Floor Packet Page No. 45
      Amend CSSB 7 (House committee report) as follows:
      (1)  In Section 39.901(e), Utilities Code, as added by
SECTION 40 of the bill (page 141, line 26 through page 142, line
8), strike the first two sentences of Subsection (e) and substitute
the following:
Not later than May 1 of each year, the commission shall transfer
from the system benefit fund to the foundation school fund the
amounts determined by the Texas Education Agency under Subsections
(b) and (c) to the extent money in the system benefit fund is
available.  If in any year the system benefit fund is insufficient
to make the transfer designated by the Texas Education Agency, the
shortfall shall be included in the projected revenue requirement
for the system benefit fund the next time the commission sets the
fee under Section 39.903, and the shortfall amount shall be
transferred to the Foundation School Program the following year if
sufficient money in the fund is available.
      (2)  Strike Section 39.903, Utilities Code, as added by
SECTION 40 of the bill (page 143, line 24 through page 146, line
6), and substitute a new Section 39.903 to read as follows:
      Sec. 39.903.  SYSTEM BENEFIT FUND.  (a)  The system benefit
fund is created as a trust fund with the comptroller and shall be
administered by the commission as trustee on behalf of the
recipients of money from the fund.
      (b)  The system benefit fund is financed by a nonbypassable
fee set by the commission in an amount not to exceed 50 cents per
megawatt hour, except beginning on January 1, 2002, and ending on
December 31, 2006, the commission may set the fee in an amount not
to exceed 65 cents per megawatt hour to the extent necessary to
collect sufficient revenue to fund the 10 percent reduced rate
requirements of the program required by Subsection (h).  The system
benefit fund fee is allocated to customers based on the amount of
kilowatt hours used.
      (c)  The nonbypassable fee may not be imposed on the retail
electric customers of a municipally owned utility or electric
cooperative before the sixth month preceding the date on which the
utility or cooperative implements customer choice. Money
distributed from the system benefit fund to a municipally owned
utility or an electric cooperative shall be proportional to the
nonbypassable fee paid by the municipally owned utility or the
electric cooperative, subject to the reimbursement provided by
Subsection (i). On request by a municipally owned utility or
electric cooperative, the commission shall reduce the nonbypassable
fee imposed on retail electric customers served by the municipally
owned utility or electric cooperative by an amount equal to the
amount provided by the municipally owned utility or electric
cooperative or its ratepayers for local low-income programs and
local programs that educate customers about the retail electric
market in a neutral and nonpromotional manner.
      (d)  The commission shall annually review and approve system
benefit fund accounts, projected revenue requirements, and proposed
nonbypassable fees.
      (e)  The system benefit fund shall provide funding solely for
the following regulatory purposes:
            (1)  programs to assist low-income electric customers
provided by Subsections (f)-(l);
            (2)  customer education programs; and
            (3)  the school funding loss mechanism provided by
Section 39.901.
      (f)  Notwithstanding Section 39.106(b), the commission shall
adopt rules regarding programs to assist low-income electric
customers on the introduction of customer choice.  The programs may
not be targeted to areas served by municipally owned utilities or
electric cooperatives that have not adopted customer choice.  The
programs shall include:
            (1)  reduced electric rates as provided by Subsections
(h)-(l); and
            (2)  targeted energy efficiency programs to be
administered by the Texas Department of Housing and Community
Affairs in coordination with existing weatherization programs.
      (g)  Until customer choice is introduced in a power region,
an electric utility may not reduce, in any manner, programs already
offered to assist low-income electric customers.
      (h)  The commission shall adopt rules for a retail electric
provider to determine a reduced rate for eligible customers to be
discounted off the standard retail service package as approved by
the commission under Section 39.106, or the price to beat
established by Section 39.202, whichever is lower.  Municipally
owned utilities and electric cooperatives shall establish a reduced
rate for eligible customers to be discounted off the standard
retail service package established under Section 40.053 or 41.053,
as appropriate.  The reduced rate for a retail electric provider
shall result in a total charge that is at least 10 percent, and if
sufficient money in the system benefit fund is available, up to 20
percent, lower than the amount the customer would otherwise be
charged.  For a municipally owned utility or electric cooperative,
the reduced rate shall be equal to an amount that can be fully
funded by that portion of the nonbypassable fee proceeds paid by
the municipally owned utility or electric cooperative that is
allocated to the utility or cooperative by the commission under
Subsection (e) for programs for low-income customers of the utility
or cooperative.  The reduced rate for municipally owned utilities
and electric cooperatives under this section is in addition to any
rate reduction that may result from local programs for low-income
customers of the municipally owned utilities or electric
cooperatives.
      (i)  A retail electric provider, municipally owned utility,
or electric cooperative seeking reimbursement from the system
benefit fund may not charge an eligible low-income customer a rate
higher than the appropriate rate determined under Subsection (h).
A retail electric provider not subject to the price to beat, or a
municipally owned utility or electric cooperative subject to the
nonbypassable fee under Subsection (c), shall be reimbursed from
the system benefit fund for the difference between the reduced rate
and the rate established under Section 39.106, or as appropriate,
the rate established under Section 40.053 or 41.053.   A retail
electric provider who is subject to the price to beat shall be
reimbursed from the system benefit fund for the difference between
the reduced rate and the price to beat.  The commission shall adopt
rules providing for the reimbursement.
      (j)  The commission shall adopt rules providing for methods
of enrolling customers eligible to receive reduced rates under
Subsection (h). The rules must provide for automatic enrollment as
one enrollment option. The Texas Department of Human Services, on
request of the commission, shall assist in the adoption and
implementation of these rules.  The commission and the Texas
Department of Human Services shall enter into a memorandum of
understanding establishing the respective duties of the commission
and the department in relation to the automatic enrollment.
      (k)  A retail electric provider is prohibited from charging
the customer a fee for participation in the reduced rate program.
      (l)  For the purposes of this section, a "low-income electric
customer" is an electric customer:
            (1)  whose household income is not more than 125
percent of the federal poverty guidelines; or
            (2)  who receives food stamps from the Texas Department
of Human Services or medical assistance from a state agency
administering a part of the medical assistance program.
      (m)  Funding of programs to assist low-income customers under
Subsections (f)-(l) and customer education programs shall be given
funding priority over the school funding loss mechanism provided by
Section 39.901.