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90_HB2650eng
220 ILCS 5/16-111
Amends the Public Utilities Act. Makes a technical
change in a Section relating to rates during the mandatory
transition period.
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1 AN ACT to amend the Public Utilities Act by changing
2 Section 16-111.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Public Utilities Act is amended by
6 changing Section 16-111 as follows:
7 (220 ILCS 5/16-111)
8 Sec. 16-111. Rates and restructuring transactions during
9 mandatory transition period.
10 (a) During the mandatory transition period,
11 notwithstanding any provision of Article IX of this Act, and
12 except as provided in subsections (b), (d), (e), and (f) of
13 this Section, the Commission shall not (i) initiate,
14 authorize or order any change by way of increase (other than
15 in connection with a request for rate increase that which was
16 filed after September 1, 1997 but before prior to October 15,
17 1997, by an electric utility serving less than 12,500
18 customers in this state), (ii) initiate or, unless requested
19 by the electric utility, authorize or order any change by way
20 of decrease, restructuring or unbundling (except as provided
21 in Section 16-109A), in the rates of any electric utility
22 that were in effect on October 1, 1996, or (iii) in any order
23 approving any application for a merger pursuant to Section
24 7-204 that was pending as of May 16, 1997, impose any
25 condition requiring any filing for an increase, decrease, or
26 change in, or other review of, an electric utility's rates or
27 enforce any such condition of any such order; provided,
28 however, that this subsection shall not prohibit the
29 Commission from:
30 (1) approving the application of an electric
31 utility to implement an alternative to rate of return
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1 regulation or a regulatory mechanism that rewards or
2 penalizes the electric utility through adjustment of
3 rates based on utility performance, pursuant to Section
4 9-244;
5 (2) authorizing an electric utility to eliminate
6 its fuel adjustment clause and adjust its base rate
7 tariffs in accordance with subsection (b), (d), or (f) of
8 Section 9-220 of this Act, to fix its fuel adjustment
9 factor in accordance with subsection (c) of Section 9-220
10 of this Act, or to eliminate its fuel adjustment clause
11 in accordance with subsection (e) of Section 9-220 of
12 this Act;
13 (3) ordering into effect tariffs for delivery
14 services and transition charges in accordance with
15 Sections 16-104 and 16-108, for real-time pricing in
16 accordance with Section 16-107, or the options required
17 by Section 16-110 and subsection (n) of 16-112, allowing
18 a billing experiment in accordance with Section 16-106,
19 or modifying delivery services tariffs in accordance with
20 Section 16-109; or
21 (4) ordering or allowing into effect any tariff to
22 recover charges pursuant to Sections 9-201.5, 9-220.1,
23 9-221, 9-222 (except as provided in Section 9-222.1),
24 16-108, and 16-114 of this Act, Section 5-5 of the
25 Electricity Infrastructure Maintenance Fee Law, Section
26 6-5 of the Renewable Energy, Energy Efficiency, and Coal
27 Resources Development Law of 1997, and Section 13 of the
28 Energy Assistance Act of 1989.
29 (b) Notwithstanding the provisions of subsection (a),
30 each Illinois electric utility serving more than 12,500
31 customers in Illinois shall file tariffs (i) reducing,
32 effective August 1, 1998, each component of its base rates to
33 residential retail customers by 15% from the base rates in
34 effect immediately prior to January 1, 1998 and (ii) if the
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1 public utility provides electric service to more than 500,000
2 customers in this State on the effective date of this
3 amendatory Act of 1997, reducing, effective May 1, 2002, each
4 component of its base rates to residential retail customers
5 by an additional 5% from the base rates in effect immediately
6 prior to January 1, 1998. Provided, however, that (A) if an
7 electric utility's average residential retail rate is less
8 than or equal to the average residential retail rate for a
9 group of Midwest Utilities (consisting of all investor-owned
10 electric utilities with annual system peaks in excess of 1000
11 megawatts in the States of Illinois, Indiana, Iowa, Kentucky,
12 Michigan, Missouri, Ohio, and Wisconsin), based on data
13 reported on Form 1 to the Federal Energy Regulatory
14 Commission for calendar year 1995, then it shall only be
15 required to file tariffs (i) reducing, effective August 1,
16 1998, each component of its base rates to residential retail
17 customers by 5% from the base rates in effect immediately
18 prior to January 1, 1998, (ii) reducing, effective October 1,
19 2000, each component of its base rates to residential retail
20 customers by the lesser of 5% of the base rates in effect
21 immediately prior to January 1, 1998 or the percentage by
22 which the electric utility's average residential retail rate
23 exceeds the average residential retail rate of the Midwest
24 Utilities, based on data reported on Form 1 to the Federal
25 Energy Regulatory Commission for calendar year 1999, and
26 (iii) reducing, effective October 1, 2002, each component of
27 its base rates to residential retail customers by an
28 additional amount equal to the lesser of 5% of the base rates
29 in effect immediately prior to January 1, 1998 or the
30 percentage by which the electric utility's average
31 residential retail rate exceeds the average residential
32 retail rate of the Midwest Utilities, based on data reported
33 on Form 1 to the Federal Energy Regulatory Commission for
34 calendar year 2001; and (B) if the average residential retail
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1 rate of an electric utility serving between 150,000 and
2 250,000 retail customers in this State on January 1, 1995 is
3 less than or equal to 90% of the average residential retail
4 rate for the Midwest Utilities, based on data reported on
5 Form 1 to the Federal Energy Regulatory Commission for
6 calendar year 1995, then it shall only be required to file
7 tariffs (i) reducing, effective August 1, 1998, each
8 component of its base rates to residential retail customers
9 by 2% from the base rates in effect immediately prior to
10 January 1, 1998; (ii) reducing, effective October 1, 2000,
11 each component of its base rates to residential retail
12 customers by 2% from the base rate in effect immediately
13 prior to January 1, 1998; and (iii) reducing, effective
14 October 1, 2002, each component of its base rates to
15 residential retail customers by 1% from the base rates in
16 effect immediately prior to January 1, 1998. Provided,
17 further, that any electric utility for which a decrease in
18 base rates has been or is placed into effect between October
19 1, 1996 and the dates specified in the preceding sentences of
20 this subsection, other than pursuant to the requirements of
21 this subsection, shall be entitled to reduce the amount of
22 any reduction or reductions in its base rates required by
23 this subsection by the amount of such other decrease. The
24 tariffs required under this subsection shall be filed 45 days
25 in advance of the effective date. Notwithstanding anything to
26 the contrary in Section 9-220 of this Act, no restatement of
27 base rates in conjunction with the elimination of a fuel
28 adjustment clause under that Section shall result in a lesser
29 decrease in base rates than customers would otherwise receive
30 under this subsection had the electric utility's fuel
31 adjustment clause not been eliminated.
32 (c) Any utility reducing its base rates by 15% on August
33 1, 1998 pursuant to subsection (b) shall include the
34 following statement on its bills for residential customers
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1 from August 1 through December 31, 1998: "Effective August 1,
2 1998, your rates have been reduced by 15% by the Electric
3 Service Customer Choice and Rate Relief Law of 1997 passed by
4 the Illinois General Assembly.". Any utility reducing its
5 base rates by 5% on August 1, 1998, pursuant to subsection
6 (b) shall include the following statement on its bills for
7 residential customers from August 1 through December 31,
8 1998: "Effective August 1, 1998, your rates have been
9 reduced by 5% by the Electric Service Customer Choice and
10 Rate Relief Law of 1997 passed by the Illinois General
11 Assembly.".
12 Any utility reducing its base rates by 2% on August 1,
13 1998 pursuant to subsection (b) shall include the following
14 statement on its bills for residential customers from August
15 1 through December 31, 1998: "Effective August 1, 1998, your
16 rates have been reduced by 2% by the Electric Service
17 Customer Choice and Rate Relief Law of 1997 passed by the
18 Illinois General Assembly.".
19 (d) During the mandatory transition period, but not
20 before January 1, 2000, and notwithstanding the provisions
21 of subsection (a), an electric utility may request an
22 increase in its base rates if the electric utility
23 demonstrates that the 2-year average of its earned rate of
24 return on common equity, calculated as its net income
25 applicable to common stock divided by the average of its
26 beginning and ending balances of common equity using data
27 reported in the electric utility's Form 1 report to the
28 Federal Energy Regulatory Commission but adjusted to remove
29 the effects of accelerated depreciation or amortization or
30 other transition or mitigation measures implemented by the
31 electric utility pursuant to subsection (g) of this Section
32 and the effect of any refund paid pursuant to subsection (e)
33 of this Section, is below the 2-year average for the same 2
34 years of the monthly average yields of 30-year U.S. Treasury
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1 bonds published by the Board of Governors of the Federal
2 Reserve System in its weekly H.15 Statistical Release or
3 successor publication. The Commission shall review the
4 electric utility's request, and may review the justness and
5 reasonableness of all rates for tariffed services, in
6 accordance with the provisions of Article IX of this Act,
7 provided that the Commission shall consider any special or
8 negotiated adjustments to the revenue requirement agreed to
9 between the electric utility and the other parties to the
10 proceeding. In setting rates under this Section, the
11 Commission shall exclude the costs and revenues that are
12 associated with competitive services and any billing or
13 pricing experiments conducted under Section 16-106.
14 (e) For the purposes of this subsection (e) all
15 calculations and comparisons shall be performed for the
16 Illinois operations of multijurisdictional utilities. During
17 the mandatory transition period, notwithstanding the
18 provisions of subsection (a), if the 2-year average of an
19 electric utility's earned rate of return on common equity,
20 calculated as its net income applicable to common stock
21 divided by the average of its beginning and ending balances
22 of common equity using data reported in the electric
23 utility's Form 1 report to the Federal Energy Regulatory
24 Commission but adjusted to remove the effect of any refund
25 paid under this subsection (e), and further adjusted to
26 include the annual amortization of any difference between the
27 consideration received by an affiliated interest of the
28 electric utility in the sale of an asset which had been sold
29 or transferred by the electric utility to the affiliated
30 interest subsequent to the effective date of this amendatory
31 Act of 1997 and the consideration for which such asset had
32 been sold or transferred to the affiliated interest, with
33 such difference to be amortized ratably from the date of the
34 sale by the affiliated interest to December 31, 2006, exceeds
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1 the 2-year average of the Index for the same 2 years by 1.5
2 or more percentage points, the electric utility shall make
3 refunds to customers beginning the first billing day of April
4 in the following year in the manner described in paragraph
5 (3) of this subsection. For purposes of this subsection (e),
6 the "Index" shall be the sum of (A) the average for the 12
7 months ended September 30 of the monthly average yields of
8 30-year U.S. Treasury bonds published by the Board of
9 Governors of the Federal Reserve System in its weekly H.15
10 Statistical Release or successor publication for each year
11 1998 through 2004, and (B) (i) 4.00 percentage points for
12 each of the 12-month periods ending September 30, 1998
13 through September 30, 1999 or 8.00 percentage points if the
14 electric utility's average residential retail rate is less
15 than or equal to 90% of the average residential retail rate
16 for the "Midwest Utilities", as that term is defined in
17 subsection (b) of this Section, based on data reported on
18 Form 1 to the Federal Energy Regulatory Commission for
19 calendar year 1995, and the electric utility served between
20 150,000 and 250,000 retail customers on January 1, 1995, or
21 (ii) 5.00 percentage points for each of the 12-month periods
22 ending September 30, 2000 through September 30, 2004 or 9.00
23 percentage points if the electric utility's average
24 residential retail rate is less than or equal to 90% of the
25 average residential retail rate for the "Midwest Utilities",
26 as that term is defined in subsection (b) of this Section,
27 based on data reported on Form 1 to the Federal Energy
28 Regulatory Commission for calendar year 1995 and the electric
29 utility served between 150,000 and 250,000 retail customers
30 in this State on January 1, 1995.
31 (1) For purposes of this subsection (e), "excess
32 earnings" means the difference between (A) the 2-year
33 average of the electric utility's earned rate of return
34 on common equity, less (B) the 2-year average of the sum
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1 of (i) the Index applicable to each of the 2 years and
2 (ii) 1.5 percentage points; provided, that "excess
3 earnings" shall never be less than zero.
4 (2) On or before March 31 of each year 2000 through
5 2005 each electric utility shall file a report with the
6 Commission showing its earned rate of return on common
7 equity, calculated in accordance with this subsection,
8 for the preceding calendar year and the average for the
9 preceding 2 calendar years.
10 (3) If an electric utility has excess earnings,
11 determined in accordance with paragraphs (1) and (2) of
12 this subsection, the refunds which the electric utility
13 shall pay to its customers beginning the first billing
14 day of April in the following year shall be calculated
15 and applied as follows:
16 (i) The electric utility's excess earnings
17 shall be multiplied by the average of the beginning
18 and ending balances of the electric utility's common
19 equity for the 2-year period in which excess
20 earnings occurred.
21 (ii) The result of the calculation in (i)
22 shall be multiplied by 0.50 and then divided by a
23 number equal to 1 minus the electric utility's
24 composite federal and State income tax rate.
25 (iii) The result of the calculation in (ii)
26 shall be divided by the sum of the electric
27 utility's projected total kilowatt-hour sales to
28 retail customers plus projected kilowatt-hours to be
29 delivered to delivery services customers over a one
30 year period beginning with the first billing date in
31 April in the succeeding year to determine a cents
32 per kilowatt-hour refund factor.
33 (iv) The cents per kilowatt-hour refund factor
34 calculated in (iii) shall be credited to the
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1 electric utility's customers by applying the factor
2 on the customer's monthly bills to each
3 kilowatt-hour sold or delivered until the total
4 amount calculated in (ii) has been paid to
5 customers.
6 (f) During the mandatory transition period, an electric
7 utility may file revised tariffs reducing the price of any
8 tariffed service offered by the electric utility for all
9 customers taking that tariffed service, which shall be
10 effective 7 days after filing.
11 (g) During the mandatory transition period, an electric
12 utility may, without obtaining any approval of the Commission
13 other than that provided for in this subsection and
14 notwithstanding any other provision of this Act or any rule
15 or regulation of the Commission that would require such
16 approval:
17 (1) implement a reorganization, other than a merger
18 of 2 or more public utilities as defined in Section 3-105
19 or their holding companies;
20 (2) retire generating plants from service;
21 (3) sell, assign, lease or otherwise transfer
22 assets to an affiliated or unaffiliated entity and as
23 part of such transaction enter into service agreements,
24 power purchase agreements, or other agreements with the
25 transferee; provided, however, that the prices, terms and
26 conditions of any power purchase agreement must be
27 approved or allowed into effect by the Federal Energy
28 Regulatory Commission; or
29 (4) use any accelerated cost recovery method
30 including accelerated depreciation, accelerated
31 amortization or other capital recovery methods, or record
32 reductions to the original cost of its assets.
33 In order to implement a reorganization, retire generating
34 plants from service, or sell, assign, lease or otherwise
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1 transfer assets pursuant to this Section, the electric
2 utility shall comply with subsections (c) and (d) of Section
3 16-128, if applicable, and provide the Commission with at
4 least 30 days notice of the proposed reorganization or
5 transaction, which notice shall include the following
6 information:
7 (i) a complete statement of the entries that
8 the electric utility will make on its books and
9 records of account to implement the proposed
10 reorganization or transaction together with a
11 certification from an independent certified public
12 accountant that such entries are in accord with
13 generally accepted accounting principles and, if the
14 Commission has previously approved guidelines for
15 cost allocations between the utility and its
16 affiliates, a certification from the chief
17 accounting officer of the utility that such entries
18 are in accord with those cost allocation guidelines;
19 (ii) a description of how the electric utility
20 will use proceeds of any sale, assignment, lease or
21 transfer to retire debt or otherwise reduce or
22 recover the costs of services provided by such
23 electric utility;
24 (iii) a list of all federal approvals or
25 approvals required from departments and agencies of
26 this State, other than the Commission, that the
27 electric utility has or will obtain before
28 implementing the reorganization or transaction;
29 (iv) an irrevocable commitment by the electric
30 utility that it will not, as a result of the
31 transaction, impose any stranded cost charges that
32 it might otherwise be allowed to charge retail
33 customers under federal law or increase the
34 transition charges that it is otherwise entitled to
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1 collect under this Article XVI; and
2 (v) if the electric utility proposes to sell,
3 assign, lease or otherwise transfer a generating
4 plant that brings the amount of net dependable
5 generating capacity transferred pursuant to this
6 subsection to an amount equal to or greater than 15%
7 of the electric utility's net dependable capacity as
8 of the effective date of this amendatory Act of
9 1997, and enters into a power purchase agreement
10 with the entity to which such generating plant is
11 sold, assigned, leased, or otherwise transferred,
12 the electric utility also agrees, if its fuel
13 adjustment clause has not already been eliminated,
14 to eliminate its fuel adjustment clause in
15 accordance with subsection (b) of Section 9-220 for
16 a period of time equal to the length of any such
17 power purchase agreement or successor agreement, or
18 until January 1, 2005, whichever is longer; if the
19 capacity of the generating plant so transferred and
20 related power purchase agreement does not result in
21 the elimination of the fuel adjustment clause under
22 this subsection, and the fuel adjustment clause has
23 not already been eliminated, the electric utility
24 shall agree that the costs associated with the
25 transferred plant that are included in the
26 calculation of the rate per kilowatt-hour to be
27 applied pursuant to the electric utility's fuel
28 adjustment clause during such period shall not
29 exceed the per kilowatt-hour cost associated with
30 such generating plant included in the electric
31 utility's fuel adjustment clause during the full
32 calendar year preceding the transfer, with such
33 limit to be adjusted each year thereafter by the
34 Gross Domestic Product Implicit Price Deflator.
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1 (vi) In addition, if the electric utility
2 proposes to sell, assign, or lease, (A) either (1)
3 an amount of generating plant that brings the amount
4 of net dependable generating capacity transferred
5 pursuant to this subsection to an amount equal to or
6 greater than 15% of its net dependable capacity on
7 the effective date of this amendatory Act of 1997,
8 or (2) one or more generating plants with a total
9 net dependable capacity of 1100 megawatts, or (B)
10 transmission and distribution facilities that either
11 (1) bring the amount of transmission and
12 distribution facilities transferred pursuant to this
13 subsection to an amount equal to or greater than 15%
14 of the electric utility's total depreciated original
15 cost investment in such facilities, or (2) represent
16 an investment of $25,000,000 in terms of total
17 depreciated original cost, the electric utility
18 shall provide, in addition to the information listed
19 in subparagraphs (i) through (v), the following
20 information: (A) a description of how the electric
21 utility will meet its service obligations under this
22 Act in a safe and reliable manner and (B) the
23 electric utility's projected earned rate of return
24 on common equity, calculated in accordance with
25 subsection (d) of this Section, for each year from
26 the date of the notice through December 31, 2004
27 both with and without the proposed transaction. If
28 the Commission has not issued an order initiating a
29 hearing on the proposed transaction within 30 days
30 after the date the electric utility's notice is
31 filed, the transaction shall be deemed approved.
32 The Commission may, after notice and hearing,
33 prohibit the proposed transaction if it makes either
34 or both of the following findings: (1) that the
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1 proposed transaction will render the electric
2 utility unable to provide its tariffed services in a
3 safe and reliable manner, or (2) that there is a
4 strong likelihood that consummation of the proposed
5 transaction will result in the electric utility
6 being entitled to request an increase in its base
7 rates during the mandatory transition period
8 pursuant to subsection (d) of this Section. Any
9 hearing initiated by the Commission into the
10 proposed transaction shall be completed, and the
11 Commission's final order approving or prohibiting
12 the proposed transaction shall be entered, within 90
13 days after the date the electric utility's notice
14 was filed. Provided, however, that a sale,
15 assignment, or lease of transmission facilities to
16 an independent system operator that meets the
17 requirements of Section 16-126 shall not be subject
18 to Commission approval under this Section.
19 In any proceeding conducted by the Commission
20 pursuant to this subparagraph (vi), intervention
21 shall be limited to parties with a direct interest
22 in the transaction which is the subject of the
23 hearing and any statutory consumer protection agency
24 as defined in subsection (d) of Section 9-102.1.
25 Notwithstanding the provisions of Section 10-113 of
26 this Act, any application seeking rehearing of an
27 order issued under this subparagraph (vi), whether
28 filed by the electric utility or by an intervening
29 party, shall be filed within 10 days after service
30 of the order.
31 The Commission shall not in any subsequent proceeding or
32 otherwise, review such a reorganization or other transaction
33 authorized by this Section, but shall retain the authority to
34 allocate costs as stated in Section 16-111(i). An entity to
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1 which an electric utility sells, assigns, leases or transfers
2 assets pursuant to this subsection (g) shall not, as a result
3 of the transactions specified in this subsection (g), be
4 deemed a public utility as defined in Section 3-105. Nothing
5 in this subsection (g) shall change any requirement under the
6 jurisdiction of the Illinois Department of Nuclear Safety
7 including, but not limited to, the payment of fees. Nothing
8 in this subsection (g) shall exempt a utility from obtaining
9 a certificate pursuant to Section 8-406 of this Act for the
10 construction of a new electric generating facility. Nothing
11 in this subsection (g) is intended to exempt the transactions
12 hereunder from the operation of the federal or State
13 antitrust laws. Nothing in this subsection (g) shall require
14 an electric utility to use the procedures specified in this
15 subsection for any of the transactions specified herein. Any
16 other procedure available under this Act may, at the electric
17 utility's election, be used for any such transaction.
18 (h) During the mandatory transition period, the
19 Commission shall not establish or use any rates of
20 depreciation, which for purposes of this subsection shall
21 include amortization, for any electric utility other than
22 those established pursuant to subsection (c) of Section 5-104
23 of this Act or utilized pursuant to subsection (g) of this
24 Section. Provided, however, that in any proceeding to review
25 an electric utility's rates for tariffed services pursuant to
26 Section 9-201, 9-202, 9-250 or 16-111(d) of this Act, the
27 Commission may establish new rates of depreciation for the
28 electric utility in the same manner provided in subsection
29 (d) of Section 5-104 of this Act. An electric utility
30 implementing an accelerated cost recovery method including
31 accelerated depreciation, accelerated amortization or other
32 capital recovery methods, or recording reductions to the
33 original cost of its assets, pursuant to subsection (g) of
34 this Section, shall file a statement with the Commission
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1 describing the accelerated cost recovery method to be
2 implemented or the reduction in the original cost of its
3 assets to be recorded. Upon the filing of such statement,
4 the accelerated cost recovery method or the reduction in the
5 original cost of assets shall be deemed to be approved by the
6 Commission as though an order had been entered by the
7 Commission.
8 (i) Subsequent to the mandatory transition period, the
9 Commission, in any proceeding to establish rates and charges
10 for tariffed services offered by an electric utility, shall
11 consider only (1) the then current or projected revenues,
12 costs, investments and cost of capital directly or indirectly
13 associated with the provision of such tariffed services; (2)
14 collection of transition charges in accordance with Sections
15 16-102 and 16-108 of this Act; (3) recovery of any employee
16 transition costs as described in Section 16-128 which the
17 electric utility is continuing to incur, including recovery
18 of any unamortized portion of such costs previously incurred
19 or committed, with such costs to be equitably allocated among
20 bundled services, delivery services, and contracts with
21 alternative retail electric suppliers; and (4) recovery of
22 the costs associated with the electric utility's compliance
23 with decommissioning funding requirements; and shall not
24 consider any other revenues, costs, investments or cost of
25 capital of either the electric utility or of any affiliate of
26 the electric utility that are not associated with the
27 provision of tariffed services. In setting rates for
28 tariffed services, the Commission shall equitably allocate
29 joint and common costs and investments between the electric
30 utility's competitive and tariffed services. In determining
31 the justness and reasonableness of the electric power and
32 energy component of an electric utility's rates for tariffed
33 services subsequent to the mandatory transition period and
34 prior to the time that the provision of such electric power
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1 and energy is declared competitive, the Commission shall
2 consider the extent to which the electric utility's tariffed
3 rates for such component for each customer class exceed the
4 market value determined pursuant to Section 16-112, and, if
5 the electric power and energy component of such tariffed rate
6 exceeds the market value by more than 10% for any customer
7 class, may establish such electric power and energy component
8 at a rate equal to the market value plus 10%. In any such
9 case, the Commission may also elect to extend the provisions
10 of Section 16-111(e) for any period in which the electric
11 utility is collecting transition charges, using information
12 applicable to such period.
13 (j) During the mandatory transition period, an electric
14 utility may elect to transfer to a non-operating income
15 account under the Commission's Uniform System of Accounts
16 either or both of (i) an amount of unamortized investment tax
17 credit that is in addition to the ratable amount which is
18 credited to the electric utility's operating income account
19 for the year in accordance with Section 46(f)(2) of the
20 federal Internal Revenue Code of 1986, as in effect prior to
21 P.L. 101-508, or (ii) "excess tax reserves", as that term is
22 defined in Section 203(e)(2)(A) of the federal Tax Reform Act
23 of 1986, provided that (A) the amount transferred may not
24 exceed the amount of the electric utility's assets that were
25 created pursuant to Statement of Financial Accounting
26 Standards No. 71 which the electric utility has written off
27 during the mandatory transition period, and (B) the transfer
28 shall not be effective until approved by the Internal Revenue
29 Service. An electric utility electing to make such a
30 transfer shall file a statement with the Commission stating
31 the amount and timing of the transfer for which it intends to
32 request approval of the Internal Revenue Service, along with
33 a copy of its proposed request to the Internal Revenue
34 Service for a ruling. The Commission shall issue an order
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1 within 14 days after the electric utility's filing approving,
2 subject to receipt of approval from the Internal Revenue
3 Service, the proposed transfer.
4 (Source: P.A. 90-561, eff. 12-16-97; 90-563, eff. 12-16-97.)