Bill Text: TX SB403 | 2011-2012 | 82nd Legislature | Comm Sub
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Relating to the consideration of pension and other postemployment benefits in establishing the rates of a gas utility.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Passed) 2011-05-28 - Effective immediately [SB403 Detail]
Download: Texas-2011-SB403-Comm_Sub.html
Bill Title: Relating to the consideration of pension and other postemployment benefits in establishing the rates of a gas utility.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Passed) 2011-05-28 - Effective immediately [SB403 Detail]
Download: Texas-2011-SB403-Comm_Sub.html
By: Eltife | S.B. No. 403 | |
(In the Senate - Filed January 24, 2011; February 2, 2011, | ||
read first time and referred to Committee on Natural Resources; | ||
March 28, 2011, reported adversely, with favorable Committee | ||
Substitute by the following vote: Yeas 9, Nays 0; March 28, 2011, | ||
sent to printer.) | ||
COMMITTEE SUBSTITUTE FOR S.B. No. 403 | By: Eltife |
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relating to the consideration of pension and other postemployment | ||
benefits in establishing the rates of a gas utility. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Subchapter B, Chapter 104, Utilities Code, is | ||
amended by adding Section 104.059 to read as follows: | ||
Sec. 104.059. PENSION AND OTHER POSTEMPLOYMENT BENEFITS. | ||
(a) In establishing a gas utility's rates, the regulatory | ||
authority shall allow recovery of the gas utility's costs of | ||
pensions and other postemployment benefits, as determined by | ||
actuarial or other similar studies in accordance with generally | ||
accepted accounting principles, in amounts the regulatory | ||
authority finds reasonable and necessary. | ||
(b) If a gas utility establishes one or more reserve | ||
accounts for the purpose of tracking changes in the costs of | ||
pensions and other postemployment benefits, the gas utility shall | ||
periodically record in a reserve account any difference between: | ||
(1) the annual amount of pension and other | ||
postemployment benefits approved and included in the gas utility's | ||
then current rates or, if that annual amount cannot be determined | ||
from the regulatory authority's order, the amount recorded for | ||
pension and other postemployment benefits under generally accepted | ||
accounting principles during the first year that rates from the gas | ||
utility's last general rate proceeding were in effect; and | ||
(2) the annual amount of costs of pensions and other | ||
postemployment benefits as determined by actuarial or other similar | ||
studies that would otherwise be recorded by the gas utility were | ||
this provision not applicable. | ||
(c) The gas utility must: | ||
(1) establish separate reserve accounts for pensions | ||
and for other postemployment benefits; and | ||
(2) apply the same methodology to allocate pension and | ||
other postemployment benefits between capital and expense as in the | ||
gas utility's last rate case. | ||
(d) A surplus in a reserve account exists if the amount of | ||
pension and other postemployment benefits under Subsection (b)(1) | ||
is greater than the amount determined under Subsection (b)(2). A | ||
shortage in a reserve account exists if the amount of pension and | ||
other postemployment benefits under Subsection (b)(1) is less than | ||
the amount determined under Subsection (b)(2). | ||
(e) If the gas utility establishes reserve accounts for the | ||
costs of pensions and other postemployment benefits, the regulatory | ||
authority at a subsequent general rate proceeding shall: | ||
(1) review the amounts recorded to each reserve | ||
account to determine whether the amounts are reasonable and | ||
necessary; | ||
(2) determine in accordance with Subsection (d) | ||
whether each reserve account has a surplus or shortage; and | ||
(3) subtract any surplus from or add any shortage to | ||
the gas utility's rate base, with the surplus or shortage amortized | ||
over a reasonable time. | ||
SECTION 2. Subsections (b) through (e), Section 104.059, | ||
Utilities Code, as added by this Act, apply only in relation to a | ||
reserve account established by a gas utility on or after January 1, | ||
2012. | ||
SECTION 3. 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, 2011. | ||
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