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May 2007

Vol. 12, No. 18 Week of May 06, 2007

Alaska Legislature likely to give RCA new life, bills tighten timelines, create task force

As the 25th Alaska Legislature moves inexorably toward the close of its first session May 16, the fate of the Regulatory Commission of Alaska is one order of business yet to be decided.

Under a sunset provision in state law, the RCA is scheduled to cease operation June 30, unless lawmakers act to extend the life of the agency.

Created in 1999 upon reorganization of the Alaska Public Utilities Commission, the five-commissioner RCA is responsible for ensuring safe, adequate, and fair public utility and pipeline services. This is done by allowing regulated entities to charge users rates and provide service in a manner best for the public and the regulated entity itself.

The RCA regulates pipeline, telephone, electric, natural gas, water, sewer, refuse, cable TV and steam services in Alaska, either through certification or economic regulation. The commission also has consumer protection, tariff review, dispute resolution and significant administrative responsibilities.

Despite the apparent 11th hour for the legislation, prospects for the RCA getting an extension of up to eight years appear to be good, according to knowledgeable sources.

“Both the Senate President and the House Speaker have committed to passing the legislation, and I expect it to happen,” said RCA Chairman Kate Giard May 4.

Ted Moninski, director of regulatory affairs for Alaska Communications Systems, said he also expects lawmakers to reauthorize the RCA this session.

“In Alaska, these things manage to play out right toward the end of the session,” he said in a telephone interview May 3.

Auditors seek improvements

“Several bills related to the RCA are moving in the Legislature in both the House and Senate. House Concurrent Resolution 8 just passed out of the House Labor and Commerce Committee. It would create a task force that would work between sessions, looking at things like staffing, qualifications and such, and report back to the Legislature next year.”

Moninski praised the RCA’s performance in recent years, noting that the commission has made considerable progress in managing its caseload, using administrative law judges, and developing an electronic filing system that it is about ready to bring on line.

He also said the companies that the RCA regulates are eager to see even more improvements at the commission.

“The actual reauthorization bill will likely go forward, and ACS would be supportive of that,” he added.

State auditors also praised the RCA’s performance in a sunset review conducted last fall. In an Oct. 20, 2006 report, the auditors concluded:

“In our opinion RCA meets a valid public policy need and is serving Alaskans by:

“Assessing the capabilities of utility and pipeline companies to safely and capably serve the public;

“Evaluating tariffs and charges made by regulated entities;

“Verifying the pass through charges to consumers from electric and natural gas utilities;

“Adjudicating disputes between ratepayers and regulated entities;

“Providing consumer protection services; and,

“Performing financial reviews of utilities for the State’s power cost equalization program.”

They also made suggestions for continued improvement, including some related to earlier recommendations upon which the commission has not acted.

Essentially, the auditors urged the RCA to proceed with development of regulations that will enhance the transparency, accountability, and efficiency of the commission’s decision-making process.

“Our identified improvement areas include establishment of additional timelines, adoption of rules related to discovery; and defining when a record is considered complete and the given timeline starts,” the auditors said.

They also recommended that the termination date for the commission be extended until June 30, 2015.

Higher salaries needed

RCA Commissioner Dave Harbour, whose term is set to expire in March 2008, also weighed in with his opinion on changes that should take place at the commission.

In a letter to Gov. Sarah Palin April 20, Harbour urged state leaders to take action to update monetary compensation for RCA commissioners after years of neglect.

“In this sunset year the Legislature should act to bring long-neglected RCA salaries to an appropriate level,” Harbour said. “Commissioners significantly impact the lives of all Alaskans, regulating complex rate structures of our 300 utilities and pipelines, from the North Slope to Ketchikan.

“Full-time, professional commissioners should be much closer to the level of judges or industry executives than middle-management supervisors,” he added.

Rid agency of time lag

One bill, House Bill 209, is currently being reviewed in committee. Introduced in the House Labor and Commerce Committee, the measure sought to address some of the auditors’ recommendations, including revisions to statutory timelines for the commission’s decision-making process.

Because longer timelines for decisions are more costly for industry, Giard said the proposed changes would strengthen the RCA, an agency that routinely handles about 2 million pieces of paper every year.

“When you can eliminate regulatory lag, it gives you a much better regulatory climate. And now that we are moving to an electronic format, we’re strongly supportive of (shorter timelines),” she said.

HB 209 originally called for numerous other changes, but those have been removed from the bill’s language as lawmakers have winnowed the measure from 19 pages to three pages in recent days, Giard said.

She credited Rep. Jay Ramras, R-Fairbanks, with introducing strong amendments to the bill when it reached the House Judiciary Committee.

—Rose Ragsdale

Editor’s note: To read RCA Commissioner Dave Harbour’s letter to the governor, visit http://rca.alaska.gov/data/companyDetail.html?acronym=RCA






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