Bill signed that helps guarantee PSC funds

New law also widens monitoring authority, sets aside court ruling

May 17, 2002|By Dan Thanh Dang | Dan Thanh Dang,SUN STAFF

Capping a fruitful legislative year for the Maryland Public Service Commission, Gov. Parris N. Glendening signed a bill yesterday that helps guarantee funding and gives the regulatory agency wider authority to monitor utility service in the state.

The new law also nullifies an appeals court ruling issued last month that reversed a PSC order prohibiting utilities from sharing resources and assets with their affiliates. The law keeps intact procedures used by the PSC to issue orders and regulations.

In addition, the budget passed by the General Assembly authorizes three new hires for the PSC, which has been pressed for resources as its regulatory responsibilities continue to expand.

"We're very excited with what happened this General Assembly session," said PSC Chairman Catherine I. Riley. "The legislation allows us to charge fees, generate additional revenue and overturns two years of Court of Appeals proceedings. The new fiscal budget also gives us three new positions to help with additional responsibilities. The changes bring some flexibility to the commission."

House Bill 135 started as a measure to help ensure funding to the PSC.

The bill designates special funding status to the PSC and the Office of People's Counsel, the consumers' advocate on utility issues, so that both can avoid fluctuations in the general fund budget.

"For ever and ever, the commission has been funded by the utilities it oversees," Riley said. "As we move into the competitive world, some of those companies were not part of the regulated paradigm. This helps us generate additional revenue."

The law allows the PSC to charge companies they license and charge fees for filings.

"We didn't know whether the bill was going to be signed or not," said Del. Joan F. Stern, a Montgomery County Democrat who co-sponsored HB135. "It's such a significant bill for both agencies. It really helps the PSC, which was really going to be hurt by the government cutbacks and hiring freeze. They were going to have to lay off four people and return half a million dollars to utilities. Now that won't have to happen."

A last-minute amendment - attached and passed on the last day of the session - invalidated a Court of Appeals ruling overturning a PSC order that limited links between utilities and their unregulated affiliates on procedural grounds.

The state's highest court ruled April 8 that instead of using "generic proceedings" to issue an order, the PSC should have held formal proceedings with public notification, public response and legislative review of the directives to adopt regulations that affected all utilities. Such a process could take as long as six months.

The ruling jeopardized not only the Code of Conduct governing utility and affiliate practices in a deregulated environment, but also endangered years of business guidelines created by the PSC through orders.

With HB135 signed into law, the Code of Conduct remains intact and the PSC can issue regulations or bypass formal administrative procedures when issuing orders.

Riley said the commission is preparing to fill three new jobs related to beefing up security procedures: a telecommunications position; a transportation position designed to conduct face-to-face interviews with drivers for taxi cab licensing; and an engineer for pipeline inspection.

The commission took over jurisdiction in October of two liquid hazardous materials pipelines. Previously, it only regulated natural gas pipelines.

"Since Sept. 11, all our pipelines are on the national critical infrastructure list," Riley said. "It's additional responsibility we didn't have, but these new hires will help tremendously."

In a related issue, the governor signed House Bill 1164 to spur more competition in telecommunications. The provisions include requiring the PSC to rule on allegations of noncompetitive practices within six months of receiving a formal complaint. The law also allows the commission to speed resolution of complaints by cutting the period for appeals to as short as one week. The legislation goes into effect Oct. 1.

Sun staff writer Andrew Ratner contributed to this article.

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