By:  Averitt                                                      S.B. No. 1447


A BILL TO BE ENTITLED

AN ACT

relating to electric utility employee pension and other post 
retirement benefit expense.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Chapter 36, Utilities Code, is amended by adding 
Section 36.065, to read as follows:
	Sec. 36.065.  EXPENSE FOR PENSION AND OTHER POST EMPLOYMENT 
BENEFITS.  (a)  Effective January 1, 2005, an electric utility may 
establish one or more reserve accounts for pension and other post 
employment benefits expenses and shall periodically record to such 
accounts a surplus (regulatory liability) or shortage (regulatory 
asset) between the annual amounts approved in the Company's last 
general rate proceeding as an operating expense and the annual 
amounts determined by actuarial or similar studies that are 
chargeable to operating expense.  In a subsequent rate proceeding, 
the regulatory authority shall review the amounts booked to such 
reserve accounts to determine that the amounts are reasonable and 
necessary expenses and shall subtract any surplus from or add any 
shortage to the utility's rate base, with the surplus or shortage to 
be amortized over a reasonable time.
	(b)  The regulatory authority shall include in the rates of 
an electric utility expenses for pension and other post employment 
benefits as determined by actuarial or similar studies of such 
obligations, in an amount found reasonable by the regulatory 
authority.  With respect to all personnel who had been employed by 
the predecessor integrated electric utility prior to the utility's 
unbundling under Chapter 39 of this title, and irrespective of what 
business activity they performed or which affiliate they may have 
transferred to on or after unbundling, the portion of their pension 
and other post employment benefit expense that arises from their 
respective service with the predecessor integrated electric 
utility shall be included in rates.
	SECTION 2.  This Act takes effect immediately if it receives 
a vote of two-thirds of all the members elected to each house, as 
provided by Section 39, Article III, Texas Constitution.  If this 
Act does not receive the vote necessary for immediate effect, this 
Act takes effect September 1, 2005.