) of this subsection are additive.
(1)
Financial standards required for credit quality. A REP
shall fulfill the following financial qualifications listed below concerning
its underlying credit quality:
(A)
Minimum credit standards for REP certification. In order
to be certified by the commission, a REP or its parent corporation or controlling
shareholder providing a guaranty of its REP under subparagraph (D) of this
paragraph must demonstrate that it has:
(i)
Assets in excess of liabilities, or equity, of at least
$50,000,000 on its most recent balance sheet;
(ii)
An investment grade credit rating as provided for under
subparagraph (1)(F); or
(iii)
Cash resources of at least $100,000.
(B)
Utility credit standards for REPs. With the exception
of the credit standards provided for in paragraph (3) of this subsection,
a transmission and distribution utility shall not impose any additional or
separate credit conditions on a REP, unless the REP has defaulted on one or
more payments to the utility for services provided by the utility. A transmission
and distribution utility may impose credit conditions on a REP that has defaulted
to the extent specified in its tariff and allowed by commission rules.
(C)
Financial evidence. A REP shall be permitted to use any
of the financial instruments listed below, as well as any other financial
instruments approved in advance by the commission, in order to satisfy the
cash requirements established by this rule.
(i)
Cash or cash equivalent, including cashier's check or
sight draft;
(ii)
A certificate of deposit with a bank or other financial
institution;
(iii)
A letter of credit issued by a bank or other financial
institution, irrevocable for a period of at least 15 months;
(iv)
A line of credit or other loan issued by a bank or other
financial institution, including a bond, irrevocable for a period of at least
15 months;
(v)
A loan issued by a subsidiary or affiliate of the applicant
or a corporation holding controlling interest in the applicant, irrevocable
for a period of at least 15 months;
(vi)
A guaranty issued by a shareholder or principal of the
applicant; a subsidiary or affiliate of the applicant or a corporation holding
controlling interest in the applicant; irrevocable for period of at least
15 months.
(D)
Loans or guarantees. To the extent that it relies upon
a loan or guaranty described in subparagraph (C)(v) or (vi) of this paragraph,
the REP shall provide financial evidence sufficient to demonstrate that the
lender or guarantor possesses the cash or cash equivalents needed to fund
the loan or guaranty.
(E)
Unencumbered resources. All cash and other instruments
listed in subparagraph (C) of this paragraph as evidence of financial resources
shall be unencumbered by pledges for collateral. These financial resources
shall be subject to verification and review prior to certification of the
REP and at any time after certification in which the REP relies on the cash
or other financial instrument to meet the requirements under this subsection.
The resources available to the REP must be authenticated by independent, third
party documentation.
(F)
Credit ratings. To meet the requirements of this paragraph,
a REP may rely upon either its own investment grade credit rating, or a bond,
guaranty, or corporate commitment of an affiliate or another company, if the
entity providing such security is also rated investment grade. The determination
of such investment grade quality will be based on the ratings of either Standard &
Poors (S&P) or Moody's Investor Services (Moody's). If the investment
grade credit rating of either S&P or Moody's is suspended or withdrawn,
the REP must provide alternative financial evidence included under subparagraphs
(C)-(E) of this paragraph within ten days of the credit downgrade.
(2)
Financial standards required for customer protection.
A REP shall maintain records on an on-going basis for any deposits or advance
payments received from customers. Financial obligations to customers shall
be payable to them within 30 calendar days from the date the REP notifies
the commission that it intends to withdraw its certification or is deemed
by the commission not able to meet its current customer obligations. Customer
obligations shall be settled before the REP withdraws its certification or
ceases doing business in Texas. A REP must meet the following financial qualifications
concerning its receipt of customer payments:
(A)
Financial obligations to customers. The REP must maintain
and provide evidence of financial resources equal to the sum of its obligations
to customers for any deposits or other advance payments received from customers,
subject to the following conditions.
(i)
Financial resources required under this paragraph shall
be maintained at levels sufficient to demonstrate that the REP can cover all
deposits or other advance payments that are outstanding at any given time.
(ii)
The REP shall file with the commission a sworn affidavit
demonstrating compliance with this paragraph within 90 days of receiving the
first payment from customers for its services.
(iii)
Financial resources required pursuant to this subsection
shall not be reduced by the REP without the advance approval of the commission.
(B)
Financial evidence. A REP shall be permitted to use any
of the financial instruments and conditions set out in paragraph (1)(C)-(F)
of this subsection to demonstrate that its resources are adequate for customer
protection.
(C)
External notice. Any party providing the financial resources
necessary to protect customers under this provision of the rule, either directly
or indirectly, shall be provided a copy of this rule by the REP.
(3)
Financial standards required of REPs for the
billing and collection of transition charges. If a REP serves customers in
the service area of a transmission and distribution utility that is subject
to a financing order pursuant to PURA §39.310, the REP shall comply with
any additional standards specified in §25.108 of this title (relating
to Financial Standards for Retail Electric Providers Regarding the Billing
and Collection of Transition Charges).
(4)
Credit support by affiliates. To the extent it relies
on an affiliated transmission or distribution utility for credit, investment,
or financing arrangements pursuant to this subsection, the REP shall demonstrate
that any such arrangement complies with §25.272(d)(7) of this title.
(5)
Reporting requirements. A REP certified under this
subsection is subject to the ongoing annual financial requirements of subsection
(f) of this section and any other applicable requirements of subsection (i)
of this section.
(g)
Technical and managerial resource requirements. As a requisite
for providing retail electric service, a REP must have technical resources
to provide continuous and reliable electric service to customers in its service
area and technical and managerial ability to supply electric service at retail
in accordance with its customer contracts. Technical and managerial resource
requirements include:
(1)
Capability to comply with all scheduling, operating, planning,
reliability, customer registration and settlement policies, rules, guidelines,
and procedures established by the ERCOT independent system operator (ISO),
or other independent organization, if applicable, including any independent
organization requirements for 24 hour coordination with control centers for
scheduling changes, reserve implementation, curtailment orders, interruption
plan implementation, and telephone number, fax number, and address where its
staff can be directly reached at all times.
(2)
Capability to comply with the registration and certification
requirements of the ERCOT ISO or other independent organization and its system
rules, or contracts for the purchase of power from entities registered with
or certified by the ERCOT ISO or independent organization and capable of complying
with its system rules.
(3)
Purchase of capacity and reserves, or other ancillary
services, as may be required by the ERCOT ISO or other independent organization
to provide adequate electricity to all the applicant's customers in its certificated
area.
(4)
Compliance with all renewable energy portfolio standards
in accordance with §25.173 of this title (relating to Goal for Renewable
Energy).
(5)
At least one principal or employee experienced in
the retail electric industry or a related industry.
(6)
Adequate staffing and employee training to meet all
service level commitments.
(7)
The capability and effective procedures to be the
primary point of contact for retail electric customers for distribution system
service, including procedures for response to outage notices on a 24-hour
basis.
(8)
A customer service plan that describes how the REP
complies with the commission's customer protection and anti-discrimination
rules.
(9)
The following information submitted in an initial
application:
(A)
Prior experience of the applicant or one or more of the
applicant's principals or employees in the retail electric industry or a related
industry.
(B)
A 12 month estimate of the expected total load and residential
load to be supplied with electric service in Texas by the applicant.
(C)
Any complaint history and compliance record during the
three calendar years prior to the filing of the application regarding the
applicant, applicant's affiliates that provide utility related services such
as telecommunications, electric, gas, water, or cable service, the applicant's
predecessors in interest, and principals with public utility commissions,
attorney general offices, or other applicable regulatory agencies in other
states where the applicant is doing business or has conducted business in
the past or with the Texas Secretary of State, Texas Comptroller's Office,
or Office of the Texas Attorney General. Relevant information shall include,
but is not limited to, the type of complaint, status of complaint, resolution
of complaint and the number of customers in each state where complaints occurred.
The Office of Customer Protection shall review any similar complaint information
on file at the commission.
(D)
A summary of any history of bankruptcy, dissolution, merger
or acquisition of the applicant or any predecessors in interest in the three
calendar years immediately preceding the application; and
(E)
A statement indicating whether the applicant is currently
under investigation, or has been penalized, by an attorney general or any
state or federal regulatory agency, either in this state or in another state
or jurisdiction for violation of any deceptive trade or consumer protection
laws or regulations.
(F)
Disclosure of whether the applicant, a predecessor, an
officer, director or principal has been convicted or found liable for fraud,
theft or larceny, deceit, or violations of any customer protection or deceptive
trade laws in any state;
(G)
An affidavit stating that the applicant will register
with or be certified by the ERCOT ISO or other independent organization and
will comply with all system rules and standards established by the ERCOT ISO
or other independent organization; or that all entities with whom the applicant
has a contractual relationship to purchase power are registered with or certified
by the independent organization and will comply with all system rules and
standards established by the independent organization; and
(H)
Other evidence, at the discretion of the applicant, supporting
the applicant's plans for meeting requirements listed in paragraphs (1) -
(5) of this subsection.
(h)
Customer Protection requirements. As a requisite for obtaining
and maintaining certification, a REP shall comply with any customer protection
requirements, disclosure requirements, marketing guidelines and anti-discrimination
rules adopted by the commission pursuant to PURA §§17.001 - 17.004
and Chapter 39. In the absence of further specificity in other commission
rules, certificated REPS shall be held to the general standards listed below.
An applicant for certification as a REP shall provide a sworn affidavit, as
specified in the application form approved by the commission, that it will
comply with this section and any other applicable customer protection rules,
disclosure requirements, marketing guidelines, and anti-discrimination rules
approved by the commission.
(1)
A REP may not refuse to provide retail electric service
or otherwise discriminate in the provision of electric service to any customer
because of race, creed, color, national origin, ancestry, sex, marital status,
lawful source of income, disability, or familial status; or refuse to provide
retail electric service to a customer because the customer is located in an
economically distressed geographic area or qualifies for low-income affordability
or energy efficiency services.
(2)
A REP shall disclose to its customers whom to contact
and what to do in the event of power outage or other electricity-related emergency.
(3)
A REP shall inform its customers of illegal practices
and of the customer's rights and avenues available to pursue a complaint against
the REP.
(4)
A REP shall not switch, or cause to be switched,
the retail electric provider for a customer without first obtaining the customer's
permission.
(5)
A REP shall not bill, or cause to be billed, an unauthorized
charge to a customer's retail electric service bill.
(6)
A REP shall respond in good faith when notified by
a customer of a complaint.
(7)
A REP shall maintain a customer service staff adequate
to handle its customers' inquiries and complaints.
(8)
A REP may not release proprietary customer information
to any person unless the customer authorizes the release in a manner approved
by the commission.
(i)
Requirements for reporting and for changing the terms
of a REP certificate. The ongoing maintenance of a REP certificate is dependent
upon keeping the certification information up to date, pursuant to the following
requirements:
(1)
The certificate holder shall notify the commission within
30 days of any change in its office address, business address, telephone number(s),
or other contact information.
(2)
A certificate holder that has met the Texas office
requirement by affidavit, pursuant to subsection (e)(2)(B) of this section,
shall supply the commission with the physical office address on or before
the date of commencing retail electric service in Texas.
(3)
The holder of a REP certificate shall notify the
commission within 30 days and must be prepared if, necessary, for re-certification
by the commission if any of the following events occur:
(A)
a material change in any of the technical conditions presented
pursuant to subsection (g) of this section as the basis for the approval of
the applicant's initial certification; or,
(B)
a material change in any of the financial requirements
presented pursuant to subsection (f) of this section as the basis for approval
of the applicant's initial certification;
(4)
All REP certificate holders shall file updated
information set forth in this subsection on an annual basis on a report form
approved by the commission. The annual report is due on June 1 each year for
the preceding calendar year. The following information, at a minimum, shall
be reported annually:
(A)
Any changes in addresses, telephone numbers, authorized
contacts, and other information necessary for contacting the certificate holder.
(B)
If certificated for a service area defined by geography,
identification of areas where REP is providing retail electric service to
customers in Texas compiled by zip code.
(C)
For 36 months after retail competition begins, the result
of the 4CP calculation and proof of threshold residential service requirements,
if applicable, pursuant to subsection (e)(3) of this section.
(D)
A list of aggregators with whom the REPs has conducted
business in the reporting period, including commission registration verification
for each.
(E)
A sworn affidavit that the certificate holder is not in
material violation of any of the requirements of its certificate.
(5)
The holder of a REP certificate shall file with
the commission notice of changes to the organizational structure or to the
material facts represented in its application, including, but not limited
to any change in name, service area, facilities ownership or affiliation upon
which the commission relied in approving the REP's application. The commission
may require the REP to file an amendment to its certificate if it determines
that the changes warrant a reevaluation of the REP's basis for certification.
(6)
The holder of a REP certificate for a service area
defined by specific customers may amend its certificate to add additional
specified customers by submitting to the commission the affidavit required
by subsection (d)(2) of this section from the additional customers on or before
the commencement of electric service to the those customers.
(7)
A REP certificate shall not be transferred without
prior commission approval. Approval for transfer shall be obtained by petition
to the commission. The transferee must complete and file with the commission
an application form for certification that demonstrates the transferee's financial
and technical fitness to render service under the transferred certificate.
(8)
No REP certificate holder shall cease operations
as a REP without prior notice to the commission, to each of the REP's customers
to whom the REP is providing service on the proposed date of cessation of
business operations, and other affected persons, including the independent
operator, transmission and distribution utilities, electric distribution cooperatives,
municipally owned utilities, generation suppliers, and providers of last resort.
The REP shall file with the commission proof of refund of any monies owed
to customers. Upon the effective cessation date, a REP's certificate will
be deemed suspended. If, within 24-months of cessation, a REP demonstrates
compliance with certification requirements, the certificate will be reinstated.
(9)
If a REP files a petition in bankruptcy, is the subject
of an involuntary bankruptcy proceeding, or in any other manner becomes insolvent,
it shall notify the commission within ten days of this event and shall provide
the commission a brief summary of the nature of the proceedings. The commission
shall have the right to proceed against any financial resources that the REP
relied on in obtaining its certificate, to satisfy unpaid administrative penalties
or payments owed to customers.
(j)
Suspension and revocation. Pursuant to PURA §39.356,
certificates granted pursuant to this section are subject to suspension and
revocation for significant violations of PURA, commission rules, or reliability
standards adopted by an independent organization. The commission may also
amend the certificate or impose an administrative penalty for a significant
violation. The commission or any affected person may bring a complaint seeking
to suspend or revoke a REP's certificate. Significant violations include,
but are not limited to, the following:
(1)
Providing false or misleading information to the commission;
(2)
Engaging in fraudulent, unfair, misleading, deceptive,
or anti-competitive business practices or unlawful discrimination;
(3)
Switching, or causing to be switched, the retail
electric provider for a customer without first obtaining the customer's permission;
(4)
Billing an unauthorized charge, or causing an unauthorized
charge to be billed to a customer's retail electric service bill;
(5)
Failure to maintain continuous and reliable electric
service to its customers pursuant to this section;
(6)
Failure to maintain the minimum financial resources
as set out in subsection (f) of this section;
(7)
Bankruptcy, insolvency, or inability to meet financial
obligations on a timely basis;
(8)
Failure to observe any scheduling, operating, planning,
reliability, and settlement policies, rules, guidelines, and procedures established
by the independent organization;
(9)
A pattern of not responding to commission inquiries
or customer complaints in a timely fashion;
(10)
Suspension or revocation of a registration, certification,
or license by any state or federal authority;
(11)
Conviction of a felony by the certificate holder
or principal employed by the certificate holder, of any crime involving fraud,
theft or deceit related to the certificate holder's service;
(12)
Not providing retail electric service to customers
within 24 months of the certificate being granted by the commission;
(13)
Failure to serve as a provider of last resort if
required to do so by the commission pursuant to PURA §39.106(f); and
(14)
Failure, or a pattern of failures to meet the conditions
of this section or other commission rules or orders.
§25.108. Financial Standards for Retail Electric Providers Regarding the Billing and Collection of Transition Charges.
(a)
Application. This section applies to any retail electric
provider (REP) serving customers in a transmission and distribution (T&D)
utility service area subject to a financing order issued by the commission
under Public Utility Regulatory Act (PURA) §39.303.
(b)
Applicability of REP standards. Beginning on the date
of customer choice for any retail customers, the servicer of the transition
bonds will bill the transition charges for those customers to each retail
customer's REP and the REP will collect transition charges from its retail
customers. The standards in this section are the most stringent that can be
imposed on REPs by any servicer of transition bonds without the prior approval
of the commission. The standards relate only to the billing and collection
of transition charges authorized by a financing order and do not apply to
the collection of any other non-bypassable charges, or any other charges.
The standards apply to all REPs other than REPs that have contracted with
the transmission and distribution company to bill and collect transition charges
from retail customers. REPs may contract with parties other than the transmission
and distribution company to bill and collect transition charges from retail
customers, but such REPs shall remain subject to the standards in this section.
Modifications to the REP standards in this section may not be implemented
absent prior written confirmation from each of the rating agencies that have
rated the transition bonds that such modifications will not cause a suspension,
withdrawal, or downgrade of the ratings on the transition bonds.
(c)
REP standards. The REP standards for transition charges
are:
(1)
Rating, deposit, and related requirements. A REP that
does not have or maintain the requisite long-term, unsecured credit rating
may select which alternate form of deposit, credit support, or combination
thereof it will utilize, in its sole discretion. The indenture trustee shall
be the beneficiary of any affiliate guarantee, surety bond or letter of credit.
The provider of any affiliate guarantee, surety bond, or letter of credit
must have and maintain a long-term, unsecured credit ratings of not less than
"BBB-" and "Baa3" (or the equivalent) from Standard & Poor's ("S&P")
and Moody's Investors Service ("Moody's"), respectively. Each REP must:
(A)
have a long-term, unsecured credit rating of not less
than "BBB-" and "Baa3" (or the equivalent) from S&P and Moody's , respectively;
or
(B)
provide:
(i)
a deposit of two months' maximum expected transition charge
collections in the form of cash,
(ii)
an affiliate guarantee, surety bond, or letter of credit
providing for payment of such amount of transition-charge collections in the
event that the REP defaults in its payment obligations, or
(iii)
a combination of clause (i) and (ii) of this subparagraph.
(2)
Loss of credit rating. If the long-term,
unsecured credit rating from either S&P or Moody's of a REP that did not
previously provide the alternate form of deposit, credit support, or combination
thereof or of any provider of an affiliate guarantee, surety bond, or letter
of credit is suspended, withdrawn, or downgraded below "BBB-" or "Baa3" (or
the equivalent), the REP must provide the alternate form of deposit, credit
support, or combination thereof, or new forms thereof, in each case from providers
with the requisite ratings, within ten business days following such suspension,
withdrawal, or downgrade. A REP failing to make such provision must comply
with the provisions set forth in paragraph (5) of this subsection.
(3)
Computation of deposit. The computation of the size
of a required deposit shall be agreed upon by the servicer and the REP, and
reviewed no more frequently than quarterly to ensure that the deposit accurately
reflects two months' maximum collections. Within ten business days following
such review, the REP shall remit to the indenture trustee the amount of any
shortfall in such required deposit, or the servicer shall instruct the indenture
trustee to remit to the REP any amount in excess of such required deposit.
A REP failing to so remit any such shortfall must comply with the provisions
set forth in paragraph (5) of this subsection. REP cash deposits shall be
held by the indenture trustee, maintained in a segregated ccount, and invested
in short-term high quality investments, as permitted by the rating agencies
rating the transition bonds. Investment earnings on REP cash deposits shall
be considered part of such cash deposits so long as they remain on deposit
with the indenture trustee. At the instruction of the servicer, cash deposits
will be remitted with investment earnings to the REP at the end of the term
of the transition bonds unless otherwise utilized for the payment of the REP's
obligations for transition bond payments. Once the deposit is no longer required,
the servicer shall promptly (but not later than 30 calendar days) instruct
the indenture trustee to remit the amounts in the segregated accounts to the
REP.
(4)
Payment of transition charges. Payments of transition
charges are due 35 calendar days following each billing by the servicer to
the REP, without regard to whether or when the REP receives payment from its
retail customers. The servicer shall accept payment by electronic funds transfer,
wire transfer, and/or check. Payment will be considered received the date
the electronic funds transfer or wire transfer is received by the servicer,
or the date the check clears. A 5.0% penalty is to be charged on amounts received
after 35 calendar days; however, a ten calendar-day grace period will be allowed
before the REP is considered to be in default. A REP in default must comply
with the provisions set forth in paragraph (5) of this subsection. The 5.0%
penalty will be a one-time assessment measured against the current amount
overdue from the REP to the servicer. The "current amount" consists of the
total unpaid transition charges existing on the 36th calendar day after billing
by the servicer. Any and all such penalty payments will be made to the indenture
trustee to be applied against transition charge obligations. A REP shall not
be obligated to pay the overdue transition charges of another REP. If a REP
agrees to assume the responsibility for the payment of overdue transition
charges as a condition of receiving the customers of another REP that has
decided to terminate service to those customers for any reason, the new REP
shall not be assessed the 5.0% penalty upon such transition charges; however,
the prior REP shall not be relieved of the previously-assessed penalties.
(5)
Remedies upon default. After the ten calendar-day
grace period (the 45th calendar day after the billing date) referred to in
paragraph (4) of this subsection, the servicer shall have the option to seek
recourse against any cash deposit, affiliate guarantee, surety bond, letter
of credit, or combination thereof provided by the REP, and to avail itself
of such legal remedies as may be appropriate to collect any remaining unpaid
transition charges and associated penalties due the servicer after the application
of the REP's deposit or alternate form of credit support. In addition, a REP
that is in default with respect to the requirements set forth in paragraphs
(2), (3), or (4) of this subsection shall select and implement one of the
options listed in subparagraphs (A), (B), or (C) of this paragraph. If a REP
that is in default fails to immediately select and implement one of these
options or, after so selecting one of the options, fails to adequately meet
its responsibilities thereunder, then the servicer shall immediately implement
the option in subparagraph (A) of this paragraph. Upon re-establishment of
compliance with the requirements set forth in paragraphs (2), (3), or (4)
of this subsection, and the payment of all past-due amounts and associated
penalties, the REP will no longer be required to comply with this paragraph.
(A)
Allow the Provider of Last Resort ("POLR") or a qualified
REP of the customer's choosing to immediately assume the responsibility for
the billing and collection of transition charges.
(B)
Immediately implement other mutually suitable and agreeable
arrangements with the servicer. It is expressly understood that the servicer's
ability to agree to any other arrangements will be limited by the terms of
the securitization Servicing Agreement and requirements of each of the rating
agencies that have rated the transition bonds necessary to avoid a suspension,
withdrawal, or downgrade of the ratings on the transition bonds.
(C)
Arrange that all amounts owed by retail customers for
services rendered be timely billed and immediately paid directly into a lock-box
controlled by the servicer with such amounts to be applied first to pay transition
charges before the remaining amounts are released to the REP. All costs associated
with this mechanism will be borne solely by the REP.
(6)
Billing by providers of last resort. The initial
POLR appointed by the commission, or any commission-appointed successor to
the POLR, must meet the minimum credit rating or deposit/credit support requirements
described in paragraph (1) of this subsection in addition to any other standards
that may be adopted by the commission. If the POLR defaults or is not eligible
to provide such services, responsibility for billing and collection of transition
charges will immediately be transferred to and assumed by the servicer until
a new POLR can be named by the commission or the customer requests the services
of a certified REP. Retail customers may never be re-billed by the successor
REP, the POLR, or the servicer for any amount of transition charges they have
paid their REP (although future transition charges shall reflect REP and other
system-wide charge-offs). Additionally, if the amount of the penalty detailed
in paragraph (5) of this subsection is the sole remaining past-due amount
after the 45th calendar day, the REP shall not be required to comply with
paragraph (5)(A), (B) or (C) of this subsection, unless the penalty is not
paid within an additional 30 calendar days.
(7)
Dispute resolution. In the event that a REP disputes
any amount of billed transition charges, the REP shall pay the disputed amount
under protest according to the timelines detailed in paragraph (4) of this
subsection. The REP and servicer shall first attempt to informally resolve
the dispute, but if they fail to do so within 30 calendar days, either party
may file a complaint with the commission. If the REP is successful in the
dispute process (informal or formal), the REP shall be entitled to interest
on the disputed amount paid to the servicer at the commission-approved interest
rate. Disputes about the date of receipt of transition charge payments (and
penalties arising thereof) or the size of a required REP deposit will be handled
in a like manner. It is expressly intended that any interest paid by the servicer
on disputed amounts shall not be recovered through transition charges if it
is determined that the servicer's claim to the funds is clearly unfounded.
No interest shall be paid by the servicer if it is determined that the servicer
has received inaccurate metering data from another entity providing competitive
metering services pursuant to PURA §39.107.
(8)
Metering data. If the servicer is providing the metering,
metering data will be provided to the REP at the same time as the billing.
If the servicer is not providing the metering, the entity providing metering
services will be responsible for complying with commission rules and ensuring
that the servicer and the REP receive timely and accurate metering data in
order for the servicer to meet its obligations under the securitization servicing
agreement and the applicable financing order with respect to billing and true-ups.
(9)
Charge-off allowances. The REP will be allowed to
hold back an allowance for charge-offs in its payments to the servicer. Such
charge-off rate will be recalculated each year in connection with the annual
true-up procedure. In the initial year, REPs will be allowed to remit payments
based on the same system-wide charge-off percentage then being used by the
servicer to remit payments to the indenture trustee for the holders of transition
bonds. On an annual basis in connection with the true-up process, the REP
and the servicer will be responsible for reconciling the amounts held back
with amounts actually written off as uncollectible in accordance with the
terms agreed to by the REP and the servicer, provided that:
(A)
The REP's right to reconciliation for write-offs will
be limited to customers whose service has been permanently terminated and
whose entire accounts (
i.e.,
all amounts due
the REP for its own account as well as the portion representing transition
charges) have been written off.
(B)
The REP's recourse will be limited to a credit against
future transition charge payments unless the REP and the servicer agree to
alternative arrangements, but in no event will the REP have recourse to the
indenture trustee, the Special Purpose Entity ("SPE") established at the time
of securitization, or the SPE's funds for such payments.
(C)
The REP shall provide information on a timely basis to
the servicer so that the servicer can include the REP's default experience
and any subsequent credits into its calculation of the adjusted transition
charge rates for the next transition charge billing period and the REP's rights
to credits will not take effect until after such adjusted transition charge
rates have been implemented.
(10)
Service termination. In the event that the
servicer is billing customers for transition charges, the servicer shall have
the right to terminate transmission and distribution service to the end-use
customer for non-payment by the end-use customer pursuant to applicable commission
rules. In the event that a REP or the POLR is billing customers for transition
charges, the REP shall have the right to transfer the customer to the POLR
(or to another certified REP) or to direct the servicer to terminate transmission
and distribution service to the end-use customer for non-payment by the end-use
customer pursuant to applicable commission rules.
(11)
Precedence and modifications of REP standards in
a financing order.
(A)
Compliance with financing order standards. If the REP
standards in the applicable financing order are different than the standards
in this section, then the REP must comply with the REP standards stated in
the financing order, instead of the standards stated in this section, unless
the standards of the financing order have been modified and approved according
to subparagraph (B) of this paragraph.
(B)
Commission modification of standards. The commission may
impose standards on REPs that are different from those in the applicable financing
order but only if the commission receives prior written confirmation from
each rating agency that rated the transition bonds authorized by that financing
order that the proposed modifications will not cause a suspension, withdrawal,
or downgrade of ratings on the transition bonds.
This agency hereby certifies that the proposal
has been reviewed by legal counsel and found to be within the agency's legal
authority to adopt.
Filed with the Office of
the Secretary of State, on April 14, 2000.
TRD-200002657
Rhonda Dempsey
Rules Coordinator
Public Utility Commission of Texas
Earliest possible date of adoption: May 28, 2000
For further information, please call: (512) 936-7308
Subchapter E. CERTIFICATION, LICENSING AND REGISTRATION
16 TAC §26.107
The Public Utility Commission of Texas (commission) proposes
an amendment to §26.107, relating to Registration of Nondominant Telecommunications
Carriers.
The proposed amendment will implement the provisions of the Public Utility
Regulatory Act (PURA) §§17.051 - 17.053 and §§64.051 -
64.053 (Vernon Supplement 2000), which direct the commission to adopt registration
requirements for all telecommunications utilities that are not dominant carriers,
allow the commission to require registration as a condition of doing business
in the state of Texas, establish customer service and protection rules, suspend
or revoke certificates or registrations for repeated violations of PURA or
commission rules, and require telecommunications service providers to submit
reports concerning any matter over which the commission has authority. Project
Number 21456,
Amendments to Substantive Rules §§26.107,
26.109, 26.111 and new 26.114 Regarding Certification, Registration, and Reporting
Requirements in Relation to SB 560 and Miscellaneous Revisions
, was
assigned to this proceeding on September 29, 1999. The timeline for this proposed
rulemaking, amendment to substantive rule §26.107, coincides with the
revised timeline for the entire rulemaking project. Copies of the proposed
amendment and proposed new annual reporting form entitled
Reporting Requirements for Interexchange Carriers, Prepaid Calling Services
Companies, and other Nondominant Telecommunications Carriers
may be
obtained in the commission's Central Records and on the commission's web page
at http://www/puc.state.tx.us/telecomm/projects/21016/21456.cfm.
Tamarian Stevens, Network Analyst, Telecommunications Industry Analysis,
Office of Regulatory Affairs, and Denise E. Taylor, Senior Enforcement Investigator,
Office of Customer Protection, have determined that for each year of the first
five-year period the proposed section is in effect there will be no fiscal
implications for state or local government as a result of enforcing or administering
the section.
Ms. Stevens and Ms. Taylor have determined that for each year of the first
five years the proposed section is in effect the public benefit anticipated
as a result of enforcing the section will be greater protection of the public
interest, a more uniform process of certifying and registering telecommunications
utilities in the state of Texas, a reduction in the number of public complaints
against telecommunications utilities concerning the provision of service and
quality of service, and an increase in compliance by telecommunications utilities
with the certification, registration, and reporting requirements of PURA.
There will be no effect on small businesses or micro-businesses as a result
of enforcing this section. There is an anticipated economic cost to persons
who are required to comply with this section as proposed which cannot be quantified
at this time.
Ms. Stevens and Ms. Taylor have also determined that for each year of the
first five years the proposed section is in effect there should be no affect
on a local economy, and therefore no local employment impact statement is
required under Administrative Procedure Act §2001.022.
The commission staff will conduct a public hearing on this rulemaking under
Texas Government Code §2001.029 at the commission's offices located in
the William B. Travis Building, 1701 North Congress Avenue, Austin, Texas
78701, on Wednesday, May 31, 2000, at 9:00 a.m. in Hearing Room Gee.
Comments on the proposed amendment and the proposed new annual reporting
form may be submitted to the Filing Clerk, Public Utility Commission of Texas,
1701 North Congress Avenue, P.O. Box 13326, Austin, Texas 78711-3326, within
30 days after publication. The commission invites specific comments regarding
the costs associated with, and benefits that will be gained by, implementation
of the proposed section. The commission will consider the costs and benefits
in deciding whether to adopt the section. All comments should refer to Project
Number 21456.
This amendment is proposed under Senate Bill 86, Act of May 26,
1999, 76th Legislative Session, chapter 1579, §3, 1999, Texas Session
Law Service, 5424 (Vernon) (codified as an amendment to the Public Utility
Regulatory Act (PURA) §§17.051 - 17.053), Senate Bill 560, Act of
May 26, 1999, 76th Legislative Session, chapter 1212, §55, 1999 Texas
Session Law Service, 4237 (Vernon) (codified as amendments to PURA §§64.051
- 64.053), and PURA §§14.002, 15.023, 17.004, 17.051, 17.052, 17.053,
64.051, 64.052, and 64.053. Section 14.002 provides the commission with the
authority to make and enforce rules reasonably required in the exercise of
its power and jurisdiction. Section 15.023 grants the commission authority
to impose an administrative penalty against an entity for violation of a rule
adopted under PURA. Section 17.004 grants the commission authority to adopt
and enforce rules as necessary or appropriate to establish customer protection
standards. Section 17.051 and §64.051 direct the commission to adopt
registration requirements for all telecommunications utilities that are not
dominant carriers. Section 17.052 and §64.052 allow the commission to
require registration as a condition of doing business in Texas, establish
customer service and protection rules, and suspend or revoke certificates
or registrations for repeated violations of this chapter or commission rules.
Section 17.053 and §64.053 allow the commission to require a telecommunications
service provider to submit reports to the commission concerning any matter
over which it has authority under this chapter.
Cross Reference to Statutes: Public Utility Regulatory Act §§14.002,
15.023, 17.004, 17.051, 17.052, 17.053, 54.008, 64.051, 64.052, and 64.053.
§26.107. Registration of Interexchange Carriers, Prepaid Calling Services Companies, and Other Nondominant Telecommunications Carriers.
(a)
Application. This section
applies to the registration of persons and entities who provide intralata
and interlata long distance telecommunications services, prepaid calling services
companies pursuant to §26.34 of this title (relating to Telephone Prepaid
Calling Services), pay telephone service providers pursuant to §26.102
of this title (relating to Registration of Pay Telephone Service Providers),
and other telecommunications services that do not require certification as
established in the Public Utility Regulatory Act, Chapter 54, Subchapter C.
(b)
Purpose. Through this section,
the commission strives to identify, monitor, and protect the public interest
against telecommunications entities providing uncertificated telecommunications
services. The commission's overall goal is to encourage the development of
a competitive marketplace for nondominant telecommunications services, free
of unreasonable barriers to entry, that will provide consumers with the best
services at the lowest cost.
(c)
[
(1)
Legal name and
all
assumed names
under
which the registrant conducts business.
[
(2)
Address [
(3)
Principal office and
business office telephone number, fax number, website address, E-mail address,
and toll-free customer service telephone number. (If the registrant has not
obtained a toll-free customer service telephone number at the time of the
registration, the registrant must commit to obtaining one before commencing
business);
(4)
[
[
Name, address, and office
location of each partner (if applicable) or each officer;]
(5)
Form of business (
e.g.
, corporation, partnership, sole proprietorship), state in
which business was formed, certification/authorization number, and date business
was formed; [
(6)
Legal name of all affiliated companies that
are public utilities or that are providing telecommunications services and
the states in which they are providing service. Give a description of all
affiliates and explain in detail the relationship between the registrant and
its affiliates. An organizational chart should be provided;
[
(7)
FCC Carrier Identification Code (CIC) or National
Exchange Carriers Association (NECA) Operating Carrier Numbers (OCNs), if
available;
[
(8)
Name, addresses, phone
numbers, and e-mail/website address, and office location of each director,
officer, or partner (if applicable);
(9)
Names, addresses, phone
numbers, and e-mail/website address of the five largest shareholders (if applicable);
and
(10)
Name, address, telephone
number, and e-mail/website address of authorized/registered agent who can
be contacted by the commission.
(d)
[
(e)
[
(f)
Compliance enforcement.
(1)
Administrative penalties. If the commission
finds that a registrant has violated any provision of this section, the commission
shall order the registrant to take corrective action, as necessary, and the
registrant may be subject to administrative penalties and other enforcement
actions pursuant to PURA, Chapter 15.
(2)
Revocation or suspension. If the commission
finds that a registrant is repeatedly in violation of PURA or commission rules,
the commission may suspend or revoke a registration pursuant to PURA Chapter
17.
(3)
Enforcement. The commission shall coordinate
its enforcement efforts of fraudulent, misleading, deceptive, and anticompetitive
business practices with the Office of the Attorney General in order to ensure
consistent treatment of specific alleged violations.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed with the Office of
the Secretary of State, on April 13, 2000.
TRD-200002614
Rhonda Dempsey
Rules Coordinator
Public Utility Commission of Texas
Earliest possible date of adoption: May 28, 2000
For further information, please call: (512) 936-7308
16 TAC §26.129
The Public Utility Commission of Texas (commission) proposes
new §26.129 relating to Standards for Access to Provide Telecommunications
Services at Tenant Request. The purpose of this proposed rule is to implement
the Public Utility Regulatory Act, Texas Utilities Code Annotated §§54.259,
54.260, and 54.261 (Vernon 1998 & Supplement 2000) (PURA), regarding the
non-discriminatory treatment of telecommunications utilities by property owners.
Project Number 21400 has been assigned to this proceeding.
The proposed rule sets forth procedures whereby a requesting telecommunications
carrier may seek access to the lease owner's property to install telecommunications
equipment upon a tenant's request. The rule encourages independent negotiations
between the telecommunications carrier and the property owner, and establishes
procedures for resolution by the commission in the event an agreement cannot
be reached. Further, the proposed rule addresses situations in which the property
owner may deny access to the building for safety concerns or space constraints.
In 1995, the Legislature enacted PURA §§54.259, 54.260, and 54.261
as part of a comprehensive package of legislation to open Texas' telecommunications
market to competition. The thrust of these particular PURA sections is to
promote competition in the telecommunications market by allowing a tenant
under a real estate lease to choose the provider of its telecommunications
services. As the competitive marketplace has developed, the need for specific
rules to implement these sections has become evident. Accordingly, the commission
initiated this rulemaking proceeding to ensure the access of a telecommunications
utility to the owner's property to serve a tenant as requested, thereby promoting
tenant choice.
As part of the drafting process, commission staff conducted workshops in
Austin, Houston, and Dallas to receive input from potentially affected persons.
Further, staff participated in building tours to promote an understanding
of the technical aspects of and potential space constraints due to the installation
of telecommunications equipment.
The commission has prepared a takings impact assessment pursuant to Texas
Government Code Annotated §2007.043. Interested persons may obtain a
copy of this assessment by contacting the commission's Central Records department
and referencing Project Number 21400. In summary, the commission finds that
adherence to PURA §54.259 and proposed §26.129 may result in takings
of real property. The purpose of the statute and proposed rule is to promote
competition in the telecommunications market by effectuating a tenant's choice
of telecommunications services provider. This purpose is advanced by ensuring
the reasonable access of the telecommunications services provider to the owner's
property to provide service to a tenant that has chosen such company as its
telecommunications provider. Although PURA §54.259 and the proposed rule
impose a burden on private real property, any taking that might result will
be compensated. PURA §54.260 and the proposed rule require a telecommunications
services provider to pay reasonable compensation to the affected property
owner for the use of such space on the property.
The commission finds that the citizens of Texas will benefit from the proposed
rule because it will foster competition in the tenant sector of the telecommunications
services market. The language of PURA specifically sets forth the interrelationship
between the property owner and the telecommunications services provider chosen
by the tenant and authorizes the provider's access to the property as the
means for accomplishing a tenant's choice in a telecommunications services
provider. PURA further grants the commission plenary jurisdiction to enforce
the statute's requirements. See PURA §54.259(c) and §54.260(b).
Evan Farrington, Attorney, Office of Policy Development, has determined
that for the first five-year period the proposed rule is in effect there are
no foreseeable implications relating to cost or revenues of the state or local
governments as a result of enforcing or administering the section.
Mr. Farrington has also determined that for each year of the first five
years the proposed rule is in effect the public benefits expected as a result
of enforcing the rule will be that customers will have increased choice of
telecommunications providers. Furthermore, there will be no adverse economic
effect on small businesses or micro-businesses as a result of enforcing the
proposed section. There may be economic costs to persons who are required
to comply with the proposed section. These costs are likely to vary from business
to business, and are difficult to ascertain. However, the benefits accruing
from implementation of the proposed section will outweigh these costs.
Moreover, Mr. Farrington has determined that the proposed rule will not
affect a local economy for each year of the first five years it is in effect.
Therefore, a local employment impact statement is not required under Administrative
Procedure Act, Texas Government Code Annotated §2001.022.
The commission seeks comments on the proposed rule from interested persons.
Comments should be organized in a manner consistent with the organization
of the proposed rule. The commission invites specific comments regarding the
costs associated with, and benefits that will be gained by, implementation
of the proposed rule. The commission will consider the costs and benefits
in deciding whether to adopt the proposed rule. Additionally, the commission
invites specific comments from interested persons on the proposal of using
six months as the measure of time remaining on a lease for purposes of defining
the term "tenant" in the definitions section of the proposed rule. The commission
also seeks comment regarding any applicable Texas Supreme Court case law that
delineates the standards necessary to determine whether compensation is adequate
pursuant to the requirement in PURA §54.260(a)(6). The commission invites
comment on whether the proposed rule provides property owners with adequate
measures to address the security, safety, liability and other concerns specified
in PURA §54.260(a)(1)-(5). Lastly, the commission seeks comment on whether
it should adopt a section that allows parties to opt into alternative dispute
resolution. If so, what procedures should the commission adopt for referral
to mediation or arbitration?
Comments on the proposed rule (16 copies) may be submitted to the Filing
Clerk, Public Utility Commission of Texas, 1701 North Congress Avenue, P.O.
Box 13326, Austin, Texas, 78711-3326, within 30 days after publication. Reply
comments may be submitted within 45 days after publication. All comments should
refer to Project Number 21400.
The commission staff will conduct a public hearing on this rulemaking pursuant
to Texas Government Code §2001.029 on Tuesday, June 13, 2000 at 9:30
a.m. in the Commissioners' Hearing Room at the commission's offices, 1701
North Congress Avenue, Austin, Texas, 7th floor.
This new section is proposed pursuant to the Public Utility Regulatory
Act (PURA), Texas Utilities Code Annotated (Vernon 1998 & Supplement 2000) §14.002,
which provides the commission with authority to make and enforce rules reasonably
required in the exercise of its powers and jurisdiction. The commission also
proposes this rule pursuant to PURA §54.259, which provides it with authority
to enforce the prohibition on discrimination by property owners; PURA §54.260,
which provides it with authority to enforce conditions imposed by property
owners; and PURA §54.261 regarding shared tenant services contracts.
Cross Reference to Statutes: PURA §§14.002, 54.259, 54.260, and
54.261.
§26.129. Standards for Access to Provide Telecommunications Services at Tenant Request.
(a)
Purpose. The purpose of this section is to implement Public
Utility Regulatory Act (PURA) §§54.259, 54.260, and 54.261 regarding
the non-discriminatory treatment of a telecommunications utility by the property
owner upon a tenant's request for telecommunications services.
(b)
Application.
(1)
This section applies to the following entities:
(A)
"Telecommunications utilities" or "telecommunications
utility" as defined in PURA §51.002(11) that hold a consent, franchise,
or permit as determined to be the appropriate grants of authority by the municipality
and hold a certificate if required by the Public Utility Regulatory Act ;
(B)
Public or private property owners of commercial property
and the property owner's authorized representative(s); and
(C)
Public or private property owners of commercially operated
residential property with four or more dwelling units and the property owner's
authorized representative(s).
(2)
This section does not apply to institutions
of higher education as set forth by PURA §54.259(b).
(c)
Definitions. The following words and terms, when used
in this section, shall have the following meanings, unless the context clearly
indicates otherwise.
(1)
Conduit - A pipe installed on the property, in a building
between floors, attached to walls, between buildings, located in the ceiling
or floor space of a building, located on a customer's premise, or from a public
right of way into a building or buildings for the purposes of containing and
protecting cable.
(2)
Existing carrier - A telecommunications utility that
has installed telecommunications equipment on the property and is providing
telecommunications services to a tenant on the property through the use of
its own installed telecommunications equipment at the time the requesting
carrier seeks access to the property.
(3)
Property - A building or buildings that are under
common ownership and which are located on a single piece of land, or a campus,
or a parcel of land.
(4)
Property owner - The owner of the property or its
authorized representative(s).
(5)
Requesting carrier - A telecommunications utility,
that is not the existing carrier, seeking access to space in or on one or
more buildings on the property for the purpose of providing telecommunications
services to one or more tenants who have requested such services.
(6)
Space - Area of the property for which access is
being requested by the requesting carrier, which will be used to install the
telecommunications equipment needed to provide telecommunications services
to a requesting tenant on the property. Space includes conduit and may be
located in or on the rooftop of a building or buildings on the property.
(7)
Telecommunications equipment - The equipment installed
or used by the existing carrier or the requesting carrier to provide telecommunications
services to a tenant who has requested telecommunications services from the
existing carrier or the requesting carrier.
(8)
Tenant - Any occupant of a building or buildings
on the property under the terms of a lease with the property owner which has
a remaining term of more than six months and who is not subject to filed bona
fide eviction proceedings under such lease with the property owner, or an
authorized subtenant of such occupant whose occupancy is subject to the terms
of the primary lease which has a remaining term of more than six months.
(d)
Rights of parties.
(1)
Tenant's right to choose requesting carrier. A tenant
is entitled to choose the provider of its telecommunications services.
(2)
Property owner's rights to manage access. The requirements
of this subsection are not intended to eliminate or restrict the property
owner's rights to manage access to public or private property pursuant to
PURA §§54.259, 54.260, and 54.261.
(A)
A property owner may:
(i)
impose a condition on the requesting carrier that is reasonably
necessary to protect:
(I)
the safety, security, appearance, and condition of the
property; and
(II)
the safety and convenience of other persons;
(ii)
impose a reasonable limitation on the time at which the
requesting carrier may have access to the property to install telecommunications
equipment;
(iii)
impose a reasonable limitation on the number of such
requesting carriers that have access to the property, if the property owner
can demonstrate a space constraint that requires the limitation;
(iv)
require a requesting carrier to agree to indemnify the
property owner for damage caused installing, operating, or removing telecommunications
equipment;
(v)
require a tenant or requesting carrier to bear the entire
cost of installing, operating, or removing telecommunications equipment; and
(vi)
require requesting carrier to pay compensation that is
reasonable and nondiscriminatory among such telecommunications utilities.
(B)
A property owner may not:
(i)
prevent the requesting carrier from installing telecommunications
equipment on the property upon a tenant request;
(ii)
interfere with the requesting carrier's installation
of telecommunications equipment on the property upon a tenant request;
(iii)
discriminate against such requesting carrier regarding
installation, terms, or compensation of telecommunications equipment to a
tenant on the property;
(iv)
demand or accept an unreasonable payment of any kind
from a tenant or the requesting carrier for allowing the requesting carrier
on or in the property; or
(v)
discriminate in favor of or against a tenant in any manner,
including rental charge discrimination, based on the identity of a telecommunications
utility from which a tenant receives telecommunications services.
(3)
Requesting carrier's right to access.
(A)
Upon a tenant request, the requesting carrier has the
right to install telecommunications equipment on the property:
(i)
for a period no longer than the remaining term of the
requesting tenant's lease unless otherwise agreed to by the requesting carrier
and the property owner;
(ii)
without interference from the property owner, except
as provided in this subsection; and
(iii)
at terms, conditions, and compensation rates which are
non-discriminatory.
(B)
The requesting carrier shall comply with all applicable
federal, state, and local codes and standards,
e.g.,
fire codes, electrical codes, safety codes, building codes, elevator
codes.
(4)
Restriction on exclusive agreement. A telecommunications
utility shall not enter into an agreement, contract, pact, understanding or
other like arrangement with the property owner to be the sole or exclusive
provider of telecommunications services to a specific or defined group of
actual or prospective tenants on the property.
(e)
Procedures upon tenant request.
(1)
Tour of property.
(A)
Upon receiving a request for telecommunications services
from a tenant, but prior to or concurrently with providing the property owner
with notice of intent to install telecommunications equipment as described
in paragraph (3) of this subsection, the requesting carrier may request, in
writing, a tour of the property to determine an appropriate location for the
telecommunications equipment needed to provide the telecommunications services
requested by such tenant. This request shall identify the requesting tenant
and be sent by certified mail, return receipt requested.
(B)
The property owner shall provide such property tour within
ten calendar days of receipt of the requesting carrier's written request.
(2)
Request for technical drawings.
(A)
In its written request for a tour of the property, the
requesting carrier may request that the property owner provide computer aided
design (CAD) drawings or similarly detailed drawings of the mechanical room(s),
risers and other common spaces, if available, in order to assist the requesting
carrier in developing plans and specifications for placement of telecommunications
equipment.
(B)
Such drawings should be provided to the requesting carrier,
at the requesting carrier's expense, within ten calendar days of the property
owner's receipt of the requesting carrier's written request.
(3)
Notice of intent to install telecommunications
equipment.
(A)
Upon receiving a request for telecommunications services
from a tenant, the requesting carrier shall notify the property owner not
fewer than 30 calendar days before the proposed date on which installation
of telecommunications equipment needed to provide the telecommunications services
requested by a tenant is to commence.
(B)
Such notice shall be sent by certified mail, return receipt
requested, to the property's on-site manager and to the person identified
in the tenant's lease to receive notices. The requesting carrier shall also
provide a copy of the notice of intent to any person designated by the property's
on-site manager as the proper party to receive such notice.
(C)
The requesting carrier shall include, but is not limited
to, the following in its notice of intent:
(i)
the identity of the requesting tenant;
(ii)
the property address and building number (if applicable);
(iii)
the proposed timeline for the installation of telecommunications
equipment;
(iv)
the type of telecommunications equipment to be installed;
(v)
the proposed location, space requirements, proposed engineering
drawings, and other specifications of the telecommunications equipment;
(vi)
the conduit requirements, if any; and
(vii)
a copy of PURA §§54.259, 54.260, and 54.261
and this section (Substantive Rule §26.129).
(f)
Requirement to negotiate for 45 days.
(1)
Upon receipt of the requesting carrier's notice of intent
to install telecommunications equipment, the property owner and the requesting
carrier shall attempt to reach a mutually acceptable agreement regarding the
installation of the requesting carrier's telecommunications equipment and
reasonable compensation due the property owner as a result of such installation.
(2)
If such an agreement is not reached within 45 calendar
days of the property owner's receipt of the requesting carrier's notice of
intent, either party may file for resolution with the commission pursuant
to subsection (i) of this section.
(3)
The requesting carrier and the property owner may
agree, in writing, to extend the period of negotiation prescribed by this
subsection.
(g)
Parameters for installation of telecommunications equipment.
The property owner shall not deny the requesting carrier access to space,
except due to inadequate space or safety concerns.
(1)
Inadequate space.
(A)
Property owner's denial due to inadequate space. The property
owner may deny access to space if it does so within ten calendar days of its
receipt of the requesting carrier's notice of intent to install telecommunications
equipment, where the space and/or conduit required for installation is not
sufficient to accommodate the requesting carrier's request.
(B)
Demonstration of inadequate space.
(i)
In the event the property owner denies access to space,
the property owner shall demonstrate that there is insufficient space and/or
conduit to accommodate the requesting carrier's request for space. The property
owner shall allow the requesting carrier to inspect the space and/or conduit
to which it is denied access; or it may utilize any other method of proof
mutually agreed upon by the property owner and the requesting carrier.
(ii)
Such demonstration shall be completed within ten calendar
days of the requesting carrier's receipt of the property owner's denial.
(iii)
Following such demonstration or other agreed upon method
of proof, the requesting carrier shall have ten calendar days to dispute the
property owner's assertion that a space limitation exists by pursuing commission
resolution pursuant to subsection (i) of this section.
(C)
The requesting carrier and the property owner may agree,
in writing, to extend the timelines prescribed by this subsection.
(2)
Safety concerns.
(A)
Property owner's denial due to safety concern. The property
owner may deny access to space if it does so within ten calendar days of its
receipt of the requesting carrier's notice of intent to install telecommunications
equipment, where the installation of the requesting carrier's telecommunications
equipment would cause an unreasonable circumstance that would compromise the
safety of the property and/or persons on the property.
(B)
Demonstration of safety concern.
(i)
In the event the property owner denies access to space,
the property owner shall demonstrate that an unreasonable safety hazard that
requires the denial of access to space exists. The property owner shall specify
the alleged safety hazard and cite any applicable codes and/or standards.
The property owner shall allow the requesting carrier to inspect the space
and/or conduit to which it is denied access, or it may utilize any other method
of proof mutually agreed upon by the property owner and the requesting carrier.
(ii)
Such demonstration shall be completed within ten calendar
days of the requesting carrier's receipt of the property owner's denial.
(iii)
Following such demonstration or other agreed upon method
of proof, the requesting carrier shall have ten calendar days to dispute the
property owner's assertion that a safety hazard exists by pursuing commission
resolution pursuant to subsection (i) of this section.
(C)
The requesting carrier and the property owner may agree,
in writing, to extend the timelines prescribed by this subsection.
(h)
Parameters for determining reasonable compensation for
access.
(1)
The property owner and the requesting carrier shall attempt
to reach a mutually acceptable agreement regarding reasonable and non-discriminatory
compensation due the property owner as a result of the requesting carrier's
installation of telecommunications equipment required to provide telecommunications
services to a requesting tenant.
(2)
The property owner shall not impose a fee on the
requesting carrier unrelated to the requesting carrier's usage of space and/or
provision of telecommunications services to a requesting tenant, except as
provided by agreement of the property owner and the requesting carrier.
(3)
The property owner and the requesting carrier shall
negotiate terms and conditions concerning the removal of the requesting carrier's
telecommunications equipment upon the departure of a tenant served by such
requesting carrier or the end of the service agreement between a tenant and
the requesting carrier.
(4)
The property owner may require a security deposit
not to exceed an amount equal to one month of fees or rents as determined
by the agreement between the requesting carrier and the property owner.
(i)
Failure to reach negotiated agreement.
(1)
Alternative Dispute Resolution. As an alternative to petitioning
the commission for resolution of a dispute, parties may voluntarily submit
any controversy or claim under this subsection to settlement by alternative
dispute resolution. This alternative dispute resolution shall be conducted
under the alternative dispute resolution procedures of Chapter 2009, Administrative
Procedure Act, and Chapter 154, Civil Practice and Remedies Code.
(2)
Petition to commission for resolution of dispute.
If a mutually acceptable agreement regarding the installation of the requesting
carrier's telecommunications equipment, the reasonable compensation due the
property owner as a result of such installation, or other disputed issues
is not reached within 45 calendar days of the property owner's receipt of
the requesting carrier's notice of intent to install telecommunications equipment,
either the property owner or the requesting carrier may petition the commission
for resolution. The petition shall include proof of the requesting carrier's
proper service of notice of intent to the property owner in the form of an
affidavit and attached copy of return receipt.
(3)
Types of disputes and information required for each.
(A)
Installation dispute.
(i)
The property owner may deny access consistent with subsection
(g) of this section.
(ii)
The property owner and the requesting carrier shall each
provide the commission with information specifying the space or safety related
installation dispute(s) that is preventing a negotiated agreement.
(iii)
The property owner and the requesting carrier shall
each provide the commission with information supporting its position in the
dispute(s).
(B)
Reasonable compensation dispute.
(i)
The property owner shall provide the commission with the
amount of compensation being sought and the basis for such claim, including
information supporting the factors listed in clause (iii) of this subparagraph.
(ii)
The requesting carrier shall provide the commission with
information supporting the amount of compensation it deems reasonable to compensate
the property owner for installation of its telecommunications equipment.
(iii)
In determining a reasonable amount of compensation due
the property owner for installation of the requesting carrier's telecommunications
equipment, the commission may consider, but is not limited to, the following:
(I)
the location and amount of space occupied by installation
of the requesting carrier's telecommunications equipment;
(II)
evidence that the property owner has a specific alternative
use for any space which would be occupied by the requesting carrier's telecommunications
equipment and which would result in a specific quantifiable loss to the property
owner;
(III)
the value of the property before and after the installation
of the requesting carrier's telecommunications equipment and the methods used
to determine such values;
(IV)
possible interference of the requesting carrier's telecommunications
equipment with the use and occupancy of the property which would cause a decrease
in the rental or resale value of the property;
(V)
actual costs incurred by the property owner directly related
to installation of the requesting carrier's telecommunications equipment;
(VI)
the market rate for similar space used for installation
of telecommunications equipment in a similar property; and
(VII)
the market rate for tenant leaseable space in the property
or a similar property.
(C)
Other disputed issues.
(i)
The property owner and the requesting carrier shall each
provide the commission with information specifying any other dispute(s) preventing
a negotiated agreement.
(ii)
The property owner and the requesting carrier shall each
provide the commission with information supporting its position regarding
these other dispute(s).
(4)
Procedure.
(A)
Upon the proper filing of a petition, as set forth in
paragraph (1) of this subsection, the commission may proceed to resolution
of a dispute pursuant to the commission's procedural rules as set forth in
Chapter 22 of this title (relating to Practice and Procedure).
(B)
In addition to the requirements set forth in paragraph
(1) of this subsection, all petitions shall comply with the requirements of
Chapter 22, Subchapter D of this title (relating to Notice) and Chapter 22,
Subchapter E of this title (relating to Pleadings and Other Documents).
(C)
The commission may grant interim relief, subject to true-up,
so as not to impair or delay, the right of the requesting carrier to install,
maintain, and remove its telecommunications equipment, or to provide telecommunications
services to a requesting tenant, during the pendency of the proceeding.
(j)
Administrative penalties. The provisions set forth in §22.246
of this title (relating to Administrative Penalties) shall apply to any violation
of this section.
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of
the Secretary of State, on April 13, 2000.
TRD-200002642
Rhonda Dempsey
Rules Coordinator
Public Utility Commission of Texas
Earliest possible date of adoption: May 28, 2000
For further information, please call: (512) 936-7308
Chapter 401.
ADMINISTRATION OF STATE LOTTERY ACT
Subchapter A. PROCUREMENT
16 TAC §401.101
The Texas Lottery Commission proposes amendments to 16 TAC §401.101,
relating to lottery procurement procedures.
The proposed amendments clarify the procedures to be followed by the agency
when procuring goods and/or services pursuant to its authority under the State
Lottery Act. Additionally, the proposed amendments incorporate recommendations
made by the State Auditor's Office in SAO Report No. 99-050 entitled "A Report
on the Procurement Practices at the Texas Lottery Commission." The proposed
amendments also implement several provisions set forth in Senate Bill (SB)
177, §5, 76th Legislature, Regular Session. The proposed amendments also
delete the portions of the rule that set out procurement protest procedures.
Protest procedures may become the subject of separate rules.
Proposed amendments to the rule were originally published in the December
31, 1999, issue of the
Texas Register
, (24
TexReg 11848) (hereinafter referred to as "the proposed amendments as originally
published"). The proposed amendments contained herein differ from the proposed
amendments as originally published as follows: First, the proposed amendments
now provide for a definition for the term "cost." Second, the proposed amendments
now require, when conducting an informal competitive solicitation or an invitation
for bids, the executive director or the executive director's designee to award
a contract to the qualified bidder submitting the lowest and best price quotation,
except that the executive director may reject all price quotations if it is
determined to be in the best interest of the state. Third, the proposed amendments
now require an amount to be added to a nonresident bidder's bid equal to the
amount a Texas resident bidder would be required to underbid a nonresident
bidder to obtain a comparable contract in the state in which the nonresident
bidder has its principal place of business in determining the lowest bid submitted
in response to an invitation for bids. Fourth, the proposed amendments now
permit the executive director, or the executive director's designee to engage
in simultaneous negotiations with proposers. Fifth, the proposed amendments
correct several typographical errors that were contained in the rule as originally
proposed.
The proposed amendments are being republished in order to provide notice
of the changes to the proposed amendments as originally published and to allow
for public comment on changes to the proposed amendment.
Richard Sookiasian, Budget Analyst, has determined that for each year of
the first five-year period the proposed amendments will be in effect, there
will be no fiscal implications to state government or local government as
a result of administering the proposed amendments.
Mr. Sookiasian has also determined that for each year of the first five-year
period the proposed amendments will be in effect, there will be no estimated
reductions in costs to the state or to local governments as a result of administering
the proposed amendments.
Mr. Sookiasian has also determined that for each year of the first five-year
period the proposed amendments will be in effect, there will be no estimated
increases in revenue to the state or to local governments as a result of administering
the proposed amendments. Mr. Sookiasian has also determined that for each
year of the first five-year period the proposed amendments will be in effect,
there will be no estimated decreases in revenue to the state or to local governments
as a result of administering the proposed amendments.
Mr. Sookiasian has also determined that administering the proposed amendments
does not have foreseeable implications relating to cost or revenues of the
state or local governments.
Mr. Sookiasian has also determined that for each year of the first five-year
period the proposed amendments will be in effect, the public benefits anticipated
as a result of administering the proposed amendments will be to clarify the
procedures used by the agency in procuring goods and/or services made pursuant
to its authority under the State Lottery Act.
Mr. Sookiasian has also determined that for each year of the first five-year
period the proposed amendments will be in effect, there will be no probable
economic cost to persons required to comply with the proposed amendments.
Mr. Sookiasian has also determined that there will be no cost to small
businesses or individuals who are required to comply with the proposed amendments,
and no effect on local employment is anticipated.
Comments on the proposed amendments may be submitted to Ridgely C. Bennett,
Deputy General Counsel, Texas Lottery Commission, P.O. Box 16630, Austin,
Texas 78761-6630.
The amendments to this section are proposed under §466.105,
Government Code, which provides the Texas Lottery Commission with the authority
to adopt rules governing the establishment and operation of the lottery, §466.101,
Government Code, which provides the Texas Lottery Commission with the authority
to adopt rules requiring any person seeking to contract for goods or services
relating to the implementation and administration of the State Lottery Act
to submit to competitive bidding procedures in accordance with the rules adopted
by the Commission, §467.102, Government Code, which provides the Texas
Lottery Commission with the authority to adopt rules for the enforcement and
administration of the State Lottery Act and the laws under the Commission's
jurisdiction, and Chapter 2001, Government Code, which provides for the adoption
of administrative rules.
Texas Government Code, Chapter 466 is affected by the proposed section.
§401.101. Lottery Procurement Procedures.
(a)
Definitions. The following words and terms, when used
in this section, shall have the following meanings, unless the context clearly
indicates otherwise.
(1) - (2)
(No change.)
(3)
Commission -- The agency created
under chapter
467, Government Code
[
(4) - (5)
(No change.)
(6)
IFB -- A written invitation for
bids
[
(7)
(No change.)
(8)
Nonresident bidder or proposer -- A bidder or proposer
whose principal place of business is not in Texas
.
[
(9)
Principal place of business in Texas -- A business
entity that has at least one [
(10)
Produced in Texas -- Those goods that are manufactured
in Texas, excluding the sole process of packaging or repackaging.
Packaging
or repackaging does not constitute being manufactured in Texas.
(11)
(No change.)
(12)
Resident bidder or proposer -- A bidder or proposer
whose principal place of business is in Texas
.
[
(13)
Services -- Includes consultant services, personal
services, professional services, facility services (i.e., the lease of real
property, including utility and custodial service), [
(14)
(No change.)
(15)
Electronic State Business
Daily or Business Daily -- the website administered by the Department of Economic
Development, or its successor, on which procurement opportunities are advertised
in electronic format via the Texas Marketplace.
(16)
Cost -- the price at
which the commission or executive director can purchase goods and/or services.
(b)
Competitive solicitations.
(1) - (3)
(No change.)
(4)
For the purchase of printing services,
regardless
of the amount,
the commission must conduct a formal competitive solicitation
in an attempt to obtain at least three competitive bids or proposals.
(5)
(No change.)
(6)
Notwithstanding paragraphs (1)-(3) of this subsection,
the commission may make an emergency purchase or lease of goods or services
if the commission will suffer financial or operational damage. Prior to making
an emergency purchase or lease of goods or services, the existence of an emergency
should be documented. For emergency purchases in excess of $5,000, the commission,
at a minimum, must conduct an informal competitive solicitation in an attempt
to obtain at
least
[
(7)
Notwithstanding paragraphs
(1)-(3) of this subsection, the commission may make a purchase or lease of
goods or services under any other procedure authorized by law.
(c)
Informal competitive solicitations.
(1)
An informal competitive solicitation is a process conducted
in
an effort
[
(A)
the name and telephone number
of each person or company to which the price quotation was provided;
(B)
[
(C)
[
(D)
[
(E)
[
(2)
The executive director or the executive director's
designees shall award a contract to the qualified bidder submitting the lowest
and best
price quotation
, except that the executive director may
reject all price quotations if it is determined to be in the best interest
of the state
. In determining the lowest price quotation, an amount will
be added to a nonresident bidder's or proposer's price quotation equal to
the amount a Texas resident bidder or proposer would be required to underbid
a nonresident bidder or proposer to obtain a comparable contract in the state
in which the nonresident bidder or proposer has its principal place of business.
This added amount will only be used for evaluation purposes, and will not
be included in the nonresident bidder's or proposer's contract if one is awarded.
(3)
(No change.)
(d)
Formal competitive solicitations.
(1)
(No change.)
(2)
When an RFP is used by the commission, the RFP shall
contain, at a minimum, the following:
(A) - (B)
(No change.)
(C)
the time and date proposals are due, and the location/person
they are to be submitted to; [
(D)
an identification of the
process
[
(E)
a listing of the factors to
be utilized in evaluating proposals and awarding a contract. At a minimum,
the factors should include:
(i)
the proposer's price to provide the goods or
services;
(ii)
the probable quality of the offered goods
or services;
(iii)
the quality of the proposer's past performance
in contracting with the commission, with other state entities, or with private
sector entities;
(iv)
the financial status of the proposer;
(v)
the qualifications of the proposer's personnel;
(vi)
the experience of the proposer in providing
the requested goods or services; and
(vii)
whether the proposer made a good faith effort
to reach the minority participation goals set forth by the commission.
(3)
Where time permits, the commission shall
advertise formal competitive solicitations, whether by IFB or RFP,
on
[
(4)
For formal competitive solicitations where an IFB
is used, the executive director or the executive director's designee shall
award a contract to the qualified bidder submitting the lowest
and best
bid, except that the executive director may reject all bids if it is
determined to be in the best interest of the
lottery
[
(5)
For formal competitive solicitations where an RFP
is used, the executive director or the executive director's designee(s) shall,
prior to the deadline for receipt of proposals, develop and establish a comprehensive
evaluation
criteria
[
(e)
Preferences.
(1) - (5)
(No change.)
(6)
A bidder or proposer entitled to a preference(s)
under this subsection should claim the preference(s) in its bid or proposal.
[
[
Protests.]
[
Any bidder or proposer aggrieved by the terms
of any formal competitive solicitation, or with any contract award made pursuant
to such a solicitation, may protest the commission's or the executive director's
action. For the protest of a formal competitive solicitation, a protest must
be filed, in writing, with the commission's general counsel within 72 hours
after issuance of the IFB or RFP. For the protest of a contract award, a protest
must be filed, in writing, with the commission's general counsel within 72
hours after receipt of notice of the execution of the contract. Protests not
filed timely will not be considered, and the protestant will be so notified
in writing by the commission's general counsel.]
[
To be considered, a protest must contain.]
[
a specific identification of the statutory
provision, rule provision, or procurement procedure allegedly violated;]
[
a brief statement of the relevant facts;]
[
an identification of the issue or issues to
be resolved;]
[
arguments and authorities in support of the
protest;]
[
an affidavit that the contest of the protest
are true and correct; and]
[
a certification that a copy of the protest
(if to a contract award) has been served on the successful proposer.]
[
In the event of a timely filed protest
of a solicitation, the executive director shall not proceed with issuance
of a purchase order or execution of a contract unless the commission determines,
in writing, that such action is necessary to protest the interests of the
state.]
[
In the event of a protest of a contract
award, the successful proposer may file a written response to the protest
within 72 hours after the commission's receipt of the protest.]
[
The executive director will review the
protest, any response, and the solicitation file; and will make a written
determination of the protest. The written determination on the protest may
include a determination cancelling the solicitation or voiding the contract.
The executive director's written determination will be served, by facsimile,
on the protestant and the successful proposer (if any). Confirmation of delivery
to the designated facsimile machine will be conclusive proof that delivery
was made. The protestant may appeal the determination of the executive director
to the Texas Lottery Commission by filing a request with the general counsel
not later than 72 hours after receipt of notice of the executive director's
determination. Any appeal to the Texas Lottery Commission will be based solely
on the written protest, any responses filed with the executive director, and
the executive director's written determination The Texas Lottery Commission's
determination of any appeal shall be administratively final when issued.]
(f)
[
(1)
When determined appropriate by the executive director,
a contract for the purchase or lease of goods or services related to the implementation,
operation, or administration of the lottery shall provide for liquidated damages
and a performance bond in an amount equal to the executive director's best
available estimate of the revenue that would be lost by the state if the contractor
fails to meet deadlines specified in the contract or materially fails to perform
its contractual obligations in any other manner. When such contract terms
are determined appropriate by the executive director, the IFB or RFP shall
reflect such requirement.
(2)
When determined appropriate by the executive director,
a contract for the purchase or lease of goods or services related to the implementation,
operation, or administration of the lottery shall provide that the contractor,
when utilizing subcontractors, shall give a preference to minority businesses,
as defined in the State Lottery Act, Texas Government Code, §466.107.
When such contract term is determined appropriate by the executive director,
the IFB and RFP shall reflect such requirement.
(3)
A contract for the purchase or lease of goods or
services relating to the implementation, operation, or administration of the
lottery shall provide that the executive director may terminate the contract,
without penalty, if an investigation made pursuant to the Act reveals that
the person to whom the contract was awarded would not be eligible to receive
a sales agent license under the State Lottery Act, Texas Government Code, §466.155.
An IFB or RFP may require that bidders or proposers provide in their bids
or proposals sufficient information to allow the commission to determine whether
the bidder or proposer meets the eligibility requirements for a sales agent
license.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed with the Office of
the Secretary of State, on April 17, 2000.
TRD-200002702
Ridgely C. Bennett
Deputy General Counsel
Texas Lottery Commission
Earliest possible date of adoption: May 28, 2000
For further information, please call: (512) 344-5113
Chapter 25.
SUBSTANTIVE RULES APPLICABLE TO ELECTRIC SERVICE PROVIDERS
Subchapter O. UNBUNDLING AND MARKER POWER
Chapter 25.
SUBSTANTIVE RULES APPLICABLE TO ELECTRIC SERVICE PROVIDERS
Chapter 26.
SUBSTANTIVE RULES APPLICABLE TO TELECOMMUNICATIONS SERVICE PROVIDERS
(a)
] Each nondominant carrier not
holding a certificate of operating authority
(COA)
or service provider
certificate of operating authority
(SPCOA)
[
and not currently
registered with the commission
] shall file with the commission the information
set forth in paragraphs
(1)-(10)
[
(1)-(7)
] of this subsection
within 30 days of commencing service in Texas. Each
registered
[
uncertificated
] nondominant carrier shall keep this information
updated and current at all times. [
Each certificated nondominant carrier
also shall keep updated and current the similar information included in its
application for a certificate:
]
, if any;
]
A registrant shall use only one name in which to provide telecommunications
services to the public per registration;
and telephone number
] of the
principal office
and business office
;
(3)
] Date service
commences/
commenced in Texas;
(4)
Names and addresses of five largest shareholders (if applicable);
]
Name,
address, and telephone number of registered agent or designated person who
can be contacted by the commission; and
]
Name, address, and telephone number of attorney, if
any;
]
(b)
] By June 30 of each year, each
nondominant carrier [
that during the previous 12 months has not filed
changes to the information required pursuant to subsection (a) of this section
] shall file with the commission
an updated registration form
[
a letter informing the commission that no changes have occurred
].
An uncertificated nondominant carrier failing to file
an updated registration
form by
[
either the letter or the updates required by subsection
(a) of this section during the 12-month period ending
] June 30 may no
longer be considered to be registered with the commission.
(c)
] All nondominant carriers shall
comply with the reporting requirements in §26.89 of this title (relating
to Information Regarding Rates and Services of Nondominant Carriers).
Subchapter F. REGULATION OF TELECOMMUNICATIONS SERVICE
Part 9.
TEXAS LOTTERY COMMISSION
by House Bill 54, 72nd Legislature, First
Called Session, as amended by House Bill 1587 and House Bill 1013, 73rd Legislature,
Regular Session
].
bid
].
, but
excludes a bidder or
]
A
proposer whose ultimate parent company
or majority owner has its principal place of business in Texas
is considered
a resident bidder or proposer
.
permanent
] office located in Texas,
from which business activities other than submitting bids or proposals to
governmental agencies are conducted, with at least one employee working in
that office.
, and includes
]
A
[
a
] bidder or proposer whose ultimate parent
company or majority owner has its principal place of business in Texas
is considered a resident bidder or proposer
.
public relations,
] telecommunications services, and advertising services.
lease
] three competitive price quotations.
The commission may ask the General Services Commission or any other appropriate
entity for advice and assistance in the handling of an emergency purchase.
order
] to receive at least three competitive
price quotations for a specifically identified good or service, without the
advertisement and issuance of an IFB or RFP. The price quotations may be solicited
by letter,
electronic mail
[
telegram
], facsimile, or
telephone call. The following information must be recorded by the commission
in the solicitation file:
(A)
] the name and telephone number
of the person or company submitting the price quotation;
(B)
] the time and date the price
quotation was received;
(C)
] the amount of the price quotation;
and
(D)
] the name and telephone number
of the person receiving the price quotation for the
commission
[
division
].
and
]
criteria
] to be utilized in evaluating proposals and awarding a contract
; and
[
.
]
in
] the
Electronic State Business Daily
[
Texas Register
]. The commission may advertise such solicitations in
other media determined appropriate by the commission. [
In addition, the
commission shall provide a copy of the IFB or RFP to those vendors who have
specifically expressed, in writing, an interest in providing certain goods
or services to the commission and whose names and addresses are on file with
the commission.
]
state
]. In determining the lowest bid, an amount will be added to a nonresident
bidder's bid equal to the amount a Texas resident bidder would be required
to underbid a nonresident bidder to obtain a comparable contract in the state
in which the nonresident bidder has its principal place of business. This
added amount will only be used for evaluation purposes, and will not be included
in the nonresident bidder's contract if one is awarded. The contract shall
be awarded by the issuance of a written purchase order. At the time the purchase
order is issued, the commission shall also notify, in writing, all other bidders
of the contract award by
facsimile, or by
certified mail, return
receipt requested, or by overnight mail. Any information relating to the solicitation
not made privileged from disclosure by law shall be made available for public
disclosure after issuance of the purchase order pursuant to the Texas Open
Records Act.
plan
] to be utilized by an evaluation
committee in evaluating the proposals and awarding a contract. [
The evaluation
plan shall be based upon the evaluation criteria used by the evaluation committee
appointed by the executive director. If the evaluation criteria include price
as one of the criteria,
]
In determining the lowest price,
an amount will be added to a nonresident proposer's price proposal equal to
the amount a Texas resident proposer would be required to underbid a nonresident
proposer to obtain a contract in the state in which the nonresident proposer
has its principal place of business. This added amount will only be used for
evaluation purposes, and will not be included in the nonresident proposer's
contract if one is awarded. All proposals
that are responsive to the
RFP
[
received
] will be reviewed by the evaluation committee.
The evaluation committee will evaluate and rank all proposals in accordance
with the evaluation
criteria
[
plan
]. As part of the
evaluation process, the top proposers may be requested to make an oral presentation
to the committee, which may include an inspection trip to the proposer's facilities
[
at a mutually agreeable time and place
]. The evaluation committee
will then make a final ranking of all proposers who have made a presentation,
based upon the presentation and the evaluation
criteria
[
plan
]. The committee will forward its written recommendation to the
executive director, who will review the recommendation and make the final
decision, including the acceptance of a proposal in whole or in part. The
executive director or the executive director's designee(s) shall then attempt
to negotiate a contract with the selected proposer
or the executive director
or the executive director's designee(s), at the sole discretion of the executive
director or the executive director's designee(s) may engage in simultaneous
negotiations with multiple proposers
. If a contract cannot be negotiated
with the selected
proposer(s) on terms
[
proposer at a price
] the executive director determines reasonable, negotiations with that
proposer will be terminated, and negotiations will be undertaken with the
next highest ranked proposer. This process will be continued until a contract
is executed by a proposer and the executive director, or negotiations with
the highest ranked proposers are terminated. If no contract is executed, the
executive director or the executive director's designee(s) may attempt to
negotiate a contract with any of the other proposers. Negotiations will continue
until a contract is executed or all proposals are rejected. If a contract
is executed, the commission shall promptly notify, in writing, all other proposers
of the contract award by
facsimile, or by
certified mail, return
receipt requested, or by overnight mail. Any information relating to the solicitation
not made privileged from disclosure by law shall be made available for public
disclosure after execution of the contract pursuant to the Texas Open Records
Act.
However, a preference(s) may be granted to a bidder or proposer who
fails to claim the preference(s) if documents attached to the bid or proposal
clearly indicate entitlement to the preference(s).
]
(f)
(1)
(2)
(A)
(B)
(C)
(D)
(E)
(F)
(3)
(4)
(5)
g
] Contract terms.