HOUSE BILL No. 4126
January 28, 1997, Introduced by Rep. Dobb and referred to the Committee on Public Utilities.
A bill to codify, revise, consolidate, and classify the laws
relating to the regulation of certain public utilities; to pre-
scribe certain procedures; to prescribe the powers and duties of
certain departments and agencies; to prescribe the powers and
duties of certain local officials and agencies; to provide cer-
tain appropriations; to provide penalties and remedies; to repeal
certain executive reorganization orders; and to repeal acts and
parts of acts.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
1 ARTICLE 1
2 GENERAL PROVISIONS
3 PART 11. SHORT TITLE AND INTENT
4 Sec. 1101. This act shall be known and may be cited as the
5 "Michigan utility code".
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1 Sec. 1102. (1) The purpose of this act is to revise only as
2 necessary to codify and classify the laws relating to the
3 regulation of public utilities and other entities.
4 (2) The legislature specifically intends that any changes in
5 the language and structure of statutes repealed and codified as
6 sections or parts of this act are not and should not be construed
7 as changes or revisions to the intent, purpose, or meanings of
8 those statutes.
9 (3) Changes in language and structure do not alter, amend,
10 or void any court interpretations or holdings as of the effective
11 date of this act that involve the statutes incorporated into this
12 act.
13 (4) Evidence of a specific change in language or structure
14 from the incorporated statutes or parts of statutes shall not be
15 used as a basis by the courts or commission to expand or narrow
16 the regulation of public utilities and other entities.
17 Sec. 1103. A heading or title of an article or part of this
18 act shall not be used to construe the act more broadly or nar-
19 rowly than the text of the sections of the act would indicate,
20 but shall be considered as inserted for the convenience of the
21 users of this act.
22 PART 12. DEFINITIONS
23 Sec. 1201. Except as otherwise defined in this act, as used
24 in this act:
25 (a) "Commission" means the Michigan public service commis-
26 sion described in article 2.
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1 (b) "Contested case" means a contested case under chapter 4
2 of the administrative procedures act of 1969, 1969 PA 306, MCL
3 24.271 to 24.287.
4 (c) "Department" means the department of consumer and indus-
5 try services.
6 (d) "Municipality" means a city, township, or village.
7 (e) "Municipally owned utility" means a utility that is
8 owned by a municipality.
9 (f) "Person" means an individual, partnership, corporation,
10 limited liability company, association, or other legal entity.
11 (g) "Rule" means a rule promulgated under the administrative
12 procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328.
13 ARTICLE 2
14 MICHIGAN PUBLIC SERVICE COMMISSION
15 PART 21. COMMISSION ORGANIZATION
16 Sec. 2101. The commission created under section 1 of former
17 1939 PA 3 shall continue in existence under this act in the
18 department.
19 Sec. 2102. (1) The commission shall consist of 3 members
20 appointed by the governor for 6-year staggered terms with the
21 advice and consent of the senate. Not more than 2 commission
22 members may be of the same political party. Each commission
23 member shall be a citizen of the United States and this state.
24 (2) The governor shall designate 1 commission member to
25 serve as chairperson of the commission.
26 (3) A commission member shall not be pecuniarily interested
27 in a public utility subject to the commission's jurisdiction.
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1 During his or her term, a commission member shall not serve as an
2 officer or committee member of a political party organization,
3 hold any office, or be employed by any other commission, board,
4 department, or institution of this state.
5 (4) A commission member shall not be retained or employed by
6 a public utility or person subject to the commission's jurisdic-
7 tion while he or she is acting as a commission member or for 6
8 months after that time.
9 (5) A commission member who is also a member of the state
10 bar of Michigan shall not practice law or act as counselor or
11 attorney in a court of this state while he or she is a commission
12 member.
13 (6) This section does not require a commission member to
14 retire from or dissolve a partnership of which he or she is a
15 member, but the partnership shall not engage in public utility
16 practice while he or she is a commission member.
17 (7) When a commission member's term expires, the governor
18 shall appoint a successor subject to the requirements of this
19 section, for a term of 6 years or until his or her successor is
20 appointed and qualified.
21 (8) A commission member serving at the effective date of
22 this act shall continue as a commission member under this act for
23 the remainder of his or her term, unless he or she resigns, dies,
24 or is removed under section 2103.
25 (9) A vacancy on the commission shall be filled in the same
26 manner as is provided for an appointment of a commission member
27 under this section. If a vacancy is created other than by
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1 expiration of a term, the new commission member shall be
2 appointed for the balance of the unexpired term of the commission
3 member to be succeeded.
4 Sec. 2103. (1) A commission member becomes qualified by
5 taking and subscribing to the constitutional oath of office and
6 shall hold office until the appointment and qualification of his
7 or her successor.
8 (2) A vacancy in the commission does not impair the right of
9 the 2 remaining commission members to exercise all of the
10 commission's powers.
11 (3) Two commission members constitute a quorum.
12 (4) A commission member shall devote his or her entire work
13 time to the performance of the duties of office.
14 (5) The commission shall adopt an official seal, of which
15 all courts shall take judicial notice and by which commission
16 proceedings, orders, and decrees are authenticated. The commis-
17 sion shall be provided by the department with suitable offices,
18 supplies, and equipment in the city of Lansing.
19 (6) The legislature shall annually establish the salary of
20 the chairperson and the other commission members and the schedule
21 for reimbursement of expenses.
22 (7) The governor may remove a commission member after a
23 hearing if it is found the commission member committed misfeas-
24 ance, malfeasance, or nonfeasance in office.
25 Sec. 2104. (1) The commission may appoint a secretary, dep-
26 uties, clerks, assistants, inspectors, heads of divisions, and
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1 other employees necessary to exercise the commission's powers and
2 duties.
3 (2) The commission may employ engineers and experts in
4 public utilities matters and fix their compensation for services
5 which may be paid out of the appropriation provided by the
6 legislature.
7 (3) The engineers, inspectors, and employees are entitled to
8 actual and necessary expenses incurred in the performance of
9 their duties under the schedule established by the legislature.
10 (4) All salaries and other expenses the commission incurs
11 shall be paid from funds provided under part 23.
12 PART 22. COMMISSION JURISDICTION, POWERS, AND DUTIES
13 Sec. 2201. (1) The commission shall have the jurisdiction
14 and authority to administer this act.
15 (2) In administering this act, the commission shall be
16 limited to the specific powers and duties prescribed by statute.
17 (3) Subject to this act, the commission shall have the same
18 measure of authority as was granted and conferred with respect to
19 railroads and railroad companies under the various statutes that
20 created the Michigan railroad commission and defining its powers
21 and duties as provided in article 7, and the commission shall
22 have and exercise all rights, privileges, and the jurisdiction in
23 all respects as had been transferred from the Michigan railroad
24 commission and conferred by law and exercised by the Michigan
25 public utilities commission.
26 (4) Where reference is or has been made in any law to the
27 "commission", the "Michigan public utilities commission", or the
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1 "Michigan railroad commission", that reference shall be construed
2 to mean the Michigan public service commission.
3 Sec. 2202. (1) The commission is vested with complete power
4 and jurisdiction to regulate all public utilities in the state
5 except a municipally owned utility, the owner of a renewable
6 resource power production facility as provided in subsection (2),
7 and except as otherwise restricted by law. The commission is
8 vested with the power and jurisdiction to regulate all rates,
9 fares, fees, charges, services, rules, conditions of service, and
10 all other matters pertaining to the formation, operation, or
11 direction of public utilities. The commission is further granted
12 the power and jurisdiction to hear and pass upon all matters per-
13 taining to, necessary, or incident to the regulation of public
14 utilities, including electric light and power companies, whether
15 private, corporate, or cooperative; and oil, gas, and pipeline
16 companies.
17 (2) Notwithstanding any other provision of this act, the
18 owner of a renewable resource power production facility is not
19 subject to the regulation or control of the commission, if all of
20 the following conditions are met:
21 (a) The owner of the renewable resource power production
22 facility, before the construction of the renewable resource power
23 production facility, was not a public utility subject to the
24 jurisdiction of the commission.
25 (b) The ownership of the renewable resource power production
26 facility is ancillary to the financing of the facility.
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1 (3) As used in this act, "renewable resource power
2 production facility" means a facility having a rated power
3 production capacity of 30 megawatts or less which produces elec-
4 tric energy by the use of biomass, waste, wood, hydroelectric,
5 wind, and other renewable resources, or any combination of renew-
6 able resources, as the primary energy source.
7 (4) Unless otherwise provided in this act, as used in this
8 act, "public utility" does not include a telecommunication pro-
9 vider under the Michigan telecommunications act, 1991 PA 179, MCL
10 484.2101 to 484.2605.
11 Sec. 2203. (1) The commission may require public utilities
12 to make reports and to supply data reasonably necessary for the
13 proper performance of the commission's powers and duties under
14 this act.
15 (2) The commission may promulgate and enforce rules and reg-
16 ulations for the conduct of its business and the proper discharge
17 of its functions under this act. All persons dealing with the
18 commission or interested in any matter or proceeding pending
19 before it shall be bound by such rules and regulations.
20 (3) The commission may promulgate rules for conducting the
21 business of public utilities subject to its jurisdiction under
22 this act.
23 (4) A person that violates a rule established under this
24 section is liable for a fine of not less than $100.00 or more
25 than $1,000.00 for each offense. A person that fails to pay the
26 fine as required is guilty of a misdemeanor punishable by a fine
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1 of not less than $10.00 or more than $1,000.00 or imprisonment of
2 not more than 6 months, or both.
3 Sec. 2204. (1) The commission may examine the books,
4 accounts, or records of a public utility subject to its
5 jurisdiction. For the purposes of an examination, a commission
6 member, examiner, or employee shall be given free and full access
7 to the books, accounts, or records of a public utility.
8 (2) For purposes provided in this act, a commission member
9 may administer oaths, certify to official acts, issue subpoenas,
10 and compel the attendance of witnesses or the production of
11 books, records, or other evidence or testimony relating to the
12 operations or management of a public utility. A subpoena shall
13 be served in the same manner as a subpoena of the circuit court.
14 (3) The commission may summon the owner, manager, or officer
15 of any person owning or operating a public utility to appear
16 before the commission to answer questions concerning the
17 utility's operation and business.
18 (4) The commission may apply to the circuit court in any
19 county to enforce its subpoena. The court has jurisdiction to
20 compel compliance with the subpoena in the same manner as any
21 other court subpoena.
22 (5) A person who fails to comply with a subpoena of the com-
23 mission or refuses to testify is guilty of a misdemeanor.
24 Sec. 2205. (1) A person operating a public utility within
25 this state subject to this act shall maintain a principal office
26 within this state.
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1 (2) Except as otherwise provided in this act or by
2 commission order or rule, the public utility shall keep all
3 books, accounts, and records pertaining to the business and oper-
4 ation of the utility at its principal office.
5 (3) Schedules of rates in a form and in the detail directed
6 by the commission shall be filed in the office of the commission
7 and copies of the schedules shall be printed and posted in the
8 principal office of the public utility and other locations as the
9 commission directs. A schedule is not operative until the com-
10 mission has approved it. A change shall not be made in the
11 schedules except with the commission's approval.
12 Sec. 2206. In addition to the rights, powers, and duties
13 vested in and imposed on the commission by this act, the
14 commission's jurisdiction shall extend to and include the control
15 and regulation, including the fixing of rates and charges, of all
16 public utilities within this state, producing, transmitting,
17 delivering, or furnishing steam for heating or power, or gas for
18 heating or lighting purposes, for the public use. Subject to the
19 provisions of this act, the commission shall have the same mea-
20 sure of authority with reference to such utilities as was granted
21 and conferred with respect to railroads and railroad companies
22 under the various provisions of the statutes that created the
23 Michigan railroad commission and defining its powers and duties.
24 The power and authority granted by this article shall not extend
25 to, or include, any power of regulation or control of any munici-
26 pally owned utility. It shall be the duty of the commission on
27 the request of any city or village to give advice and render
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1 assistance as may be reasonable and expedient with respect to the
2 operation of any utility owned and operated by the city or
3 village. The commission shall not have power to change or alter
4 the rates or charges fixed in, or regulated by, any franchise or
5 agreement granted or made by any city, village, or township. It
6 shall be competent for any municipality and any public utility
7 operating within the limits of the municipality, whether the
8 utility is operating under the terms of a franchise or otherwise,
9 to join in submitting to the commission any question involving
10 the fixing or determination of rates or charges, or the making of
11 rules or conditions of service, and the commission is empowered,
12 and it shall be its duty to make full investigation as to all
13 matters submitted and to fix and establish reasonable maximum
14 rates and charges, and prescribe rules and conditions of service
15 and make determinations and orders relative thereto as is just
16 and reasonable. Such order when made shall have like force and
17 effect as other orders made under this act. In any case where a
18 franchise under which a utility is, or has been, operated, has
19 expired or will expire, the municipality has the right to peti-
20 tion the commission to fix the rates and charges of the utility
21 in accordance with this article, or make a complaint as provided
22 with reference to any practice, service, or regulation of the
23 utility. The commission shall have full jurisdiction in the
24 premises.
25 Sec. 2207. (1) The commission shall make an annual report
26 of its activities to the governor and the legislature on or
27 before the first Monday of March of each year.
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1 (2) The annual report shall be a summary of commission
2 activities and may include rules, opinions, and orders promul-
3 gated or entered by the commission during the calendar year cov-
4 ered by the report. The annual report shall also contain any
5 other information the commission considers to be of value.
6 PART 23. UTILITY ASSESSMENT
7 Sec. 2301. As used in this part, "public utility" means a
8 steam, heat, electric, power, gas, water, telecommunications,
9 telegraph, communications, pipeline, or gas producing company
10 regulated by the commission, whether private, corporate, or coop-
11 erative, except a municipally owned utility.
12 Sec. 2302. (1) Within 30 days after the enactment into law
13 of any appropriation to it, the department shall ascertain the
14 amount of the appropriation attributable to the regulation of
15 public utilities. This amount shall be assessed against the
16 public utilities and shall be apportioned among them as provided
17 in this part. The amount assessed under this section shall not
18 be less than $50.00.
19 (2) The gross revenue for the preceding calendar year
20 derived from intrastate operations for each public utility shall
21 be totaled and each public utility shall pay a portion of the
22 assessment in the same proportion that its gross revenue for the
23 preceding calendar year derived from intrastate operations bears
24 to the total.
25 (3) An amount equal to the difference by which the actual
26 expenditures for the previous fiscal year attributable to the
27 regulation of public utilities are less than the amounts
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1 appropriated for those purposes shall be deducted from any amount
2 to be assessed under subsection (2). Those deductions shall be
3 made in the same proportion as the original assessments in
4 subsection (2).
5 Sec. 2303. (1) Within 15 days after receiving the statement
6 of an amount assessed under this part, the public utility may
7 file with the commission objections setting forth in detail the
8 grounds upon which the assessment is claimed to be excessive,
9 erroneous, unlawful, or invalid.
10 (2) After notice to the public utility, the commission shall
11 hold a hearing on the objections. If the commission finds the
12 assessment is not excessive, erroneous, unlawful, or invalid in
13 whole or in part, it shall record its findings and transmit them
14 to the public utility and again mail or serve a copy of the
15 assessment upon the utility.
16 Sec. 2304. Assessment statements to which objections have
17 not been filed and assessment statements and amended assessment
18 statements mailed or served after a hearing on objections filed
19 under section 2303 shall be paid not later than 30 days after
20 their receipt. Assessments not paid when due bear interest at
21 the rate of 1% per month. The attorney general shall recover
22 unpaid assessments together with interest upon them by appropri-
23 ate action.
24 Sec. 2305. (1) A person shall not maintain a suit or pro-
25 ceeding in a court to restrain or delay the collection or payment
26 of an assessment made under this part. A person making a payment
27 under this part who believes the amount to be excessive,
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1 erroneous, unlawful, or invalid may seek recovery through the
2 court of claims. In an action for recovery of a payment made
3 under this part, the claimant may raise every relevant issue of
4 law and fact evidenced by the record made before the commission.
5 (2) The court of claims may review questions of law and fact
6 involved in a final decision or determination of the commission
7 made under this part. The procedure providing for the determina-
8 tion of the lawfulness of assessments and the recovery of pay-
9 ments made under this part is exclusive of all other remedies and
10 procedures.
11 Sec. 2306. After notice and hearing, the commission may
12 exempt a public utility from this part if it determines that
13 gross revenues derived from intrastate operations is not a fair
14 or equitable basis for assessing the costs of regulating that
15 public utility and the commission prescribes a fair and equitable
16 manner for assessing those costs of regulation.
17 Sec. 2307. A person over which the commission has jurisdic-
18 tion solely under part 61 or 62 shall pay fees as prescribed by
19 the commission in lieu of an assessment under this part.
20 Sec. 2308. (1) At the end of each month, the commission
21 shall transfer all fees and money received by the commission
22 under this part to the state treasurer.
23 (2) Notwithstanding this or any other act, all funds trans-
24 ferred to the state treasury under this part shall be credited to
25 a special account to be utilized solely to finance the cost of
26 regulating public utilities.
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1 ARTICLE 3
2 PROCEEDINGS BEFORE THE COMMISSION
3 PART 31. CERTIFICATE OF CONVENIENCE AND NECESSITY
4 Sec. 3101. As used in this part:
5 (a) "Municipality" means a city, village, or township.
6 (b) "Public utility" means persons and corporations, other
7 than municipal corporations, or their lessees, trustees, and
8 receivers owning or operating in this state equipment or facili-
9 ties for producing, generating, transmitting, delivering, or fur-
10 nishing gas or electricity for the production of light, heat, or
11 power to or for the public for compensation.
12 Sec. 3102. (1) A public utility shall not begin construct-
13 ing or operating a public utility plant or system or render any
14 service to transact or carry on a local business, either directly
15 or indirectly, by serving any other utility or agency so engaged
16 in such a local business in a municipality where another utility
17 or agency is engaged in that local business and rendering the
18 same sort of service, or where the municipality is receiving
19 service of the same sort, until it first obtains from the commis-
20 sion a certificate that public convenience and necessity requires
21 or will require the construction, operation, service, or
22 extension.
23 (2) To obtain a certificate of convenience and necessity,
24 the applicant shall file an application with the commission stat-
25 ing the name of the municipality or municipalities that it
26 desires to serve and the kind of service that it proposes to
27 render, and that the applicant has secured the necessary consent
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1 or franchise from the municipality or municipalities authorizing
2 it to transact a local business.
3 Sec. 3103. When an application is filed, the commission
4 shall set a hearing and notify the applicant. At least 10 days
5 before the date of the hearing, a copy of the application and a
6 notice of the date, time, and place of the hearing shall be
7 served upon every other utility or agency in the municipality or
8 municipalities proposed to be served by the applicant that
9 renders a similar service in the municipality, and upon the clerk
10 or other similar officer of each municipality and each person
11 receiving notice under this section shall have the right to
12 appear and be heard regarding the application.
13 Sec. 3104. (1) In determining the question of public conve-
14 nience and necessity, the commission shall take into considera-
15 tion the service being rendered by the public utility then serv-
16 ing the territory, the investment in the utility, the benefit, if
17 any, to the public in the matter of rates, and any other matter
18 that is proper and equitable in determining whether or not public
19 convenience and necessity requires the applying utility to serve
20 the territory.
21 (2) A certificate of public convenience and necessity issued
22 by the commission under this part shall describe in detail the
23 territory in which the applicant will operate. The applicant
24 shall not operate in or serve any other area under the authority
25 of that certificate.
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1 PART 32. CONSUMER PARTICIPATION BOARD
2 Sec. 3201. This part provides a means to insure equitable
3 representation of the interests of energy utility customers in
4 proceedings under part 42 and part 52.
5 Sec. 3202. As used in this part:
6 (a) "Annual receipts" means the payments received by the
7 fund during a calendar year.
8 (b) "Board" means the utility consumer participation board
9 described in section 3203.
10 (c) "Energy cost recovery proceeding" means any proceeding
11 under part 42 or 52 to establish or implement a gas cost recovery
12 clause or a power supply cost recovery clause, to set gas cost
13 recovery factors under section 5216, or to set power supply cost
14 recovery factors under section 4217.
15 (d) "Energy utility" or "utility" means an electric or gas
16 company regulated by the commission.
17 (e) "Fund" means the utility consumer representation fund
18 described in section 3208.
19 (f) "Household" means a single-family home, duplex, mobile
20 home, seasonal dwelling, farm home, cooperative, condominium, or
21 apartment that has normal household facilities such as a bath-
22 room, individual cooking facilities, and kitchen sink
23 facilities. Household does not include a penal or corrective
24 institution, or a motel, hotel, or other similar structure if
25 used as a transient dwelling.
26 (g) "Jurisdictional" means subject to rate regulation by the
27 commission.
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1 (h) "Net grant proceeds" means the annual receipts of the
2 fund less the amounts reserved for the attorney general's use and
3 the amounts expended for board expenses and operation.
4 (i) "Residential energy utility consumer" or "consumer"
5 means a customer of an energy utility who receives utility serv-
6 ice for use within an individual household or an improvement rea-
7 sonably appurtenant to and normally associated with an individual
8 household.
9 (j) "Residential tariff sales" means those sales by an
10 energy utility subject to residential tariffs on file with the
11 commission.
12 (k) "Utility consuming industry" means a person that
13 receives energy utility service ordinarily and primarily for use
14 in connection with the manufacture, sale, or distribution of
15 goods or the provision of services. Utility consuming industry
16 does not include a nonprofit organization representing residen-
17 tial utility customers.
18 Sec. 3203. (1) The utility consumer participation board
19 created under section 6l of former 1939 PA 3 shall continue in
20 existence under this act in the department of consumer and indus-
21 try services. The procurement and related management functions
22 for the board shall be performed under the direction and supervi-
23 sion of the department of consumer and industry services.
24 (2) The board consists of 5 members appointed by the gover-
25 nor, 1 of whom shall be chosen from a list of qualified persons
26 submitted by the attorney general. A board member serving on the
27 effective date of this act shall continue as a board member for
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1 the remainder of his or her term unless he or she resigns, dies,
2 or is otherwise removed under this act.
3 (3) If the governor does not appoint a person whose name is
4 submitted by the attorney general, the attorney general shall
5 submit another list of qualified persons.
6 (4) As used in subsection (5), "utility" means an electric
7 or gas company located in or outside of this state.
8 (5) Each board member shall meet the following
9 requirements:
10 (a) Is an advocate for the interests of residential utility
11 consumers, as demonstrated by the member's knowledge of and sup-
12 port for consumer interests and concerns in general or specifi-
13 cally related to utility matters.
14 (b) Within the 5 years preceding appointment, was not a
15 member of a governing body of or employed in a managerial, pro-
16 fessional, or consulting capacity by any of the following:
17 (i) A utility or an association representing utilities.
18 (ii) An enterprise or professional practice that received
19 over $1,500.00 in the year preceding the appointment as a sup-
20 plier of goods or services to a utility or association represent-
21 ing utilities.
22 (iii) An organization representing employees of a utility,
23 association, enterprise, or professional practice, or an associa-
24 tion representing such an organization.
25 (c) Within 1 year preceding appointment, did not have a
26 financial interest exceeding $1,500.00 in a utility, an
27 association representing utilities, or an enterprise or
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1 professional practice that received over $1,500.00 in the year
2 preceding the appointment as a supplier of goods or services to a
3 utility or association representing utilities.
4 (d) Is not an officer or director of an applicant for a
5 grant under this part.
6 (e) Is not a member of the immediate family of a person who
7 would be ineligible under subdivision (a), (b), (c), or (d).
8 (6) Board members shall be appointed for 2-year terms begin-
9 ning with the first day of a legislative session in odd numbered
10 years and ending on the day before the first day of the legisla-
11 tive session in the next odd numbered year or when the members'
12 successors are appointed, whichever occurs later.
13 (7) A vacancy shall be filled in the same manner as the
14 original appointment. If the vacancy is created other than by
15 expiration of a term, the new member shall be appointed for the
16 balance of the unexpired term of the member to be succeeded. The
17 governor shall not appoint a member to the board for a term com-
18 mencing after the governor's term of office has ended.
19 (8) The governor shall remove a member of the board if that
20 member is absent for any reason from either 3 consecutive board
21 meetings or more than 50% of the meetings held by the board in a
22 calendar year. A person who is removed due to absenteeism is
23 eligible for reappointment to fill a vacancy that occurs in the
24 board membership. The governor also shall remove a member of the
25 board if the member is subsequently determined to be ineligible
26 under subsection (5).
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1 Sec. 3204. (1) At its first meeting following the
2 appointment of new members, or as soon as possible after the
3 first meeting, the board shall elect biennially from its member-
4 ship a chairperson and a vice-chairperson.
5 (2) The board shall hold bimonthly meetings and additional
6 meetings as necessary.
7 (3) A quorum consists of 3 members. A majority vote of the
8 members appointed and serving is necessary for a decision.
9 (4) The board shall not act directly to represent the inter-
10 ests of residential utility consumers except through administra-
11 tion of the fund and grant program under this part.
12 Sec. 3205. Board business shall be conducted at a public
13 meeting held in compliance with the open meetings act, 1976 PA
14 267, MCL 15.261 to 15.275.
15 Sec. 3206. A writing prepared, owned, used, in the posses-
16 sion of, or retained by the board in the performance of an offi-
17 cial function shall be made available to the public in compliance
18 with the freedom of information act, 1976 PA 442, MCL 15.231 to
19 15.246.
20 Sec. 3207. A member of the board may be reimbursed for
21 actual and necessary expenses, including travel expenses to and
22 from each meeting held by the board, incurred in discharging the
23 member's duties under this part. In addition to expense reim-
24 bursement, a board member may receive remuneration from the board
25 of $100.00 per meeting attended, not to exceed $1,000.00 in a
26 calendar year. These limits shall be adjusted proportionately to
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1 an adjustment in the remittance amounts under section 3309(3) to
2 allow for changes in the cost of living.
3 Sec. 3208. (1) The utility consumer representation fund
4 created by section 6m of former 1939 PA 3 shall continue in exis-
5 tence under this act.
6 (2) The state treasurer shall maintain a separate account of
7 the money in the fund and invest the money in the fund in the
8 bonds, notes, and other evidences of indebtedness issued or
9 insured by the United States government and in prime commercial
10 paper.
11 (3) The state treasurer shall be the custodian of the funds
12 and shall release money from the fund, including interest earned,
13 as directed by the board.
14 Sec. 3209. (1) Except as provided in this part, each energy
15 utility applying to the commission to initiate an energy cost
16 recovery proceeding shall pay into the fund before filing the
17 initial application for a proceeding and on or before the first
18 anniversary of that application an amount of money determined by
19 the board in the following manner:
20 (a) For an energy utility serving 100,000 or more customers
21 in this state, an amount that has the same proportion to
22 $300,000.00 multiplied by a factor as provided in subsection (3),
23 as the utility's jurisdictional 1981 total operating revenues
24 stated in its annual report has to the jurisdictional 1981 total
25 operating revenues of all energy utilities serving at least
26 100,000 customers in this state. This amount shall be made
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1 available by the board for use by the attorney general for the
2 purposes described in section 3212(1).
3 (b) For an energy utility serving 100,000 or more residen-
4 tial customers in this state, an amount that has the same propor-
5 tion to $300,000.00 multiplied by a factor as provided in subsec-
6 tion (3), as the utility's jurisdictional 1981 gross revenues
7 from residential tariff sales has to the jurisdictional 1981
8 gross revenues from residential tariff sales of all energy utili-
9 ties serving at least 100,000 residential customers in this
10 state. This amount shall be used for grants under section
11 3211(2).
12 (2) On or before the second and succeeding anniversaries of
13 its initial application for an energy cost recovery proceeding,
14 an energy utility shall remit to the board amounts equal to 5/6
15 of the amounts required under subsection (1).
16 (3) For purposes of subsection (1), the board shall set the
17 factor at a level not more than the percentage increase in the
18 consumer price index for the Detroit standard metropolitan sta-
19 tistical area as compiled by the United States department of
20 labor for the period between January 1981 and January of the year
21 in which the payment is required. If more than 1 index is com-
22 piled, the index yielding the largest payment shall be used to
23 calculate the maximum allowable factor. The board shall advise
24 utilities of the factor.
25 (4) Payments made by an energy utility under subsection
26 (1)(a) are operating expenses of the utility that the commission
27 shall permit the utility to charge to its customers. Payments
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1 made by an energy utility under subsection (1)(b) are operating
2 expenses of the utility that the commission shall permit the
3 energy utility to charge to its residential customers.
4 (5) The payment requirements of this section do not apply to
5 an energy utility organized as a cooperative corporation under
6 sections 98 to 109 of 1931 PA 327, MCL 450.98 to 450.109, or a
7 consumer cooperative organized under chapter 11 of the nonprofit
8 corporation act, 1982 PA 162, MCL 450.3100 to 450.3192. Grants
9 from the fund shall not be used to participate in an energy cost
10 recovery proceeding primarily affecting such an energy utility.
11 (6) If a dispute exists between the board and an energy
12 utility about the amount of payment due, the utility shall pay
13 the undisputed amount. If the utility and the board cannot
14 agree, the board may initiate civil action in the Ingham county
15 circuit court for recovery of the disputed amount.
16 (7) The commission shall not accept or take action on an
17 application for an energy cost recovery proceeding from an energy
18 utility subject to this section that has not fully paid the
19 undisputed amount required by this section.
20 (8) The commission shall not accept or take action on an
21 application for an energy cost recovery proceeding from an energy
22 utility subject to this section until 30 days after the board has
23 notified it that the board is ready to process grant applica-
24 tions, will transfer funds to the attorney general upon the
25 receipt of those funds, and within 30 days will approve grants
26 and remit funds to qualified grant applicants.
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1 Sec. 3210. The board may accept a gift or grant from any
2 source to be deposited in the fund if the conditions or purposes
3 of the gift or grant are consistent with this part.
4 Sec. 3211. (1) The costs of operation and expenses the
5 board incurs in performing its duties under this part shall be
6 paid from the fund. A maximum of 5% of the annual receipts of
7 the fund may be budgeted and used to pay expenses other than
8 grants made under subsection (2).
9 (2) The net grant proceeds shall finance a grant program
10 from which the board may award to an applicant an amount the
11 board determines to be used for the purposes set forth in this
12 part.
13 (3) The board shall create and make available an application
14 form. Each applicant shall indicate on the application how the
15 applicant meets the eligibility requirements under this part and
16 how the applicant proposes to use a grant from the fund to par-
17 ticipate in 1 or more proceedings as authorized in this part,
18 which have been or are expected to be filed.
19 (4) The board shall receive an application requesting a
20 grant from the fund only from a nonprofit organization or a unit
21 of local government in this state.
22 (5) The board shall consider only applications for grants
23 containing proposals that comply with this part and that serve
24 the interests of residential utility consumers. In making
25 grants, the board may consider protecting the environment, con-
26 serving energy, creating employment and a healthy economy in this
27 state, and maintaining adequate energy resources. The board
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1 shall not consider an application that primarily benefits the
2 applicant or a service provided or administered by the
3 applicant.
4 (6) The board shall encourage the representation of the
5 interests of identifiable types of residential utility consumers
6 whose interests may differ, including various social and economic
7 classes and areas of the state, and if necessary, may make grants
8 to more than 1 applicant whose applications are related to a sim-
9 ilar issue to achieve this type of representation. In addition,
10 the board shall consider and balance the following criteria in
11 determining whether to make a grant to an applicant:
12 (a) Evidence of the applicant's competence, experience, and
13 commitment to advancing the interests of residential utility
14 consumers.
15 (b) In the case of a nongovernmental applicant, the extent
16 to which the applicant is representative of or has a previous
17 history of advocating the interests of citizens, especially resi-
18 dential utility consumers.
19 (c) The anticipated effect of the proposal contained in the
20 application on residential utility consumers, including the imme-
21 diate and long-term impacts of the proposal.
22 (d) Evidence demonstrating the potential for continuity of
23 effort and the development of expertise in relation to the pro-
24 posal contained in the application.
25 (e) The uniqueness or innovativeness of an applicant's posi-
26 tion or point of view, and the probability and desirability of
27 that position or point of view prevailing.
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1 (7) As an alternative to choosing between 2 or more
2 applications having similar proposals, the board may invite 2 or
3 more of the applicants to file jointly and award a grant to be
4 managed cooperatively.
5 (8) The board shall not consider an application from a non-
6 profit organization if 1 of the organization's principal inter-
7 ests or unifying principles is the welfare of an energy utility
8 or its investors or employees, or the welfare of 1 or more busi-
9 nesses or industries, other than farms not owned or operated by a
10 corporation, that receive utility service ordinarily and primar-
11 ily for use in connection with the profit-seeking manufacture,
12 sale, or distribution of goods or services. Ownership of securi-
13 ties by a nonprofit organization or its members does not alone
14 disqualify an application submitted by that organization.
15 (9) The board shall make disbursements under a grant before
16 an applicant's proposed actions as set forth in the application
17 if necessary to enable the applicant to initiate, continue, or
18 complete the proposed actions.
19 (10) A notice to utility customers and the general public of
20 hearings or other state proceedings in which grants from the fund
21 may be used shall contain a notice of the availability of the
22 fund and the address of the board.
23 Sec. 3212. (1) The annual receipts and interest earned,
24 less administrative costs, may be used only for participating in
25 administrative and judicial proceedings under part 42 or 52 and
26 federal administrative and judicial proceedings that directly
27 affect the energy costs paid by energy utilities in this state.
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1 (2) Amounts that have been in the fund more than 12 months
2 may be retained in the fund for future grants, or may be returned
3 to energy utilities or used to offset their future remittances in
4 proportion to their previous remittances to the fund as the board
5 determines will best serve the interests of consumers.
6 (3) The following conditions apply to all grants from the
7 fund:
8 (a) Disbursements from the fund may be used only to advocate
9 the interests of energy utility customers or classes of energy
10 utility customers, and not for representation of individual
11 interests.
12 (b) The board shall attempt to maintain a reasonable rela-
13 tionship between the payments from a particular energy utility
14 and the benefits to consumers of that utility.
15 (c) The board shall coordinate the funded activities of
16 grant recipients with those of the attorney general to avoid
17 duplicating effort, to promote supplementing effort, and to maxi-
18 mize the number of hearings and proceedings with intervenor
19 participation.
20 Sec. 3213. (1) A recipient of a grant under section 3211
21 may use the grant only for advancing the proposed action approved
22 by the board, including, but not limited to, costs of staff,
23 hired consultants and counsel, and research.
24 (2) A recipient of a grant under section 3311 shall file a
25 report with the board within 90 days after the end of the year or
26 a shorter period for which the grant is made. The report shall
27 be made in a form approved by the board and shall be subject to
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1 audit by the board. The report shall include all of the
2 following information:
3 (a) An account of all grant expenditures made by the grant
4 recipient. Expenditures shall be reported within the following
5 categories:
6 (i) Employee and contract for services costs.
7 (ii) Costs of materials and supplies.
8 (iii) Filing fees and other costs required to effectively
9 represent residential utility consumers as provided in this
10 part.
11 (b) Any additional information concerning uses of the grant
12 required by the board.
13 Sec. 3214. The attorney general shall file a report with
14 the house and senate committees on appropriations within 90 days
15 after the end of each fiscal year. The report shall include all
16 of the following information:
17 (a) An account of all expenditures made by the attorney gen-
18 eral of funds received under this part. Expenditures shall be
19 reported within the following categories:
20 (i) Employee and contract for services costs.
21 (ii) Costs of materials and supplies.
22 (iii) Filing fees and other costs required to effectively
23 represent utility consumers as provided in this part.
24 (b) Any additional information concerning uses of the funds
25 received under this part required by the committees.
26 Sec. 3215. (1) On or before July 1 of each year, the board
27 shall submit a detailed report to the legislature regarding the
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30
1 discharge of duties and responsibilities under this part during
2 the preceding calendar year.
3 (2) At 3-year intervals starting from October 13, 1985, a
4 senate committee chosen by the majority leader of the senate and
5 a house committee chosen by the speaker of the house of represen-
6 tatives shall review the relationship between costs and benefits
7 resulting from this part and may recommend changes to the
8 legislature.
9 PART 33. DEPOSITS, ATTACHMENTS, AND CONSERVATION PROGRAMS
10 Sec. 3301. (1) A public utility regulated by this act may
11 require a ratepayer to pay a deposit as a guaranty for payment of
12 the public utility's services. In the absence of specific rules
13 adopted by the commission, the commission shall approve the terms
14 and conditions for a guaranty deposit required by a public
15 utility.
16 (2) The commission may prescribe by rule all of the
17 following:
18 (a) The circumstances under which a public utility may
19 require a guaranty deposit.
20 (b) The amount of the guaranty deposit.
21 (c) The interest rate payable on the guaranty deposit.
22 (d) The method by which the public utility will pay interest
23 on the guaranty deposit to the ratepayer.
24 (e) The circumstances under which the guaranty deposit must
25 be returned to the ratepayer.
26 Sec. 3302. (1) As used in this section:
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31
1 (a) "Attaching party" means any person, firm, corporation,
2 partnership, or cooperatively organized association, other than a
3 public utility or a municipality, which seeks to construct
4 attachments upon, along, under, or across public ways or private
5 rights-of-way.
6 (b) "Attachment" means a wire, cable, facility, or apparatus
7 for the transmission of writing, signs, signals, pictures,
8 sounds, or other forms of intelligence or for the transmission of
9 electricity for light, heat, or power, installed by an attaching
10 party upon a pole or in a duct or conduit owned or controlled, in
11 whole or in part, by 1 or more specified utilities.
12 (c) "Specified utility" means a public utility subject to
13 the regulation and control of the commission that owns or con-
14 trols, or shares ownership or control of poles, ducts, or con-
15 duits used or useful, in whole or in part, for supporting or
16 enclosing wires, cables, or other facilities or apparatus for the
17 transmission of writing, signs, signals, pictures, sounds, or
18 other forms of intelligence or for the transmission of electric-
19 ity for light, heat, or power.
20 (2) The commission shall regulate the rates, terms, and con-
21 ditions of attachments by attaching parties. The commission
22 shall not require a hearing when approving the rates, terms, and
23 conditions unless the attaching party or specified utility peti-
24 tions the commission for a hearing.
25 (3) The commission shall ensure that the rates, terms, and
26 conditions are just and reasonable and shall consider the
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1 interests of the attaching parties' customers as well as the
2 specified utility and its customers.
3 (4) An attaching party shall obtain any necessary authoriza-
4 tion before occupying public ways or private rights-of-way with
5 its attachment.
6 (5) Procedures under this section shall be those applicable
7 to any public utility whose rates charged its customers are regu-
8 lated by the commission, including the right to appeal a final
9 decision of the commission to the courts.
10 Sec. 3303. (1) The commission may approve energy conserva-
11 tion programs for residential customers of public utilities.
12 (2) The related costs of money, bad debt expense, adminis-
13 trative costs, and the cost of residential energy audits associ-
14 ated with an energy conservation program authorized by this sec-
15 tion, except for an energy conservation loan program, shall be
16 included only in the public utility's general rates. The inclu-
17 sion of costs in public utility rates as provided in this subsec-
18 tion shall not continue after the costs arising from an approved
19 energy conservation program have been recovered.
20 (3) The conservation programs subject to this section shall
21 provide approved conservation devices, services, and materials
22 and may include approved ceiling and wall insulation, flue damp-
23 ers, caulking, and weather stripping as allowed by state law and
24 rules.
25 (4) A residential energy audit or preinspection shall be
26 completed by the public utility before the installation of any
27 device or material under this section. A residential customer
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1 participating in an energy conservation program shall be provided
2 with cost benefit information regarding those conservation
3 devices, services, and materials as they apply to the customer's
4 residence.
5 (5) If a residential customer participating in an energy
6 conservation program personally installs insulation in the
7 customer's place of residence, the cost of installation shall not
8 be included as part of the customer's participation in the
9 program.
10 (6) A public utility maintaining an energy conservation pro-
11 gram permitted under this section shall not accept an application
12 for or make a loan as a part of that program.
13 PART 34. ENERGY EMERGENCIES
14 Sec. 3401. As used in this part:
15 (a) "Energy advisory committee" means the committee created
16 under section 3402.
17 (b) "Energy emergency" means a condition of danger to the
18 health, safety, or welfare of the citizens of this state due to
19 an impending or present energy shortage.
20 (c) "Energy resource" means electricity, natural gas, syn-
21 thetic gas, a petroleum product including a liquefied petroleum
22 gas, coal, wood fuel, geothermal source, hydropower, nuclear
23 material, or other source producing power or heat.
24 (d) "Energy resource supplier" means a person who furnishes
25 an energy resource for the public at the wholesale or retail
26 level.
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1 (e) "Energy shortage" means lack of adequate available
2 energy resources in the state, or any part of the state, as
3 determined by the energy advisory committee or the governor.
4 Sec. 3402. (1) The energy advisory committee created under
5 section 2 of former 1982 PA 191 shall continue in existence under
6 this act.
7 (2) The energy advisory committee shall consist of the
8 director of the department, the director of the department of
9 agriculture, the chairperson of the commission, the director of
10 the department of community health, the director of the depart-
11 ment of transportation, and the director of the department of
12 state police. The governor shall designate 1 of the 6 members of
13 the energy advisory committee as chairperson of the energy
14 advisory committee.
15 (3) The energy advisory committee shall notify the governor
16 of an impending energy emergency. The energy advisory committee
17 shall determine whether an energy emergency is imminent on the
18 basis of information available to the energy advisory committee
19 from the commission, other state agencies, federal agencies, and
20 other sources of information including computer information
21 systems.
22 Sec. 3403. (1) The governor may declare, by executive order
23 or proclamation, a state of energy emergency upon notification of
24 an impending energy emergency by the energy advisory committee
25 under section 3402(3), or upon the governor's own initiative if
26 the governor finds that an energy emergency exists or is
27 imminent.
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1 (2) Except as provided in subsections (3) and (4), the state
2 of an energy emergency declared by the governor under
3 subsection (1) shall continue until the governor finds that the
4 energy emergency no longer exists, or until the state of energy
5 emergency has been in effect for 90 days, whichever period is
6 shorter.
7 (3) After a state of energy emergency has been in effect for
8 90 days, the legislature may approve an extension of the state of
9 energy emergency for a specific number of days by a concurrent
10 resolution adopted by a record roll call vote by a majority of
11 the members elected to and serving in each house of the
12 legislature. If the legislature does not act to extend the state
13 of energy emergency under this subsection, the state of energy
14 emergency is terminated.
15 (4) The legislature may terminate a state of energy emer-
16 gency at any time after the governor declares a state of energy
17 emergency, by a concurrent resolution adopted by a record roll
18 call vote by a majority of the members elected to and serving in
19 each house of the legislature.
20 Sec. 3404. During an energy emergency, the governor may do
21 all of the following:
22 (a) Order specific restrictions on the use and sale of
23 energy resources. Restrictions imposed by the governor under
24 this subdivision may include any of the following:
25 (i) Restrictions on the interior temperature of public, com-
26 mercial, industrial, and school buildings.
00135'97
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1 (ii) Restrictions on the hours and days during which public,
2 commercial, industrial, and school buildings may be open.
3 (iii) Restrictions on the conditions under which energy
4 resources may be sold to consumers.
5 (iv) Restrictions on lighting levels in public, commercial,
6 industrial, and school buildings.
7 (v) Restrictions on the use of display and decorative
8 lighting.
9 (vi) Restrictions on the use of privately owned vehicles or
10 a reduction in speed limits.
11 (vii) Restrictions on the use of public transportation
12 including directions to close a public transportation facility.
13 (viii) Restrictions on the use of pupil transportation pro-
14 grams operated by public schools.
15 (b) Direct an energy resource supplier to provide an energy
16 resource to a health facility, school, public utility, public
17 transit authority, fire or police station or vehicles, newspaper,
18 or television or radio station for the purpose of relaying emer-
19 gency instructions or other emergency message, food producer,
20 processor, retailer, or wholesaler, and to any other person or
21 facility which provides essential services for the health,
22 safety, and welfare of the residents of this state.
23 (c) By executive order, suspend, in whole or in part, a
24 statute or an order or rule of a state agency if strict compli-
25 ance with the statute, rule, or order will prevent, hinder, or
26 delay necessary action in coping with the energy emergency. The
27 governor may not suspend a criminal process or procedure or a
00135'97
37
1 statute or rule governing the operation of the legislature. At
2 the time of the suspension of a statute, rule, or order, the gov-
3 ernor shall state the extent of the energy shortage and shall
4 specify the provisions of a statute, rule, or order which are
5 suspended, the length of time for which the provisions are sus-
6 pended, and the degree to which the provisions are suspended. A
7 suspended statute, rule, or order shall be directly related to an
8 energy emergency.
9 Sec. 3405. (1) The governor may issue an executive order,
10 proclamation, or directive having the force and effect of law to
11 implement this part. The governor may rescind or amend an execu-
12 tive order, proclamation, or directive.
13 (2) An executive order, proclamation, or directive issued
14 under this part shall be effective for the duration of a state
15 energy emergency as provided in section 3403(2). If the legisla-
16 ture approves an extension of a state of energy emergency under
17 section 3403(3), an executive order, proclamation, or directive
18 shall continue in effect for the extended period unless the leg-
19 islature by a concurrent resolution adopted by a record roll call
20 vote by a majority of the members elected to and serving in each
21 house of the legislature disapproves the executive order, procla-
22 mation, or directive, or unless it is rescinded by the governor
23 under subsection (1).
24 (3) An executive order, proclamation, or directive issued
25 under this part shall be disseminated promptly to the general
26 public and filed with the secretary of state and the department
27 of state police.
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1 (4) The governor shall notify the legislature of an
2 executive order, proclamation, or directive issued under this
3 part.
4 Sec. 3406. This part shall not limit, modify, or abridge
5 the authority of the governor to proclaim a state of disaster
6 under the emergency management act, 1976 PA 390, MCL 30.401 to
7 30.420, or to exercise any other powers vested in the governor by
8 the state constitution of 1963, state statutes, or the common law
9 of the state.
10 Sec. 3407. (1) A person who knowingly violates this part or
11 an order, proclamation, or directive issued by the governor under
12 this part, is guilty of a misdemeanor punishable by a fine of not
13 more than $500.00. Each day a violation continues is a separate
14 offense.
15 (2) The attorney general or a prosecuting attorney of a
16 county may bring an action in a court of competent jurisdiction
17 to prevent a violation of this part or of an executive order,
18 proclamation, or directive issued under this part, or to compel a
19 person to perform a duty imposed on the person under this part or
20 an executive order, proclamation, or directive issued under this
21 part.
22 PART 35. PROTECTION OF UNDERGROUND FACILITIES
23 Sec. 3501. As used in this part:
24 (a) "Association" means the association created under sec-
25 tion 3507.
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1 (b) "Person" includes an individual, partnership,
2 corporation, association, or any other legal entity. Person does
3 not mean a public agency.
4 (c) "Public agency" means the state, a city, village, town-
5 ship, county, or any other governmental entity or municipality.
6 (d) "Public utility" means a natural gas company subject to
7 the jurisdiction of the federal energy regulatory commission or
8 an electric, steam, gas, power, water, or pipeline company
9 subject to the jurisdiction of the commission under this act or a
10 telecommunication provider under the Michigan telecommunications
11 act, 1991 PA 179, MCL 484.2101 to 484.2605, a person or public
12 agency owning or operating cable television facilities, and a
13 public agency, other than the state transportation department,
14 owning public service facilities for supplying water, light,
15 heat, gas, power, telecommunications, sewage disposal, storm
16 drains, or storm water drainage facilities.
17 Sec. 3502. This part does not apply to a person or public
18 agency using only nonpowered hand tools in performing excavating
19 or tunneling operations.
20 Sec. 3503. A person or public agency shall not discharge
21 explosives, excavate, or tunnel in a street, highway, public
22 place, a private easement of a public utility, or near the loca-
23 tion of a public utility facility owned, maintained, or installed
24 on a customer's premises, or demolish a building containing a
25 public utility facility without having first ascertained in the
26 manner prescribed in sections 3505 or 3507 the location of all
27 underground facilities of a public utility in the proposed area
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1 of excavation, discharging of explosives, tunneling, or
2 demolition.
3 Sec. 3504. A public utility having underground facilities
4 in a county shall file with the clerk of the county a list con-
5 taining the name of every city, village, township, and section
6 within the township in the county in which it has underground
7 facilities, the name of the public utility and the title and
8 address of its representative designated to receive the written
9 notice of intent required by section 3505.
10 Sec. 3505. (1) Except as provided in sections 3507 and
11 3509, a person or public agency responsible for excavating or
12 tunneling operations, drilling or boring procedures, or discharge
13 of explosives in a street, highway, other public place, a private
14 easement for a public utility, or near the location of utility
15 facilities on a customer's property, or demolition of a building
16 containing a utility facility, shall give written or telephone
17 notice to the association as required in section 3507 of intent
18 to excavate, tunnel, discharge explosives, or demolish at least 3
19 full working days, excluding Saturdays, Sundays, and holidays,
20 but not more than 21 calendar days, before commencing the exca-
21 vating, demolishing, discharging of explosives, tunneling opera-
22 tions, or drilling or boring procedures.
23 (2) The written or telephone notice of intent shall contain
24 the name, address, and telephone number of the person or public
25 agency filing the notice of intent, the name of the person or
26 public agency performing the excavation, discharging of
27 explosives, tunneling, or demolition, the date and type of
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1 excavating, discharging of explosives, demolishing, drilling or
2 boring procedure, or tunneling operation to be conducted, and the
3 location of the excavation, tunneling, discharging of explosives,
4 drilling, boring, or demolition.
5 Sec. 3506. A public agency that under law requires a person
6 to obtain a permit shall require as a condition of the permit
7 that the person comply with this part.
8 Sec. 3507. (1) Public utilities having underground facili-
9 ties shall form and operate an association providing for mutual
10 receipt of notification of construction activities in those areas
11 served by public utilities having underground facilities.
12 Notification to the association formed and operated by the public
13 utilities shall be considered to be notice to each public utility
14 having underground facilities within the proposed areas of exca-
15 vation, discharging of explosives, tunneling, demolition,
16 drilling, or boring. Notification to the association shall be
17 effected in writing as set forth in section 3505 or by telephone
18 call, providing the same information required by section 3505,
19 made by the person or public agency responsible for the excavat-
20 ing, demolishing, discharging of explosives, drilling or boring
21 procedures, or tunneling operations.
22 (2) A public utility owned by a public agency shall partici-
23 pate in and receive the services furnished by the association and
24 shall pay its share of the costs and services furnished, but
25 shall not be required to become a member of the association. The
26 association, whose members or participants have underground
27 facilities within a county, shall file with the clerk of the
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42
1 county a description of the geographical area served by the
2 association and list the name and address of every member and
3 participating public utility.
4 (3) If notification is made by telephone, an adequate record
5 shall be maintained by the association to document compliance
6 with the requirements of this part.
7 Sec. 3508. (1) Not less than 1 working day in advance of
8 proposed construction, unless otherwise agreed between the person
9 or public agency performing the excavation, discharging of explo-
10 sives, drilling, boring, tunneling, or demolition and the public
11 utility, a public utility served with notice under section 3505
12 or 3507 shall inform the person or public agency of the approxi-
13 mate location of the underground facilities owned or operated by
14 the public utility in the proposed area of excavation, discharg-
15 ing of explosives, drilling, boring, tunneling, or demolition, in
16 a manner that enables the person or public agency to employ hand
17 dug test holes or other similar means of establishing the precise
18 location of the underground facilities using reasonable care to
19 establish the precise location of the underground facilities in
20 advance of construction.
21 (2) For the purposes of this part, the approximate location
22 of underground facilities is defined as a strip of land at least
23 36 inches wide but not wider than the width of the facility plus
24 18 inches on either side of the facility. If the approximate
25 location of an underground facility is marked with stakes or
26 other physical means, the public utility shall follow the color
27 coding prescribed in this section.
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1
2 Utility and Type of Product Specific Group Identifying Color
3 Electric power distribution and
4 transmission Safety red
5 Municipal electric systems Safety red
6 Gas distribution and
7 transmission High visibility safety yellow
8 Oil distribution and
9 transmission High visibility safety yellow
10 Dangerous materials, product
11 lines High visibility safety yellow
12 Telephone and telegraph systems Safety alert orange
13 Cable television Safety alert orange
14 Police and fire communications Safety alert orange
15 Water systems Safety precaution blue
16 Sewer systems Safety brown
17 Storm drains Safety green
18 Land survey monumentation High visibility safety pink
19 (3) All safety alert orange markings shall include the name
20 or type of the company who owns the underground facility to be
21 marked.
22 (4) If the precise location of the underground facilities
23 cannot be established, the person or public agency shall then
24 notify the public utility, which shall no later than 1 working
25 day after the notice provide such further assistance as may be
26 needed to determine the precise location of the underground
27 facilities in advance of the proposed excavating, tunneling,
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1 discharging of explosives, drilling or boring procedures, or
2 demolition operations.
3 (5) Where demolition of a building is proposed and the
4 public utility is notified, it shall be given reasonable time to
5 remove or protect its facilities before demolition of the
6 building.
7 Sec. 3509. (1) In case of an emergency involving danger to
8 life, health, or property or which requires immediate correction
9 in order to continue the operation of a major industrial plant or
10 to assure the continuity of public utility service, a person or
11 public agency may make excavation, maintenance, or repairs, with-
12 out using explosives, if notice in writing is given to the public
13 utility or association as soon as reasonably possible.
14 (2) In case of an emergency involving an immediate and sub-
15 stantial danger of death or serious personal injury, explosives
16 may be discharged if notice is given to a public utility or an
17 association at any time before the discharge is undertaken.
18 Sec. 3510. (1) This part shall not be construed to autho-
19 rize, affect, or impair local ordinances, charters, or other pro-
20 visions of law, requiring permits to be obtained before excavat-
21 ing or tunneling in a public street or highway or to construct or
22 demolish buildings or other structures on private property nor to
23 grant to a person or public agency any rights not specifically
24 provided by this part.
25 (2) A permit issued by a public agency shall not be consid-
26 ered to relieve a person from the responsibility for complying
27 with the provisions of this part.
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1 (3) The failure of a person, who has been granted a permit,
2 to comply with the provisions of this part shall not be consid-
3 ered to impose any liability upon the public agency issuing the
4 permit.
5 (4) This part shall not preclude establishment of working
6 agreements between public utilities and contractor associations
7 to accomplish the intent and purpose of this part.
8 Sec. 3511. Upon receiving the information provided for in
9 section 3505 or 3507, a person or public agency excavating, tun-
10 neling, or discharging explosives shall exercise reasonable care
11 when working in close proximity to the underground facilities of
12 a public utility. If the facilities are to be or are likely to
13 be exposed, only hand-digging shall be employed and such support
14 as may be reasonably necessary to protect the facilities shall be
15 provided in and near the construction area.
16 Sec. 3512. (1) When contact with or damage to a pipe,
17 cable, or its protective coating or other underground facility of
18 a public utility occurs, the public utility shall be notified
19 immediately by the person or public agency responsible for the
20 operations causing the contact or damage.
21 (2) Upon receiving the notice, the public utility shall dis-
22 patch personnel to the location as soon as possible to effect
23 temporary or permanent repair of the damage. If a serious elec-
24 trical short is occurring or if dangerous fluids or gases are
25 escaping from a broken line, the person or public agency respon-
26 sible for causing the damage shall evacuate the immediate area
27 while awaiting the arrival of the public utility personnel.
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1 Sec. 3513. Except as otherwise provided for in this part,
2 this act does not affect any civil remedies for damage to public
3 utility facilities and does not affect any civil remedies a
4 person may have for actual damage to the person's property caused
5 by a public utility's negligence in staking its facilities.
6 Sec. 3514. In a civil action in a court of this state, when
7 it is shown by competent evidence that damage to the underground
8 facilities of a public utility resulted from excavating, tunnel-
9 ing, drilling or boring procedures, demolishing operations, or
10 the discharge of explosives, as described in section 3503, and
11 that the person responsible for giving notice of intent to exca-
12 vate, tunnel, demolish, or discharge explosives failed to give
13 notice, did not employ hand-digging, or failed to provide sup-
14 port, the person shall be liable for the resulting damage to the
15 underground facilities, but the liability for damages shall be
16 reduced in proportion to the negligence of the public utility if
17 it fails to comply with section 3508.
18 Sec. 3515. (1) A person who damages the facilities of a
19 public utility on more than 3 occasions on any 1 construction
20 contract location because of that person's failure to comply with
21 this part may be enjoined from engaging in any further excavat-
22 ing, demolition, discharging of explosives, drilling or boring
23 procedures, or tunneling work within the state, except under
24 terms and conditions as a court may prescribe to ensure the
25 safety of the public.
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1 (2) A court may prescribe penalties as it considers
2 necessary or appropriate for a violation of an injunctive order
3 up to a maximum of $5,000.00 per violation.
4 Sec. 3516. A person who willfully removes or otherwise
5 destroys the stakes or other physical markings used by a public
6 utility to mark the approximate location of underground facili-
7 ties is guilty of a misdemeanor, punishable by a fine of not more
8 than $5,000.00, or imprisonment for not more than 1 year, or
9 both.
10 PART 36. PUBLIC UTILITY FRANCHISES
11 Sec. 3601. (1) A township may grant a franchise to a person
12 to use the highways, streets, alleys, and other public places of
13 the township to construct, operate, and maintain poles, wires,
14 and pipes or conduits and the right to transact a local business
15 in the township, subject to reasonable regulations.
16 (2) As used in this part, "person" does not include a tele-
17 communication provider under the Michigan telecommunications act,
18 1991 PA 179, MCL 484.2101 to 484.2605.
19 Sec. 3602. (1) A township may grant the franchise allowed
20 under section 3601 by a majority vote of the township board. The
21 board shall designate the franchise as either revocable or
22 irrevocable.
23 (2) If the franchise is designated as irrevocable, approval
24 of the franchise as irrevocable shall be submitted to a vote of
25 the electors of the township at the next election.
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1 (3) If the electors do not approve the irrevocability of the
2 franchise, the franchise shall remain valid but continue as a
3 revocable franchise.
4 Sec. 3603. At least 20 days before the next election, the
5 township clerk shall give notice that the question of granting an
6 irrevocable franchise will be submitted to a vote of the electors
7 by posting a notice in 3 or more public places in the township.
8 Sec. 3604. Unless revoked by the board or otherwise voted
9 by the electors, a revocable franchise granted before June 26,
10 1996, shall be a revocable franchise under this part subject to
11 the terms and conditions of any existing agreements or contracts
12 between the franchisee and the township.
13 PART 37. COMPLAINTS
14 Sec. 3701. (1) The commission shall investigate a complaint
15 submitted in writing that any rate, classification, regulation,
16 or practice charged, made, or observed by any public utility is
17 unjust, inaccurate, or improper, or that any service is inade-
18 quate to the prejudice of the complainant. The commission shall
19 establish procedures to be followed in such complaint cases in
20 rules adopted by the commission. The commission shall notify the
21 public utility that a complaint has been made and furnish the
22 public utility with a copy of the complaint at least 20 days
23 prior to a formal investigation.
24 (2) In all cases, reasonable notice of not less than 10 days
25 shall be given to the parties concerned as to the time and place
26 of any hearing which is deemed necessary. The public utility
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1 shall have the right to a hearing with respect to a complaint.
2 All parties shall be entitled to be heard.
3 (3) Hearings shall be governed by the rules of the commis-
4 sion and applicable statutory provisions. If a hearing is held,
5 parties to the hearing shall have the right to present
6 witnesses. The taking of testimony at such hearing shall be gov-
7 erned by the rules of the commission.
8 (4) Upon completion of any hearing, the commission shall
9 have the authority to issue an order dismissing the complaint or
10 directing that the rate, charge, practice, or other matter com-
11 plained of be removed, modified, or altered, in a manner which is
12 just, equitable, and in accordance with the rights of the parties
13 concerned.
14 (5) If the commission believes that any rate or rates or
15 charge or charges may be unreasonable or unjustly discriminatory,
16 or that any service is inadequate, it may, upon its own motion,
17 investigate the rate, charge, or service. Before making an
18 investigation, the commission shall present to the public utility
19 a statement in writing, setting forth the rate, charge, or serv-
20 ice to be investigated. The commission may proceed in the same
21 manner as when a complaint has been made.
22 (6) This part does not replace but is in addition to any
23 other complaint provision under this act.
24 PART 38. REHEARINGS AND MODIFICATIONS OF ORDERS
25 Sec. 3801. (1) The commission in any proceeding which may
26 now be pending before it or which shall hereafter be brought
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1 before it, shall have full power and authority to grant
2 rehearings and alter, amend, or modify its findings and orders.
3 (2) The time allowed to bring an action to review a commis-
4 sion order shall continue after the order denying a rehearing or
5 made upon a rehearing for the same number of days now provided by
6 this act for reviewing the order upon which the rehearing was
7 denied or conducted.
8 ARTICLE 4
9 ELECTRIC UTILITIES
10 PART 41. GENERAL PROVISIONS
11 Sec. 4101. (1) When electricity is generated or developed
12 by steam, water, or other power, within 1 county of this state,
13 and transmitted and delivered to the consumer in the same or some
14 other county, then the transmission and distribution of the elec-
15 tricity in or on the public highways, streets, and places, the
16 rate of charge to be made to the consumer for the electricity
17 transmitted and distributed, and the rules and conditions of
18 service under which the electricity is transmitted and distrib-
19 uted shall be subject to regulation as provided in this act.
20 (2) The commission shall have control and supervision of the
21 business of transmitting and supplying electricity as set forth
22 in subsection (1). A public utility supplying electricity shall
23 not put into force any rate or charge for the same without first
24 receiving the commission's approval to initiate or put into force
25 such rate or charge.
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1 (3) This article does not apply to transmitting or using
2 electricity to convey information by telegraph, telephone, or
3 similar method.
4 Sec. 4102. (1) If an electric utility applies to the com-
5 mission for a finding or order to increase its rates and charges
6 or to alter, change, or amend its rates or rate schedules, the
7 effect of which will be to increase the cost of services to its
8 customers, notice shall be given within the service area to be
9 affected. The electric utility shall place in evidence facts
10 relied upon to support its application to increase its rates and
11 charges or to alter, change, or amend its rates or rate
12 schedules. After giving notice to the interested parties within
13 the affected service area and affording interested parties a rea-
14 sonable opportunity for a full and complete hearing, the commis-
15 sion after submission of all proofs by any interested party may
16 upon written motion by the electric utility make a finding and
17 enter an order granting partial and immediate relief. The com-
18 mission shall not authorize or approve such finding or order ex
19 parte, nor until the commission's technical staff has made an
20 investigation and report.
21 (2) The commission may authorize and approve an alteration
22 or amendment in rates or rate schedules applied for by an elec-
23 tric utility that will not result in an increase in the cost of
24 service to its customers without notice or hearing.
25 (3) The commission shall not authorize or approve an
26 increase in rates based upon changes in cost of fuel unless
27 notice has been given within the affected service area and there
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1 has been an opportunity for a full and complete hearing on the
2 cost of fuel. The rates charged by an electric utility under an
3 automatic fuel adjustment clause shall not be altered, changed,
4 or amended unless notice has been given within the affected serv-
5 ice area and there has been an opportunity for a full and com-
6 plete hearing on the cost of the fuel.
7 (4) The commission shall adopt rules and procedures for the
8 filing, investigating, and hearing of applications or petitions
9 to increase or decrease electric utility rates and charges as the
10 commission finds necessary or appropriate to enable it to reach a
11 final decision with respect to applications or petitions within 9
12 months after filing.
13 (5) The commission shall not authorize or approve adjustment
14 clauses that operate without notice and an opportunity for a full
15 and complete hearing, and any such clauses shall be abolished.
16 (6) The commission may hold a full and complete hearing to
17 determine the cost of fuel or purchased power separately from a
18 full and complete hearing on a general rate case. The hearing
19 may be held concurrently with the general rate case. The commis-
20 sion shall authorize an electric utility to recover the cost of
21 fuel or purchased power only to the extent that the purchases are
22 reasonable and prudent.
23 (7) As used in this part:
24 (a) "Full and complete hearing" means a hearing that pro-
25 vides interested parties a reasonable opportunity to present and
26 cross-examine evidence and present arguments relevant to the
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1 specific element or elements of the request that are the subject
2 of the hearing.
3 (b) "General rate case" means a proceeding initiated by an
4 electric utility in an application filed with the commission that
5 alleges a revenue deficiency and requests an increase in the
6 schedule of rates or charges based on the electric utility's
7 total cost of providing service.
8 (8) If a final decision has not been reached upon a petition
9 or application to increase or decrease utility rates within the
10 9-month period required by subsection (4), the commission shall
11 give priority to the case and shall take other action necessary
12 or appropriate to expedite a final decision. If the commission
13 fails to reach a final decision with respect to a petition or
14 application to increase or decrease utility rates within the
15 9-month period required under subsection (4), the commission
16 shall submit a written report to the governor and to the presi-
17 dent of the senate and the speaker of the house of representa-
18 tives within 15 days after the 9-month period expires stating the
19 reasons a decision was not reached within the 9-month period and
20 the actions being taken to expedite the decision. The commission
21 shall submit a further report upon reaching a final decision pro-
22 viding full details with respect to the conduct of the case,
23 including the time required to issue the commission's decision
24 following the conclusion of hearings.
25 Sec. 4103. (1) The commission shall investigate a complaint
26 submitted in writing by a consumer or a city, village, or
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1 township concerning the price of electricity sold and delivered,
2 or concerning any other matter of complaint.
3 (2) The commission's agents, examiners, inspectors, engi-
4 neers, and accountants may inspect the system and method used in
5 transmitting and supplying electricity and may examine the books
6 and papers of a person pertaining to the transmittal and supply
7 of electricity or any other matter of complaint.
8 (3) The commission shall provide notice of hearing with a
9 copy of the complaint to the affected electric utility and the
10 person complained of or affected by the complaint and that person
11 may be heard in any matter complained of at a convenient time and
12 place stated in the notice. After the investigation and hearing,
13 the commission may by order fix the price of electricity to be
14 charged by the electric utility and may by order establish rules
15 and conditions of service that are just and reasonable.
16 (4) The electric utility shall receive notice of the price
17 fixed by the commission under subsection (3) and charge that
18 fixed price until changed by the commission.
19 (5) In determining the price, the commission shall consider
20 and give due weight to all lawful elements necessary for the com-
21 mission to determine the price to be fixed for supplying elec-
22 tricity, including cost, reasonable return on the fair value of
23 all property used in the service, depreciation, obsolescence,
24 risks of business, value of service to the consumer, the con-
25 nected load, the hours of the day when used, and the quantity
26 used each month.
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1 (6) The commission shall not change or alter the price fixed
2 in or regulated by or under a franchise granted by a city,
3 village, or township.
4 (7) If identical or substantially identical rates are estab-
5 lished in 2 or more contiguous cities, villages, townships, or
6 communities served or whose inhabitants are served by the same
7 electric utility, the territory served shall be treated as a unit
8 for fixing rates. A rate shall not be changed with respect to 1
9 or more of the cities, villages, townships, or communities so as
10 to establish a difference of rate within the territory served,
11 unless it is shown that the continuance of the identical or sub-
12 stantially identical rate or rates will work substantial hardship
13 to a city, village, township, or electric utility or unless oth-
14 erwise provided by law.
15 (8) The rates of an electric utility shall be just and rea-
16 sonable and a consumer shall not be charged more or less than
17 what other consumers are charged for like contemporaneous service
18 rendered under similar circumstances and conditions.
19 (9) If an electric public utility doing business in this
20 state, directly or indirectly, by a special rate, rebate,
21 draw-back, or other device, directly or indirectly, charges,
22 demands, collects, or receives from a person a greater or lesser
23 compensation for a service rendered than the electric public
24 utility charges, demands, collects, or receives from any other
25 person for rendering a like contemporaneous service, the electric
26 public utility is guilty of unjust discrimination which is
27 prohibited and declared to be unlawful.
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1 (10) A person shall not, directly or indirectly, ask,
2 demand, or accept a rebate, draw-back, or other device by which
3 the person obtains electric service for a rate less than that
4 charged others in like circumstances.
5 Sec. 4104. (1) As used in this section:
6 (a) "Resource recovery facility" means a facility that meets
7 all of the following requirements:
8 (i) Has machinery, equipment, and structures installed for
9 the primary purpose of recovering energy through the incineration
10 of qualified solid waste, qualified landfill gas, or scrap
11 tires.
12 (ii) Utilizes at least 80% of its total annual fuel input in
13 the form of qualified solid waste, at least 90% of its total
14 annual fuel input in the form of qualified landfill gas, or 90%
15 of its total annual fuel input in the form of scrap tires, exclu-
16 sive of fuel used for normal start-up and shutdown.
17 (iii) Is a qualifying facility as defined by the federal
18 energy regulatory commission under the public utility regulatory
19 policies act of 1978, Public Law 95-617, 92 Stat. 3117.
20 (b) "Qualified landfill gas" means gas reclaimed from a type
21 II landfill as defined in R 299.4105 of the Michigan administra-
22 tive code.
23 (c) "Qualified solid waste" means solid waste that may be
24 lawfully disposed of in a type II landfill as defined in
25 R 299.4105 of the Michigan administrative code, and which is gen-
26 erated within this state.
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1 (d) "Scrap tire", "scrap tire hauler", and "scrap tire
2 processor" mean those terms as they are defined in part 169
3 (scrap tires) of the natural resources and environmental protec-
4 tion act, 1994 PA 451, MCL 324.16901 to 324.16909.
5 (2) Electric utilities with more than 500,000 customers in
6 this state shall enter into power purchase agreements for the
7 purchase of capacity and energy from resource recovery facilities
8 that incinerate qualified landfill gas, that incinerate qualified
9 solid waste, at least 50.1% of which is generated within the
10 service areas of the electric utility, or, subject to the provi-
11 sions of this section, that incinerate scrap tires, under rates,
12 charges, terms, and conditions of service that, for these facili-
13 ties, may differ from those negotiated, authorized, or prescribed
14 for purchases from qualifying facilities that are not resource
15 recovery facilities.
16 (3) If a resource recovery facility incinerates scrap tires,
17 or any other tires that are obtained from outside the state, or
18 if more than 50.1% of the scrap tires or other tires are obtained
19 outside the electric utility service area, the electric utility
20 may in partial satisfaction of its obligation under this section
21 purchase capacity and energy from the facility but is not obli-
22 gated by this act to purchase the facility's capacity and
23 energy.
24 (4) A resource recovery facility that incinerates at least
25 90% of its total annual fuel input in the form of scrap tires
26 shall accept all scrap tires that first became scrap tires in the
27 state and that are delivered to the facility by a scrap tire
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1 processor or a scrap tire hauler. The first 6,000,000 of these
2 scrap tires delivered to the resource recovery facility each year
3 shall be charged a rate not greater than an amount equal to
4 $34.50 per ton, increased each calendar quarter beginning July 1,
5 1990, by an amount equal to the increase in the all items version
6 of the consumer price index for urban wage earners and clerical
7 workers during the prior calendar quarter.
8 (5) Including power purchase agreements executed prior to
9 June 30, 1989, this section does not apply after 120 megawatts of
10 electric resource recovery facility capacity in an electric
11 utility's service territory have been contracted and entered in
12 commercial operation.
13 (6) This section also does not apply to more than the first
14 30 megawatts of scrap tire fueled resource recovery facility
15 capacity in the state that has been contracted and entered in
16 commercial operation.
17 (7) Excluding rate provisions, if 1 or more provisions of a
18 purchase agreement remain in dispute, each party shall submit to
19 the commission all of the purchase agreement provisions of their
20 last best offer and a supporting brief. On each disputed provi-
21 sion, the commission shall within 60 days either select or reject
22 with recommendation the offers submitted by either party.
23 (8) A power purchase agreement entered into by an electric
24 utility for the purchase of capacity and energy from a resource
25 recovery facility shall be filed with the commission and a con-
26 tested case proceeding shall commence immediately.
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1 (9) A power purchase agreement shall be considered approved
2 if the commission does not approve or disapprove the agreement
3 within 6 months of the date of the filing of the agreement.
4 Approval under this subsection constitutes prior approval under
5 section 4212(b).
6 (10) The energy rate component of all power sales contracts
7 for resource recovery facilities shall be equal to the avoided
8 energy cost of the purchasing electric utility.
9 (11) When averaged over the term of the contract, the capac-
10 ity rate component of all power sales contracts for resource
11 recovery facilities may be equal to but not less than the full
12 avoided cost of the electric utility as determined by the
13 commission. In determining the capacity rate, the commission may
14 assume that the electric utility needs capacity.
15 (12) Capacity purchased by an electric utility prior to
16 January 1, 2000 under a power sales contract with a resource
17 recovery facility shall not be considered directly or indirectly
18 in determining the electric utility's reserve margin, reserve
19 capacity, or other resource capability measurement.
20 (13) To insure compliance with this section, a resource
21 recovery facility that incinerates scrap tires shall provide an
22 annual accounting to the legislature and the commission. The
23 annual accounting shall include the total amount of scrap tires
24 incinerated at the resource recovery facility and the percentage
25 of those scrap tires that prior to incineration were used within
26 this state for their original intended purpose.
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1 Sec. 4105. Any person, firm or corporation engaged or
2 organized to engage in any such business of transmitting and
3 supplying electricity in 1 or more counties of this state shall,
4 with the consent of the duly constituted city, village and town-
5 ship authorities of the cities, villages and townships in or
6 through which it operates or may hereafter propose to operate,
7 have the right to use the highways, streets, alleys and other
8 public places of such cities, villages and townships: Provided,
9 That in all cases each transmission line used shall have insula-
10 tion and conductivity in accordance with its voltage. In case it
11 has or procures a franchise from any city, village or township or
12 a right to do business therein, it may transact a local business
13 therein. Nothing herein contained shall be construed to impair
14 any right possessed by any village or township to the reasonable
15 control of its streets, alleys and public places in all matters
16 of mere local concern.
17 Sec. 4106. (1) Subject to part 43 and if the commission
18 requires, a person erecting any lines to transmit electricity in
19 or through the highways, streets, or public places of 1 or more
20 counties of this state shall file with the commission data and
21 information relative to the method and manner of the construction
22 of those lines, the franchise or consent under which the lines
23 were constructed or are being maintained, and any other informa-
24 tion the commission reasonably requires. The commission may
25 require the filing of detailed specifications showing the type of
26 construction of lines and the details of construction of lines of
27 various voltages.
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1 (2) After the commission approves specifications under this
2 section, all lines shall be constructed according to those
3 specifications.
4 (3) The height of the lines at all highway crossings shall
5 not be less than 22 feet, and at railroad crossings shall be in
6 accordance with the commission's rules.
7 (4) The commission may require that all poles used in the
8 transmission of electricity be stenciled or otherwise marked with
9 the owner's name.
10 Sec. 4107. (1) The commission shall have the power to
11 inspect and examine all electrical apparatus installed in a
12 public highway, street, or place and may investigate the method
13 employed by persons transmitting and supplying electricity.
14 (2) The commission shall have the power to order improve-
15 ments in the method employed in transmitting and supplying elec-
16 tricity which are necessary to secure good service and the safety
17 of the public, those employed in the business of transmitting and
18 distributing the electricity, or any persons liable to be injured
19 by the erection, maintenance, or use of the apparatus.
20 Sec. 4108. (1) The commission may do any of the following:
21 (a) Order electric current for distribution to be delivered
22 at a suitable primary voltage, to any city, village, or township
23 through which a transmission line or lines may pass.
24 (b) Order service to be rendered by an electric utility if
25 it is reasonable for the service to be ordered.
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1 (c) Prescribe uniform methods of keeping accounts to be
2 observed by persons engaged in such business of transmitting and
3 supplying electricity.
4 (d) Keep informed as to the methods employed by electric
5 utilities in the transaction of their business.
6 (e) Insure that the property of electric utilities is main-
7 tained and operated for the security and accommodation of the
8 public and in compliance with the legal requirements.
9 (f) Require an electric utility annually to file a verified
10 report in the form the commission specifies providing information
11 the commission determines necessary to perform its duties and
12 require from all electric utilities in this state information
13 that it may need to perform its duties under this part.
14 (g) In connection with any rate or service hearing or inves-
15 tigation, make an audit and analysis of the books and records of
16 the electric utility, and an inventory and appraisal of its prop-
17 erty as necessary in connection with the commission's duties
18 under this part.
19 (2) In a case described in subsection (1)(g), the commission
20 shall keep a record of all expenses incurred in connection with
21 its investigation of the affairs and property of the electric
22 utility. During the progress or at the conclusion of its work,
23 the commission shall state the amount in writing to the electric
24 utility and the electric utility shall pay to the department of
25 treasury the amount of that expense in the manner the commission
26 by order requires. This money shall be credited to the
27 commission for the payment of its expenses.
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1 Sec. 4109. (1) An electric utility and its officers,
2 agents, and employees shall obey all lawful orders issued by the
3 commission under this part so long as the order remains in
4 force.
5 (2) A person who willfully or knowingly fails or neglects to
6 obey or comply with an order or provision of this part is liable
7 for a fine of not more than $300.00 for each offense. Every act
8 that violates an order or provision of this part is a separate
9 offense and, for a continued violation, each day constitutes a
10 separate offense.
11 (3) An action to recover a fine under this section may be
12 brought in a court of competent jurisdiction.
13 (4) All money recovered in the action, together with the
14 costs, shall be paid into the state treasury to the credit of the
15 general fund.
16 PART 42. POWER SUPPLY COST RECOVERY
17 Sec. 4201. As used in this part:
18 (a) "General rate case" means a proceeding before the com-
19 mission in which interested parties are given notice and a rea-
20 sonable opportunity for a full and complete hearing on an elec-
21 tric utility's total cost of service and all other lawful ele-
22 ments properly to be considered in determining just and reason-
23 able rates.
24 (b) "Interested person" means the attorney general, the
25 commission's technical staff, an intervenor admitted to 1 or both
26 of the electric utility's 2 previous general rate cases or to 1
27 or both of the electric utility's 2 previous reconciliation
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1 hearings, or an association of electric utility customers that
2 meets the requirements to intervene in a reconciliation hearing
3 under the commission's rules of practice and procedure.
4 (c) "Power supply cost recovery clause" means a clause in
5 the electric rates or rate schedule of an electric utility that
6 permits the monthly adjustment of rates for power supply to allow
7 the electric utility to recover the booked costs, including
8 transportation costs, reclamation costs, and disposal and repro-
9 cessing costs, of fuel burned by the utility for electric genera-
10 tion and the booked costs of purchased and net interchanged power
11 transactions by the electric utility incurred under reasonable
12 and prudent policies and practices.
13 (d) "Power supply cost recovery factor" means that element
14 of the rates to be charged for electric service to reflect power
15 supply costs incurred by an electric utility and made under a
16 power supply cost recovery clause incorporated in the rates or
17 rate schedule of an electric utility.
18 Sec. 4202. (1) The commission may, but is not required to
19 do so, incorporate a power supply cost recovery clause in the
20 electric rates or rate schedule of an electric utility.
21 (2) An order incorporating a power supply cost recovery
22 clause shall be as a result of a hearing held solely on the ques-
23 tion of the inclusion of the clause in the rates or rate
24 schedule. A hearing under this section shall be conducted as a
25 contested case or under section 4217 as a result of a general
26 rate case.
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1 (3) An order incorporating a power supply cost recovery
2 clause shall replace and rescind any previous fuel cost
3 adjustment clause or purchased and net interchanged power adjust-
4 ment clause incorporated in the electric rates of the electric
5 utility upon the effective date of the first power supply cost
6 recovery factor authorized for the electric utility under its
7 power supply cost recovery clause.
8 Sec. 4203. (1) To implement the power supply cost recovery
9 clause established under section 4202, an electric utility annu-
10 ally shall file a complete power supply cost recovery plan
11 describing the expected sources of electric power supply and
12 changes in the cost of power supply anticipated over a future
13 12-month period specified by the commission and requesting for
14 each of those 12 months a specific power supply cost recovery
15 factor. The commission may establish filing procedures.
16 (2) The plan shall be filed not less than 3 months before
17 the beginning of the 12-month period covered by the plan.
18 (3) The plan shall describe all major contracts and power
19 supply arrangements entered into by the electric utility for pro-
20 viding power supply during the specified 12-month period. The
21 description of the major contracts and arrangements shall include
22 the price of fuel, the duration of the contract or arrangement,
23 and an explanation or description of any other term or provision
24 required by the commission.
25 (4) The plan shall also include the evaluation by the elec-
26 tric utility of the reasonableness and prudence of its decisions
27 to provide power supply in the manner described in the plan, in
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1 light of its existing sources of electrical generation, and an
2 explanation of the actions taken by the electric utility to mini-
3 mize the cost of fuel to the electric utility.
4 Sec. 4204. (1) To implement the power supply cost recovery
5 clause established under section 4202, an electric utility shall
6 file contemporaneously with its power supply cost recovery plan a
7 5-year forecast of the power supply requirements of its custom-
8 ers, its anticipated sources of supply, and projections of power
9 supply costs, in light of its existing sources of electrical gen-
10 eration and sources of electrical generation under construction.
11 (2) The forecast shall include a description of all relevant
12 major contracts and power supply arrangements entered into or
13 contemplated by the electric utility, and other information the
14 commission requires.
15 Sec. 4205. (1) If an electric utility files a power supply
16 cost recovery plan and a 5-year forecast, the commission shall
17 conduct a power supply and cost review to evaluate the reason-
18 ableness and prudence of the power supply cost recovery plan of
19 the electric utility and establish the power supply cost recovery
20 factors to implement a power supply cost recovery clause incorpo-
21 rated in the electric rates or rate schedule of the electric
22 utility.
23 (2) The power supply and cost review shall be conducted as a
24 contested case.
25 (3) In its final order in a power supply and cost review,
26 the commission shall evaluate the reasonableness and prudence of
27 the decisions underlying the power supply cost recovery plan of
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1 the electric utility and shall approve, disapprove, or amend the
2 power supply cost recovery plan accordingly.
3 (4) In evaluating the decisions underlying the power supply
4 cost recovery plan, the commission shall consider:
5 (a) The cost and availability of the electrical generation
6 available to the electric utility.
7 (b) The cost of short-term firm purchases available to the
8 electric utility.
9 (c) The availability of interruptible service.
10 (d) The ability of the electric utility to reduce or to
11 eliminate any firm sales to out-of-state customers if the elec-
12 tric utility is not a multi-state utility whose firm sales are
13 subject to other regulatory authority.
14 (e) Whether the electric utility has taken all appropriate
15 actions to minimize the cost of fuel.
16 (f) Other relevant factors.
17 (5) The commission shall approve, reject, or amend the 12
18 monthly power supply cost recovery factors requested by the elec-
19 tric utility in its power supply cost recovery plan. The factors
20 shall not reflect items the commission could reasonably antici-
21 pate would be disallowed under section 4212. The factors ordered
22 shall be described in fixed dollar amounts per unit of electrici-
23 ty, but may include specific amounts contingent on future
24 events.
25 Sec. 4206. In its final order in a power supply and cost
26 review, the commission shall evaluate the decisions underlying
27 the 5-year forecast of the electric utility. The commission may
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1 also indicate any cost items in the 5-year forecast that, on the
2 basis of present evidence, the commission would be unlikely to
3 permit the electric utility to recover from its customers in
4 rates, rate schedules, or power supply cost recovery factors
5 established in the future.
6 Sec. 4207. (1) On its own motion or the motion of any
7 party, the commission may make a finding and enter a temporary
8 order granting approval or partial approval of a power supply
9 cost recovery plan in a power supply and cost recovery review,
10 after first giving notice to the parties to the review and after
11 having provided the parties a reasonable opportunity for a full
12 and complete hearing.
13 (2) A temporary order made under this section is a final
14 order for purposes of judicial review.
15 Sec. 4208. (1) If the commission has made a final or tempo-
16 rary order in a power supply and cost review, the electric util-
17 ity may each month incorporate in its rates for the period cov-
18 ered by the order any amounts up to the power supply cost recov-
19 ery factors permitted in that order.
20 (2) If the commission has not made a final or temporary
21 order within 3 months after a complete power supply cost recovery
22 plan is submitted or by the beginning of the period covered in
23 the plan, whichever comes later, or, if a temporary order has
24 expired without being extended or replaced, then pending an order
25 that determines the power supply cost recovery factors, an elec-
26 tric utility may each month adjust its rates to incorporate all
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1 or a part of the power supply cost recovery factors requested in
2 its plan.
3 (3) Any amounts collected under the power supply cost recov-
4 ery factors under subsection (2) are subject to prompt refund
5 with interest to the extent the total amounts collected exceed
6 the total amounts determined in the commission's final order to
7 be reasonable and prudent for the same period of time.
8 Sec. 4209. (1) Not less than 3 months before the beginning
9 of the third quarter of the 12-month period, the electric utility
10 may file a revised power supply cost recovery plan covering the
11 remainder of the 12-month period.
12 (2) Upon receipt of the revised power supply cost recovery
13 plan, the commission shall reopen the power supply and cost
14 review.
15 (3) The commission may reopen the power supply and cost
16 review on its own motion or on the showing of good cause by any
17 party if at least 6 months have elapsed since the electric util-
18 ity submitted its complete filing and if there are at least 60
19 days remaining in the 12-month period under consideration.
20 (4) A reopened power supply and cost review shall be con-
21 ducted as a contested case and in accordance with this part.
22 Sec. 4210. (1) Not more than 45 days following the last day
23 of each billing month in which a power supply cost recovery
24 factor has been applied to customers' bills, the electric utility
25 shall file with the commission a detailed statement for that
26 month of the revenues recorded under the power supply cost
27 recovery factor, the allowance for cost of power supply included
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1 in the base rates established in the latest commission order for
2 the electric utility, and the cost of power supply.
3 (2) The commission shall prescribe the manner and form for
4 the detailed statement. The commission shall establish proce-
5 dures for insuring that the detailed statement is promptly veri-
6 fied and corrected if necessary.
7 Sec. 4211. (1) Not less than once a year, and not later
8 than 3 months after the end of the 12-month period covered by an
9 electric utility's power supply cost recovery plan, the commis-
10 sion shall commence a power supply cost reconciliation proceeding
11 as a contested case.
12 (2) Reasonable discovery shall be permitted before and
13 during the power supply cost reconciliation proceeding to assist
14 parties and interested persons in obtaining evidence concerning
15 reconciliation issues including, but not limited to, the reason-
16 ableness and prudence of expenditures and the amounts collected
17 under the clause.
18 (3) At the power supply cost reconciliation proceeding, the
19 commission shall reconcile the revenues recorded under the power
20 supply cost recovery factors and the allowance for cost of power
21 supply included in the base rates established in the latest com-
22 mission order for the electric utility with the amounts actually
23 expensed and included in the cost of power supply by the electric
24 utility. The commission shall consider any issue regarding the
25 reasonableness and prudence of expenses for which customers were
26 charged if the issue was not considered adequately at a
27 previously conducted power supply and cost review.
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1 Sec. 4212. An order in a power supply cost reconciliation
2 proceeding shall disallow all of the following:
3 (a) Cost increases resulting from changes in accounting or
4 rate-making expense treatment not previously approved by the
5 commission. The commission may order the electric utility to pay
6 a penalty not to exceed 25% of the amount improperly collected.
7 Costs incurred by the electric utility for penalty payments shall
8 not be charged to customers.
9 (b) Any capacity charges associated with power purchased for
10 periods in excess of 6 months unless the electric utility has
11 obtained the prior approval of the commission. If the commission
12 has approved capacity charges in a contract with a qualifying
13 facility, as defined by the federal energy regulatory commission
14 under the public utility regulatory policies act of 1978, Public
15 Law 95-617, 92 Stat. 3117, the commission shall not disallow the
16 capacity charges for the facility in the power supply cost recon-
17 ciliation proceeding unless the commission has ordered revised
18 capacity charges upon reconsideration under this subsection. A
19 contract is valid and binding in accordance with its terms, and
20 capacity charges paid under the contract shall be recoverable
21 costs of the electric utility for rate-making purposes notwith-
22 standing that the order approving the contract is later vacated,
23 modified, or otherwise held to be invalid in whole or in part if
24 the order approving the contract has not been stayed or suspended
25 by a competent court within 30 days after the date of the order.
26 The commission shall determine the scope and manner of the review
27 of capacity charges for a qualifying facility. Proceedings
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1 seeking approvals shall be conducted as a contested case. The
2 commission, upon its own motion or upon application of any
3 person, may reconsider its approval of capacity charges in a con-
4 tested case hearing after a period necessary for financing the
5 qualifying facility if the commission has first issued an order
6 making a finding based on evidence presented in a contested case
7 that there has been a substantial change in circumstances since
8 the commission's initial approval and the commission's finding is
9 set forth in a commission order subject to immediate judicial
10 review. The financing period for a qualifying facility during
11 which previously approved capacity charges are not subject to
12 commission reconsideration is 17.5 years, beginning with the date
13 of commercial operation, for all qualifying facilities, except
14 that the minimum financing period before reconsideration of the
15 previously approved capacity charges shall be for the duration of
16 the financing for a qualifying facility that produces electric
17 energy by the use of biomass, waste, wood, hydroelectric, wind,
18 and other renewable resources, or any combination of renewable
19 resources, as the primary energy source.
20 (c) Net increased costs attributable to a generating plant
21 outage of more than 90 days in duration unless the electric util-
22 ity demonstrates by clear and satisfactory evidence that the
23 outage, or any part of the outage, was not caused or prolonged by
24 the utility's negligence or by unreasonable or imprudent
25 management.
26 (d) Transportation costs attributable to capital investments
27 to develop the capability of an electric utility to transport
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1 fuel or relocate fuel at the electric utility's facilities and
2 unloading and handling expenses incurred after receipt of fuel by
3 the electric utility.
4 (e) The cost of fuel purchased from an affiliated company to
5 the extent the fuel is more costly than fuel of requisite quality
6 available at or about the same time from other suppliers with
7 whom it would be comparably cost beneficial to deal.
8 (f) Charges unreasonably or imprudently incurred for fuel
9 not taken.
10 (g) Additional costs resulting from unreasonably or impru-
11 dently renegotiated fuel contracts.
12 (h) Penalty charges unreasonably or imprudently incurred.
13 (i) Demurrage charges.
14 (j) Increases in charges for nuclear fuel disposal unless
15 the electric utility has received the prior approval of the
16 commission.
17 Sec. 4213. (1) In its order in a power supply cost recon-
18 ciliation, the commission shall require an electric utility to
19 refund to customers or credit to customers' bills any net amount
20 determined to have been recovered over the period covered in
21 excess of the amounts determined to have been actually expensed
22 by the electric utility for power supply and to have been
23 incurred through reasonable and prudent actions not precluded by
24 the commission order in the power supply and cost review.
25 (2) The refunds or credits shall be apportioned among the
26 customers of the electric utility utilizing procedures that the
27 commission determines to be reasonable. The commission may adopt
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1 different procedures with respect to customers served under the
2 various rate schedules of the electric utility and may, in appro-
3 priate circumstances, order refunds or credits in proportion to
4 the excess amounts actually collected from each customer during
5 the period covered.
6 Sec. 4214. (1) In its order in a power supply cost recon-
7 ciliation, the commission shall authorize an electric utility to
8 recover from customers any net amount by which the amount deter-
9 mined to have been recovered over the period covered was less
10 than the amount determined to have been actually expended by the
11 electric utility for power supply and to have been incurred
12 through reasonable and prudent actions not precluded by the com-
13 mission order in the power supply and cost review.
14 (2) For excess costs incurred through management actions
15 contrary to the commission's power supply and cost review order,
16 the commission shall authorize an electric utility to recover
17 costs incurred for power supply in the reconciliation period in
18 excess of the amount recovered over the period only if the elec-
19 tric utility demonstrates by clear and convincing evidence that
20 the excess expenses were beyond the electric utility's ability to
21 control through reasonable and prudent actions.
22 (3) For excess costs incurred through management actions
23 consistent with the commission's power supply and cost review
24 order, the commission shall authorize an electric utility to
25 recover costs incurred for power supply in the reconciliation
26 period in excess of the amount recovered over the period only if
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1 the electric utility demonstrates that the level of such expenses
2 resulted from reasonable and prudent management actions.
3 (4) The amounts in excess of the amounts actually recovered
4 by the electric utility for power supply shall be apportioned
5 among and charged to the customers of the electric utility using
6 procedures the commission determines are reasonable. The commis-
7 sion may adopt different procedures with respect to customers
8 served under the various rate schedules of the electric utility
9 and may, in appropriate circumstances, order charges to be made
10 in proportion to the amounts that would have been paid by those
11 customers if the amounts in excess of the amounts actually recov-
12 ered by the electric utility for cost of power supply had been
13 included in the power supply cost recovery factors with respect
14 to those customers during the period covered.
15 (5) Charges for the excess amounts shall be spread over a
16 period the commission determines is appropriate.
17 Sec. 4215. (1) If the commission orders refunds or credits
18 under section 4213, or additional charges to customers under sec-
19 tion 4214, in its final order in a power supply cost reconcilia-
20 tion proceeding, the refunds, credits, or additional charges
21 shall include interest.
22 (2) In determining the interest included in a refund,
23 credit, or additional charge under this section, the commission
24 shall consider, to the extent material and practicable, when the
25 excess recoveries or insufficient recoveries, or both occurred.
26 The commission shall determine a rate of interest for excess
27 recoveries, refunds, and credits equal to the greater of the
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1 average short-term borrowing rate available to the electric
2 utility during the appropriate period or the authorized rate of
3 return on the electric utility's common stock during that same
4 period. Costs incurred by the electric utility for refunds and
5 interest on refunds shall not be charged to customers.
6 (3) The commission shall determine a rate of interest for
7 insufficient recoveries and additional charges equal to the aver-
8 age short-term borrowing rate available to the electric utility
9 during the appropriate period.
10 Sec. 4216. To avoid undue hardship or unduly burdensome or
11 excessive cost, the commission may do the following:
12 (a) Exempt an electric utility with fewer than 200,000 cus-
13 tomers in this state from 1 or more of the procedural provisions
14 of this part or may modify the filing requirements of this part.
15 (b) Exempt an electric utility organized as a cooperative
16 corporation under sections 98 to 109 of 1931 PA 327, MCL 450.98
17 to 450.109, or a consumer cooperative organized under chapter 11
18 of the nonprofit corporation act, 1982 PA 162, MCL 450.3100 to
19 450.3192, from 1 or more of the provisions of this part.
20 Sec. 4217. Notwithstanding any other provision of this act,
21 the commission may, upon application by an electric utility, set
22 power supply cost recovery factors, in a manner otherwise consis-
23 tent with this article, in an order resulting from a general rate
24 case. If the commission sets power supply cost recovery factors
25 in an order resulting from a general rate case, all of the fol-
26 lowing apply:
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1 (a) The power supply cost recovery factors shall cover a
2 future period of 48 months or the number of months that elapse
3 until the commission orders new power supply cost recovery fac-
4 tors in a general rate case, whichever is the shorter period.
5 (b) Annual reconciliation proceedings shall be conducted
6 under section 4211 and if an annual reconciliation proceeding
7 shows a recoverable amount under section 4214, the commission
8 shall authorize the electric utility to defer the amount and to
9 accumulate interest on the amount under section 4215, and in the
10 next order resulting from a general rate case shall authorize the
11 electric utility to recover the amount and interest from its cus-
12 tomers in the manner provided in section 4214.
13 (c) The power supply cost recovery factors shall not be
14 revised under section 4209.
15 Sec. 4218. Every 5 years, the standing committees of the
16 house and senate that deal with public utilities shall review
17 section 4212(b).
18 PART 43. ELECTRIC TRANSMISSION LINES
19 Sec. 4301. As used in this part:
20 (a) "Certificate" means a certificate of public convenience
21 and necessity issued for a major transmission line under this
22 part or issued for a transmission line under section 4308.
23 (b) "Construction" means any substantial action taken on a
24 route constituting placement or erection of the foundations or
25 structures supporting a transmission line. Construction does not
26 include preconstruction activity or the addition of circuits to
27 an existing transmission line.
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1 (c) "Electric utility" means a person, partnership,
2 corporation, association, or other legal entity whose transmis-
3 sion or distribution of electricity the commission regulates
4 under 1909 PA 106, MCL 460.551 to 460.559, or 1939 PA 3, MCL
5 460.1 to 460.8. Electric utility does not include a municipal
6 utility.
7 (d) "Major transmission line" means a transmission line of 5
8 miles or more in length wholly or partially owned by an electric
9 utility through which electricity is transferred at system bulk
10 supply voltage of 345 kilovolts or more.
11 (e) "Municipality" means a city, township, or village.
12 (f) "Preconstruction activity" means activity on a proposed
13 route conducted before construction of a transmission line
14 begins. Preconstruction activity includes surveys, measurements,
15 examinations, soundings, borings, sample-taking, or other testing
16 procedures, photography, appraisal, or tests of soil, groundwa-
17 ter, structures, or other materials in or on the real property
18 for contamination. Preconstruction activity does not include an
19 action that permanently or irreparably alters the real property
20 on or across the proposed route.
21 (g) "Route" means real property on or across which a trans-
22 mission line is constructed or proposed to be constructed.
23 (h) "Transmission line" means all structures, equipment, and
24 real property necessary to transfer electricity at system bulk
25 supply voltage of 100 kilovolts or more.
26 Sec. 4302. Transmission of electricity is an essential
27 service.
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1 Sec. 4303. (1) If an electric utility that has 50,000 or
2 more residential customers in this state plans to construct a
3 major transmission line in this state in the 5 years after plan-
4 ning commences, the electric utility shall submit a construction
5 plan to the commission. An electric utility with less than
6 50,000 residential customers in this state may submit a plan
7 under this section. The plan shall include all of the
8 following:
9 (a) The general location and size of all major transmission
10 lines to be constructed in the 5 years after planning commences.
11 (b) Copies of relevant bulk power transmission information
12 filed by the electric utility with any state or federal agency,
13 national electric reliability coalition, or regional electric
14 reliability coalition.
15 (c) Additional information required by commission rule or
16 order that directly relates to the construction plan.
17 (2) At the same time the electric utility submits a con-
18 struction plan to the commission under subsection (1), the elec-
19 tric utility shall provide a copy of the construction plan to
20 each municipality in which construction of the planned major
21 transmission line is intended.
22 Sec. 4304. An electric utility shall not begin construction
23 of a major transmission line for which a plan has been submitted
24 under section 4303 until the commission issues a certificate for
25 that transmission line. Except as otherwise provided in section
26 4308, a certificate of public convenience and necessity under
27 this act is not required for constructing a new transmission line
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1 other than a major transmission line or for reconstructing,
2 repairing, replacing, or improving an existing transmission line,
3 including the addition of circuits to an existing transmission
4 line.
5 Sec. 4305. (1) Before applying for a certificate, an elec-
6 tric utility shall schedule and hold a public meeting in each
7 municipality through which a proposed major transmission line for
8 which a plan has been submitted under section 4303 would pass. A
9 public meeting held in a township satisfies the requirement that
10 a public meeting be held in each affected village located within
11 the township.
12 (2) In the 60 days before a public meeting held under
13 subsection (1), the electric utility shall offer in writing to
14 meet with the chief elected official of each affected municipal-
15 ity or his or her designee to discuss the electric utility's
16 desire to build the major transmission line and to explore the
17 routes to be considered.
18 Sec. 4306. (1) An electric utility that has 50,000 or more
19 residential customers in this state shall apply to the commission
20 for a certificate for a proposed major transmission line. An
21 applicant may withdraw an application at any time.
22 (2) An application for a certificate shall contain all of
23 the following:
24 (a) The planned date for beginning construction.
25 (b) A detailed description of the proposed major transmis-
26 sion line, its route, and its expected configuration and use.
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1 (c) A description and evaluation of 1 or more alternate
2 major transmission line routes and a statement of why the
3 proposed route was selected.
4 (d) If a zoning ordinance prohibits or regulates the loca-
5 tion or development of any portion of a proposed route, a
6 description of the location and manner in which that zoning ordi-
7 nance prohibits or regulates the location or construction of the
8 proposed route.
9 (e) The estimated overall cost of the proposed major trans-
10 mission line.
11 (f) Information supporting the need for the proposed major
12 transmission line, including identification of known future
13 wholesale users of the proposed major transmission line.
14 (g) Estimated quantifiable and nonquantifiable public bene-
15 fits of the proposed major transmission line.
16 (h) Estimated private benefits of the proposed major trans-
17 mission line to the applicant or any legal entity that is affili-
18 ated with the applicant.
19 (i) Information addressing potential effects of the proposed
20 major transmission line on public health and safety.
21 (j) A summary of all comments received at each public meet-
22 ing and the applicant's response to those comments.
23 (k) Information indicating that the proposed major transmis-
24 sion line will comply with all applicable state and federal envi-
25 ronmental standards, laws, and rules.
26 (l) Other information reasonably required by the commission
27 pursuant to rule.
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1 Sec. 4307. (1) Upon applying for a certificate, the
2 electric utility shall give public notice in the manner and form
3 the commission prescribes of an opportunity to comment on the
4 application. Notice shall be published in a newspaper of general
5 circulation in the area to be affected within a reasonable time
6 period after an application is filed with the commission, and
7 shall be sent to each affected municipality and each affected
8 landowner on whose property a portion of the proposed major
9 transmission line will be constructed. The notice shall be writ-
10 ten in plain, nontechnical, and easily understood terms and shall
11 contain a title that includes the name of the electric utility
12 and the words "NOTICE OF INTENT TO CONSTRUCT A MAJOR TRANSMISSION
13 LINE".
14 (2) The commission shall conduct a proceeding on the appli-
15 cation as a contested case. Upon receiving an application for a
16 certificate, each affected municipality and each affected land-
17 owner shall be granted full intervenor status as of right in com-
18 mission proceedings concerning the proposed major transmission
19 lines.
20 (3) The commission may assess certificate application fees
21 from the electric utility to cover the commission's administra-
22 tive costs in processing the application and may require the
23 electric utility to hire consultants chosen by the commission to
24 assist the commission in evaluating those issues the application
25 raises.
26 (4) The commission shall grant or deny the application for a
27 certificate not later than 1 year after the application's filing
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1 date. If a party submits an alternative route for the proposed
2 major transmission line, the commission shall grant the applica-
3 tion for either the electric utility's proposed route or 1 alter-
4 native route or shall deny the application. The commission may
5 condition its approval upon the applicant taking additional
6 action to assure the public convenience, health, and safety and
7 reliability of the proposed major transmission line.
8 (5) The commission shall grant the application and issue a
9 certificate if it determines all of the following:
10 (a) The quantifiable and nonquantifiable public benefits of
11 the proposed major transmission line justify its construction.
12 (b) The proposed or alternative route is feasible and
13 reasonable.
14 (c) The proposed major transmission line does not present an
15 unreasonable threat to public health or safety.
16 (d) The applicant has accepted the conditions contained in a
17 conditional grant.
18 (6) A certificate issued under this section shall identify
19 the major transmission line's route and shall contain an esti-
20 mated cost for the transmission line.
21 (7) If construction of a proposed major transmission line is
22 not begun within 5 years of the date that a certificate is grant-
23 ed, the certificate is void and a new certificate shall be
24 required for the proposed major transmission line.
25 Sec. 4308. (1) An electric utility may file an application
26 with the commission for a certificate for a proposed transmission
27 line other than a major transmission line. If an electric
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1 utility applies for a certificate under this section, the
2 electric utility shall not begin construction of the proposed
3 transmission line until the commission issues a certificate for
4 that transmission line.
5 (2) The commission shall proceed on an application in the
6 same manner as provided in section 4307. Except as otherwise
7 provided in subsection (3), the provisions of this part that
8 apply to applications and certificates for major transmission
9 lines apply in the same manner to applications and certificates
10 issued under this section.
11 (3) Section 4303 does not apply to a transmission line for
12 which a certificate is sought under this section.
13 Sec. 4309. (1) If the commission grants a certificate under
14 this part, that certificate shall take precedence over a con-
15 flicting local ordinance, law, rule, regulation, policy, or prac-
16 tice that prohibits or regulates the location or construction of
17 a transmission line for which the commission has issued a
18 certificate.
19 (2) A zoning ordinance or limitation imposed after an elec-
20 tric utility files for a certificate shall not limit or impair
21 the transmission line's construction, operation, or maintenance.
22 (3) In an eminent domain or other related proceeding arising
23 out of or related to a transmission line for which a certificate
24 is issued, a certificate issued under this part is conclusive and
25 binding as to the public convenience and necessity for that
26 transmission line and its compatibility with the public health
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1 and safety, or any zoning or land use requirements in effect when
2 the application was filed.
3 Sec. 4310. (1) In a civil action in the circuit court under
4 section 4 of the uniform condemnation procedures act, 1980 PA 87,
5 MCL 213.54, the court may grant a limited license to an electric
6 utility for entry on land to conduct preconstruction activity
7 related to a proposed major transmission line or a transmission
8 line if the electric utility has scheduled or held a public meet-
9 ing in connection with a certificate sought under section 4308
10 and if written notice of the intent to enter the land has been
11 given to each affected landowner on whose property the electric
12 utility wishes to enter. The limited license may be granted upon
13 such terms as justice and equity require.
14 (2) An electric utility that obtains a limited license shall
15 provide each affected land owner with a copy of the limited
16 license. A limited license shall include a description of the
17 purpose of entry, the scope of activities permitted, and the
18 terms and conditions of entry with respect to the time, place,
19 and manner of entry.
20 (3) The court shall not deny a limited license for entry to
21 conduct preconstruction activity for any of the following
22 reasons:
23 (a) A disagreement exists over the proposed route.
24 (b) The electric utility has not yet applied for a
25 certificate.
26 (c) The commission has not yet granted or denied the
27 application.
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1 (d) An alleged lack of public convenience or necessity.
2 Sec. 4311. (1) Reasonable and prudent costs for a transmis-
3 sion line for which a certificate is issued shall be included in
4 the rates of an electric utility.
5 (2) The commission shall not disallow costs the electric
6 utility incurs in constructing a transmission line for which a
7 certificate is issued that do not exceed the amount set forth in
8 the certificate unless the commission determines that the actual
9 costs were imprudently and unreasonably incurred, based upon sub-
10 stantial evidence presented in opposition to the utility's rate
11 request.
12 (3) Costs incurred by the electric utility that exceed the
13 amount set forth in the certificate shall be included in the
14 electric utility's rates if reasonably and prudently incurred
15 based upon substantial evidence presented in support of the elec-
16 tric utility's rate request.
17 Sec. 4312. (1) Except as otherwise provided in this sec-
18 tion, information obtained by the commission under this act is a
19 public record under the freedom of information act, 1976 PA 442,
20 MCL 15.231 to 15.246.
21 (2) An electric utility may designate information received
22 from a third party that the utility submits to the commission in
23 an application for a certificate or in other documents required
24 by the commission for purposes of certification submitted to the
25 commission as being only for the confidential use of the
26 commission. The commission shall notify the electric utility of
27 a request for public records under section 5 of the freedom of
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1 information act, 1976 PA 442, MCL 15.235, if the scope of the
2 request includes information designated as confidential. The
3 electric utility has 10 days after the receipt of the notice to
4 demonstrate to the commission that the information designated as
5 confidential should not be disclosed because the information is a
6 trade secret or secret process, or is production, commercial, or
7 financial information the disclosure of which would jeopardize
8 the competitive position of the electric utility or the person
9 from whom the information was obtained. The commission shall not
10 grant the request for the information if the electric utility
11 demonstrates to the satisfaction of the commission that the
12 information should not be disclosed for a reason authorized in
13 this section. If the commission makes a decision to grant a
14 request, the information requested shall not be released until 3
15 days after the date of the notice of the decision is provided to
16 the electric utility.
17 (3) If any person uses information described in
18 subsection (1) to forecast electrical demand, the person shall
19 structure the forecast so the third party is not identified
20 unless the third party waives confidentiality.
21 Sec. 4313. (1) The commission may promulgate rules to
22 implement this part. The rules may contain standards to deter-
23 mine a proposed major transmission line's health and safety
24 aspects, including but not limited to standards for permissible
25 additions to electric and magnetic fields produced by the trans-
26 mission line.
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1 (2) Until rules are promulgated under subsection (1), the
2 commission shall consider and determine any health or safety
3 issue a party raises in a proceeding concerning a certificate
4 application.
5 PART 44. ELECTRIC UTILITY FACILITIES
6 Sec. 4401. As used in this part:
7 (a) "Electric utility facility" means a facility that a
8 municipality is authorized to acquire as part of a municipal
9 electric utility system under this part or other law.
10 (b) "Governing body" means the council, commission, or board
11 of trustees of a municipality, or when the charter of a munici-
12 pality provides that a separate board has general management over
13 the municipal electric utility system, governing body means that
14 separate board, subject to review by the legislative body of the
15 municipality as its charter may provide.
16 (c) "Governmental unit" means a municipality or a joint
17 agency venture project.
18 (d) "Joint agency" means a public body corporate and politic
19 consisting of a combination of 2 or more municipalities, authori-
20 ties, or other public bodies organized in accordance with section
21 4416 to 4433.
22 (e) "Joint venture" means a project undertaken by 2 or more
23 municipalities, or 1 or more municipalities in conjunction with 1
24 or more joint agencies, electric power cooperatives, publicly or
25 privately owned utilities, authorities, or other public or pri-
26 vate bodies, organized in accordance with sections 4412 to 4415.
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1 (f) "Municipal bond" means a bond or note or other evidence
2 of indebtedness payable from ad valorem taxes that a governmental
3 unit may issue.
4 (g) "Municipal electric utility system" means a system owned
5 by a municipality or combination of municipalities to furnish
6 heat, power, and light.
7 (h) "Municipality" means a city, county, incorporated vil-
8 lage, township, or metropolitan district of this state, or a
9 board, agency, or commission thereof owning a system or facility
10 for the generation, transmission, or distribution of electric
11 power and energy for public or private use, or proposing to own
12 the system or facility.
13 (i) "Project" means a system or facility for the generation,
14 transmission, or transformation, or a combination thereof, of
15 electric power and energy carried out by a municipal electric
16 utility system by any means, including, but not limited to, any 1
17 or more electric generating units.
18 (j) "Project cost" means, but is not limited to, the cost of
19 acquisition, construction, reconstruction, improvement, enlarge-
20 ment, betterment, or extension of a project, including the cost
21 of studies, plans, specifications, surveys, and estimates of
22 costs and revenues relating to the project, the cost of land,
23 land rights, rights of way, easements, water rights, fees, per-
24 mits, approvals, licenses, certificates, franchises, and the
25 preparation of applications for securing the land, engineering
26 and inspection expenses, financing fees, expenses, and costs,
27 working capital, fuel costs, interest on bonds, establishment of
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1 reserves and all other expenditures of the issuing municipality
2 or joint agency that are incidental, necessary, or convenient to
3 the acquisition, construction, reconstruction, improvement,
4 enlargement, betterment, or extension of a project and the plac-
5 ing of the project in operation.
6 (k) "Power utility" means a political subdivision of this or
7 another state or a Canadian province, an agency of this or
8 another state, a federal agency, or a Canadian federal or provin-
9 cial agency, or a cooperative or investor owned entity subject to
10 the regulation of the commission or the equivalent regulatory
11 agency of another state that is engaged in generating, transmit-
12 ting, or distributing electricity.
13 (l) "Power utility bond" means electric utility bonds,
14 notes, or other evidences of indebtedness of a municipality,
15 including refunding bonds issued to underwrite projects autho-
16 rized by this part.
17 (m) "Revenues" means all fees, charges, money, profits, pay-
18 ment of principal of, or interest on, municipal or power utility
19 bonds, or other gifts, grants, contributions and appropriations.
20 Sec. 4402. (1) The governing body of a municipal electric
21 utility system may purchase, acquire, construct, improve,
22 enlarge, extend, or repair in the name of the municipality a
23 source or sources of electrical energy for distribution and sale
24 by the municipal electric utility system, whether the source is
25 located within or without the state.
26 (2) A source may include, but not be limited to, facilities
27 utilizing fossil fuels, garbage, trash, and other waste
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1 materials, nuclear fuels, water power, including pumped storage,
2 solar energy, wind power, geothermal energy, energy derived from
3 municipal waste of any kind, or other energy or fuel sources of
4 whatever nature.
5 (3) The governing body may in relation to a source, pur-
6 chase, acquire, construct, improve, enlarge, extend, or repair
7 facilities for the control, abatement, or prevention of pollution
8 or damage to the environment which might otherwise be caused by
9 facilities for the generation of electric power, and may acquire
10 facilities for the safe disposal of waste or by-products from the
11 generation of electrical powers.
12 Sec. 4403. (1) The governing body of a municipal electric
13 utility system may purchase, acquire, construct, improve,
14 enlarge, extend, or repair in the name of the municipality fuel
15 sources and reserves it considers necessary to the continued
16 efficient operation of the municipal electric utility system,
17 together with the necessary facilities for transportation and
18 storage.
19 (2) The fuel sources and reserves may include, but not be
20 limited to, advance payments on contracts for nuclear fuels, and
21 contracts for heat from facilities belonging to others.
22 (3) Facilities for transportation and storage of fuels shall
23 include, but not be limited to, pipelines, conveyor systems,
24 railroad cars, ships, storage tanks, underground storage areas,
25 and other necessary and related appurtenances.
26 Sec. 4404. The governing body of a municipal electric
27 utility system may purchase, acquire, construct, improve,
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1 enlarge, extend, or repair facilities for the transmission of
2 energy, and may contract for the purchase, sale, exchange, inter-
3 change, wheeling, pooling, or transmission of electrical energy
4 with another power utility.
5 Sec. 4405. The governing body of a municipal electric util-
6 ity system may exercise its authority to plan, finance, acquire,
7 construct, own, operate, maintain, and improve electric utility
8 facilities, individually, in joint venture agreements authorized
9 by sections 4412 to 4415, or in joint agency agreements as autho-
10 rized by sections 4416 to 4433, or in other joint endeavors
11 authorized by this part or other law, and in cooperation with 1
12 or more other power utilities, whether authorized by this part or
13 other law.
14 Sec. 4406. (1) A municipality engaging in a joint venture,
15 joint agency agreement, or other joint endeavor described in sec-
16 tion 4405 and authorized by sections 4412 to 4415 or sections
17 4416 to 4433 shall own a percentage of any common facility equal
18 to the percentage of the money furnished or the value of the
19 property supplied by the municipality for the acquisition and
20 construction of the common facility.
21 (2) Each municipality in a joint endeavor shall defray its
22 own interest and other payments required to be made in connection
23 with a financing undertaken by it to pay its own percentage of
24 the money furnished or the value of the property supplied by it
25 for the planning, acquisition, and construction of a common
26 facility, or an addition or betterment to the common facility.
27 The agreement shall provide a uniform method of determining and
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1 allocating operation and maintenance expenses of the joint
2 facility or agency.
3 Sec. 4407. (1) A municipality may finance the cost of an
4 electric utility facility, or its share of the cost of an elec-
5 tric utility facility acquired jointly under sections 4412 to
6 4415 or sections 4416 to 4433 or other law, by any lawful means
7 available to the municipality, including the issuance of general
8 obligation bonds under charter authority, the issuance of revenue
9 bonds under the revenue bond act of 1933, 1933 PA 94, MCL 141.101
10 to 141.139, or the issuance of mortgage bonds under charter
11 authority.
12 (2) An agreement for the joint acquisition of facilities
13 entered into under this part shall be subject to provisions con-
14 tained in this and other law relating to the issuance of bonds by
15 the municipality.
16 (3) It is declared to be in the public interest and for a
17 public purpose that power utilities be permitted to participate
18 jointly in the development of electric facilities as provided in
19 this part as a means of achieving economies of scale and promot-
20 ing the economic development of the state and to this end the
21 issuance of revenue bonds is a public purpose.
22 (4) A municipality may pledge for the payment of the princi-
23 pal of, premium if any, and interest on the bonds, the revenues,
24 or a portion thereof, derived or to be derived from the ownership
25 and operation of the municipality's system or facilities for the
26 generation, transmission, or distribution of electric power or
27 energy, or its interest in a joint project or projects, except
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1 that the proceeds of the bonds issued for a joint project and the
2 faith and credit of the municipality pledged for the bonds shall
3 be dedicated exclusively to the acquisition of the municipality's
4 undivided share of a joint project as specified in section 4406.
5 Sec. 4408. (1) To the extent of ownership by governmental
6 units or joint agencies, projects undertaken under joint venture
7 agreements authorized by sections 4412 to 4415 or joint agency
8 agreements authorized by sections 4416 to 4433 of this part are
9 exempt from assessment, collection, and levy of general or spe-
10 cial taxes of the state or its political subdivisions. Income
11 produced from municipal ownership in a joint venture or a joint
12 agency shall be exempt from taxation by the state or its politi-
13 cal subdivisions.
14 (2) A joint agency corporation formed under sections 4416 to
15 4433 shall not be required to pay taxes upon its income, exis-
16 tence, or franchise. The bonds and notes issued by a municipal-
17 ity in a joint venture agreement or a joint agency corporation,
18 their transfer and the income from the bonds and notes, including
19 a profit made on the sale of the bonds or notes, shall be exempt
20 from taxation within this state.
21 Sec. 4409. In connection with the ownership and operation
22 of an electric utility facility, whether owned individually or
23 jointly, the governing body of a municipal electric utility
24 system may enter into the necessary license agreements with fed-
25 eral, state, or Canadian regulatory agencies, and comply with
26 conditions imposed by the licensing agency, including, but not
27 limited to, actions necessary to preserve and protect the
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1 environment, the acquisition of required public liability
2 insurance, including waiver of defenses and payment of retrospec-
3 tive premiums, and other actions as may be necessary.
4 Sec. 4410. The governing body of a municipality or the
5 board of commissioners of a joint agency may make application and
6 enter into contracts for, and accept grants in aid and loans from
7 state and federal agencies and private and public organizations
8 for any purpose authorized by this part. The governing body of a
9 municipality or the board of commissioners of a joint agency may
10 do any or all of the following:
11 (a) Enter into and carry out contracts with the state or
12 federal government or an agency or institution thereof under
13 which the government, agency, or institution grants financial or
14 other assistance to the municipality or joint agency.
15 (b) Accept assistance or funds granted or loaned by the
16 state or federal government, with or without a contract.
17 (c) Agree to or comply with reasonable conditions that are
18 imposed upon a grant or loan accepted under this section.
19 (d) Make expenditures from funds granted or loaned.
20 Sec. 4411. (1) A municipality may take private property
21 under 1911 PA 149, MCL 213.21 to 213.25, and the uniform condem-
22 nation procedures act, 1980 PA 87, MCL 213.51 to 213.77, for the
23 purposes defined in and authorized by this part, if the taking
24 and use is necessary for public purposes and for public benefit.
25 (2) A municipality shall not exercise its power of eminent
26 domain to acquire an existing electrical generation or
27 transmission facility held in private ownership or a part of an
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1 electrical generation or transmission facility held in private
2 ownership, without first securing in writing the approval of the
3 lawful private owner or owners. The acquired property may be
4 conveyed for use in joint agency or joint venture projects autho-
5 rized by this part in a manner and upon terms as the municipality
6 considers appropriate.
7 Sec. 4412. (1) A governmental unit may join in a joint ven-
8 ture agreement to plan, finance, develop, construct, reconstruct,
9 acquire, improve, enlarge, better, own, operate, or maintain an
10 undivided interest as a tenant in common in a project situated
11 within or without the state with 1 or more municipalities, joint
12 agencies, or power utilities and make plans and enter into con-
13 tracts in connection with a joint venture agreement, not incon-
14 sistent with this part, as are necessary or appropriate.
15 (2) Before entering a joint venture agreement, the governing
16 body of a municipality shall determine the needs of the munici-
17 pality for power and energy based on engineering studies and
18 reports. In determining the future power requirements of a
19 municipality, all of the following shall be considered:
20 (a) The economies and efficiencies to be achieved in con-
21 structing on a large scale facilities for the generation and
22 transmission of electric power and energy.
23 (b) The municipality's need for reserve and peaking capac-
24 ity, and to meet obligations under pooling and reserve sharing
25 agreements reasonably related to its needs for power and energy
26 to which it is or may become a party.
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1 (c) The estimated useful life of the project.
2 (d) The estimated time necessary for the planning,
3 development, acquisition, or construction of the project, and the
4 length of time required in advance to obtain, acquire, or con-
5 struct additional power supply.
6 (e) The reliability and availability of existing or alterna-
7 tive power supply sources, and the cost of those existing or
8 alternative power supply sources.
9 Sec. 4413. (1) Under a joint venture agreement, each gov-
10 ernmental unit shall own an undivided interest in a project or
11 projects in proportion to the amount of money furnished or the
12 value of property or other consideration supplied by the govern-
13 mental unit for the planning, development, acquisition, or con-
14 struction of the project, and each governmental unit shall be
15 entitled to a percentage share of output and capacity from the
16 project equal to its undivided interest.
17 (2) Each governmental unit shall be severally liable for its
18 own acts, but shall not be jointly or severally liable for the
19 acts, omissions or obligations of other governmental units or
20 power utility party to the joint venture agreement, and money or
21 property or other consideration supplied by the governmental unit
22 shall not be credited or otherwise applied to the account of
23 another governmental unit or power utility, nor shall the undi-
24 vided share of a governmental unit in a project be charged
25 directly or indirectly with a debt or obligation of another gov-
26 ernmental unit or be subject to a lien as a result of a debt or
27 obligation of another governmental unit or power utility.
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1 (3) The acquisition of a project may include, but not be
2 limited to, the purchase or lease of an existing, completed
3 project, or the purchase of a project under construction.
4 (4) A governmental unit participating in the joint planning,
5 financing, construction, reconstruction, acquisition, improve-
6 ment, enlargement, betterment, ownership, operation, or mainte-
7 nance of a project under this part may furnish money derived from
8 the proceeds of bonds, from the ownership and operation of its
9 electrical system, or from any other source, and may provide
10 property, both real and personal, services, and other
11 considerations.
12 Sec. 4414. (1) A joint venture agreement entered into by
13 governmental units with respect to joint ownership in a project
14 shall contain those terms, conditions, and provisions, not incon-
15 sistent with this part, as the governing bodies of the governmen-
16 tal units determine to be in the interest of the governmental
17 units. The contracts shall be ratified by resolution of the gov-
18 erning body of each governmental unit in the manner as may be
19 prescribed by law or local charter.
20 (2) A contract shall include provisions relating to, but not
21 limited to, all of the following:
22 (a) The purpose or purposes of the contract.
23 (b) The duration of the contract.
24 (c) The method of appointing or employing the personnel nec-
25 essary in connection with the project.
26 (d) The method of financing the project, including the
27 apportionment of costs and revenues.
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1 (e) The ownership interest of the parties in property used
2 or useful in connection with the project, and the procedures for
3 disposition of that property when the contract expires or is ter-
4 minated, or when the project is abandoned, decommissioned, or
5 dismantled.
6 (f) The prohibition or restrictions of the alienation or
7 partition of a governmental unit's undivided interest in a
8 project, which provisions shall not be subject to a law restrict-
9 ing covenants against alienation or partition.
10 (g) The construction of a project, which may include the
11 determination that a governmental unit jointly participating, or
12 a person, firm, or corporation, may construct the project as
13 agent for all parties to the joint venture agreement.
14 (h) The operation and maintenance of a project, which may
15 include a determination that a governmental unit jointly partici-
16 pating, or that a person, firm, or corporation, may operate and
17 maintain the project for all parties.
18 (i) Detailed project costs.
19 (j) The creation of a committee of representatives of the
20 governmental units or power utility jointly participating, which
21 committee shall have powers regarding the construction and opera-
22 tion of the project as the contract, not inconsistent with this
23 part, may provide.
24 (k) If 1 or more of the governmental units default in the
25 performance or discharge of its or their obligations with respect
26 to the project, the other party or parties may assume, pro rata
27 or otherwise, the obligations of the defaulting parties, and may
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1 succeed to the rights and interest of the defaulting party or
2 parties in the project as may be agreed upon in the contract.
3 (l) Methods for amending the contract.
4 (m) Methods for terminating the contract.
5 (n) Any other necessary or proper matter.
6 Sec. 4415. (1) Capacity or output derived by a governmental
7 unit from its ownership share of a project not then required by
8 the governmental unit for its own use and for the use of its cus-
9 tomers may be sold or exchanged by the governmental unit for a
10 consideration and for a period and upon other terms and condi-
11 tions as may be determined by the parties to the sale.
12 (2) Municipalities proposing to jointly plan, finance,
13 develop, own, and operate a project may, either jointly or sepa-
14 rately, apply to the appropriate agencies of the state, the fed-
15 eral government, another state, or another proper agency, for the
16 necessary licenses, permits, certificates, or approvals; may con-
17 struct, maintain, and operate the project in accordance with the
18 licenses, permits, certificates, or approvals; and may obtain,
19 hold, and use the licenses, permits, certificates, or approvals
20 in the same manner as the operating unit of any other power
21 utility.
22 (3) Municipalities participating in a joint project or
23 projects may enter into contracts for the exchange, interchange,
24 wheeling, pooling, or transmission of electric power and energy
25 produced by the project or projects with a municipality of this
26 state or another state owning electric distribution facilities,
27 with an electric membership corporation, with an electric
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1 utility, or with a state, federal, or municipal agency which owns
2 electric generation, transmission, or distribution facilities in
3 this state or another state.
4 (4) Personnel appointed by a municipality to work on a joint
5 project shall have the same authority, rights, privileges, and
6 immunities which the officers, agents, and employees of the
7 appointing municipality enjoy within the jurisdictional bounda-
8 ries of the municipality, whether within or without that territo-
9 ry, when the personnel are acting within the scope of their
10 authority or within the course of their employment.
11 (5) Municipalities party to a joint project authorized by
12 this part shall, following the end of each fiscal year, prepare
13 an annual report of the activities of the project, including a
14 complete operating and financial statement covering the opera-
15 tions of the project for that year. The municipalities shall
16 cause an audit of the books of records and accounts of the
17 project to be made not less than annually by a certified public
18 accountant, and the cost of the audit may be treated as part of
19 the cost of construction of the project, or as part of the
20 expense of administering the project covered by the audit.
21 Sec. 4416. (1) A joint agency is formed when the governing
22 bodies of 2 or more municipalities by resolution determine that
23 it is in the best interest of the municipalities engaged in gen-
24 eration, transmission, or distribution of electricity as of
25 January 13, 1977, in accomplishing the purposes of this part to
26 create a joint agency for the purpose of undertaking the
27 planning, financing, development, acquisition, construction,
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1 reconstruction, improvement, enlargement, betterment, operation,
2 or maintenance of a project or projects to supply electric power
3 and energy for their present or future needs as an alternative or
4 supplemental method of obtaining the benefits and assuming the
5 responsibilities of ownership in a project.
6 (2) In determining whether the creation of a joint agency
7 for this purpose is in the best interest of a municipality, the
8 governing body of each municipality shall consider, but shall not
9 be limited to, all of the following:
10 (a) Whether a separate entity may be able to finance the
11 cost of projects in a more economic and efficient manner.
12 (b) Whether financial market acceptance may be enhanced if 1
13 entity is responsible for issuing and selling all of the bonds
14 required for a project or projects in a timely and orderly manner
15 and with a uniform credit rating, instead of multiple entities
16 marketing their separate issues of bonds.
17 (c) Whether savings and other advantages may be obtained by
18 providing a separate entity responsible for the acquisition, con-
19 struction, ownership, and operation of a project or projects.
20 (d) Whether the existence of a separate entity will foster
21 the continuation of joint planning and undertaking of projects,
22 and the resulting economies and efficiencies to be realized from
23 the joint planning and undertaking will serve the interest of the
24 residents of the municipality. The determination made by the
25 governing body of a municipality hereunder shall be conclusive.
26 Sec. 4417. The joint agency shall be governed by a board of
27 commissioners appointed by the respective governing bodies of the
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1 municipalities which are members of the joint agency. The
2 governing body of each member municipality shall, by resolution,
3 appoint 1 commissioner who, at the discretion of the governing
4 body, may be an officer or an employee of the municipality. Each
5 commissioner shall serve at the pleasure of the governing body by
6 which he or she was appointed.
7 Sec. 4418. (1) The board of commissioners of a joint agency
8 shall annually elect 1 of the commissioners as chairperson,
9 another as vice-chairperson, and another person or persons, who
10 may or may not be a commissioner, as treasurer, secretary, and if
11 desired, assistant secretary. The office of treasurer may be
12 held by the secretary or assistant secretary. The board of com-
13 missioners may appoint additional officers as it considers
14 necessary.
15 (2) The secretary or assistant secretary of the joint agency
16 shall keep a record of the proceedings of the joint agency, and
17 the secretary shall be the custodian of all records, books, docu-
18 ments, and papers filed with the joint agency, the minutes or
19 journal of the joint agency, and its official seal. Either the
20 secretary or the assistant secretary of the joint agency may
21 cause copies to be made of all minutes and other records and doc-
22 uments of the joint agency and may give certificates under the
23 official seal of the joint agency to the effect that the copies
24 are true copies, and all persons dealing with the joint agency
25 may rely upon a certificate under the official seal of the joint
26 agency.
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1 Sec. 4419. (1) A joint agency formed for the purposes
2 provided in this part is a public body politic and corporate and
3 the powers conferred by this part shall be considered and held to
4 be the performance of an essential public function.
5 (2) Any combination of 2 or more municipalities described in
6 section 4416 may incorporate a joint agency by the adoption of
7 articles of incorporation by resolution of the governing body of
8 each municipality. The fact of adoption shall be endorsed on the
9 articles of incorporation by the chief executive officer and
10 clerk of the municipalities.
11 (3) The articles of incorporation shall be published at
12 least once in a newspaper generally circulating within the area
13 of each municipality. One printed copy of the articles of incor-
14 poration, certified as a true copy, with the date and place of
15 the publication, shall be filed with the county clerk of the
16 county or counties in which the incorporating municipalities are
17 located and with the secretary of state.
18 (4) The incorporation of the joint agency shall become
19 effective at the time provided in the articles of incorporation.
20 (5) The validity of the joint agency incorporation shall be
21 conclusive unless questioned in a court of competent jurisdiction
22 within 60 days after the filing of certified copies with the
23 county clerk and the secretary of state.
24 (6) The articles of incorporation shall state the name of
25 the joint agency, the names of the various incorporating munici-
26 palities, the purpose or purposes for which it is created, the
27 powers, duties, and limitations of the joint agency and its
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1 officers, the method of selecting its governing body, officers,
2 and employees, the person or persons who are charged with the
3 responsibility for causing the articles of incorporation to be
4 published and filed or who are charged with the responsibility in
5 connection with the incorporation of the joint agency, the place
6 of publication, and all other matters which the incorporating
7 municipalities shall consider advisable, all of which shall be
8 subject to the provisions of this part and of the constitution
9 and laws of the state.
10 (7) A municipality described in section 4416 which did not
11 join in the original incorporation of a joint agency may become a
12 member by amendment to the articles of incorporation adopted by
13 the governing body of the municipality and by the governing body
14 of each existing member municipality of the joint agency. Other
15 amendments may be made to the articles of incorporation if
16 adopted by the governing body of each municipality of the joint
17 agency. An amendment shall be endorsed, published, and certified
18 and printed copies filed in the same manner as the original arti-
19 cles of incorporation.
20 Sec. 4420. (1) A majority of the commissioners of a joint
21 agency shall constitute a quorum for the transaction of business
22 of the joint agency. A vacancy in the board of commissioners of
23 the joint agency shall not impair the rights of a quorum to exer-
24 cise all the rights and perform all the duties of the joint
25 agency. Action taken by the joint agency shall be authorized by
26 resolution at any regular or special meeting, and each resolution
27 shall take effect immediately. A vote of the majority of the
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1 commissioners on the board of commissioners shall be necessary to
2 take action, or pass a resolution.
3 (2) A commissioner of a joint agency shall not receive com-
4 pensation for the performance of his or her duties but may be
5 reimbursed for actual and necessary expenses incurred while
6 engaged in the performance of his or her duties.
7 Sec. 4421. After the creation of a joint agency, another
8 municipality may become a member of the joint agency upon appli-
9 cation to the joint agency after the adoption of a resolution of
10 the governing body of the municipality as prescribed in section
11 4416 authorizing the municipality to participate, and with the
12 unanimous consent of the members of the joint agency evidenced by
13 the resolutions of each of their governing bodies. A municipal-
14 ity may withdraw from a joint agency, except that all contractual
15 rights acquired and obligations incurred while a member munici-
16 pality remain in full force and effect.
17 Sec. 4422. A joint agency shall have the rights and powers
18 necessary and convenient to carry out and effectuate the purposes
19 and provisions of this part, including but not limited to all of
20 the following:
21 (a) To adopt bylaws for the regulation of the affairs and
22 conduct of its business, and to prescribe rules, regulations, and
23 policies in connection with the performance of its functions and
24 duties.
25 (b) To adopt an official seal and alter the same at
26 pleasure.
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1 (c) To maintain an office at a place or places as it may
2 determine.
3 (d) To sue and be sued in its own name, and to plead and be
4 impleaded.
5 (e) To receive, administer, and comply with the conditions
6 and requirements respecting a gift, grant, or donation of prop-
7 erty or money.
8 (f) To acquire by purchase, lease, gift, or otherwise, or to
9 obtain options for the acquisition of, real or personal property,
10 improved or unimproved, including less than a fee interest in
11 land.
12 (g) To sell, lease, exchange, transfer, or otherwise dispose
13 of, or to grant options for those purposes with respect to, real
14 or personal property or an interest therein.
15 (h) To pledge or assign money, rents, charges, or other rev-
16 enues or the proceeds derived by the joint agency from the sales
17 of real or personal property, insurance, or condemnation awards.
18 (i) To issue bonds of the joint agency for the purpose of
19 providing funds for any of its corporate purposes.
20 (j) To study, plan, finance, construct, reconstruct,
21 acquire, improve, enlarge, extend, better, own, operate, or main-
22 tain 1 or more projects, and to pay all or a part of the costs of
23 the projects from the proceeds of bonds of the joint agency or
24 from other funds made available to the joint agency.
25 (k) To authorize the construction, operation, or maintenance
26 of a project or projects by a person, firm, or corporation,
27 including a political subdivision or agency of another state.
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1 (l) To acquire by lease, purchase, or otherwise an existing
2 project or a project under construction.
3 (m) To sell or otherwise dispose of a project or projects.
4 (n) To fix, charge, and collect rents, rates, fees, and
5 charges for electric power or energy or other services, facili-
6 ties, or commodities sold, furnished, or supplied through a
7 project.
8 (o) To generate, produce, transmit, deliver, exchange, pur-
9 chase or sell for resale only, electric power or energy, and to
10 enter into contracts for those purposes.
11 (p) To negotiate and to enter into contracts for the pur-
12 chase, sale, exchange, interchange, wheeling, pooling, transmis-
13 sion, or use of electric power and energy with a municipality in
14 this state or another state or a Canadian province owning elec-
15 tric distribution facilities, and electric membership corpora-
16 tion, a public utility, or a state, federal, or municipal agency
17 which owns electric generation, transmission, or distribution
18 facilities in this state or another state.
19 (q) To make and execute contracts and other instruments nec-
20 essary or convenient in the exercise of the powers and functions
21 of the joint agency under this part, including contracts with
22 persons, firms, corporation, and others.
23 (r) To apply to the appropriate agencies of the state, the
24 federal government, another state, or other proper agency for the
25 necessary permits, licenses, certificates, or approvals, and to
26 construct, maintain, and operate projects in accordance with the
27 licenses, permits, certificates, or approvals, and to obtain,
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1 hold, and use the licenses, permits, certificates, and approvals
2 in the same manner as another person or operating unit of another
3 person.
4 (s) To employ engineers, architects, attorneys, real estate
5 counselors, appraisers, financial advisors, and other consultants
6 and employees as may be required in the judgment of the joint
7 agency and to fix and pay their compensation from funds available
8 to the joint agency for that purpose.
9 (t) To do all acts and things necessary, convenient, or
10 desirable to carry out the purposes and to execute the powers
11 granted to the joint agency under this part.
12 Sec. 4423. Not more than 90 days after the initial election
13 of officers of the board of commissioners of the joint agency,
14 the board of commissioners shall do all of the following:
15 (a) Retain a general manager of the joint agency, on either
16 an acting or permanent basis.
17 (b) Establish broad policies covering all major operations
18 of the joint agency.
19 (c) Retain an independent certified public accounting firm
20 to provide annual financial audits.
21 (d) Adopt rules specifying quality control standards for
22 contractual professional services in accordance with rules estab-
23 lishing those criteria promulgated by the department or a board
24 or commission within that department.
25 Sec. 4424. (1) The general manager shall be the chief exec-
26 utive and operating officer of the joint agency. The general
27 manager shall exercise the management of the properties and
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1 business of the joint agency and its employees. The general
2 manager shall direct the enforcement of all resolutions, rules,
3 and regulations of the board of commissioners, and shall enter
4 into contracts as necessary under the general control and direc-
5 tion of the board of commissioners. The general manager shall
6 serve at the pleasure of the board of commissioners.
7 (2) Subject to the approval of the board of commissioners,
8 the general manager may appoint the officers, employees, and
9 agents necessary to carry out the general purposes of the joint
10 agency. If the joint agency operates a project described in sec-
11 tion 4401(1)(i), the general manager shall classify all the
12 offices, positions, and grades of regular employment required in
13 the project.
14 Sec. 4425. Before undertaking a project, a joint agency
15 shall, based upon engineering studies and reports meeting the
16 standards described in section 4423(d), determine that the
17 project is required to provide for the projected needs for power
18 and energy of its members from the date the project is estimated
19 to be placed in normal and continuous operation and for a reason-
20 able period of time thereafter. In determining the future power
21 requirements of members of a joint agency, the joint agency shall
22 consider all of the following:
23 (a) The economies and efficiencies to be achieved in con-
24 structing facilities for the generation and transmission of elec-
25 tric power and energy.
26 (b) The needs of the joint agency for reserve and peaking
27 capacity, and to meet obligations under pooling and reserve
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1 sharing agreements reasonably related to its needs for power and
2 energy to which the joint agency is or may become a party.
3 (c) The estimated useful life of the project.
4 (d) The estimated time necessary for the planning, develop-
5 ment, acquisition, or construction of the project and the length
6 of time required in advance to obtain, acquire, or construct
7 additional power supply for members of the joint agency.
8 (e) The reliability and availability of existing alternative
9 power supplies and the cost of those existing alternative power
10 supplies.
11 Sec. 4426. A joint agency may not levy taxes nor may it
12 pledge the credit or taxing power of the state or a political
13 subdivision, except for the pledging of receipts of taxes, spe-
14 cial assessments, or charges collected by the state or a politi-
15 cal subdivision and returnable and payable by law or by contract
16 to the joint agency, and except for the pledge by a political
17 subdivision of the state of its full faith and credit in support
18 of its contractual obligations to the joint agency as authorized
19 by law. Projects of joint agencies shall be financed, in addi-
20 tion to other methods of financing provided by law, by any or all
21 of the following:
22 (a) Rents, rates, fees, and charges authorized under section
23 4422(n).
24 (b) Other income or revenues from whatever source available,
25 including contributions or appropriations of whatever nature, or
26 other revenues of the member municipalities of the joint agency.
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1 (c) Grants, loans, or contributions from federal, state, or
2 other governmental units, and grants, contributions, gifts,
3 bequests, or other devices from public or private sources.
4 (d) The proceeds of taxes, special assessments, or charges
5 imposed pursuant to law by member municipalities of the joint
6 agency, then returned or paid to the joint agency pursuant to law
7 or contract.
8 Sec. 4427. (1) A joint agency may issue bonds to pay all or
9 part of project costs or to refund all or any part of the out-
10 standing bonds or notes of the joint agency. The bonds shall be
11 payable from and may be issued in anticipation of payment of the
12 proceeds of any of the methods of financing described in section
13 4426 or elsewhere in this part or as may be provided by law.
14 (2) A member municipality of the joint agency may contract
15 as provided in section 4428 or may contract to make payments,
16 appropriations, or contributions to the joint agency of the pro-
17 ceeds of taxes, special assessments, or charges imposed and col-
18 lected by the member municipality or out of other funds legally
19 available, and may pledge its full faith and credit in support of
20 its contractual obligation to the joint agency. The contractual
21 obligation shall not constitute an indebtedness of the municipal-
22 ity within a statutory or charter debt limitation.
23 (3) If the joint agency issues bonds in anticipation of pay-
24 ments, appropriations, or contributions to be made to the joint
25 agency under contract by a political subdivision having the power
26 to levy and collect ad valorem taxes, the political subdivision
27 may obligate itself by the contract, and may levy a tax on all
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1 taxable property within the political subdivision, which tax as
2 to rate or amount will not be subject to limitation, as provided
3 in section 6 of article IX of the state constitution of 1963, for
4 contract obligations in anticipation of which bonds are issued to
5 provide sufficient money to fulfill its contractual obligation to
6 the joint agency.
7 (4) The bonds may be any of the following:
8 (a) Issued for any period of years not exceeding 50.
9 (b) Serial bonds or term bonds, or a combination of both
10 serial and term bonds.
11 (c) Issued for a consideration other than cash.
12 (d) For an amount that includes interest capitalized for a
13 period of not more than 10 years after the date of the bonds.
14 (e) Sold at public or private sale, as determined by the
15 joint agency, at a discount not to exceed 10%.
16 (f) Secured by revenues, contract payments, funds, or
17 investments and securities as determined by the joint agency.
18 (5) The resolution authorizing bonds may provide for the
19 appointment of 1 or more trustees for bondholders and a trustee
20 may be an individual or corporation domiciled or located within
21 or without the state and may be given appropriate powers whether
22 with or without the execution of an indenture.
23 (6) Unless an exception from prior approval is available
24 under subsection (10), bonds issued by any joint agency shall be
25 approved by the municipal finance commission or its successor
26 agency prior to their issuance but, except as provided by
27 subsection (10), shall not otherwise be subject to the municipal
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1 finance act, 1943 PA 202, MCL 131.1 to 139.3. Before approving
2 the issuance of the bonds, the municipal finance commission or
3 its successor agency shall determine that the amount of the pro-
4 posed issue is sufficient but not excessive, that the revenue and
5 properties pledged for the payment thereof are sufficient, and
6 that the bonds and the proceedings authorizing the same comply
7 with this part and other applicable law.
8 (7) A municipality, governmental unit, private corporation,
9 firm, or individual may advance money or deliver property to the
10 joint agency to enable it to carry out or finance any of its
11 powers and duties. The joint agency may agree to repay an
12 advance or pay for the property within a period of not more than
13 10 years, from the proceeds of its bonds or from other funds
14 legally available for that purpose, with or without interest as
15 may be agreed at the time of the advance or delivery. The obli-
16 gation of the joint agency to make the repayment or payment may
17 be evidenced by contract or note, which contract or note may
18 pledge a source of payment determined by the joint agency.
19 Unless an exception from prior approval is available under sub-
20 section (10), the contract or note shall be subject to prior
21 approval by the municipal finance commission or its successor
22 agency.
23 (8) A municipality desiring to enter into a contract under
24 this section pledging the full faith and credit of the municipal-
25 ity shall authorize, by resolution of its governing body, the
26 execution of the contract. Subsequent to the adoption of the
27 resolution a notice shall be published in a newspaper of general
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1 publication in the municipality and shall state all of the
2 following:
3 (a) That the governing body has adopted a resolution autho-
4 rizing execution of the contract.
5 (b) The purpose of the contract.
6 (c) The source of payment of the municipality's contractual
7 obligation.
8 (d) The right of referendum on the contract.
9 (e) Any other information as the governing body shall deter-
10 mine to be necessary to adequately inform all interested persons
11 of the nature of the obligation.
12 (9) The contract may be executed and delivered by the munic-
13 ipality upon approval by its governing body without a vote of the
14 electors, but the contract shall not become effective until the
15 expiration of 45 days after the date of publication of the
16 notice. If within the 45-day period a petition signed by at
17 least 10% or 15,000, whichever is the lesser, of the registered
18 electors residing within the limits of the municipality is filed
19 with the clerk requesting a referendum upon the contract, the
20 contract shall not become effective until approved by the vote of
21 a majority of the electors of the municipality at a general or
22 special election, which election shall be held within 180 days
23 after the filing of a petition. When any contract is to be
24 entered into by any township only on behalf of the unincorporated
25 area of the township, only the registered electors residing
26 within the unincorporated area of the township shall be qualified
27 to sign the petition and vote at the election.
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1 (10) The requirement of subsections (6) and (7) for
2 obtaining the prior approval of the municipal finance commission
3 or its successor agency before issuing bonds, notes, or contracts
4 under this section shall be subject to sections 10 and 11 of
5 chapter III of 1943 PA 202, MCL 133.10 and 133.11, and the
6 department of treasury shall have the same authority as provided
7 by 1943 PA 202, MCL 131.1 to 139.3, to issue an order providing
8 or denying an exception from the prior approval required by sub-
9 sections (6) and (7) for bonds, notes, and contracts authorized
10 by this section.
11 Sec. 4428. (1) A municipality which is a member of a joint
12 agency may contract to buy power and energy from the joint agency
13 required for the municipality's present or future requirements,
14 including the capacity and output of 1 or more specified
15 projects. The contract may provide that the member municipality
16 shall be obligated to make the payments required by the contract
17 whether or not a project is completed, operable, or operating,
18 and notwithstanding the suspension, interruption, interference,
19 reduction, or curtailment of the output of a project or the power
20 and energy contracted for, and that the payments under the con-
21 tract shall not be subject to a reduction whether by offset or
22 otherwise, and shall not be conditioned upon the performance or
23 nonperformance of the joint agency or another member of the joint
24 agency under the contract or other instrument.
25 (2) A contract with respect to the sale or purchase of
26 capacity or output of a project entered into between a joint
27 agency and its member municipalities may also provide that if 1
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1 or more of the municipalities default in the payment of its or
2 their obligations with respect to the purchase of the capacity or
3 output, then the remaining member municipalities which are pur-
4 chasing capacity and output under the contract are required to
5 accept and pay for and shall be entitled proportionately to and
6 may use or otherwise dispose of the capacity or output which was
7 to be purchased by the defaulting municipality.
8 (3) Payments by a municipality under a contract for the pur-
9 chase of capacity and output from a joint agency shall be made
10 solely from the revenues derived from the ownership and operation
11 of the electric system of the municipality, and an obligation
12 under the contract shall not constitute a legal or equitable
13 pledge, charge, lien, or encumbrance upon property of the munici-
14 pality or upon the municipality's income, receipts, or revenues,
15 except the revenues of its electric system.
16 (4) A municipality is obligated to fix, charge, and collect
17 rents, rates, fees, and charges for electric power and energy and
18 other services, facilities, and commodities, sold, furnished, or
19 supplied through its electric systems sufficient to provide reve-
20 nues adequate to meet its obligations under the contract, and to
21 pay other amounts payable from or constituting a charge and lien
22 upon those revenues, including amounts sufficient to pay the
23 principal of and interest on general obligation bonds issued by
24 the municipality for purposes related to its electric system.
25 (5) A municipality which is a member of a joint agency may
26 furnish the joint agency with money derived solely from the
27 ownership and operation of its electric system or facilities and
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1 provide the joint agency with personnel, equipment, and property,
2 both real and personal. A member municipality may also provide
3 services to a joint agency.
4 (6) A member municipality of a joint agency may contract
5 for, advance, or contribute funds derived solely from ownership
6 of its electric system or facilities to a joint agency as may be
7 agreed upon by the joint agency and the member municipality, and
8 the joint agency shall repay the advance or contribution from the
9 proceeds of bonds, from operating revenues, or from other funds
10 of the joint agency, together with interest as may be agreed upon
11 by the member municipality and the joint agency.
12 Sec. 4429. A joint agency may sell or exchange the excess
13 capacity or output of a project not then required by any of its
14 members for a consideration and for a period and upon terms and
15 conditions as may be determined by the parties. The sale or
16 exchange shall not be made with a municipality not engaged in the
17 generating, transmitting, or distributing of electricity as of
18 January 13, 1977, unless no other power utility is willing to
19 enter into a sale or exchange upon equally favorable terms and
20 conditions.
21 Sec. 4430. A joint agency may take private property under
22 1911 PA 149, MCL 213.21 to 213.25, and the uniform condemnation
23 procedures act, 1980 PA 87, MCL 213.51 to 213.77, or any other
24 applicable law as determined necessary by a joint agency for car-
25 rying out its purpose, except that a joint agency shall not exer-
26 cise its power of eminent domain to acquire an existing
27 electrical generation or transmission facility or a part thereof
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1 held in private ownership, including, without limitation,
2 nonprofit corporation, without first securing in writing the
3 approval of the lawful private owner or owners.
4 Sec. 4431. (1) When the board of commissioners of a joint
5 agency and the governing bodies of its member municipalities
6 shall by resolution determine that the purposes for which the
7 joint agency was formed have been substantially fulfilled and
8 that bonds issued and other obligations incurred by the joint
9 agency have been fully paid or satisfied, the board of commis-
10 sioners and governing bodies may declare the joint agency to be
11 dissolved.
12 (2) On the effective date of the resolution, the title to
13 the funds and other properties owned by the joint agency at the
14 time of the dissolution shall vest in the member municipalities
15 of the joint agency as provided in this part and the bylaws of
16 the joint agency, and in accordance with section 4406.
17 Sec. 4432. A joint agency shall, following the close of
18 each fiscal year, submit a report of its activities for the pre-
19 ceding year to the governing bodies of its member
20 municipalities. The annual report shall set forth a complete
21 operating and financial statement covering the operations of the
22 joint agency during the preceding year, together with an audit of
23 its operations as prescribed in section 4433.
24 Sec. 4433. The joint agency shall annually cause an audit
25 of its books of records and accounts by a certified public
26 accountant, and the cost of the audit may be treated as part of
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1 the cost of construction of a project or projects, or as part of
2 the expense of administration of a project covered by the audit.
3 ARTICLE 5
4 GAS UTILITIES
5 PART 51. GENERAL PROVISIONS
6 Sec. 5101. (1) If a gas utility applies to the commission
7 for a finding or order to increase its rates and charges or to
8 alter, change, or amend its rates or rate schedules, the effect
9 of which will be to increase the cost of services to its custom-
10 ers, notice shall be given within the service area to be
11 affected. The gas utility shall place in evidence facts relied
12 upon to support its application to increase its rates and charges
13 or to alter, change, or amend its rates or rate schedules. After
14 giving notice to the interested parties within the affected serv-
15 ice area and affording interested parties a reasonable opportu-
16 nity for a full and complete hearing, the commission after sub-
17 mission of all proofs by any interested party may upon written
18 motion by the gas utility make a finding and enter an order
19 granting partial and immediate relief. The commission shall not
20 authorize or approve such finding or order ex parte, nor until
21 the commission's technical staff has made an investigation and
22 report.
23 (2) The commission may authorize and approve an alteration
24 or amendment in rates or rate schedules applied for by a gas
25 utility that will not result in an increase in the cost of serv-
26 ice to its customers without notice or hearing.
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1 (3) The commission shall not authorize or approve an
2 increase in rates based upon changes in cost of purchased gas
3 unless notice has been given within the affected service area,
4 and there has been an opportunity for a full and complete hearing
5 on the cost of purchased gas. The rates charged by a gas utility
6 under an automatic purchased gas adjustment clause shall not be
7 altered, changed, or amended unless notice has been given within
8 the affected service area, and there has been an opportunity for
9 a full and complete hearing on the cost of the purchased gas.
10 (4) The commission shall adopt rules and procedures for the
11 filing, investigating, and hearing of applications or petitions
12 to increase or decrease gas utility rates and charges as the com-
13 mission finds necessary or appropriate to enable it to reach a
14 final decision with respect to applications or petitions within 9
15 months after filing.
16 (5) Adjustment clauses that operate without notice and an
17 opportunity for a full and complete hearing are abolished and
18 shall not be authorized or approved by the commission.
19 (6) The commission may hold a full and complete hearing to
20 determine the cost of purchased gas separately from a full and
21 complete hearing on a general rate case. The hearing may be held
22 concurrently with the general rate case. The commission shall
23 authorize a gas utility to recover the cost of purchased gas only
24 to the extent that the purchases are reasonable and prudent.
25 (7) As used in this part:
26 (a) "Full and complete hearing" means a hearing that
27 provides interested parties a reasonable opportunity to present
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1 and cross-examine evidence and present arguments relevant to the
2 specific element or elements of the request that are the subject
3 of the hearing.
4 (b) "General rate case" means a proceeding initiated by a
5 gas utility in an application filed with the commission that
6 alleges a revenue deficiency and requests an increase in the
7 schedule of rates or charges based on the utility's total cost of
8 providing service.
9 (8) If a final decision has not been reached upon an appli-
10 cation or petition to increase or decrease utility rates within
11 the 9-month period required by subsection (4), the commission
12 shall give priority to the case and shall take other action nec-
13 essary or appropriate to expedite a final decision. If the com-
14 mission fails to reach a final decision with respect to an appli-
15 cation or petition to increase or decrease utility rates within
16 the 9-month period required under subsection (4), the commission
17 shall submit a written report to the governor and to the presi-
18 dent of the senate and the speaker of the house of representa-
19 tives within 15 days after the 9-month period expires stating the
20 reasons a decision was not reached within the 9-month period and
21 the actions being taken to expedite the decision. The commission
22 shall submit a further report upon reaching a final decision pro-
23 viding full details with respect to the conduct of the case,
24 including the time required to issue the commission's decision
25 following the conclusion of hearings.
26 Sec. 5102. (1) This section applies if both of the
27 following criteria are met:
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1 (a) The rates of a gas utility are based, among other
2 considerations, upon the cost of natural gas purchased by the gas
3 utility that is in turn distributed by the gas utility to the
4 public.
5 (b) The cost for that gas is regulated by the federal energy
6 regulatory commission.
7 (2) In a proceeding to increase the rates and charges or to
8 alter, change, or amend any rate or rate schedule of the gas
9 utility, the commission shall receive in evidence the rates,
10 charges, classifications, and schedules on file with the federal
11 energy regulatory commission by which the cost of the gas pur-
12 chased or received by the gas utility is determined.
13 (3) If a proceeding described in subsection (2) is pending
14 before the commission and a proceeding is instituted or pending
15 before or on appeal from the federal energy regulatory commission
16 with respect to or affecting the cost of gas payable by the gas
17 utility, the commission shall consider as an item of the gas
18 utility's operating expense the cost of gas set forth in those
19 rates, charges, classifications, and schedules on file with the
20 federal energy regulatory commission.
21 (4) If the commission has entered an order approving the
22 rates of a gas utility under subsection (3) and the federal
23 energy regulatory commission or the appellate court reduces the
24 cost of gas payable by the gas utility in a final order, the com-
25 mission, upon its own motion or upon complaint and after notice
26 and hearing, may order a refund to the gas utility's customers of
27 any sum refunded to the gas utility for the period after the
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1 effective date of the commission's order approving rates under
2 subsection (3).
3 PART 52. GAS COST RECOVERY
4 Sec. 5201. As used in this part:
5 (a) "Gas cost recovery clause" means an adjustment clause in
6 the rates or rate schedule of a gas utility that permits the
7 monthly adjustment of rates for gas to allow the gas utility to
8 recover the booked costs of gas sold by the gas utility if
9 incurred under reasonable and prudent policies and practices.
10 (b) "Gas cost recovery factor" means that element of the
11 rates to be charged for gas service to reflect gas costs incurred
12 by a gas utility and made under a gas cost recovery clause incor-
13 porated in the rates or rate schedules of a gas utility.
14 (c) "General rate case" means a proceeding before the com-
15 mission in which interested parties are given notice and a rea-
16 sonable opportunity for a full and complete hearing on a gas
17 utility's total cost of service and all other lawful elements
18 properly to be considered in determining just and reasonable
19 rates.
20 (d) "Interested person" means the attorney general, the
21 commission's technical staff, an intervenor admitted to 1 or both
22 of the gas utility's 2 previous general rate cases or to 1 or
23 both of the gas utility's 2 previous reconciliation hearings, or
24 an association of gas utility customers that meets the require-
25 ments to intervene in a reconciliation hearing under the
26 commission's rules of practice and procedure.
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1 Sec. 5202. (1) The commission may incorporate a gas cost
2 recovery clause in the rates or rate schedule of a gas utility,
3 but is not required to do so.
4 (2) An order incorporating a gas cost recovery clause shall
5 be as a result of a hearing solely on the question of the inclu-
6 sion of the clause in the rates or rate schedule, which shall be
7 conducted as a contested case or under section 5216 as a result
8 of a general rate case.
9 (3) An order incorporating a gas cost recovery clause shall
10 replace and rescind any previous purchased gas adjustment clause
11 incorporated in the rates of the gas utility upon the effective
12 date of the first gas cost recovery factor authorized for the gas
13 utility under its gas cost recovery clause.
14 Sec. 5203. (1) To implement the gas cost recovery clause
15 established under section 5202, a gas utility annually shall file
16 a complete gas cost recovery plan describing the expected sources
17 and volumes of its gas supply and changes in the cost of gas
18 anticipated over a future 12-month period specified by the com-
19 mission and requesting for each of those 12 months a specific gas
20 cost recovery factor. The commission may establish procedures
21 pertaining to the filing.
22 (2) The plan shall be filed not less than 3 months before
23 the beginning of the 12-month period covered by the plan.
24 (3) The plan shall describe all major contracts and gas
25 supply arrangements entered into by the gas utility for obtaining
26 gas during the specified 12-month period. The description of the
27 major contracts and arrangements shall include the price of the
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1 gas, the duration of the contract or arrangement, and an
2 explanation or description of any other term or provision
3 required by the commission.
4 (4) The plan shall also include the gas utility's evaluation
5 of the reasonableness and prudence of its decisions to obtain gas
6 in the manner described in the plan, in light of the major alter-
7 native gas supplies available to the gas utility, and an explana-
8 tion of the legal and regulatory actions taken by the gas utility
9 to minimize the cost of gas purchased by the gas utility.
10 Sec. 5204. To implement the gas cost recovery clause estab-
11 lished under section 5202, a gas utility shall file contemporane-
12 ously with the gas cost recovery plan a 5-year forecast of the
13 gas requirements of its customers, its anticipated sources of
14 supply, and projections of gas costs. The forecast shall include
15 a description of all relevant major contracts and gas supply
16 arrangements entered into or contemplated between the gas utility
17 and its suppliers, a description of all major gas supply arrange-
18 ments that the gas utility knows have been, or expects will be,
19 entered into between the gas utility's principal pipeline suppli-
20 ers and their major sources of gas, and other information the
21 commission requires.
22 Sec. 5205. (1) If a gas utility files a gas cost recovery
23 plan and a 5-year forecast, the commission shall conduct a gas
24 supply and cost review to evaluate the reasonableness and pru-
25 dence of the plan and establish the gas cost recovery factors to
26 implement a gas cost recovery clause incorporated in the rates or
27 rate schedule of the gas utility.
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1 (2) The gas supply and cost review shall be conducted as a
2 contested case.
3 (3) In its final order in a gas supply and cost review, the
4 commission shall evaluate the reasonableness and prudence of the
5 decisions underlying the gas cost recovery plan of the gas util-
6 ity and shall approve, disapprove, or amend the gas cost recovery
7 plan accordingly.
8 (4) In evaluating the decisions underlying the gas cost
9 recovery plan, the commission shall consider all of the
10 following:
11 (a) The volume, cost, and reliability of the major alterna-
12 tive gas supplies available to the gas utility.
13 (b) The cost of alternative fuels available to some or all
14 of the gas utility's customers.
15 (c) The availability of gas in storage.
16 (d) The gas utility's ability to reduce or to eliminate any
17 sales to out-of-state customers.
18 (e) Whether the gas utility has taken all appropriate legal
19 and regulatory actions to minimize the cost of purchased gas.
20 (f) Other relevant factors.
21 (5) The commission shall approve, reject, or amend the 12
22 monthly gas cost recovery factors requested by the gas utility in
23 its gas cost recovery plan. The factors ordered shall be
24 described in fixed dollar amounts per unit of gas, but may
25 include specific amounts contingent on future events, including
26 proceedings of the federal energy regulatory commission or its
27 successor agency.
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1 Sec. 5206. In its final order in a gas supply and cost
2 review, the commission shall evaluate the decisions underlying
3 the 5-year forecast of the gas utility. The commission may also
4 indicate any cost items in the 5-year forecast that on the basis
5 of present evidence, the commission would be unlikely to permit
6 the utility to recover from its customers in rates, rate sched-
7 ules, or gas cost recovery factors established in the future.
8 Sec. 5207. On its own motion or the motion of any party,
9 the commission may make a finding and enter a temporary order
10 granting approval or partial approval of a gas cost recovery plan
11 in a gas supply and cost recovery review, after first having
12 given notice to the parties to the review, and after having
13 afforded to the parties to the review a reasonable opportunity
14 for a full and complete hearing. A temporary order made under
15 this subsection is a final order for purposes of judicial
16 review.
17 Sec. 5208. (1) If the commission has made a final or tempo-
18 rary order in a gas supply and cost review, the gas utility may
19 each month incorporate in its rates for the period covered by the
20 order any amounts up to the gas cost recovery factors permitted
21 in that order.
22 (2) If the commission has not made a final or temporary
23 order within 3 months after a complete gas cost recovery plan is
24 submitted or by the beginning of the period covered in the plan,
25 whichever comes later, or, if a temporary order has expired with-
26 out being extended or replaced, then pending an order that
27 determines the gas cost recovery factors, a gas utility may each
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1 month adjust its rates to incorporate all or a part of the gas
2 cost recovery factors requested in its plan.
3 (3) Any amounts collected under the gas cost recovery fac-
4 tors before the commission makes its final order are subject to
5 prompt refund with interest to the extent the total amounts col-
6 lected exceed the total amounts determined in the commission's
7 final order to be reasonable and prudent for the same period of
8 time.
9 Sec. 5209. (1) Not less than 3 months before the beginning
10 of the third quarter of the 12-month period, the gas utility may
11 file a revised gas cost recovery plan covering the remainder of
12 the 12-month period.
13 (2) Upon receipt of the revised gas cost recovery plan, the
14 commission shall reopen the gas supply and cost review. In addi-
15 tion, the commission may reopen the gas supply and cost review on
16 its own motion or on the showing of good cause by any party if at
17 least 6 months have elapsed since the gas utility submitted its
18 complete filing and if there are at least 60 days remaining in
19 the 12-month period under consideration.
20 (3) A reopened gas supply and cost review shall be conducted
21 as a contested case.
22 Sec. 5210. (1) Not more than 45 days following the last day
23 of each billing month in which a gas cost recovery factor has
24 been applied to customers' bills, the gas utility shall file with
25 the commission a detailed statement for that month of the reve-
26 nues recorded under the gas cost recovery factor, the allowance
27 for cost of gas included in the base rates established in the
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1 latest commission order for the gas utility, and the cost of gas
2 sold.
3 (2) The commission shall prescribe the manner and form for
4 the detailed statement. The commission shall establish proce-
5 dures for insuring that the detailed statement is promptly veri-
6 fied and corrected if necessary.
7 Sec. 5211. (1) Not less than once a year, and not later
8 than 3 months after the end of the 12-month period covered by a
9 gas cost recovery plan of a gas utility, the commission shall
10 commence a gas cost reconciliation proceeding as a contested
11 case.
12 (2) Reasonable discovery shall be permitted before and
13 during the reconciliation proceeding to assist parties and inter-
14 ested persons in obtaining evidence concerning reconciliation
15 issues including, but not limited to, the reasonableness and pru-
16 dence of expenditures and the amounts collected pursuant to the
17 clause.
18 (3) At the gas cost reconciliation proceeding, the commis-
19 sion shall reconcile the revenues recorded under the gas cost
20 recovery factor and the allowance for cost of gas included in the
21 base rates established in the latest commission order for the gas
22 utility with the amounts actually expensed and included in the
23 cost of gas sold by the gas utility. The commission shall con-
24 sider any issue regarding the reasonableness and prudence of
25 expenses for which customers were charged if the issue could not
26 have been considered adequately at a previously conducted gas
27 supply and cost review.
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1 Sec. 5212. (1) In its order in a gas cost reconciliation
2 proceeding, the commission shall require a gas utility to refund
3 to customers or credit to customers' bills any net amount deter-
4 mined to have been recovered over the period covered in excess of
5 the amounts determined to have been actually expensed by the gas
6 utility for gas sold and to have been incurred through reasonable
7 and prudent actions not precluded by the commission order in the
8 gas supply and cost review.
9 (2) The refunds or credits shall be apportioned among the
10 customers of the gas utility utilizing procedures that the com-
11 mission determines to be reasonable. The commission may adopt
12 different procedures with respect to customers served under the
13 various rate schedules of the gas utility and may, in appropriate
14 circumstances, order refunds or credits in proportion to the
15 excess amounts actually collected from each customer during the
16 period covered.
17 Sec. 5213. (1) In its order in a gas cost reconciliation,
18 the commission shall authorize a gas utility to recover from cus-
19 tomers any net amount by which the amount determined to have been
20 recovered over the period covered was less than the amount deter-
21 mined to have been actually expensed by the gas utility for gas
22 sold and to have been incurred through reasonable and prudent
23 actions not precluded by the commission order in the gas supply
24 and cost review.
25 (2) For excess costs incurred through actions contrary to
26 the commission's gas public supply and cost review order, the
27 commission shall authorize a gas utility to recover costs
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1 incurred for gas sold in the 12-month period in excess of the
2 amount recovered over the period only if the gas utility demon-
3 strates by clear and convincing evidence that the excess expenses
4 were beyond the gas utility's ability to control through reason-
5 able and prudent actions.
6 (3) For excess costs incurred through actions consistent
7 with commission's gas supply and cost review order, the commis-
8 sion shall authorize a gas utility to recover costs incurred for
9 gas sold in the 12-month period in excess of the amount recovered
10 over the period only if the gas utility demonstrates that the
11 excess expenses were reasonable and prudent.
12 (4) The amounts in excess of the amounts actually recovered
13 by the gas utility for gas sold shall be apportioned among and
14 charged to the customers of the gas utility using procedures the
15 commission determines are reasonable. The commission may adopt
16 different procedures with respect to customers served under the
17 various rate schedules of the gas utility and may, in appropriate
18 circumstances, order charges to be made in proportion to the
19 amounts that would have been paid by those customers if the
20 amounts in excess of the amounts actually recovered by the gas
21 utility for gas sold had been included in the gas cost recovery
22 factors with respect to those customers during the period
23 covered.
24 (5) Charges for the excess amounts shall be spread over a
25 period the commission determines is appropriate.
26 Sec. 5214. (1) If the commission orders refunds or credits
27 under section 5212 or additional charges to customers under
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1 section 5213, in its final order in a gas cost reconciliation,
2 the refunds, credits, or additional charges shall include inter-
3 est and shall be apportioned among the customer classes of the
4 gas utility in proportion to their respective usage during the
5 reconciliation period.
6 (2) In determining the interest included in a refund,
7 credit, or additional charge under this section, the commission
8 shall consider, to the extent material and practicable, when the
9 excess recoveries or insufficient recoveries, or both, occurred.
10 (3) The commission shall determine a rate of interest for
11 excess recoveries, refunds, and credits equal to the greater of
12 the average short-term borrowing rate available to the gas util-
13 ity during the appropriate period or the authorized rate of
14 return on the gas utility's common stock during that same
15 period.
16 (4) The commission shall determine a rate of interest for
17 insufficient recoveries and additional charges equal to the aver-
18 age short-term borrowing rate available to the gas utility during
19 the appropriate period.
20 Sec. 5215. To avoid undue hardship or unduly burdensome or
21 excessive cost, the commission may exempt a gas utility with
22 fewer than 200,000 customers in this state from 1 or more of the
23 procedural provisions of this part or may modify the filing
24 requirements of this part.
25 Sec. 5216. (1) Notwithstanding any other provision of this
26 act, the commission may, upon application by a gas utility, set
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1 gas cost recovery factors, in a manner otherwise consistent with
2 this act, in an order resulting from a general rate case.
3 (2) If the commission sets gas cost recovery factors in an
4 order resulting from a general rate case, all of the following
5 apply:
6 (a) The gas cost recovery factors shall cover a future
7 period of 48 months or the number of months that elapse until the
8 commission orders new gas cost recovery factors in a general rate
9 case, whichever is the shorter period.
10 (b) Annual reconciliation proceedings shall be conducted
11 under section 5211, and if an annual reconciliation proceeding
12 shows a recoverable amount under section 5213, the commission
13 shall authorize the gas utility to defer the amount and to accu-
14 mulate interest on the amount under section 5214 and in the next
15 order resulting from a general rate case shall authorize the gas
16 utility to recover the amount and interest from its customers in
17 the manner provided in section 5213.
18 (c) The gas cost recovery factors shall not be revised under
19 section 5209.
20 ARTICLE 6
21 PIPELINE COMPANIES
22 PART 61. OIL PIPELINE COMPANIES
23 Sec. 6101. Every person exercising or claiming the right to
24 carry or transport crude oil or petroleum, or any crude oil or
25 petroleum product, by or through pipelines for hire, compensa-
26 tion, or otherwise, or exercising or claiming the right to engage
27 in the business of piping, transporting, or storing crude oil or
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1 petroleum, or any crude oil or petroleum product, or engaging in
2 the business of buying, selling, or dealing in crude oil or
3 petroleum, within the limits of this state, shall not have the
4 right to conduct or engage in said business or operations or have
5 the right to locate, maintain, or operate the necessary pipe-
6 lines, fixtures, and equipment belonging to or used in connection
7 with such business or operations, on, over, along, across,
8 through, in, or under any present or future highway, or else-
9 where, within the state, or have the right of eminent domain or
10 any other rights concerning said business or operations except as
11 provided by this part. However, this part does not impair any
12 right that existed as of March 27, 1929 and that is valid,
13 vested, and incapable of revocation by any law of this state or
14 the United States.
15 Sec. 6102. For the purpose of acquiring necessary
16 rights-of-way, a person is granted the right of condemnation by
17 eminent domain, and the use of the highways in this state, for
18 the purpose of transporting petroleum by pipelines, and the loca-
19 tion, laying, constructing, maintaining, and operating the same.
20 Such condemnation proceedings shall be conducted in accordance
21 with the same procedure and in the same manner as is provided by
22 the laws of this state for the condemnation of rights-of-way by
23 railroad companies.
24 Sec. 6103. The commission shall be authorized to control,
25 investigate, and regulate persons exercising or claiming the
26 right to carry or transport crude oil or petroleum, or any crude
27 oil or petroleum product, by or through pipelines, for hire,
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1 compensation, or otherwise, or exercising or claiming the right
2 to engage in the business of piping, transporting, or storing
3 crude oil or petroleum, or any crude oil or petroleum product, or
4 engaging in the business of buying, selling, or dealing in crude
5 oil or petroleum within the limits of this state. However, all
6 persons who are producers or refiners of crude oil or petroleum,
7 or operators of private trunk or gathering lines or other methods
8 of conveying such products, where the nature and extent of their
9 business is private, and where in the conduct of such business no
10 public interest is involved, are specifically excepted and
11 excluded from the terms of this part.
12 Sec. 6104. (1) An oil pipeline company claiming or exercis-
13 ing the right to carry or transport crude oil or petroleum or any
14 crude oil or petroleum products by pipeline for hire, compensa-
15 tion, or otherwise, within the limits of this state, as owner,
16 lessee, licensee, or under any other right or claim, or engaged
17 in the business of purchasing or storing crude oil or petroleum,
18 is a common purchaser of the crude oil, petroleum, or products.
19 (2) A common purchaser shall purchase all the petroleum in
20 the vicinity of, or that may be reasonably reached by, its pipe-
21 lines or gathering branches, without discrimination in favor of 1
22 producer or 1 person against another.
23 (3) A common purchaser shall fully perform all the duties of
24 a common purchaser. If it is unable to perform those duties, or
25 is legally excused from purchasing, transporting, or storing all
26 of the petroleum produced, the common purchaser shall purchase,
27 transport, or store petroleum from each person and producer
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1 ratably in proportion to the average daily production and is
2 prohibited from discriminating in price or amount for like grades
3 of oil or facilities between producers or persons.
4 (4) If the common purchaser is also a producer, it is pro-
5 hibited from discriminating in favor of its own production or
6 storage or production or storage in which it is interested
7 directly or indirectly, in whole or in part. The common
8 purchaser's own production and storage shall be treated as that
9 of any other person or producer.
10 Sec. 6105. (1) An oil pipeline company engaged in the busi-
11 ness of carrying or transporting crude oil or petroleum, or any
12 crude oil or petroleum products for hire, compensation, or other-
13 wise, by pipeline within this state, is a common carrier of the
14 crude oil, petroleum, or products as at common law.
15 (2) A common carrier shall not allow any unjust or unlawful
16 discrimination, directly or indirectly, in favor of the carriage,
17 transportation, storage, or delivery of any crude, stock, or
18 storage oil or any products of crude, stock, or storage oil in
19 its possession or control, or in which it is interested directly
20 or indirectly.
21 Sec. 6106. (1) Before an oil pipeline exercises the right
22 of eminent domain or right-of-way pursuant to section 6104 or
23 exercises any other right conferred by this part, the oil pipe-
24 line company shall file with the commission an explicit autho-
25 rized acceptance of this part.
26 (2) If the exercise of the right involves pipelines, the oil
27 pipeline company shall also file a plat showing in detail the
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1 points within this state between which, and the route along
2 which, the trunklines are proposed to be constructed, the
3 intended size and capacity of the trunklines, and the location
4 and capacity of all pumping stations, gate valves, check valves,
5 connections, or appliances to be used, on the trunklines or
6 lines.
7 (3) The commission may require the proper party to promptly
8 file a plat showing in detail all the lines owned and operated by
9 the party, with full information as to the capacity, size, loca-
10 tion, and valves or connections required or used in its
11 operation.
12 Sec. 6107. (1) A person who violates this part or a commis-
13 sion order issued or regulation under this part is liable for a
14 fine of not less than $100.00 or more than $20,000.00.
15 (2) An officer, agent, representative, employee, or servant
16 of a person who causes, aids, assists, or participates in a vio-
17 lation described in subsection (1) is guilty of a misdemeanor
18 punishable by imprisonment for not less than 30 days or more than
19 1 year or a fine of not less than $100.00 or more than $1,000.00,
20 or both. Said penalty shall be exclusive of civil liability.
21 PART 62. GAS PIPELINE COMPANIES
22 Sec. 6201. Every corporation, association, or person, now
23 or hereafter exercising or claiming the right to carry or trans-
24 port natural gas by or through pipe line or lines, for hire, com-
25 pensation, or otherwise, or now or hereafter exercising or claim-
26 ing the right to engage in the business of piping or transporting
27 natural gas, or any other person or persons, now or hereafter
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1 engaging in the business of buying and selling or transporting
2 natural gas within the limits of this state, shall not have or
3 possess the right to conduct or engage in said business or opera-
4 tions, in whole or in part, as above described, or have or pos-
5 sess the right to locate, maintain, or operate the necessary pipe
6 lines, fixtures, and equipment thereto belonging, or use in con-
7 nection therewith, concerning the said business of carrying or
8 transporting natural gas as aforesaid, on, over, along, across,
9 through, in, or under any present or future highway, or part
10 thereof, or elsewhere, within the state, or have or possess the
11 right of eminent domain, or any other right or rights, concerning
12 said business or operation, in whole or in part, except as autho-
13 rized by and subject to the provisions of this part, except, fur-
14 ther, and only such right or rights as may already exist as of
15 March 19, 1929 which are valid, vested, and incapable of revoca-
16 tion by any law of this state or of the United States.
17 Sec. 6202. For the purpose of acquiring necessary
18 rights-of-way, every such corporation, association or person is
19 hereby granted the right of condemnation by eminent domain, and
20 the use of the highways in this state, for the purpose of trans-
21 porting natural gas by pipe lines, and for locating, laying, con-
22 structing, maintaining, and operating the same; and such condem-
23 nation proceedings shall be conducted in accordance with the pro-
24 cedure and in the same manner as is provided by the laws of this
25 state for the condemnation of rights-of-way by railroad
26 companies: Provided, however, That no corporation, association
27 or person shall be granted such right of condemnation by eminent
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1 domain or the right to use the highways of this state to lay or
2 construct, maintain, or operate a pipe line or lines for the
3 transmission or transportation of natural gas unless and except
4 such pipe line or lines are to be used solely and exclusively for
5 the transmission, transportation, and distribution of natural gas
6 within this state.
7 Sec. 6203. There is hereby granted to and vested in the
8 commission the power to control and regulate corporations, asso-
9 ciations, and persons engaged, directly or indirectly, in the
10 business of purchasing or selling or transporting natural gas for
11 public use; and the commission shall investigate any alleged
12 neglect or violation of the laws of the state by any corporation,
13 association, or person purchasing or selling natural gas and
14 transmitting or conveying the same by pipe line or lines for
15 public use: Provided, That nothing in this part shall be con-
16 strued to prevent oil and gas operators or producers of gas from
17 laying pipe lines to transport or transmit gas to drilling wells
18 within this state: And provided further, That factories or
19 industries in this state may transport or transmit gas through
20 pipe lines for their own use in plants located wholly within this
21 state without constituting themselves a common purchaser within
22 the terms of this part.
23 Sec. 6204. Every corporation, association, or person, now
24 or hereafter claiming or exercising the right to carry or trans-
25 port natural gas by pipe line or lines, for hire, compensation,
26 or otherwise, within the limits of this state, as owner, lessee,
27 licensee, or by virtue of any other right or claim, or now
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1 engaged or hereafter engaging in the business of purchasing and
2 selling natural gas shall be a common purchaser thereof, and
3 shall purchase all the natural gas in the vicinity of, or which
4 may be reasonably reached by its pipe lines, or gathering
5 branches, without discrimination in favor of 1 producer or 1
6 person as against another, and shall fully perform all the duties
7 of a common purchaser; but if it shall be unable to perform the
8 same, or be legally excused from purchasing and transporting all
9 the natural gas produced or offered, then it shall purchase and
10 transport natural gas from each person or producer ratably, in
11 proportion to the average production, and such common purchasers
12 are hereby expressly prohibited from discriminating in price or
13 amount for like grades of natural gas or facilities as between
14 producers or persons; and in the event it is likewise a producer,
15 it is hereby prohibited from discrimination in favor of its own
16 production, or production in which it may be interested directly
17 or indirectly, in whole or in part, and its own production shall
18 be treated as that of any other person or producer.
19 Sec. 6205. The commission is hereby empowered and it is
20 made its duty to make regulations for the equitable purchasing,
21 taking, and collecting of all such gas, for the metering and
22 delivery of the same and for providing adequate facilities for
23 service demanded, which regulations shall apply to all persons
24 affected thereby in like manner; and it shall have authority to
25 relieve any such common purchaser, after due application, notice,
26 and hearing, from the obligation of purchasing gas of an inferior
27 quality or grade or from purchasing gas from wells which for
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1 economic reasons are not at the time a practicable source of
2 supply.
3 Sec. 6206. All corporations, associations, and persons,
4 purchasing or collecting natural gas and transmitting or convey-
5 ing the same for hire, compensation, or otherwise by pipe line or
6 lines as a common carrier shall be a common carrier thereof as at
7 common law, and it shall be unlawful for any such common carrier
8 doing business within this state to give, either directly or
9 indirectly, any preference or advantage to any person, copartner-
10 ship, corporation or locality, in any respect whatsoever as to
11 rates, service, facilities for service or commodity delivered.
12 Sec. 6207. All corporations, associations, and persons,
13 whether producing or receiving gas from producers in any produc-
14 tion field are hereby prohibited from taking more than 25 per
15 centum of the daily natural flow of any gas well or wells,
16 unless, for good cause shown, under the exigencies of the partic-
17 ular case, the commission shall establish a higher or lower per
18 centum under the prescribed rules and regulations thereof.
19 Sec. 6208. Whenever the full production from any common
20 source or field of supply of natural gas in this state is in
21 excess of the market demands, then any common purchaser of such
22 natural gas as herein defined receiving production or output from
23 such source or field shall take therefrom only such proportion of
24 the available supply as may be marketed and utilized without
25 waste, as the natural flow of the well or wells owned or con-
26 trolled by such common purchaser bears to the total natural flow
27 or production of such common source or field, having due regard
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1 to the acreage drained by each well, so as to prevent any common
2 purchaser from securing an unfair proportion therefrom; and it
3 shall be the duty of the commission and it is hereby empowered to
4 regulate and enforce the above provision, provided that the com-
5 mission may by proper order permit the taking of a greater pro-
6 portion by any common purchaser whenever or wherever it shall
7 determine a taking of such greater proportion reasonable and
8 equitable or conducive to public convenience or necessity.
9 Sec. 6209. Any corporation, association, or person within
10 the terms of this act desiring to construct transmission mains
11 for the transportation or conveying of natural gas from its
12 source to the locality or localities where utilized, shall submit
13 to the commission, accompanied by due application, a map or plat
14 of such proposed line or lines which it desires to construct,
15 showing the dimensions and character of such proposed pipe line
16 or lines, its compression stations, control valves, and connec-
17 tions, and shall first receive the approval of the commission of
18 such map, route and type of construction before proceeding with
19 the actual construction of such transmission lines, and it shall
20 be the duty of the commission to examine and inquire into the
21 necessity and practicability of such transmission line or lines
22 and to determine that such line or lines will when constructed
23 and in operation serve the convenience and necessities of the
24 public before approval of such map and proposed transmission line
25 or lines: Provided, That persons, associations, or corporations
26 having already acquired the rights of common purchasers and
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1 common carriers as of March 19, 1929 shall be required to file
2 the map or plat provided for in this section only.
3 Sec. 6210. A common purchaser or common carrier of natural
4 gas, before receiving the gas for transmission or delivery, shall
5 file with the commission a schedule of the rates and price at
6 which the common purchaser or common carrier will receive gas at
7 delivery stations from a well, field, or source of supply, as
8 well as the rates or charges at which the common purchaser or
9 common carrier will deliver gas to connecting carriers or dis-
10 tributing lines or customers, and, if the common purchaser or
11 common carrier is operating as a carrier for hire, the rates and
12 charges which the common purchaser or common carrier will charge
13 for the service to be performed by it. A common purchaser or
14 common carrier operating as a carrier for hire also shall file a
15 copy of each contract for purchasing, receiving, or supplying
16 gas. The price to be paid and the rates and charges shall be
17 stated and set up in the manner and form required by the commis-
18 sion and outlined in the rules of the commission for filing of
19 rates of artificial gas utilities or pursuant to rules and condi-
20 tions of service adopted by the commission, which the commission
21 may make for the regulation of common purchasers and common car-
22 riers of natural gas. Thereafter, a common purchaser or common
23 carrier of natural gas may alter or amend its price paid, rates,
24 charges, and conditions of service by application to and approval
25 by the commission in the same manner and by the same process and
26 under the same legal limitations and like right as are now
27 provided by statute for the regulation by the commission of the
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1 rates for electricity transmitted in this state and process of
2 appeal provided in section 7114.
3 Sec. 6211. Every common purchaser or common carrier of nat-
4 ural gas shall file with the commission a true and verified copy
5 of the contract for the sale and purchase of gas entered into
6 between the producer or producers and such common purchaser or
7 common carrier, within 30 days after the making thereof.
8 Sec. 6212. Every common purchaser and common carrier of
9 natural gas is hereby required to file with the commission on or
10 before April first of each year, upon blanks to be prescribed and
11 furnished by the commission, an annual statement of its income,
12 expenses, operating and corporate accounts for the preceding cal-
13 endar year, including the state of its finances in capital secur-
14 ities, fixed capital and other related corporate or balance sheet
15 accounts and including also statistical data relating to the pro-
16 duction, purchase, transmission and sales of gas by such common
17 purchasers and common carriers of natural gas, its equipment
18 facilities and customers, said statement to be verified by the
19 oath of some officer of the utility knowing the facts stated
20 therein.
21 Sec. 6213. The commission shall have the power and author-
22 ity and it is hereby made its duty to prescribe the manner and
23 the form or system of accounts, financial records, and operating
24 memoranda or data to be set up and kept by all common purchasers
25 and common carriers of natural gas and every common purchaser and
26 common carrier of natural gas existing and operating within this
27 state is hereby required to set up and keep its books of
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1 accounts, records and memoranda in the manner and form prescribed
2 by the commission.
3 Sec. 6214. The commission shall have authority to prevent
4 the waste of natural gas in producing operations and in the
5 piping and distribution thereof and to make rules and regulations
6 for that purpose. It is hereby authorized and empowered to do
7 all things necessary for the conservation of natural gas in con-
8 nection with the production, piping and distribution thereof and
9 to establish such other rules and regulations as will be neces-
10 sary to carry into effect this part, to conserve the natural gas
11 resources of the state and to preserve the public peace, safety,
12 and convenience in relation thereto.
13 Sec. 6215. Any corporation, association, or person, violat-
14 ing any provision of this part or any order or regulation of the
15 commission made pursuant thereto, shall be deemed guilty of an
16 unlawful act and shall be liable to a penalty of not less than
17 100 dollars, nor more than 20,000 dollars. Any officer, agent,
18 representative, employee, or servant of any corporation or asso-
19 ciation or any person who causes, aids or assists, or partici-
20 pates in any such unlawful act shall be deemed guilty of a misde-
21 meanor, and on conviction thereof shall be liable to a fine of
22 not less than 100 dollars, nor more than 1,000 dollars, or to
23 imprisonment in the county jail not less than 30 days, nor more
24 than 1 year, or to both such fine and imprisonment in the discre-
25 tion of the court. Said penalty shall be exclusive of civil
26 liability.
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1 Sec. 6216. Nothing in this part contained shall be
2 construed to vest the commission with regulatory control and
3 authority over any natural gas utility owned and operated by a
4 municipal corporation nor to in any way infringe upon the author-
5 ity of the duly constituted official bodies having charge of such
6 municipally owned utilities.
7 PART 63. GAS SAFETY STANDARDS
8 Sec. 6301. As used in this part:
9 (a) "Gas" means natural gas, flammable gas, or gas that is
10 toxic or corrosive.
11 (b) "Person" means an individual, firm, joint venture, part-
12 nership, corporation, association, municipality, cooperative
13 association, or joint stock association, and includes a trustee,
14 receiver, assignee, or personal representative of such an
15 entity.
16 (c) "Pipeline facilities" includes, but is not limited to,
17 new and existing pipelines, rights-of-way, and any equipment,
18 facility, or building used in the transportation of gas or the
19 treatment of gas during the course of transportation.
20 (d) "Transportation of gas" means the gathering, transmis-
21 sion, or distribution of gas by pipeline or the storage of gas.
22 Transportation of gas does not include the gathering of gas in
23 rural locations that lie outside the limits of an incorporated or
24 unincorporated city, town, village, or other designated residen-
25 tial or commercial area such as a subdivision, business center,
26 shopping center, community development, or similar populated area
27 that the commission defines as a nonrural area. Transportation
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1 of gas includes gathering lines located in or occupying the
2 property of schools, hospitals, churches, parks, or similar
3 public places.
4 Sec. 6302. (1) The commission shall promulgate rules and
5 prescribe safety standards for pipeline facilities and the trans-
6 portation of gas. In prescribing safety standards, the commis-
7 sion shall consider all of the following:
8 (a) Relevant available pipeline safety data.
9 (b) Whether the standards are appropriate for the particular
10 type of pipeline transportation.
11 (c) The extent to which the standards will contribute to
12 public safety.
13 (2) If a person engaged in the transportation of gas or the
14 operation of pipeline facilities applies, the commission, after
15 notice and opportunity for a hearing and under the terms and con-
16 ditions and to the extent the commission considers appropriate,
17 may waive in whole or in part compliance with any standard estab-
18 lished under this part if the waiver is not inconsistent with gas
19 pipeline safety. When it issues the waiver, the commission shall
20 state the reasons for its issuance.
21 Sec. 6303. A person who engages in the transportation of
22 gas or who owns or operates a pipeline facility shall do all of
23 the following:
24 (a) Comply with any standard the commission prescribes.
25 (b) File and comply with a plan of inspection and mainte-
26 nance as required by section 6304.
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1 (c) Permit access to and the copying of records, make
2 reports and provide information, and permit entry and inspection
3 as required by sections 6305 and 6306.
4 Sec. 6304. A person who engages in the transportation of
5 gas or who owns or operates pipeline facilities shall file with
6 the commission a plan for inspection and maintenance of each
7 pipeline facility owned or operated by the person and any changes
8 in the plan, in accordance with the commission's rules. If the
9 commission finds that the plan is inadequate to achieve pipeline
10 safety, it shall require the plan to be revised, after notice and
11 opportunity for a hearing. In determining the adequacy of any
12 plan, the commission shall consider all of the following:
13 (a) Relevant available pipeline safety data.
14 (b) Whether the plan is appropriate for the particular type
15 of pipeline transportation.
16 (c) The extent to which the plan will contribute to the
17 public safety.
18 Sec. 6305. (1) A person who engages in the transportation
19 of gas or who owns or operates pipeline facilities shall estab-
20 lish and maintain records, make reports, and provide information
21 as the commission reasonably requires to enable it to determine
22 whether the person has acted or is acting in compliance with the
23 standards established under this part.
24 (2) Upon the request of the commission, the person shall
25 permit the commission or a person authorized by the commission to
26 inspect the person's books, papers, records, or other relevant
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1 documents to determine whether the person has acted or is acting
2 in compliance with the standards established under this part.
3 Sec. 6306. (1) The commission may conduct an inspection or
4 investigation as necessary to aid in the enforcement of this part
5 and the standards established under this part. The commission
6 shall furnish the attorney general any information obtained indi-
7 cating noncompliance with the standards for appropriate action.
8 (2) To enforce this part, officers, employees, or agents
9 authorized by the commission, upon presenting appropriate creden-
10 tials to the person in charge of the pipeline facilities, may
11 enter and inspect pipeline facilities at reasonable times, in a
12 reasonable manner, and with reasonable promptness.
13 Sec. 6307. (1) Accident reports made by a commission
14 employee or agent are available for use in any civil, criminal,
15 or other judicial proceeding arising out of the accident and the
16 officer, employee, or agent may be required to testify in the
17 proceedings.
18 (2) The report shall be made available to the public in a
19 manner that does not identify individuals. All reports on
20 research projects, demonstration projects, and other related
21 activities are public information.
22 Sec. 6308. (1) All information reported to or otherwise
23 obtained by the commission or its representative under section
24 6305, 6306, or 6307 that contains or relates to a trade secret
25 referred to in section 1905 of chapter 93 of title 18 of the
26 United States Code, 18 U.S.C. 1905, is confidential for the
27 purposes of that section. The information may be disclosed to
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1 other officers and employees concerned with carrying out this
2 part or when relevant in any proceeding under this part.
3 (2) This section does not authorize the withholding of
4 information by the commission or a commission employee or agent
5 from a standing committee of the legislature concerned with gas.
6 Sec. 6309. (1) The commission may conduct research, test-
7 ing, development, and training necessary to carry out this part.
8 (2) Upon request, the commission shall furnish to the fed-
9 eral department of transportation any information it has concern-
10 ing the safety of materials, operations, devices, or processes
11 relating to the transportation of gas or the operation of pipe-
12 line facilities.
13 (3) The commission may advise, assist, and cooperate with
14 other state departments and agencies and other interested public
15 and private agencies and persons in planning and developing
16 safety standards and methods for inspecting and testing to deter-
17 mine compliance with safety standards.
18 Sec. 6310. (1) This part does not apply to a pipeline
19 facility or the transportation of gas subject to the jurisdiction
20 of the federal energy regulatory commission under the natural gas
21 act, chapter 556, 52 Stat. 821, 15 U.S.C. 717 to 717w.
22 (2) This part applies to a person engaged in interstate com-
23 merce other than a person subject to the jurisdiction of the fed-
24 eral energy regulatory commission.
25 Sec. 6311. (1) A person who violates this part or a rule
26 promulgated under this part is liable for a fine of not more than
27 $10,000.00 for each violation for each day that the violation
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1 persists, except that the maximum civil penalty shall not exceed
2 $500,000.00 for any related series of violations.
3 (2) In determining the amount of the fine, the commission
4 shall consider all of the following:
5 (a) The effect on the ability of the person charged to con-
6 tinue in business.
7 (b) The nature, circumstances, and gravity of the
8 violation.
9 (c) Any good faith effort by the person charged to comply
10 with the requirements of this part.
11 (d) The degree of culpability of the person charged.
12 (e) The history of prior violations of the person charged.
13 (f) The ability of the person charged to pay.
14 (g) Other matters as justice requires.
15 (3) The amount of the penalty stipulated may be deducted
16 from a sum the state owes the person charged or may be recovered
17 in a civil action in the Ingham county circuit court.
18 (4) A person who willfully and knowingly defaces, damages,
19 removes, or destroys a pipeline sign or right-of-way marker
20 required under this part is guilty of a misdemeanor punishable by
21 imprisonment for not more than 1 year or by a fine of not more
22 than $5,000.00, or both, for each offense.
23 Sec. 6312. (1) The Ingham county circuit court has juris-
24 diction to restrain violations of this part, including restrain-
25 ing transportation of gas or operation of a pipeline facility,
26 and to enforce standards established under this part upon
27 petition by the attorney general.
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1 (2) If practical, the commission shall give notice to any
2 person against whom an action for injunctive relief is contem-
3 plated and afford that person an opportunity to be heard. Except
4 in the case of a knowing and willful violation, the commission
5 shall also afford the person a reasonable opportunity to achieve
6 compliance. The failure to give notice and afford the opportu-
7 nity does not preclude the granting of appropriate relief.
8 ARTICLE 7
9 INCORPORATION OF 1909 PA 300
10 Sec. 7101. (1) The legislature specifically intends that
11 this article is added to this act solely for the purpose of cody-
12 fying and classifying the laws relating to the regulation of
13 public utilities and other entities into 1 act.
14 (2) The inclusion of this article in this act shall not
15 confer upon the commission or the courts of this state new or
16 additional authority than they have under state statutes on the
17 effective date of this act over public utilities, telecommunica-
18 tions providers under the Michigan telecommunications act, 1991
19 PA 179, MCL 484.2101 to 484.2605, or other entities.
20 (3) The inclusion of this article into this act shall not be
21 construed to affect a proceeding pending before the commission or
22 any court of this state on the effective date of this act.
23 (4) This act does not apply to a railroad or a railroad,
24 bridge, or tunnel company regulated by the railroad code of 1993,
25 1993 PA 354, MCL 462.101 to 462.451. In case of a conflict
26 between this act and the railroad code of 1993, 1993 PA 354, MCL
27 462.101 to 462.451, with respect to the regulation of railroads
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1 and railroad, bridge, and tunnel companies, the railroad code of
2 1993, 1993 PA 354, MCL 462.101 to 462.451, shall control.
3 Sec. 7102. (1) The term "common carrier" as used in this
4 article shall be construed to mean and embrace all corporations,
5 companies, individuals, associations of individuals, their les-
6 sees, trustees or receivers appointed by any court whatsoever who
7 now or may hereafter own, operate, manage or control as a common
8 carrier in this state, any railroad or part of any railroad,
9 whether operated by steam, electricity, or other motive power, or
10 cars or any other equipment used thereon, or bridges, switches,
11 spurs, tracks, sidetracks, terminal facilities, or any docks,
12 wharves or storage elevators used in connection therewith or any
13 kind of terminal facilities used or necessary in the transporta-
14 tion of persons or property designated herein, and also all
15 freight depots, yards and grounds used or necessary for the
16 transportation or delivery of any said property and whether the
17 same are owned by said railroad or otherwise; or any express com-
18 pany, car loaning companies, freight or freight line companies
19 and all associations or persons, whether incorporated or other-
20 wise, that shall do business as common carriers upon or over any
21 line of railroads in this state, or any common carrier engaged in
22 the transportation of passengers and property wholly by rail or
23 partly by rail and partly by water.
24 (2) The term "transportation" shall include cars and other
25 vehicles and all instrumentalities and facilities of shipment, or
26 carriage, irrespective of ownership, or of any contract expressed
27 or implied for the use thereof, and all services in connection
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1 with the receipt, delivery, elevation, switching and transfer in
2 transit, ventilation, refrigeration or icing, storage and han-
3 dling of persons or property transported.
4 (3) The term "railroad" as used in this article shall be
5 construed to mean all railroads, whether operated by steam, elec-
6 tric or other motive power: Provided, That the provision of this
7 article shall not apply to any logging or other private railroad
8 not doing business as a common carrier: Provided further,
9 Nothing in this article contained shall be construed to authorize
10 the commission to interfere with, lessen or impair or to autho-
11 rize the impairment of any franchise provision, contract or
12 agreement as to rate of fare now existing between any municipali-
13 ty, city, village, or township and any tram railway, street rail-
14 way, interurban or suburban railway company, or to increase or
15 lessen the rate of fare fixed by such franchise, contract or
16 agreement, or to deprive any tram railway, street railway, inter-
17 urban or suburban railway company of the right to charge for the
18 carriage of passengers the rate of fare authorized and fixed by
19 any franchise, grant or contract made or entered into between any
20 municipality, city, village or township and any such tram rail-
21 way, street railway, interurban or suburban railway company;
22 Provided further, That nothing in this article contained shall
23 apply to street and electric railroads engaged solely in the
24 transportation of passengers within the limits of cities or
25 within a distance of 5 miles of the boundaries thereof.
26 (4) The provisions of this article shall apply to the
27 transportation of passengers and property between points within
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1 this state, and to the receiving, switching, delivering, storing
2 and handling of such property, and to all charges connected
3 therewith, including icing and mileage charges: Provided, how-
4 ever, That this provision shall not be construed as a limitation
5 on the authority of the commission to prescribe car service and
6 demurrage rules applicable to all traffic beginning or ending
7 within this state.
8 (5) Express companies and sleeping car companies doing busi-
9 ness for hire within this state are hereby defined to be common
10 carriers.
11 Sec. 7103. (1) Every common carrier subject to the provi-
12 sions of this act shall file with the commission and print and
13 keep open to public inspection in each of its depots and offices,
14 schedules showing all rates, fares and charges for transporta-
15 tion, both of passengers and property, between different points
16 on its own route, and between points on its own route and on the
17 route of any other carrier, when a through route and joint rate
18 have been established. If no joint rate over the through route
19 has been established, the several carriers in such through route
20 shall file, print and keep open to public inspection as aforesaid
21 the separately established rates, fares and charges applied to
22 the through transportation. The schedules printed as aforesaid
23 by any common carrier, shall plainly state the places between
24 which property and passengers will be carried and shall contain
25 the classification of freight in force and shall also state sepa-
26 rately all terminal charges, storage charges, icing charges and
27 all other charges which the commission may require, all
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1 privileges or facilities granted or allowed and any rules or
2 regulations which in any wise change, affect or determine any
3 part of or the aggregate of such aforesaid rates, fares and
4 charges, or the value of the service rendered to the passengers,
5 shipper or consignee: Provided, That where local switching tar-
6 iffs are in effect at a competitive point, it shall be sufficient
7 if the schedule state that the terminal charges shall be subject
8 to the rules of such local switching tariffs. Such schedules
9 shall be printed plainly in large type, and copies for the use of
10 the public shall be kept on file for public inspection in every
11 depot, station or office of such carrier where passengers or
12 freight respectively are received for transportation or where
13 tickets are sold, in such form that they will be accessible to
14 the public and can conveniently be inspected. The provisions of
15 this section shall apply to all traffic and transportation and
16 facilities defined in this act;
17 (2) No change shall be made in the schedule of rates, fares
18 or charges or joint rates, fares or charges which have been filed
19 and published by common carriers in compliance with the require-
20 ments of this section, except after 30 days' notice to the com-
21 mission and to the public published as aforesaid, which shall
22 plainly state the changes proposed to be made in the schedule of
23 rates, fares or charges or joint rates, fares or charges then in
24 force and the time when such changed rates, fares or charges or
25 joint rates, fares or charges will go into effect, and no such
26 rates, fares or charges or joint rates, fares or charges shall be
27 discontinued, except after giving such notice as is required for
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1 changing rates, fares or charges or joint rates, fares or
2 charges, and the proposed changes in such rates, fares or charges
3 or joint rates, fares or charges shall be shown by printing and
4 filing new tariffs thereto or by showing such changes or discon-
5 tinuance by issuing and filing of supplements in the regular
6 manner now provided and keeping same open to public inspection:
7 Provided, That the commission may, in its discretion and for good
8 cause shown, allow changes upon less time than the notice herein
9 specified, or modify the requirements in this section in respect
10 to publishing, posting and filing of tariffs, either in particu-
11 lar instances or by general order applicable to special or pecu-
12 liar circumstances or conditions: Provided further, That upon
13 the filing with the commission by a common carrier of any tariff
14 or supplement showing any change in rates, fares or charges or
15 joint rates, fares or charges or a discontinuance of any rate or
16 rates, fares or charges or joint rates, fares or charges, it
17 shall be lawful for the said commission and it is hereby autho-
18 rized, acting upon its own initiative or upon complaint, to post-
19 pone the date when such new rate or rates or joint rates, fares
20 or charges or discontinuance of rate or rates or joint rates,
21 fares or charges, shall become effective to such time not to
22 exceed in all 45 days as shall give the said commission opportu-
23 nity to investigate the reasonableness of such proposed rate or
24 rates or discontinuance of rate or rates, and it shall thereupon
25 be lawful for said commission and it is hereby authorized to pro-
26 ceed with all convenient speed with an investigation upon at
27 least 5 days' notice to said common carrier either upon its own
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1 initiative or upon complaint as to the reasonableness of said
2 rate or rates or the discontinuance of said rate or rates, follow
3 the procedure as near as may be, and make its order therein in
4 the manner hereinafter provided in section 7110, such investiga-
5 tion to take precedence of all matters of a different nature
6 pending before the commission;
7 (3) The names of the several carriers which are parties to
8 any joint tariff shall be specified therein and each of the par-
9 ties thereto, other than the one filing the same, shall file with
10 the commission such evidence of concurrence therein or acceptance
11 thereof as may be required or approved by the commission, and
12 where evidence of concurrence or acceptance is filed it shall not
13 be necessary for the carriers filing the same to also file copies
14 of the tariffs in which they are named as parties;
15 (4) The commission may determine and prescribe the form in
16 which the schedules required by this section to be kept open to
17 the public inspection shall be prepared and arranged and may
18 change the form from time to time as may be found expedient;
19 (5) Such schedules shall, so far as is practicable, conform
20 to the forms prescribed by the interstate commerce commission;
21 (6) No carrier, unless otherwise provided by this act, shall
22 engage or participate in the transportation of passengers or
23 property as defined in this article, unless the rates, fares, and
24 charges upon which the same are transported by said carrier have
25 been filed and published in accordance with the provisions of
26 this article, nor shall any carrier charge or demand or collect
27 or receive a greater or less or different compensation for such
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1 transportation of passengers or property or for any service in
2 connection therewith between the points named in such fares and
3 charges which are specified in the tariff filed and in effect at
4 the time; nor shall any carrier refund or remit in any manner or
5 by any device any portion of the rates, fares and charges so
6 specified, nor extend to any shipper or person any privilege or
7 facilities in the transportation of persons or property, except
8 such as are specified in such tariff;
9 (7) Within 2 years after the delivery of any shipment of
10 freight at destination, and not after, any person aggrieved may
11 complain to the commission that the charge exacted for the trans-
12 portation of such freight between points in Michigan is irregular
13 or exorbitant, and thereupon the commission shall have power to
14 investigate such complaint, and to hear the same and to decide
15 upon the merits thereof, in the manner provided by section 7110.
16 If, upon such hearing, the commission shall decide that the rate
17 or charge exacted is irregular or exorbitant it shall find what,
18 in its judgment, would have been a reasonable rate or charge for
19 the service complained of. If the rate or charge so found shall
20 be less than the charge exacted and the commission shall deter-
21 mine that any party complainant is entitled to an award of dam-
22 ages under the provisions of this act for a violation thereof,
23 the commission shall make an order authorizing and directing the
24 carrier to pay the complainant the sum to which he or she is
25 entitled on or before a day named. In case of the refusal of the
26 carrier to make such refund, the party aggrieved thereby may
27 maintain an action in the courts of this state to recover the
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1 amount of such excessive charge as found by said commission, and
2 in the trial thereof the findings of the commission shall be
3 prima facie evidence of the truth of the facts found by it, and
4 no carrier shall be permitted to avail itself in the defense of
5 such action that the shipment involved was in fact made on the
6 published tariff rate in force at the time such shipment was
7 made, but no carrier making a refund upon the order of the com-
8 mission or pursuant to a judgment of court as herein provided,
9 shall be liable for any penalty or forfeiture, or subject to any
10 prosecution under the laws of this state on account of making
11 such refund;
12 (8) In time of war or threatened war preference and prece-
13 dence shall, upon the demand of the governor of the state, be
14 given over all other traffic to the transportation of troops and
15 material of war, and carriers shall adopt every means within
16 their control to facilitate and expedite the military traffic;
17 (9) Every common carrier within this state shall within 90
18 days, unless further time be granted by the commission, file in
19 the office of the commission copies of all schedules of rates,
20 including joint rates in force on its line or lines between
21 points within this state on September 1, 1909, not previously
22 filed by such carrier with the commission.
23 Sec. 7104. Nothing in this act shall be construed to pre-
24 vent concentration, commodity, transit and other special contract
25 rates, but all such rates shall be open to all shippers for a
26 like kind of traffic under similar circumstances and conditions,
27 and shall be subject to the provisions of this act as to the
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1 printing and the filing of the same: Provided, All such rates
2 shall be under the supervision and regulation of the commission.
3 Sec. 7105. If any common carrier or any agent or officer
4 thereof shall, directly or indirectly, by any special rate,
5 rebate, drawback, or by any means of false billing, false classi-
6 fication, false weighing, or by any other device whatsoever,
7 charge, demand, collect or receive from any person, firm or cor-
8 poration, a greater or less compensation for any service rendered
9 or to be rendered by it for the transportation of persons or
10 property or for any service in connection therewith than that
11 prescribed in the public tariffs then in force, or established as
12 provided herein, or than it charges, demands, collects or
13 receives from any other person, firm or corporation for a like
14 and contemporaneous service in the transportation of a like kind
15 of traffic under substantially similar circumstances and condi-
16 tions, or shall knowingly and willfully assist or willfully
17 suffer and permit such greater or less compensation to be
18 charged, demanded, collected or received, such common carrier
19 shall be deemed guilty of unjust discrimination, which is hereby
20 prohibited and declared to be unlawful. It shall be unlawful for
21 any common carrier to demand, charge, collect or receive from any
22 person, firm or corporation a less compensation for the transpor-
23 tation of property or for any service rendered or to be rendered
24 by said common carrier in consideration of said person, firm or
25 corporation furnishing any part of the facilities incident
26 thereto: Provided, Nothing shall be construed as prohibiting any
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1 common carrier from procuring any facilities or service incident
2 to transportation and paying a reasonable compensation therefor.
3 Sec. 7106. It shall be unlawful for any common carrier,
4 subject to the provisions of this act, to make or give any undue
5 or unreasonable preference or advantage to any particular person,
6 company, firm, corporation or locality or any particular descrip-
7 tion of traffic in any respect whatsoever, or to subject any par-
8 ticular person, company, firm, corporation or locality or any
9 particular description of traffic to any undue or unreasonable
10 disadvantage or prejudice in any respect whatsoever.
11 Sec. 7107. It shall be unlawful for any person, firm or
12 corporation knowingly to accept or to receive any rebate conces-
13 sion or discrimination in respect to transportation of any prop-
14 erty wholly in this state or for any service in connection there-
15 with, whereby any such property shall, by false billing, false
16 classification, false weighing or any other device whatsoever, be
17 transported at a less rate than that named in the published tar-
18 iffs in force as provided herein or whereby any service or advan-
19 tage is received, other than is therein specified. Any person,
20 firm or corporation violating the provisions of this section
21 shall be deemed guilty of a misdemeanor, and on conviction
22 thereof shall be punished by a fine of not more than $500.00 or
23 by imprisonment in the county jail for a term of not to exceed 3
24 months, or by both in the discretion of the court for each
25 offense.
26 Sec. 7108. If any common carrier shall do, or cause to be
27 done, or permit to be done, any matter, act, or thing in this act
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1 prohibited or declared to be unlawful, or shall omit to do any
2 act, matter, or thing required to be done by it, or by any lawful
3 order made under the provisions of this act by the commission,
4 such common carrier shall be liable to the person, firm or corpo-
5 ration injured thereby in double the amount of damages sustained
6 in consequence of such violation: Provided, That any recovery as
7 is in this section provided shall in no manner affect a recovery
8 by the state of the penalty prescribed for such violation.
9 Sec. 7109. It shall be unlawful for any officer, agent or
10 employee of any common carrier to willfully fail or refuse to
11 fill out and return any blank or make any report as required by
12 this act, or to willfully fail or refuse to answer any questions
13 therein propounded, or to knowingly or willfully give a false
14 answer to any such question or to evade the answer to any such
15 question where the fact inquired of is within his or her knowl-
16 edge, or to, upon proper demand, willfully fail or refuse to
17 exhibit to any commissioner or any commissioners, or any person
18 authorized to examine the same, any book, paper or account of
19 such common carrier which is in his or her possession or under
20 his or her control.
21 Sec. 7110. (1) Upon complaint in writing of any person,
22 firm or corporation or association, or of any mercantile, agri-
23 cultural or manufacturing society, or of any body politic or
24 municipal organization, that any of the rates, fares, charges or
25 classifications, or any joint rate or rates are in any respect
26 unreasonable or unjustly discriminatory, or that any regulation
27 or practice whatsoever affecting the transportation of persons or
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1 property or any service in connection therewith, is in any
2 respect unreasonable or unjustly discriminatory, or that any
3 service is inadequate, the commission shall notify the common
4 carrier complained of that complaint has been made and shall fur-
5 nish a copy of the said complaint with said notice, and 20 days
6 after such notice has been given the commission may proceed to
7 investigate the same as hereinafter provided. Before proceeding
8 to make the investigation, the commission shall give the said
9 common carrier and the complainants at least 10 days' notice of
10 the time and place when and where such matters will be considered
11 and determined, and said parties shall be entitled to be heard
12 and shall have process to enforce the attendance of witnesses.
13 Such hearings may be continued from time to time in the discre-
14 tion of the commission. If, upon such investigation, the rate or
15 rates, joint rate or rates, fares, charges or classifications,
16 regulation, practice or service complained of shall be found to
17 be unreasonable, inadequate or unjustly discriminatory, the com-
18 mission shall have power to and it shall determine and by order
19 fix and order substituted therefor, such rate or rates, joint
20 rate or rates, fares and charges, as is or are just and reason-
21 able, and which shall be the maximum to be charged in the future,
22 and such classifications, regulation, practice or service as is
23 or are just, reasonable and adequate, and which shall be imposed
24 and followed or service rendered in future in lieu of that found
25 to be unreasonable, inadequate or unjustly discriminatory, and in
26 either case the commission shall make an order that the common
27 carrier cease and desist from such violation, and shall conform
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1 to the regulation and practice so prescribed, and it shall cause
2 a certified copy of each such order to be delivered to an officer
3 or station agent of the common carrier affected thereby, which
4 order shall, of its own force, take effect and become operative
5 20 days after the service thereof. All common carriers to which
6 the order applies shall, on or before the date when such order
7 becomes effective, make such changes in schedules on file as
8 shall be necessary to make the same conform to such order, and no
9 change shall within 2 years thereafter be made by any such common
10 carrier in any such rates, fares or charges, or in any such joint
11 rate or rates, without the approval of the commission. Certified
12 copies of all other orders of the commission shall be delivered
13 to the common carriers thereby affected in like manner, and the
14 same shall take effect within such times thereafter as the com-
15 mission shall prescribe;
16 (2) The commission may, when the complaint is made of more
17 than 1 rate or charge, order separate hearings thereon, and may
18 consider and determine the several matters complained of sepa-
19 rately and at such times as it may prescribe. No complaint shall
20 of necessity at any time be dismissed because of the absence of
21 direct damage to the complainant;
22 (3) Whenever the commission shall believe that any rate or
23 rates or charge or charges may be unreasonable or unjustly dis-
24 criminatory, or that any service is inadequate, and that any
25 investigation relating thereto should be made, it may, upon its
26 own motion, investigate the same. Before making such
27 investigation, it shall present to the common carrier a statement
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1 in writing, setting forth the rate or charge to be investigated.
2 Thereafter, on 10 days' notice to the common carrier of the time
3 and place of such investigation, the commission may proceed to
4 investigate such rate or charge in the same manner and make like
5 orders in respect thereto as if such investigation had been made
6 upon complaint;
7 (4) This section shall be construed to permit any common
8 carrier to make complaint of like effect as though made by any
9 person, firm, corporation or association, mercantile, agricul-
10 tural or manufacturing society, body politic or municipal organi-
11 zation;
12 (5) The commission may, after hearing on a complaint, estab-
13 lish through routes and joint rates as the maximum to be charged
14 and the terms and conditions under which such through routes
15 shall be operated when the common carriers complained of have
16 refused or neglected to voluntarily establish such through routes
17 and joint rates: Provided, No reasonably satisfactory through
18 route and joint rate exist. Whenever the common carrier or
19 common carriers, in obedience to an order of the commission or
20 otherwise, in respect to joint rates, fares or charges, shall
21 fail to agree among themselves upon the apportionment or division
22 thereof, the commission may after hearing make a supplemental
23 order prescribing the just and reasonable proportion of such
24 joint rate, fare or charge to be received by each common carrier
25 party thereto, which order shall take effect as part of the orig-
26 inal order.
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1 Sec. 7111. (1) Each of the commissioners, for the purposes
2 mentioned in this act, shall have power to administer oaths,
3 certify to official acts, issue subpoenas, compel the attendance
4 of witnesses and the production of papers, way bills, books,
5 accounts, documents and testimony. In case of disobedience on
6 the part of any person or persons, or willful failure to comply
7 with any order of the commission or any commissioner or any sub-
8 poena, or upon the refusal of any witness to testify regarding
9 any matter upon which he or she may be lawfully interrogated, or
10 to produce any books or papers in his or her custody or control
11 which he or she shall have been required by any commissioner to
12 produce, it shall be the duty of the circuit court or any court,
13 or a judge thereof, upon application of a commissioner, to compel
14 obedience by attachment proceedings for contempt, as in the case
15 of disobedience of the requirements of a subpoena issued from
16 such court, or a refusal to testify therein, and in addition said
17 commissioner shall have the powers vested in justices of the
18 peace and notaries public to compel witnesses to testify and to
19 produce books and papers;
20 (2) Each witness who shall appear before the commission by
21 its order shall receive for his or her attendance the fees and
22 mileage now provided for witnesses in civil cases in circuit
23 court, which shall be audited and paid by the state in the same
24 manner as other expenses are audited and paid, upon the presenta-
25 tion of proper vouchers sworn to by such witnesses and approved
26 by the chairman of the commission: Provided, That no witnesses
27 subpoenaed at the instance of parties other than the commission
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1 shall be entitled to compensation from the state for attendance
2 and travel, unless the commission shall certify that his or her
3 testimony was material and necessary to the matter investigated;
4 (3) The commission or any party may, in any investigation,
5 cause the depositions of witnesses residing within or without the
6 state to be taken in the manner prescribed by law for like depo-
7 sitions in civil actions in the circuit courts;
8 (4) A full and complete record shall be kept of all proceed-
9 ings had before the commission on any investigation had under
10 section 7110 and all testimony shall be taken down by a stenogra-
11 pher appointed by the commission. When any complaint is served
12 upon the commission under the provisions of section 7114 the com-
13 mission shall, before said action is reached for trial, cause the
14 certified transcript of all proceedings had and testimony taken
15 upon such investigation to be filed with the clerk of the circuit
16 court of the county where the action is pending. A transcribed
17 copy of the evidence and proceedings, or any specific part there-
18 of, or any investigation, taken by the stenographer, certified by
19 him or her to be a true and correct transcript of all the testi-
20 mony on the investigation or of a particular witness, or of any
21 specific part thereof, carefully compared by him or her with his
22 or her original notes, and to be a correct statement of the evi-
23 dence and proceedings had on such investigation so purporting to
24 be taken and transcribed shall be received in evidence with the
25 same effect as if such stenographer were present and testified to
26 the facts so certified. A copy of such transcript shall be
27 furnished upon demand, free of cost, to any party to such
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1 investigations, and to all other persons on payment of a
2 reasonable amount therefor.
3 Sec. 7112. The commission may, at any time upon application
4 of any person or any common carrier, and upon at least 10 days'
5 notice to the parties interested, including the common carrier,
6 and after opportunity to be heard as provided in section 3109,
7 rescind, alter, or amend any order fixing any rate or rates,
8 fares, charges, or classifications, or any other order made by
9 the commission, and certified copies shall be served and take
10 effect as herein provided for original orders.
11 Sec. 7113. All rates, fares, charges, classifications, and
12 joint rates fixed by the commission and all regulations, prac-
13 tices, and services prescribed by the commission shall be in
14 force and shall be prima facie, lawful and reasonable until
15 finally found otherwise in an action brought for the purpose pur-
16 suant to the provisions of section 7114, or until changed or mod-
17 ified by the commission as provided for in section 7112.
18 (a) It shall be unlawful for any express company operating
19 or doing business in the state of Michigan to charge or collect a
20 greater amount for the transportation of merchandise or other
21 property within this state than the rates and charges set forth
22 and contained in the schedule of rates, tariffs, and classifica-
23 tions on file at each station and office to or from which said
24 rates, tariffs, and classifications are intended to apply; a copy
25 of which said schedule of rates, tariffs, and classifications
26 shall be filed with the railroad commission by the issuing
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1 carrier or some duly authorized agent or representative of such
2 carrier.
3 (b) It shall be unlawful for any express company operating
4 and doing business in the state of Michigan to discriminate in
5 favor of or against any shipper or shippers or to refuse or fail
6 to receive and transport proffered merchandise or other property,
7 providing such merchandise or other property is a proper subject
8 for shipment by express and in proper condition at the time of
9 presentation for shipment from any point where such express com-
10 pany shall maintain or conduct an office or station, or to or
11 from any junction point or points where the line of such express
12 company intersects with the line of any other express company or
13 to or from any common terminal to any point on its own line, and
14 the charge and compensation for the transportation of such mer-
15 chandise or other property by 2 or more express companies shall
16 not exceed by 30% the maximum charge for the same distance on any
17 1 line, such maximum charge being determined as hereinafter
18 prescribed.
19 (c) All express companies operating within this state shall
20 publish and continue in force and effect through or joint rates
21 between all points at which offices are maintained on the line of
22 all express companies operating within the state of Michigan:
23 Provided, That such express companies may divide charges for
24 transportation in such a manner as to allow participating carri-
25 ers an agreed minimum proportion when the division of such
26 charges on a mileage basis would not allow a sufficient minimum.
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1 (d) The following schedule of rates shall be the present
2 maximum basic general merchandise schedule chargeable within the
3 state of Michigan:
4 1 to 55 miles inclusive, 50 cents per 100 pounds;
5 56 to 75 miles inclusive, 55 cents per 100 pounds;
6 76 to 85 miles inclusive, 60 cents per 100 pounds;
7 86 to 95 miles inclusive, 65 cents per 100 pounds;
8 96 to 105 miles inclusive, 70 cents per 100 pounds;
9 106 to 130 miles inclusive, 75 cents per 100 pounds;
10 131 to 150 miles inclusive, 80 cents per 100 pounds;
11 151 to 170 miles inclusive, 85 cents per 100 pounds;
12 171 to 190 miles inclusive, 90 cents per 100 pounds;
13 191 to 210 miles inclusive, 1 dollar per 100 pounds;
14 211 to 230 miles inclusive, 1 dollar 10 cents per 100
15 pounds;
16 231 to 250 miles inclusive, 1 dollar 20 cents per 100
17 pounds;
18 251 to 275 miles inclusive, 1 dollar 30 cents per 100
19 pounds;
20 276 to 300 miles inclusive, 1 dollar 40 cents per 100
21 pounds.
22
23 (e) The graduated table or schedule of charges now in force
24 relating to shipments of merchandise or other property in quanti-
25 ties less than 100 pounds shall continue in operation except as
26 hereinafter provided.
27 (f) The commission shall have control and supervision over
28 all express companies operating within this state, and upon com-
29 plaint made to it or upon its own motion and after hearing had
30 thereon, in accordance with the rules now in force relative to
31 hearings on complaints by and against common carriers, may from
32 time to time within its discretion change, alter and amend the
33 maximum schedule of rates hereinbefore set forth, and may from
34 time to time upon proper application or upon its own motion and
35 hearing had thereon, as above prescribed, change, alter and amend
36 any graduated table or schedule of charges on merchandise or
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1 other property transported or to be transported, the weight of
2 which is less than 100 pounds.
3 (g) Any express company operating or doing business within
4 the state of Michigan, upon receipt of any property or merchan-
5 dise, providing such property or merchandise is a proper subject
6 for shipment by express and in proper condition at time of pre-
7 sentation, shall unless otherwise requested by the shipper for-
8 ward same via the nearest and most practical route, having in
9 mind the frequency of train service at different junction
10 points.
11 Sec. 7114. (1) Except as otherwise provided in
12 section 2305, section 6312, section 5 of 1921 PA 246, MCL
13 460.205, and this section, any common carrier or other party in
14 interest, being dissatisfied with any order of the commission
15 fixing any rate or rates, fares, charges, classifications, joint
16 rate or rates, or any order fixing any regulations, practices, or
17 services, may within 30 days from the issuance and notice of that
18 order file an appeal as of right in the court of appeals. The
19 court of appeals shall not have jurisdiction over any appeal that
20 is filed later than the 30-day appeal period provided for in this
21 subsection.
22 (2) An appeal of any decision or order of the commission
23 that is pending in the circuit court on April 1, 1987 shall pro-
24 ceed and be decided in that court and appealed pursuant to the
25 applicable law in effect immediately prior to April 1, 1987, if
26 on that date, the appeal has progressed beyond the filing of a
27 complaint and answer. All other pending cases shall be
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1 transferred promptly by the circuit court to the court of
2 appeals.
3 (3) An appeal from any commission order that is filed in a
4 timely manner but is incorrectly initiated in either the circuit
5 court for the county of Ingham or the court of appeals shall be
6 transferred by that court, on its own motion or on motion of a
7 party, to the proper court and shall proceed as if timely filed
8 in that court.
9 (4) No injunction shall issue except upon application to the
10 court of appeals following notice to the commission and a
11 hearing. The court of appeals shall have the same equitable
12 powers as possessed by the circuit court in chancery in the
13 county of Ingham prior to April 1, 1987.
14 (5) Beginning on April 1, 1987 and until December 31, 1988,
15 and within the time for filing an appeal, a party seeking a pre-
16 liminary injunction may apply for such relief pursuant to subsec-
17 tion (4) and may request that the court of appeals transfer such
18 application to the circuit court for the county of Ingham. Upon
19 request, the court of appeals shall transfer an application for a
20 preliminary injunction to the circuit court for a determination.
21 The circuit court shall have the same equitable powers as pos-
22 sessed by the circuit court in chancery in the county of Ingham
23 prior to April 1, 1987. The circuit court shall grant or deny an
24 application within the time period prescribed by the court of
25 appeals. An order of the circuit court granting or denying an
26 application shall be transferred by that court to the court of
27 appeals and made part of the record in the pending appeal. An
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1 appeal of a circuit court order issued under this subsection
2 shall not be necessary to confer upon the court of appeals full
3 and complete jurisdiction to enforce, vacate, or modify an order
4 of the circuit court.
5 (6) Within 28 days from the filing of an appeal, a party may
6 make application to the commission to present additional
7 evidence. A copy of the application for additional evidence
8 shall be filed in the court of appeals and the court shall stay
9 further appellate proceedings pending the commission's receipt
10 and consideration of the proposed evidence. If the commission
11 finds that the proposed evidence is different from or in addition
12 to the evidence presented at the original hearing, the commission
13 shall receive the additional evidence. After considering the
14 additional evidence, the commission may alter, modify, amend, or
15 rescind its order relating to the rate or rates, fares, charges,
16 classifications, joint rate or rates, regulations, practice, or
17 service complained of, and shall report its decision to the court
18 of appeals within the time period prescribed by the court. If
19 the commission rescinds its order, the appeal shall be
20 dismissed. If the commission alters, modifies, or amends its
21 order, that amended order shall take the place of the original
22 order, and the court of appeals shall render its decision based
23 on the amended order. If the original order is not rescinded or
24 amended by the commission, judgment shall be rendered upon the
25 original order.
26 (7) An appeal from a commission order pertaining to the
27 application of existing commission rules, tariffs, or rate
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1 schedules to an individual customer in a contested case shall be
2 filed in the circuit court for the county of Ingham within
3 30 days of the issuance and notice of an order.
4 (8) In all appeals under this section the burden of proof
5 shall be upon the appellant to show by clear and satisfactory
6 evidence that the order of the commission complained of is unlaw-
7 ful or unreasonable.
8 Sec. 7115. (1) In all actions and proceedings in court
9 arising under this act all such process shall be served and the
10 practice and rules of evidence shall be the same as in actions in
11 equity, except as otherwise herein provided. Every sheriff or
12 other officer empowered to execute civil process shall execute
13 any process issued under the provisions of this act, and shall
14 receive such compensation therefor as may be prescribed by law
15 for similar services;
16 (2) No person shall be excused from testifying or from
17 producing books and papers in any proceedings based upon or grow-
18 ing out of any violation of the provisions of this act on the
19 ground or for the reason that the testimony or evidence, documen-
20 tary or otherwise, required of him or her may tend to incriminate
21 him or her or subject him or her to penalty or forfeiture, but no
22 person having so testified shall be prosecuted or subjected to
23 any penalty or forfeiture for or on account of any transaction,
24 matter or thing concerning which he or she may have testified or
25 produced any documentary evidence: Provided, That no person so
26 testifying shall be exempted from prosecution or punishment for
27 perjury in so testifying: Provided further, The immunity hereby
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1 conferred shall extend only to a natural person who, in obedience
2 to a subpoena, gives testimony under oath, or produces evidence
3 documentary or otherwise under oath;
4 (3) Upon application of any person the commission shall fur-
5 nish certified copies, under seal of the commission and signed by
6 the commission or its secretary, of any order made by it, which
7 shall be prima facie evidence in any court or proceedings of the
8 facts stated therein.
9 Sec. 7116. (1) The commission shall have authority to
10 inquire into the management of the business of any common carrier
11 and shall keep itself informed as to the manner and shall have
12 the right to obtain from any common carrier all necessary infor-
13 mation to enable the commission to perform the duties and carry
14 out the objects for which it is created.
15 (2) The commission shall cause to be prepared for the pur-
16 poses designated in this act blanks which shall conform as nearly
17 as practicable to the forms prescribed by the interstate commerce
18 commission, and shall when necessary furnish such blanks to each
19 common carrier. Any common carrier receiving from the commission
20 any such blanks shall cause the same to be properly filled out so
21 as to answer fully and correctly each question therein pro-
22 pounded, and in case it is unable to answer any question it shall
23 give a full and sufficient reason for such failure; and said
24 answer shall be verified under oath by the proper officer of said
25 common carrier and returned to the commission at its office
26 within the time fixed by the commission. The making of a false
27 affidavit or the filing of the same shall be deemed perjury and
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1 punishable as such under the statutes of Michigan defining
2 perjury.
3 (3) The commission or any commissioner, or any person or
4 persons employed by the commission for that purpose, shall, upon
5 demand, have the right to inspect the books and papers of any
6 common carrier, and to examine under oath any officer, agent or
7 employee of such common carrier in relation to any matter which
8 is the subject of complaint or investigation: Provided, That any
9 person other than 1 of said commissioners who shall make such
10 demand shall produce his or her authority to make such inspection
11 under the hand of the commission or its secretary, and under the
12 seal of said commission.
13 (4) The commission may require by order or subpoena, to be
14 served upon any common carrier in the same manner that a subpoena
15 is served in a law action in the circuit court, the production
16 within this state, at such time and place as it may designate,
17 any books, papers or accounts relating to any matter which is the
18 subject of complaint or investigation, kept by such railroad in
19 any office or place without the state of Michigan, or verified
20 copies in lieu thereof, if the commission shall so order, in
21 order that an examination thereof shall be made by the commission
22 or under its direction, and such subpoena may issue to any sher-
23 iff in any county of the state. Any common carrier failing or
24 refusing to comply with such order or subpoena within a reason-
25 able time shall for each day it shall so fail or refuse, forfeit
26 and pay into the state treasury a sum of not less than $100.00
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1 nor more than $1,000.00, to be recovered in an action at law
2 brought in the name of the commission.
3 Sec. 7117. Every common carrier whenever required by the
4 commission shall, within a time to be fixed by the commission,
5 deliver to the commission for its use, copies of all contracts
6 which relate to the transportation of persons or property or any
7 service in connection therewith, made or entered into by it with
8 any other common carrier or any shipper or shippers, producers or
9 consumers or other person or persons doing business with it.
10 Sec. 7118. Every common carrier doing business in this
11 state, or which shall hereafter do business in this state, and
12 every person, firm, or corporation owning property in this state
13 which is used for common carrier purposes, shall on or before the
14 first day of May of each year, make and transmit to the commis-
15 sion at its office in Lansing a full and true statement, under
16 oath of the proper official of such carrier of the financial and
17 operating transactions of such carrier relative to the state of
18 Michigan for the year ending the preceding December 31, which
19 statement for the state of Michigan shall be similar in character
20 and detail to the annual report, if any, required to be made by
21 such carriers to the interstate commerce commission. The said
22 commission shall cause to be made suitable blanks at the expense
23 of the state and forward the same to such common carrier, upon
24 which to make reports required by this act. The said commission
25 may require of such common carrier, subject to the provisions of
26 this act, any other or additional information relating to the
27 management of such carrier and to the condition of its respective
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1 property utilized for common carrier purposes and such other
2 subjects as in its judgment may be necessary in order to gain
3 full information in regard thereto. Every common carrier doing
4 business in this state shall, when so ordered by the commission,
5 report to the commission its earnings and income statement for
6 the period designated in such order, and the proper blanks for
7 that purpose shall be furnished by the commission.
8 Sec. 7119. Whenever, after hearing and investigation as
9 provided in this act, the commission shall find that any charge,
10 regulation or practice affecting the transportation of passengers
11 or property, or any service in connection therewith not herein
12 specifically designated, is unreasonable or unjustly discrimina-
13 tory, it shall have the power to regulate the same as provided in
14 section 7110.
15 Sec. 7120. This commission shall inquire into any neglect
16 or violation of the laws of this state by any such common carrier
17 hereinbefore defined doing business therein, or by its officers,
18 agents, or employees thereof, and shall have the power and it
19 shall be its duty to enforce the provisions of this act as well
20 as all other laws relating to common carriers and report all vio-
21 lations thereof to the attorney general. Upon the request of the
22 commission it shall be the duty of the attorney general, or the
23 prosecuting attorney of the proper county, to aid in any investi-
24 gation, prosecution, hearing or trial had under the provisions of
25 this act, and to institute and prosecute all necessary actions or
26 proceedings for the enforcement of this act and of all other laws
27 of this state relating to common carriers, and for the punishment
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1 of all violations thereof. Any forfeiture and penalty herein
2 provided shall be paid to the state treasurer and shall be recov-
3 ered and suit therefor shall be brought in the name of the state
4 of Michigan in the circuit court of any county having jurisdic-
5 tion of the defendants. The attorney general of Michigan, or any
6 prosecuting attorney selected by the said commission in any
7 county where such action is pending, shall be the counsel in any
8 proceeding, investigation, hearing or trial prosecuted or
9 defended by the commission.
10 Sec. 7121. All claims against any common carrier for loss
11 or damage to property from any cause, or for over-charge upon any
12 shipments, or for any other service, if not acted upon within 90
13 days from the date of filing of such claim with the common car-
14 rier may be investigated by the commission in its discretion, and
15 the result of such investigation may be embodied in a special
16 report and the next annual report of the commission.
17 Sec. 7122. Any common carrier subject to the operation of
18 this act, or whenever such common carrier is a corporation, any
19 director or officer thereof, or any receiver, trustee, lessee,
20 agent or person employed by such corporation, who alone or with
21 any other corporation, company, person or party, shall willfully
22 do or cause to be done, or shall willfully suffer or permit to be
23 done any act, matter, or thing in this act prohibited or declared
24 to be unlawful, or who shall aid or abet therein, or who shall
25 willfully omit or fail to do any act, matter or thing in this
26 part required to be done, or shall cause or willfully suffer or
27 permit any act, matter or thing so directed or required by this
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1 act to be done, not to be so done, or shall do or abet any such
2 omission or failure, or shall be guilty of any infraction of this
3 act, or shall aid or abet therein, or who shall willfully disobey
4 or knowingly fail or neglect to obey any lawful order made under
5 the provisions of this act by the commission, or shall aid and
6 abet any such disobedience or omission or failure shall be deemed
7 guilty of a misdemeanor, and shall, upon conviction thereof in
8 any court having jurisdiction of misdemeanors, if a penalty for
9 such offense be not elsewhere provided in this act, be subject to
10 a fine of not to exceed $500.00 for each offense, in the discre-
11 tion of the court, or if the convicted party be a natural person,
12 he or she shall be liable to be punished by imprisonment in the
13 county jail for a period of not to exceed 3 months, or both such
14 fine and imprisonment in the discretion of the court.
15 Sec. 7123. The police powers of the state over railroads,
16 street railways, interurban railways, and suburban street rail-
17 ways, whether operated by steam, electricity, or other motive
18 power, organized or doing business in this state, shall be and
19 the same are hereby vested in the commission, and it is hereby
20 made the duty of said commission to exercise the same in accord-
21 ance with the requirements of the law.
22 Sec. 7124. A substantial compliance with the requirements
23 of this act shall be sufficient to give effect to all rules,
24 acts, and regulations of the commission, and they shall not be
25 declared inoperative, illegal, or void for any omission of a
26 technical nature in respect thereto.
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1 Sec. 7125. This act shall not have the effect to release or
2 waive any right of action by the state or by any person for any
3 right, damage, penalty, or forfeiture which may have arisen or
4 which may hereafter arise under any law of this state, and all
5 penalties and forfeitures accruing under this act shall be cumu-
6 lative, and a suit for and recovery of one shall not be a bar to
7 the recovery of any other penalty or damage.
8 Sec. 7126. In addition to all the other remedies provided
9 by this act for the prevention and punishment of any and all vio-
10 lations of the provisions hereof and of all orders of the commis-
11 sion, the commission, and likewise any person, firm or corpora-
12 tion interested, may compel compliance with the provisions of
13 this act and with the orders of the commission by proceedings in
14 mandamus, injunction or by other appropriate civil remedies.
15 Sec. 7127. The commission shall keep a record of all its
16 findings, decisions, determinations, and investigations under
17 this act or under any other act prescribing its duties and
18 powers, and shall, on January 1 of each year, render to the gov-
19 ernor a full and complete report of all such findings, decisions,
20 determinations and investigations, together with a statement of
21 all moneys expended by it or on its order, and of all salaries
22 paid by or to it. It shall include in such report such recommen-
23 dations as it shall desire to make on the conduct of railroad
24 business in the state of Michigan, and such portion or abridgment
25 of the reports of the various railroad corporations made to it as
26 it shall deem to be of interest to the general public. Not more
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1 than 1,500 copies of this report shall be published, except by
2 special authority of the board of state auditors.
3 Sec. 7128. All powers, duties, and privileges imposed and
4 conferred by law upon the commissioner of railroads, the railroad
5 and street crossing board, the crossing board, as defined by sec-
6 tion 6232 of the Compiled Laws of 1897, and the board of railway
7 consolidations as defined by section 6255 of the Compiled Laws of
8 1897, and upon the Michigan railroad commission are hereby
9 imposed and conferred upon the Michigan public service commis-
10 sion; and wherever the commissioner of railroads, the railroad
11 and street crossing board, the crossing board, and the board of
12 railway consolidations, the Michigan railroad commission are
13 named, the same shall be construed to mean and apply to and name
14 the Michigan public service commission.
15 Sec. 7129. The commission shall conduct a hearing and take
16 testimony as to the advisability of any proposed change of law
17 relative to any matter within its jurisdiction if requested to do
18 so by the legislature, by the senate or house committee dealing
19 with the public utilities, or by the governor, and shall report
20 its conclusions to the officer or body at whose request the hear-
21 ing was held. The commission may also recommend the enactment of
22 such legislation, with respect to any matter within its jurisdic-
23 tion, as it deems wise or necessary in the public interest, and
24 may draft or cause to be drafted such bills or acts as it may
25 deem necessary or proper to enact into law the legislation recom-
26 mended by it.
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1 ARTICLE 8
2 SAVINGS CLAUSES AND REPEALER
3 PART 81. SAVINGS CLAUSES
4 Sec. 8101. A proceeding before the commission on the effec-
5 tive date of this act shall continue under this act.
6 Sec. 8102. This act does not repeal or alter the content or
7 effect of orders that were issued under an act repealed by this
8 act and codified as a part or section of this act.
9 Sec. 8103. If this act directs the commission or other
10 agency to promulgate rules and rules exist on the date the
11 requirement to promulgate rules takes effect that the commission
12 or agency believes adequately cover the matter, the commission or
13 agency may determine that new rules are not required or may delay
14 the promulgation of new rules until the commission or agency con-
15 siders it advisable.
16 Sec. 8104. (1) The repeal of any statute by this act does
17 not relinquish any penalty, forfeiture, or liability, whether
18 criminal or civil in nature.
19 (2) The repealed statute shall be treated as still remaining
20 in force as necessary to institute or sustain any proper action
21 or prosecution for the enforcement of the penalty, forfeiture, or
22 liability.
23 Sec. 8105. All complaints pending before the commission as
24 of the effective date of this act and all investigations, exami-
25 nations, proceedings, and cases undertaken, commenced, or insti-
26 tuted by the commission before the effective date of this act may
27 be heard, conducted, and continued to final determination, and
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1 all pending actions or proceedings brought by or against the
2 commission may be prosecuted or defended in the same manner.
3 PART 82. CONVERSION TABLES
4 Sec. 8201.
5 Conversion table-new act to old act:
6 New Act Old Act
7 Section Section
8 ARTICLE 1
9 General Provisions
10 Part 11. Short Title and Intent
11 1101 New
12 1102 New
13 1103 New
14 Part 12. Definitions
15 1201 460.501, 460.562,
16 483.1, 483.101
17 ARTICLE 2
18 Michigan Public Service Commission
19 Part 21. Organization
20 2101 New
21 2102 460.1, 460.2
22 2103 460.1
23 2104 460.2
24 Part 22. Jurisdiction
25 2201 460.4, 460.54
26 2202 460.6
27 2203 460.55
28 2204 460.56
29 2205 460.57, 460.2
30 2206 460.54
31 2207 460.5a
32 Part 23. Utility Assessment
33 2301 - 2307 460.111 to 460.119
34 2308 460.61a, 460.115
35 ARTICLE 3
36 Proceedings before the Commission
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1 Part 31. Certificate of Convenience and Necessity
2 3101 - 3204 460.502 - 460.505
3 Part 32. Consumer Participation
4 3201 - 3307 460.6l
5 3208 - 3315 460.6m
6 Part 33. Deposits, Attachments, and Conservation Programs
7 3301 460.651, 460.652
8 3302 460.6g
9 3303 460.6c
10 Part 34. Energy Emergencies
11 3401 10.81
12 3402 10.82
13 3403 10.83
14 3404 10.84
15 3405 10.85
16 3406 10.87
17 3407 10.86
18 Part 35. Underground Facilities
19 3501 460.701
20 3502 460.702
21 3503 460.703
22 3504 460.704
23 3505 460.705
24 3506 460.706
25 3507 460.707
26 3508 460.708
27 3509 460.709
28 3510 460.710
29 3511 460.711
30 3512 460.712
31 3513 460.713
32 3514 460.714
33 3515 460.715
34 3516 460.716
35 Part 36. Public Utility Franchises
36 3601 460.601
37 3602 460.602
38 3603 460.603
39 3604 460.603a
40 Part 37. Complaints
41 3701 460.58
42 Part 38. Rehearings and Modifications of Orders
43 3801 460.351, 460.352
44 ARTICLE 4
45 Electric Utilities
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1 Part 41. General Provisions
2 4101 460.551, 460.552
3 4102 460.6a
4 4103 460.557
5 4104 460.60
6 4105 460.553
7 4106 460.554
8 4107 460.555
9 4108 460.556
10 4109 460.558
11 Part 42. Power Supply Cost Recovery
12 4201 - 4218 460.6j
13 Part 43. Electric Transmission Lines
14 4301 460.562
15 4302 460.562
16 4303 460.564
17 4304 460.565
18 4305 460.566
19 4306 460.567
20 4307 460.568
21 4308 460.569
22 4309 460.570
23 4310 460.571
24 4311 460.572
25 4312 460.573
26 4313 460.574
27 Part 44. Electric Utility Facilities
28 4401 460.802 - 460.806
29 4402 460.807
30 4403 460.808
31 4404 460.809
32 4405 460.810
33 4406 460.811
34 4407 460.812
35 4408 460.813
36 4409 460.814
37 4410 460.815
38 4411 460.816
39 4412 460.821
40 4413 460.822
41 4414 460.823
42 4415 460.824
43 4416 460.831
44 4417 460.832
45 4418 460.833
46 4419 460.834
47 4420 460.835
48 4421 460.836
49 4422 460.837
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1 4423 460.838
2 4424 460.839
3 4425 460.840
4 4426 460.841
5 4427 460.842
6 4428 460.843
7 4429 460.844
8 4430 460.845
9 4431 460.846
10 4432 460.847
11 4433 460.848
12 ARTICLE 5
13 Gas Utilities
14 Part 51. General Provisions
15 5101 460.6a
16 5102 460.6b
17 Part 52. Gas Cost Reconciliations
18 5201 460.6h
19 5202 460.6h
20 5203 460.6h
21 5204 460.6h
22 5205 460.6h
23 5206 460.6h
24 5207 460.6h
25 5208 460.6h
26 5209 460.6h
27 5210 460.6h
28 5211 460.6h
29 5212 460.6h
30 5213 460.6h
31 5214 460.6h
32 5215 460.6h
33 5216 460.6h
34 ARTICLE 6
35 Pipeline Companies
36 Part 61. Oil Pipeline Companies
37 6101 483.1
38 6102 483.2
39 6103 483.3
40 6104 483.4
41 6105 483.5
42 6106 483.6
43 6107 483.7
44 Part 62. Gas Pipeline Companies
45 6201 - 6216 483.101 - 483.116
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1 Part 63. Gas Safety Standards
2 6301 483.151
3 6302 483.152
4 6303 483.153
5 6304 483.154
6 6305 483.155
7 6306 483.156
8 6307 483.157
9 6308 483.158
10 6309 483.159
11 6310 483.160
12 6311 483.161
13 6312 483.162
14 ARTICLE 7
15 Incorporation of 1909 PA 300
16 7101 463.2a
17 7102 462.3
18 7103 462.10
19 7104 462.11
20 7105 462.16
21 7106 462.17
22 7107 462.18
23 7108 462.19
24 7109 462.20
25 7110 462.22
26 7111 462.23
27 7112 462.24
28 7113 462.25
29 7114 462.26
30 7115 462.27
31 7116 462.28
32 7117 462.29
33 7118 462.30
34 7119 462.32
35 7120 462.41
36 7121 462.42
37 7122 462.43
38 7123 462.44
39 7124 462.45
40 7125 462.46
41 7126 462.47
42 7127 462.48
43 7128 462.49
44 7129 462.50
45 ARTICLE 8
46 Savings Clauses and Repealer
47 Part 81. Savings Clauses
48 8101 New
49 8102 New
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1 8103 New
2 8104 New
3 8105 New
4 Part 82. Conversion Tables
5 8201 New
6 Part 83. Repealer
7 8301 New
8 8302 New
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1 PART 83. REPEALER
2 Sec. 8301. The following acts and parts of acts are
3 repealed:
4 MICHIGAN
5 COMPILED LAWS
6 YEAR OF ACT PUBLIC ACT NUMBER SECTION NUMBER SECTIONS
7 1909 106 460.551 to 460.559
8 1909 266 460.601 to 460.604
9 1909 300 462.2 to 462.50
10 1919 419 460.54 to 460.62
11 1921 347 460.651 to 460.652
12 1923 94 460.351 to 460.352
13 1929 9 483.101 to 483.120
14 1929 16 483.1 to 483.11
15 1929 69 460.501 to 460.506
16 1939 3 460.1 to 460.8
17 1965 380 231 16.331
18 1969 165 483.151 to 483.162
19 1972 299 460.111 to 460.120
20 1974 53 460.701 to 460.718
21 1976 448 460.801 to 460.848
22 1982 191 10.81 to 10.89
23 1995 30 460.561 to 460.575
24 Sec. 8302. Executive Reorganization Order No. 1993-9, MCL
25 460.20, is repealed.
00135'97 Final page. SAT