196.485(3m)(c)1.1. That the transmission company has no less than 5 nor more than 14 managers or directors, except that the operating agreement or bylaws may allow the requirements of this subdivision to be modified upon a unanimous vote of the managers or directors during the 10-year period after the organizational start-up date or upon a two-thirds vote of the board of directors or managers after such 10-year period.

196.485(3m)(c)2.2. That at least 4 managers or directors of the transmission company have staggered 4-year terms, are elected by a majority vote of the voting security holders and are not directors, employees or independent contractors of a person engaged in the production, sale, marketing, transmission or distribution of electricity or natural gas or of an affiliate of such a person.

196.485(3m)(c)3.3. That, during the 10-year period after the organizational start-up date, each of the following is satisfied, subject to the limitation on the number of managers or directors under subd. 1.:

196.485(3m)(c)3.a.a. Each nontransmission utility security holder that owns 10 percent or more of the outstanding voting securities of the transmission company may appoint one manager or director of the transmission company for a one-year term, except that the requirements of this subd. 3. a. may be modified upon a unanimous vote of the managers or directors.

196.485(3m)(c)3.b.b. Each group of nontransmission utility security holders that, as a group, owns 10 percent or more of the outstanding voting securities of the transmission company may appoint one manager or director of the transmission company for a one-year term if the group has entered into a written agreement regarding the appointment and the group files the agreement with the transmission company, except that the requirements of this subd. 3. b. may be modified upon a unanimous vote of the managers or directors.

196.485(3m)(c)3.bg.bg. Each nontransmission utility security holder that makes an appointment under subd. 3. a. is not allowed to make an appointment under subd. 3. b. as a member of a group of nontransmission utility security holders.

196.485(3m)(c)3.br.br. Each nontransmission utility security holder that makes an appointment as a member of a group under subd. 3. b. is not allowed to make an appointment under subd. 3. a.

196.485(3m)(c)3.c.c. Each person that receives at least 5 percent of the voting securities of the transmission company under sub. (6) (a) 1. or 3. may appoint one manager or director of the transmission company for a one-year term if the person continues to hold at least a 5 percent equity interest in the transmission company during the one-year term and if the person does not make an appointment under subd. 3. a., b. or d.

196.485(3m)(c)4.4. That, during the 5-year period after the organizational start-up date, no public utility affiliate that contributes transmission facility assets to the transmission company under sub. (5) (b) and no affiliate of such a public utility affiliate may increase its percentage share of the outstanding securities of the transmission company prior to any initial issuance of securities by the transmission company to any 3rd party other than a 3rd party exercising its right to purchase securities under sub. (6) (a) 3., except that this subdivision does not apply to securities that are issued by the transmission company in exchange for transmission facilities that are contributed in addition to the transmission facilities that are contributed under sub. (5) (b) and except that the requirements of this subdivision may be modified upon a unanimous vote of the managers or directors.

196.485(3m)(c)5.5. That, beginning 3 years after the organizational start-up date, any holder of 10 percent or more of the securities of the transmission company may require the transmission company to comply with any state or federal law that is necessary for the security holder to sell or transfer its shares.

196.485(3m)(d)(d) Commission jurisdiction. The transmission company is subject to the jurisdiction of the commission except to the extent that it is subject to the exclusive jurisdiction of the federal energy regulatory commission.

196.485(4)(a)(a) Except as provided in par. (am), a transmission utility may not transfer control over, or divest its interest in, its transmission facilities to an independent system operator or independent transmission owner unless, to the satisfaction of the commission, each of the following requirements is satisfied:

196.485(4)(a)1.1. The independent system operator or independent transmission owner is the sole provider of all transmission service to all users of its transmission system in this state, including the provision of retail transmission service to users that are public utilities.

196.485(4)(a)2.2. The independent system operator or independent transmission owner has authority over transmission facilities that is sufficient for the independent system operator or independent transmission owner to ensure the reliability of its transmission system.

196.485(4)(a)3.3. The independent system operator or independent transmission owner has sufficient authority to carry out the duties specified in sub. (3).

196.485(4)(am)(am) Each transmission utility in the transmission area that is a public utility shall become a member of the Midwest independent system operator no later than June 30, 2000, and shall transfer operational control over its transmission facilities to the Midwest independent system operator. Each such transmission utility that has not contributed its transmission facilities to the transmission company shall elect to become part of the single zone for pricing purposes within the Midwest independent system operator and any phase-in plan prepared under sub. (3m) (a) 4.

196.485(4)(b)(b) A transmission utility that transfers control over its transmission facilities to an independent system operator shall, subject to the approval of the applicable federal agency, provide reasonable and cost-effective construction, operation and maintenance services to the independent system operator that are required for operation of the transmission facilities.

196.485(5)(a)(a) Asset cap exception. Section 196.795 (6m) (e) does not apply to the eligible assets of a nonutility affiliate in a holding company system unless each public utility affiliate in the holding company system does each of the following:

196.485(5)(a)1.1. Petitions the commission and the federal energy regulatory commission to approve the transfer of operational control of all the public utility affiliate’s transmission facilities in this state and in Iowa, Michigan, Minnesota and Illinois to the Midwest independent system operator.

196.485(5)(a)2.2. Files with the commission an unconditional, irrevocable and binding commitment to contribute, no later than January 1, 2001, all of the transmission facilities that the public utility affiliate owns or operates in this state on October 29, 1999, and land rights, to the transmission company. A filing under this subdivision shall specify a date no later than January 1, 2001, on which the public utility affiliate will complete the contribution of transmission facilities.

196.485(5)(a)3.3. Files with the commission an unconditional, irrevocable and binding commitment to contribute, and to cause each entity into which it merges or consolidates or to which it transfers substantially all of its assets to contribute, any transmission facility in this state the ownership or control of which it acquires after October 29, 1999, and land rights, to the transmission company.

196.485(5)(a)4.4. Notifies the commission in writing that the public utility affiliate has become a member of the Midwest independent system operator, has agreed to transfer its transmission facilities to the Midwest independent system operator and has committed not to withdraw its membership prior to the date on which the public utility affiliate contributes transmission facilities to the transmission company under par. (b).

196.485(5)(a)5.5. Petitions the commission and the federal energy regulatory commission to approve the contributions specified in subds. 2. and 3. and agrees in such a petition not to withdraw the petition in the event that the commission or the federal energy regulatory commission conditions its approval on changes that are consistent with state and federal law.

196.485(5)(b)1.1. A public utility affiliate may not contribute a transmission facility to the transmission company until the commission has reviewed the terms and conditions of the transfer to determine whether the transfer satisfies the requirements of this subsection and has issued an order approving the terms and conditions of the transfer. The commission may modify the terms and conditions of the transfer and take any other action necessary to satisfy the requirements of this subsection. An order under this subdivision that approves or modifies the terms and conditions of a transfer may allow a public utility affiliate to recover in retail rates any adverse tax consequences of the transfer as a transition cost.

196.485(5)(b)2.2. The transmission company and a public utility affiliate that files a commitment to contribute transmission facilities under par. (a) 2. shall structure the transfer of the transmission facilities in a manner that satisfies each of the following: