79R7214 CBH-F

By:  Cook of Colorado                                             H.B. No. 2244


A BILL TO BE ENTITLED
AN ACT
relating to the payment and recovery of municipal charges and costs by providers of electricity. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Section 33.008, Utilities Code, is amended by amending Subsections (b) and (c) and adding Subsection (g-1) to read as follows: (b) If a municipality collected a charge or fee for a franchise to use a municipal street, alley, or public way from an electric utility, a municipally owned utility, or an electric cooperative before the end of the freeze period, the municipality, after the end of the freeze period or after implementation of customer choice by the municipally owned utility or electric cooperative, as appropriate, is entitled to collect from each electric utility, transmission and distribution utility, municipally owned utility, or electric cooperative that uses the municipality's streets, alleys, or public ways to provide distribution service a charge based on each kilowatt hour of electricity delivered by the utility to each retail customer whose consuming facility's point of delivery is located within the municipality's boundaries. The charge imposed shall be equal to the total electric franchise fee revenue due the municipality from electric utilities, municipally owned utilities, or electric cooperatives, as appropriate, for calendar year 1998 divided by the total kilowatt hours delivered during 1998 by the applicable electric utility, municipally owned utility, or electric cooperative to retail customers whose consuming facilities' points of delivery were located within the municipality's boundaries. The compensation a municipality may collect from each electric utility, transmission and distribution utility, municipally owned utility, or electric cooperative providing distribution service shall be equal to the charge per kilowatt hour determined for 1998 multiplied times the number of kilowatt hours delivered within the municipality's boundaries. On the termination, expiration, or extension of a franchise agreement existing on September 1, 2005, a municipality may change the per kilowatt hour charge otherwise prescribed by this subsection. The charge may not exceed $.0045 per kilowatt hour. (c) The municipal franchise charges authorized by this section shall be considered a reasonable and necessary operating expense of each electric utility, transmission and distribution utility, municipally owned utility, or electric cooperative that is subject to a charge under this section. The charge shall be included in the nonbypassable delivery charges that a customer's retail electric provider must pay under Section 39.107 to the utility serving the customer. Notwithstanding any other provision of this title, the regulatory authority shall allow an electric utility or transmission and distribution utility to adjust the utility's rates or nonbypassable charges to permit the timely recovery of any change in municipal franchise fees. The utility shall recover the change in municipal franchise fees from the customers residing in the municipality or, if applicable, from the retail electric providers serving those customers. (g-1) This section may not be construed to interfere with or abrogate the rights or obligations of any party to a franchise agreement in effect on September 1, 2005. SECTION 2. Section 36.201, Utilities Code, is amended to read as follows: Sec. 36.201. AUTOMATIC ADJUSTMENT FOR CHANGES IN COSTS. Except as permitted by Sections 33.008 and [Section] 36.204, the commission may not establish a rate or tariff that authorizes an electric utility to automatically adjust and pass through to the utility's customers a change in the utility's fuel or other costs. SECTION 3. Section 39.202, Utilities Code, is amended by adding Subsection (q) to read as follows: (q) The commission shall adjust the price to beat as necessary to reflect any change in the nonbypassable charges of a transmission and distribution utility made under Section 33.008. SECTION 4. Sections 33.008(f) and 33.023(b), Utilities Code, are repealed. SECTION 5. This Act applies only to franchise fees imposed on or after the effective date of this Act. Franchise fees imposed before the effective date of this Act are governed by the law in effect on the date the fees are imposed, and that law is continued in effect for that purpose. SECTION 6. This Act takes effect September 1, 2005.