Amendment AA10-AB389

LRBa0521/2

MDK:wlj:km

1999 - 2000 LEGISLATURE

ASSEMBLY AMENDMENT 10, TO 1999 ASSEMBLY BILL 389

June 23, 1999 - Offered by Representatives Seratti and Freese.

AB389-AA10,1,1 At the locations indicated, amend the bill as follows:

AB389-AA10,1,4 1. Page 3, line 1: after "cooperatives," insert "separation between certain public utilities and affiliated interests, nonutility activities by public utilities and public utility affiliates, subsidies between utility and nonutility affiliates,".

AB389-AA10,1,5 2. Page 27, line 5: after that line insert:

AB389-AA10,1,6 " Section 21m. 196.035 of the statutes is created to read:

AB389-AA10,1,8 196.035 Nonutility activities and services; relationship with affiliated interests. (1) Definitions. In this section:

AB389-AA10,1,13 (a) "Affiliated interest" means a person that is engaged in the performance of plumbing, electrical, heating, ventilating, air conditioning or sheet metalworking contracting services or in an activity related to the sale, lease or service of appliances in this state and that, with respect to a public utility or out-of-state utility, is any of the following:

AB389-AA10,2,2 1. A person owning or holding directly or indirectly 5% or more of the voting securities of the public utility or out-of-state utility.

AB389-AA10,2,4 2. A person in any chain of successive ownership of 5% or more of voting securities of the public utility or out-of-state utility.

AB389-AA10,2,8 3. A corporation 5% or more of whose voting securities is owned by any person owning 5% or more of the voting securities of the public utility or out-of-state utility or by any person in any chain of successive ownership of 5% or more of voting securities of the public utility or out-of-state utility.

AB389-AA10,2,16 4. A corporation operating the public utility or out-of-state utility or a servicing organization for furnishing supervisory, construction, engineering, accounting, legal and similar services to the public utility or out-of-state utility, has one or more officers or one or more directors in common with the public utility or out-of-state utility, and any other corporation that has directors in common with the public utility or out-of-state utility if the number of such directors of the corporation is more than one-third of the total number of the public utility's or out-of-state utility's directors.

AB389-AA10,2,21 5. A person that the commission determines as a matter of fact after investigation and hearing to be actually exercising any substantial influence over the policies and actions of the public utility or out-of-state utility even if the influence is not based upon stockholding, stockholders, directors or officers as specified under subds 1. to 4.

AB389-AA10,3,3 6. A person that the commission determines as a matter of fact after investigation and hearing to be actually exercising substantial influence over the policies and actions of the public utility or out-of-state utility in conjunction with one or more other persons that are related by ownership or blood relationship or by action in concert and that together are affiliated with the public utility or out-of-state utility, even though no one of them alone is so affiliated under subds. 1. to 5.

AB389-AA10,3,5 7. A person 5% or more of the securities of which are directly or indirectly owned by the public utility or out-of-state utility.

AB389-AA10,3,6 (b) "Appliance" has the meaning given in s. 196.795 (1) (b).

AB389-AA10,3,9 (bg) "Cooperative association" means a cooperative association organized under ch. 185 for the purpose of producing, transmitting, delivering or furnishing heat, light, power, natural gas or water to its members only.

AB389-AA10,3,10 (bh) "Holding company system" has the meaning given in s. 196.795 (1) (i).

AB389-AA10,3,11 (bL) "Municipal electric company" has the meaning given in s. 66.073 (3) (d).

AB389-AA10,3,12 (bm) "Municipality" means a city, village or town.

AB389-AA10,3,13 (bp) "Nonutility affiliate" has the meaning given in s. 196.795 (1) (j).

AB389-AA10,3,15 (br) 1. "Out-of-state utility" means a person that is not a public utility and that is any of the following:

AB389-AA10,3,18 a. A person that is engaged in the production, transmission, delivery or furnishing of heat, light, power or natural gas either directly or indirectly to or for the use of the public in another state.

AB389-AA10,3,20 b. A lessee, trustee or court-appointed receiver of a person specified in subd. 1. a.

AB389-AA10,3,24 c. A person that, in any chain of successive ownership, directly or indirectly as a beneficial owner, owns, controls or holds 5% or more of the outstanding voting securities or other voting interest of a person specified in subd. 1. a., with the unconditional power to vote the securities or interest.

AB389-AA10,4,3 2. "Out-of-state utility" does not include a person specified in subd. 1. a. that is, or is owned or wholly operated by, a municipal electric company, municipality or cooperative association.

AB389-AA10,4,4 (c) 1. "Public utility" means any of the following:

AB389-AA10,4,7 a. A person that is engaged in the production, transmission, delivery or furnishing of heat, light, power or natural gas either directly or indirectly to or for the use of the public in this state.

AB389-AA10,4,9 b. A lessee, trustee or court-appointed receiver of a person specified in subd. 1. a.

AB389-AA10,4,12 2. "Public utility" does not include a person specified in subd. 1. a. that is, or is owned or wholly operated by, a municipal electric company, municipality or cooperative association.

AB389-AA10,4,13 (d) "Public utility affiliate" has the meaning given in s. 196.795 (1) (L).

AB389-AA10,4,14 (2) In general. Except as provided in subs. (2g), (2m), (3) and (5):

AB389-AA10,4,16 (a) A public utility may not engage in an activity related to the sale, leasing or service of appliances.

AB389-AA10,4,20 (b) A public utility may not engage in the performance of a plumbing, electrical, heating, ventilating, air conditioning or sheet metalworking contracting service unless the service is performed in or on exempt real property, as defined in s. 196.795 (1) (fm).

AB389-AA10,5,5 (2g) Contracting services. (a) Except as provided in par. (b), a public utility may perform plumbing, electrical, heating, ventilating, air conditioning or sheet metalworking contracting services in a calendar year if the number of hours in which the services are performed in the calendar year does not exceed the number of hours in which the public utility performed such services in calendar year 1997, 1998 or 1999. For purposes of this paragraph, "contracting services" include employe travel time, on-premises services, truck stocking, cost estimating and repeat calls to customers. A public utility that performs contracting services under this paragraph shall report to the commission the number of hours in which the public utility performed such services in calendar years 1997, 1998 and 1999.

AB389-AA10,5,9 (b) A public utility may perform contracting services specified in par. (a) in a calendar year in excess of the number of hours specified in par. (a) by an amount that reflects the percentage increase in the number of customers served by the public utility in the calendar year.

AB389-AA10,5,11 (2m) Street lighting. A public utility may provide, operate or maintain lighting systems on public streets on behalf of a municipality.

AB389-AA10,5,16 (3) Emergency services. A public utility shall respond to emergency service requests related to gas odor or pressure, carbon monoxide, fire or other circumstances that reasonably appear to the public utility to endanger property or human health or life and may engage in emergency appliance service work in response to such requests.

AB389-AA10,5,19 (5) Contracts or arrangements with affiliated interests. Except as provided in sub. (6), a public utility may provide services to an affiliated interest pursuant to a contract or arrangement approved under s. 196.52.

AB389-AA10,5,21 (5m) Voting securities. A public utility may acquire the voting securities or other voting interest of an affiliated interest only in exchange for cash.

AB389-AA10,5,23 (6) Separation between public utilities and affiliated interests. (a) In general. 1. A public utility may not do any of the following:

AB389-AA10,5,25 a. Except as provided in subd. 4. a., share with or lease, sell or transfer to an affiliated interest any building, office space, equipment or research.

AB389-AA10,6,3 am. Share with or lease, sell or transfer to an affiliated interest any service or system related to appliances or any plumbing, electrical, heating, ventilating, air conditioning or sheet metalworking contracting service or system.

AB389-AA10,6,5 b. Allow an affiliated interest access to the public utility's computer or other information systems.

AB389-AA10,6,7 c. Share or subsidize the costs of an affiliated interest's research and development activities.

AB389-AA10,6,8 d. Jointly purchase with an affiliated interest any goods or services.

AB389-AA10,6,10 e. Jointly use with an affiliated interest any system for support or corporate oversight or governance.

AB389-AA10,6,11 1m. An affiliated interest may not do any of the following:

AB389-AA10,6,14 a. Except as provided in subd. 4. b., share with or lease, sell or transfer to a public utility or out-of-state utility any building, office space, equipment or research in this state.

AB389-AA10,6,18 am. Share with or lease, sell or transfer to a public utility or out-of-state utility any service or system in this state related to appliances or plumbing, electrical, heating, ventilating, air conditioning or sheet metalworking contracting service or system in this state.

AB389-AA10,6,20 b. Allow a public utility or out-of-state utility access to the affiliated interest's computer or other information systems in this state.

AB389-AA10,6,22 c. Share or subsidize the costs of the research and development activities in this state of a public utility or out-of-state utility.

AB389-AA10,6,24 d. Jointly purchase with a public utility or out-of-state utility any goods or services for use in this state.

AB389-AA10,7,2 e. Jointly use in this state with a public utility or out-of-state utility any system for support or corporate oversight or governance.

AB389-AA10,7,4 3. An affiliated interest and a public utility or out-of-state utility shall maintain separate books and records.

AB389-AA10,7,6 4. a. A public utility may sell real property to an affiliated interest only by a public sale or by offering the real property to the highest qualified bidder.

AB389-AA10,7,9 b. An affiliated interest may sell real property in this state to a public utility or out-of-state utility only by a public sale or by offering the real property to the highest qualified bidder.

AB389-AA10,7,10 (b) Restrictions on employes. 1. A public utility may not do any of the following:

AB389-AA10,7,11 a. Lease any of its employes to an affiliated interest.

AB389-AA10,7,12 b. Employ the employes or officers of an affiliated interest.

AB389-AA10,7,16 c. Except as provided in par. (bg) 1., employ a person who was formerly employed by an affiliated interest during the 6-month period immediately prior to the person's employment by the public utility if the person was not employed by the affiliated interest for the entire 6-month period.

AB389-AA10,7,17 1m. An affiliated interest may not do any of the following:

AB389-AA10,7,19 a. Lease any of its employes in this state to a public utility or out-of-state utility.

AB389-AA10,7,21 b. Employ in this state the employes, board members or officers of a public utility or out-of-state utility.

AB389-AA10,8,2 c. Except as provided in par. (bg) 2., employ a person in this state who was formerly employed by a public utility or out-of-state utility with which the affiliated interest is affiliated during the 6-month period immediately prior to the person's employment by the affiliated interest if the person was not employed by the public utility or out-of-state utility for the entire 6-month period.

AB389-AA10,8,5 3. A public utility shall provide an annual report to the commission that describes its employment of persons formerly employed by an affiliated interest of the public utility.

AB389-AA10,8,11 (bg) Employment exception. 1. A public utility may employ a person who was formerly employed by an affiliated interest if the person's primary occupation during his or her former employment was the performance of plumbing, electrical, heating, ventilating, air conditioning or sheet metalworking contracting services for the affiliated interest's customers on no more than 10 separate occasions during a calendar year.

AB389-AA10,8,17 2. An affiliated interest may employ a person who was formerly employed by a public utility or out-of-state utility with which the affiliated interest is affiliated if the person's primary occupation during his or her former employment was the performance of plumbing, electrical, heating, ventilating, air conditioning or sheet metalworking contracting services for the public utility's or out-of-state utility's customers on no more than 10 separate occasions during a calendar year.