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H.B. 127
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5 AN ACT RELATING TO PUBLIC UTILITIES; PLACING CONDITIONS ON THE SITING OF
6 ELECTRICAL FACILITIES BY LOCAL GOVERNMENTS; REQUIRING LOCAL
7 GOVERNMENTS TO PAY FOR COSTS BEYOND STANDARD COSTS, INCLUDING
8 COSTS OF BURIED TRANSMISSION LINES, UNLESS THOSE COSTS ARE
9 COLLECTED FROM CONSUMERS PURSUANT TO AN ORDER OR RULE OF THE
10 PUBLIC SERVICE COMMISSION h OR ARE APPORTIONED TO THE UTILITY PURSUANT TO A
10a DECISION OF THE ELECTRICAL FACILITY REVIEW BOARD h ; CREATING THE ELECTRICAL
10b FACILITY REVIEW
11 BOARD TO RESOLVE CERTAIN DISPUTES REGARDING THE SITING OF
12 ELECTRICAL FACILITIES; GRANTING RULEMAKING POWER TO THE BOARD; AND
13 PROVIDING AN EFFECTIVE DATE.
14 This act affects sections of Utah Code Annotated 1953 as follows:
15 ENACTS:
16 54-14-101, Utah Code Annotated 1953
17 54-14-102, Utah Code Annotated 1953
18 54-14-103, Utah Code Annotated 1953
19 54-14-104, Utah Code Annotated 1953
20 54-14-201, Utah Code Annotated 1953
21 54-14-202, Utah Code Annotated 1953
22 54-14-203, Utah Code Annotated 1953
23 54-14-204, Utah Code Annotated 1953
24 54-14-301, Utah Code Annotated 1953
25 54-14-302, Utah Code Annotated 1953
26 54-14-303, Utah Code Annotated 1953
27 54-14-304, Utah Code Annotated 1953
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1 54-14-305, Utah Code Annotated 1953
2 54-14-306, Utah Code Annotated 1953
3 54-14-307, Utah Code Annotated 1953
4 54-14-308, Utah Code Annotated 1953
5 Be it enacted by the Legislature of the state of Utah:
6 Section 1. Section 54-14-101 is enacted to read:
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9 54-14-101. Short title.
10 This chapter is known as the "Electrical Facility Review Board Act."
11 Section 2. Section 54-14-102 is enacted to read:
12 54-14-102. Legislative findings.
13 (1) The Legislature finds that the construction of transmission lines and substations by
14 electrical corporations that are public utilities under this title is a matter of statewide concern. The
15 construction of these facilities may affect the safety, reliability, adequacy, and efficiency of service
16 to customers in areas within the jurisdiction of more than a single local government. Excess costs
17 imposed by requirements of a local government for the construction of facilities may affect either
18 the rates and charges of the public utility to customers other than customers within the jurisdiction
19 of the local government or the financial viability of the public utility, unless the local government
20 pays for those excess costs.
21 (2) The Legislature finds that it is in the public interest to establish the Electrical Facility
22 Review Board to resolve issues regarding the construction and installation of transmission lines
23 and substations by any electrical corporation that is a public utility.
24 Section 3. Section 54-14-103 is enacted to read:
25 54-14-103. Definitions.
26 As used in this chapter:
27 (1) "Actual excess cost" means the difference in cost between the standard cost of a facility
28 and the actual cost of the facility, including any necessary right-of-way, as determined in
29 accordance with Section 54-14-203.
30 (2) "Board" means the Electrical Facility Review Board.
31 (3) "Commencement of construction of a facility" includes the ordering of materials
1 necessary to construct the facility.
2 (4) "Estimated excess cost" means any material difference in estimated cost between the
3 costs of a facility, including any necessary right-of-way, if constructed in accordance with the
4 requirements of a local government and the standard cost of the facility.
5 (5) "Facility" means a transmission line or a substation.
6 (6) "Local government" means a city or town as defined in Section 10-1-104 or a county.
6a h IF A FACILITY IS PROPOSED TO BE LOCATED IN MORE THAN ONE LOCAL GOVERNMENT
6b JURISDICTION, "LOCAL GOVERNMENT" MAY REFER TO ONE OR MORE OF THE LOCAL
6c GOVERNMENTS IN WHOSE JURISDICTION THE FACILITY IS LOCATED. h
7 (7) "Pay" includes in reference to a local government paying the actual excess cost of a
8 facility, payment by:
9 (a) a special district created by the local government; or
10 (b) a private entity other than the public utility pursuant to a regulation or decision of the
11 local government.
12 (8) (a) "Standard cost" means the estimated cost of a facility, including any necessary
13 right-of-way, if constructed in accordance with:
14 (i) the public utility's normal practices; and
15 (ii) zoning, subdivision, and building code regulations of a local government, including
16 siting, setbacks, screening, and landscaping requirements:
17 (A) imposed on similar land uses in the same zone; and
18 (B) that do not impair the ability of the public utility to provide service to its customers
19 in a safe, reliable, adequate, and efficient manner.
20 (b) With respect to a transmission line, standard cost is the cost of any overhead line
21 constructed in accordance with the public utility's normal practices.
22 (9) (a) "Substation" means a separate space within which electric supply equipment is
23 located for the purpose of switching, regulating, transforming, or otherwise modifying the
24 characteristics of electricity, including:
25 (i) electrical equipment such as transformers, circuit breakers, voltage regulating
26 equipment, buses, switches, capacitor banks, reactors, protection and control equipment, and other
27 related equipment;
28 (ii) the site at which the equipment is located, any foundations, support structures,
29 buildings, or driveways necessary to locate, operate, and maintain the equipment at the site; and
30 (iii) the structure intended to restrict access to the equipment to qualified persons.
31 (b) "Substation" does not include a distribution pole-mounted or pad-mounted transformer
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1 that is used for the final transformation of power to the voltage level utilized by the customer.
2 (10) "Transmission line" means an electrical line, including structures, equipment, plant,
3 or fixtures associated with the electrical line, operated at a nominal voltage of 34,000 volts or
4 above.
5 Section 4. Section 54-14-104 is enacted to read:
6 54-14-104. Rules and procedures.
7 The board may, pursuant to Title 63, Chapter 46a, Utah Administrative Rulemaking Act,
8 adopt rules governing proceedings under this chapter consistent with this chapter and Title 63,
9 Chapter 46b, Administrative Procedures Act.
10 Section 5. Section 54-14-201 is enacted to read:
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12 54-14-201. Conditions on siting of facilities by local governments -- Payment of actual
13 excess costs.
14 h [
15 construction of a facility in any manner if:
16 h [
16a utility to provide
17 safe, reliable, and adequate service to its customers; and
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18a the requirements
19 or conditions, except h ; (a) [
19a customers
20 pursuant to an order, rule, or regulation of the commission[
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20b [ (b) ANY PORTION OF THE ACTUAL EXCESS COSTS THAT THE BOARD REQUIRES
20c TO BE BORNE BY THE PUBLIC UTILITY.
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20h h
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21 Section 6. Section 54-14-202 is enacted to read:
22 54-14-202. Public utility to provide standard cost and estimated excess cost.
23 If a local government is considering imposing requirements or conditions on construction
24 of a facility that may result in an estimated excess cost and requests the public utility to provide
25 the estimated excess cost, the public utility shall provide to the local government the standard cost
26 of the facility and the estimated excess cost of the facility if constructed in accordance with local
27 government requirements or conditions.
28 Section 7. Section 54-14-203 is enacted to read:
29 54-14-203. Actual excess cost.
30 (1) If a local government issues a permit, authorization, approval, exception, or waiver
31 based upon its agreement to pay for the actual excess cost of a facility, the local government shall
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1 within 30 days either accept the estimate of excess cost as the actual excess cost of a facility or
2 request the public utility to obtain competitive bids for the facility if constructed in accordance
3 with the requirements and conditions of the local government.
4 (2) If the local government requests the public utility to obtain competitive bids, the public
5 utility shall obtain competitive bids, and the actual excess cost of the facility shall be the difference
6 between the lowest bid acceptable to the public utility plus the public utility's contract
7 administration and oversight expense and the standard cost of the facility.
8 (3) Any dispute regarding specifications, lowest acceptable bid, or administration and
9 oversight expense shall be resolved by the board on an expedited basis.
10 Section 8. Section 54-14-204 is enacted to read:
11 54-14-204. Requirements or conditions on facility considered waived if local
12 government does not pay for actual excess cost 30 days before construction.
13 Any requirement or condition in any permit, authorization, approval, exception, or waiver
14 of a local government for a facility that imposes an actual excess cost shall be considered waived
15 if the local government does not pay the public utility for the actual excess cost, except any actual
16 excess costs h [
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17 of the commission
17a the date construction of the facility should commence
18 in order to avoid a significant risk of impairment of safe, reliable, and adequate service to
19 customers of the public utility.
20 Section 9. Section 54-14-301 is enacted to read:
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22 54-14-301. Creation, purpose, and composition of board.
23 (1) The Electrical Facility Review Board is created within the Department of Commerce
24 to resolve disputes between local governments and public utilities regarding the siting and
25 construction of electrical facilities as provided in this part.
26 (2) The board shall be composed of:
27 (a) the three members of the commission;
28 (b) an individual appointed by the governor from a list of nominees of the Utah League
29 of Cities and Towns; and
30 (c) an individual appointed by the governor from a list of nominees of the Utah
31 Association of Counties.
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1 (3) The chair of the commission shall serve as chair of the board.
2 (4) Members of the commission shall serve as members of the board during their terms
3 of office as commissioners and until their successors on the commission have been appointed and
4 taken office.
5 (5) (a) Members of the board who are not commissioners:
6 (i) shall have four-year terms, except the initial term of the individual first appointed by
7 the governor from nominees of the Utah Association of Counties shall be two years;
8 (ii) may be appointed for one succeeding term; and
9 (iii) may continue to serve until their successor takes office.
10 (b) Vacancies in the board of members who are not commissioners shall be filled for the
11 unexpired term.
12 (6) Three members of the board shall constitute a quorum.
13 (7) A member of the board may be removed for cause by the governor.
14 (8) (a) (i) Members who are not state or local government employees shall receive no
15 compensation or benefits for their services, but may receive per diem and expenses incurred in the
16 performance of the member's official duties at the rates established by the Division of Finance
17 under Sections 63A-3-106 and 63A-3-107.
18 (ii) Members may decline to receive per diem and expenses for their service.
19 (b) (i) State government officer and employee members who do not receive salary, per
20 diem, or expenses from their agency for their service may receive per diem and expenses incurred
21 in the performance of their official duties from the board at the rates established by the Division
22 of Finance under Sections 63A-3-106 and 63A-3-107.
23 (ii) State government officer and employee members may decline to receive per diem and
24 expenses for their service.
25 (c) (i) Local government members who do not receive salary, per diem, or expenses from
26 their employer for their service on the board may receive per diem and expenses incurred in the
27 performance of their official duties at the rates established by the Division of Finance under
28 Sections 63A-3-106 and 63A-3-107.
29 (ii) Local government members may decline to receive per diem and expenses for their
30 service.
31 Section 10. Section 54-14-302 is enacted to read:
1 54-14-302. Staff and support for board.
2 The Department of Commerce and the commission shall provide any staff, services, or
3 meeting rooms the board requires to perform its duties.
4 Section 11. Section 54-14-303 is enacted to read:
5 54-14-303. Actions or disputes for which board review may be sought.
6 A local government or public utility may seek review by the board, if:
7 (1) a local government has imposed requirements on the construction of a facility that
8 result in estimated excess costs without entering into an agreement with the public utility to pay
9 for the actual excess cost, except any actual excess costs h [
10 consumers pursuant to an order, rule, or regulation of the commission
10a SUBSECTION 54-14-201(2)(a) OR (2)(b) h , at least 30 days before the
11 date construction of the facility should commence in order to avoid significant risk of impairment
12 of safe, reliable, and adequate service to customers of the public utility;
13 (2) there is a dispute regarding:
14 (a) the estimated excess cost or standard cost of a facility;
15 (b) when construction of a facility should commence in order to avoid significant risk of
16 impairment of safe, reliable, and adequate service to customers of the public utility; or
17 (c) whether the public utility has sought a permit, authorization, approval, exception, or
18 waiver with respect to a facility sufficiently in advance of the date construction should commence,
19 based upon reasonably foreseeable conditions, to allow the local government reasonable time to
20 pay for any estimated excess cost;
21 (3) a local government has required construction of a facility in a manner that will not
22 permit the utility to provide service to its customers in a safe, reliable, adequate, or efficient
23 manner;
24 (4) a local government has prohibited construction of a facility which is needed to provide
25 safe, reliable, adequate, and efficient service to the customers of the public utility;
26 (5) a local government has not made a final decision on the public utility's application for
27 a permit, authorization, approval, exception, or waiver with respect to a facility within 120 days
28 of the date the public utility applied to the local government for the permit, authorization,
29 approval, exception, or waiver; h [
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30 (6) a facility is located or proposed to be located in more than one local government
31 jurisdiction and the decisions of the h [
31a facility are inconsistent h [
31b (7) A FACILITY IS PROPOSED TO BE LOCATED WITHIN A LOCAL GOVERNMENT JURISDICTION
31c TO SERVE CUSTOMERS EXCLUSIVELY OUTSIDE THE JURISDICTION OF THE LOCAL GOVERNMENT
31d AND THERE IS A DISPUTE REGARDING THE APPORTIONMENT OF THE ACTUAL EXCESS COST OF
31e THE FACILITY BETWEEN THE LOCAL GOVERNMENT AND THE PUBLIC UTILITY. h
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1 Section 12. Section 54-14-304 is enacted to read:
2 54-14-304. Initial hearing.
3 (1) The board shall convene an initial hearing within 40 days of the date review is
4 initiated.
5 (2) At the initial hearing, the board shall determine how the review will take place,
6 including whether it will be conducted as a formal or informal adjudicative proceeding.
7 Section 13. Section 54-14-305 is enacted to read:
8 54-14-305. Written decisions of board.
9 (1) The board shall issue a written decision on the review expeditiously and, in any event,
10 not later than 140 days following the initial hearing.
11 (2) The written decision shall:
12 (a) specify whether the facility should be constructed and, if so, whether any requirements
13 or conditions imposed by the local government may not be imposed because they impair the ability
14 of the public utility to provide safe, reliable, and adequate service to its customers; and
15 (b) resolve any dispute regarding:
16 (i) the standard cost or estimated excess cost of the facility;
17 (ii) the date on which construction of the facility should commence in order to avoid a
18 significant risk of impairment of safe, reliable, and adequate service to customers of the public
19 utility; h [
20 (iii) whether the public utility has sought a permit, authorization, approval, exception, or
21 waiver with respect to a facility sufficiently in advance of the date construction should commence,
22 based upon reasonably foreseeable conditions, to allow the local government reasonable time to
23 pay for any estimated excess cost h [
23a (iv) APPORTIONMENT OF THE ACTUAL EXCESS COST OF THE FACILITY BETWEEN THE
23b LOCAL GOVERNMENT AND THE PUBLIC UTILITY PURSUANT TO SUBSECTION 54-14-303(7).
24 (3) If the board determines that a facility that a local government has prohibited should be
25 constructed, the written decision shall specify any general location parameters required to provide
26 safe, reliable, adequate, and efficient service to the customers of the public utility.
27 (4) The written decision shall leave to the local government any issue that does not affect
28 the provision of safe, reliable, adequate, and efficient service to customers of the public utility or
29 that does not involve an estimated excess cost.
30 (5) With respect to local government requirements or conditions that impose an estimated
31 excess cost but do not impair the provision of safe, reliable, and adequate service to the customers
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1 of the public utility, the written decision shall leave each siting issue to the local government
2 except determination of the estimated excess cost and determination of when the construction of
3 the facility should commence.
4 (6) In determining when the construction of the facility should commence, the board shall
5 consider whether the public utility sought a permit, authorization, approval, exception, or waiver
6 from the local government in a timely manner based upon reasonably foreseeable conditions, and,
7 if the board determines that the public utility did not do so, it shall allow sufficient time for the
8 local government to pay any actual excess cost that may be imposed as a result of requirements
9 or conditions the local government has imposed that do not impair the provision of safe, reliable,
10 and adequate service to customers of the public utility.
11 Section 14. Section 54-14-306 is enacted to read:
12 54-14-306. Action required of local government following board decision.
13 (1) If the board decides that a facility permitted to be constructed by a local government
14 is subject to requirements or conditions that impose an estimated excess cost but do not impair the
15 provision of safe, reliable, and adequate service to customers of the public utility, the local
16 government shall, within 20 days following the decision of the board, determine whether it will
17 impose the requirement or conditions imposing an estimated excess cost or issue the permit,
18 authorization, approval, exception, or waiver without the requirements or conditions imposing an
19 estimated excess cost.
20 (2) If the board decides that a facility should be constructed that the local government has
21 prohibited, the local government shall, within 60 days following the decision of the board, issue
22 the permit, authorization, approval, exception, or waiver consistent with the decision of the board.
23 (3) The local government may impose requirements or conditions pursuant to its zoning,
24 subdivision, or building code regulations if:
25 (a) the requirements or conditions do not impair safe, reliable, and adequate service to the
26 customers of the utility; and
27 (b) the local government enters into an agreement with the public utility within the 20-day
28 time limit specified by Subsection (1) or the 60-day time limit specified by Subsection (2) to pay
29 for the actual excess cost to the public utility, except any actual excess costs h [
30 collects from customers pursuant to an order, rule, or regulation of the commission
30a IN SUBSECTION 54-14-201(2)(a) OR (2)(b) h , at least 30
31 days before the date construction of the facility should commence.
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1 Section 15. Section 54-14-307 is enacted to read:
2 54-14-307. Stay of board's decision pending review or appeal.
3 (1) A petition for review, rehearing, or reconsideration or a petition for judicial review
4 does not stay or suspend the effectiveness of a written decision of the board.
5 (2) Any party seeking to stay the effectiveness of a decision of the board shall seek a stay
6 under Section 63-46b-18.
7 Section 16. Section 54-14-308 is enacted to read:
8 54-14-308. Judicial review in formal adjudicative proceedings.
9 The Court of Appeals has jurisdiction to review any decision of the board in a formal
10 adjudicative proceeding.
11 Section 17. Effective date.
12 This act takes effect on July 1, 1997.
Legislative Review Note
as of 2-10-97 12:15 PM
This bill raises the following constitutional or statutory concerns:
Article VI, Section 28, of the Utah Constitution, prohibits the legislative delegation of certain
municipal functions to a special commission. To determine whether a particular activity is a
municipal function, the Utah Supreme Court has applied a three-prong balancing test consisting
of the following factors: (i) the degree to which the function in question "affects the interests of
those beyond the boundaries of the municipality"; (ii) the "relative abilities of the state and
municipal governments to perform the function"; and (iii) "the extent to which the legislation
under attack will intrude upon the ability of the people within the municipality to control through
their elected officials the substantive policies that affect them uniquely."
In this bill, the Electric Facility Review Board is created to resolve certain disputes between local
governments and electric utilities regarding the siting of transmission lines or substations. The
board is empowered to decide whether a transmission line or substation should be constructed and,
if so, whether any requirements or conditions imposed by the local government may not be
imposed because they impair the ability of the public utility to provide safe, reliable, and adequate
service to its customers. If the board determines that a transmission line or substation that a local
government has prohibited should be constructed, the board must specify any general location
parameters required to provide safe, reliable, adequate, and efficient service to the customers of
the public utility. The bill reserves all other siting issues to the local government and allows a
local government to require or condition approval of a facility in a manner that imposes excess
costs so long as the local government pays the excess costs.
In recent years the courts have given much deference to the state in this area of legislation and in
the majority of such cases have determined that there is no violation of the Constitution.
However, aside from the balancing test, the courts have not established clear guidelines as to what
constitutes a "special commission" or what activities constitute "municipal functions" in every
situation. Therefore the determination of the constitutionality of this provision would be very fact
specific and would depend on the individual facts of each case.
Office of Legislative Research and General Counsel
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