20240326Order_to_Show_Cause_Order_No_36121.pdf

Office of the Secretary
Service Date
March 26,2024
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF BG & CM RAILROAD, ) CASE NO. BGR-R-24-01
INC.'S FAILURE TO PAY ITS 2023 )
ASSESSMENT FEES AND PROMPLY ) ORDER TO SHOW CAUSE
COMPLY WITH STATUTORY MANDATES )
NOTICE OF HEARING
ORDER NO. 36121
This matter came before the Idaho Public Utilities Commission ("Commission") at
Commission Staffs ("Staff') request that the Commission order BG & CM Railroad, Inc.
("Railroad") to appear and show cause why the Commission should not impose penalties for the
Railroad's continued, willful violations of its requirements under state law related to the payment
of its annual assessment fees.
The Railroad is a short line railroad providing service in Nez Perce, Clearwater, and Idaho
Counties, Idaho. The Railroad is a "railroad corporation" and a "common carrier" as defined by
Idaho Code §§ 61-111 and 61-113. As such, the Railroad is a public utility subject to the
jurisdiction of the Commission. Idaho Code § 61-129. This matter comes before the Commission
due to the Railroad's failure to pay its regulatory fees for 2023, as required by Idaho Code §§ 61-
1001 through 61-1005.
BACKGROUND
1. Commission Regulatory Fees
The Commission's operating funds are derived by assessing regulatory fees upon public
utilities and railroads subject to the Commission's jurisdiction. Each year, the Idaho Legislature
authorizes the Commission to expend funds necessary to regulate and supervise utilities and
railroads doing business in Idaho. Idaho Code § 61-1001. The maximum annual assessment fee
for each railroad shall not exceed one percent (1%) of its gross intrastate operating revenues, and
the minimum annual fee shall be no less than $50.Idaho Code § 61-1004(1) and(4).
Idaho Code § 61-1003 requires that:
On or before April 1st of each year, each public utility and railroad corporation
subject to the jurisdiction of the commission, shall file with the commission a return
verified by an officer or agent of the public utility or railroad corporation involved,
showing its gross operating revenues from its intrastate utility or railroad business
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in Idaho for the preceding calendar year during which it carried on such intrastate
utility or railroad business.
Idaho Code § 61-1003.
Furthermore,Idaho Code § 61-1001 requires that:
[E]ach railroad corporation, subject to the jurisdiction of the commission, and
subject to the provisions of this act, shall pay to the commission in each year, a
special regulatory fee in such amount as the commission shall find and determine
to be necessary, together with the amount of all other fees paid or payable to the
commission by each such public utility and railroad corporation. . . .
Idaho Code § 61-1001; see also Idaho Code § 61-1005.
Once all the railroads operating in Idaho have reported their intrastate operating revenues
for the previous calendar year, the Commission calculates the "proportionate assessment that all
railroad corporations . . . shall bear . . . in proportion to their respective gross operating revenues
derived from intrastate [railroad] business in Idaho for the preceding calendar year. . . ." Idaho
Code§ 61-1004. The Commission then notifies each railroad of its assessed regulatory fee by May
1 of each year.Idaho Code § 61-1005. The regulatory fee may be paid to the Commission in equal
semi-annual installments due May 15 and November 15 of each year. Id.;Idaho Code § 61-1003.
Idaho Code § 61-1004 sets forth the duties of the Commission regarding the determination
of fees. Regarding the year in question, the Commission has fulfilled its statutory requirements,
and the rates set by the Commission were below the statutory maximum of one percent (1%) of
gross intrastate revenue. See Order Nos. 35743 & 35744;Affidavit of Nancy Ashcraft.
In a Decision Memorandum dated March 19,2024,Commission Staff alleged the Railroad
failed to pay its assessed fees for 2023. Specifically, on December 5, 2023, the Railroad was
notified through Invoice No. 23-002 that it owed $14,775.57 for its annual assessment (the
"Assessment") plus $308.46 in accrued interest for the 2023 assessment (through December 5,
2023) and $49.25 for unpaid interest from the 2022 assessment! See Affidavit of Nancy Ashcraft,
Exhibit A. Nevertheless, the Railroad has failed, refused, or neglected to meet the requirements
of the statutes and the Commission Staffs demands that it pay its statutorily required annual
1 On December 5, 2023, the Railroad was assessed an interest charge of$308.46 at(6%) interest on its outstanding
balance of$14,775.57 due for its 2023 Assessment. See Idaho Code § 61-1005 (stating that utilities and railroads
failing to timely pay shall incur an annual fee of 6%interest on all unpaid balances).
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regulatory fees for 2023. See Affidavit of Nancy Ashcraft. Each failure to pay violates Idaho Code
§§ 61-1003 and 61-1005.
The Railroad's current outstanding balance is $15,133,28 (through December 5, 2023).
JURISDICTIONAL STATEMENT
The Commission has jurisdiction in this matter under Idaho Code §§ 61-101, et seq.,
including Idaho Code § 61-501, which vests the Commission with the authority and jurisdiction
to supervise and regulate every public utility in the state. More specifically, Idaho Code §§ 61-
701, et seq., provides direction to the Commission relating to enforcement, penalties, and
interpretation of public utilities law. See Idaho Code §§ 61-1001 through 61-1005 (relating to
regulatory fees of railroads).
CLAIM
1. Violations of Idaho Code§§61-1001 and 61-1005
Idaho Code §§ 61-1001 and 61-1005 require that the Railroad pay to the Commission an
annual regulatory fee in a proportional amount based on the Railroad's intrastate gross operating
revenues as reported in its annual verified return.
The Railroad has been contacted on several occasions by Commission Staff demanding
that it pay its annual regulatory fee for 2023. In both May and November 2023,the Railroad failed
or otherwise refused to pay the annual regulatory fee totaling $14.775.572 to the Commission in
violation of Idaho Code §§ 61-1001 and 61-1005. See Affidavit of Nancy Ashcraft. Because of the
Railroad's failure to pay its annual regulatory fees, it has incurred$308.46 in fees due to interest.3
The Railroad also carried forward $49.25 in interest due from the 2022 assessment. As of
December 5, 2023, BG & CM Railroad, Inc. owes the Commission $15,133.28 in regulatory fees
and interest charges.Id.
ORDER
Based on the evidence before the Commission, and good cause appearing, IT IS HEREBY
ORDERED that BG &CM Railroad, Inc. shall appear before the Commission on April 11, 2023,
at 10:00 A.M. (MDT) in the Commission's Hearing Room at 11331 W. Chinden Blvd.,
2 This amount represents an outstanding balance for failing to pay its annual regulatory fee for 2023.
3 Idaho Code§61-1005 requires that any outstanding balances be charged an annual fee of 6%interest on the balance.
This is the balance through December 5,2023.
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Building #8, Suite 201-A, Boise, Idaho 83714, to show cause why the following should not be
required of the Railroad by summary order issued by the Commission:
1. Order the Railroad to immediately pay the entire outstanding balance for
2023 annual fees, plus interest, in the amount of$15,133,28;
2. Direct the Commission's attorney to seek the imposition of civil penalties
under Idaho Code § 61-706 of$2,000 for each and every offense.
3. Direct the Commission's attorney to sue in District Court to enforce the
determination of the Commission, consistent with Idaho Code §§ 61-705,
61-706, and 61-1005.
IT IS FURTHER ORDERED that all hearings and prehearing conferences in this matter
will be held in facilities meeting the accessibility requirements of the Americans with Disabilities
Act (ADA). Persons needing the help of a sign language interpreter or other assistance to
participate in or to understand testimony and argument at a public hearing may ask the Commission
to provide a sign language interpreter or other assistance at the hearing. The request for assistance
must be received at least five (5) working days before the hearing by contacting the Commission
Secretary at:
IDAHO PUBLIC UTILITIES COMMISSION
P.O. BOX 83720
BOISE, IDAHO 83720-0074
[phone] (Telephone)
[phone] (FAX)
secretgU&puc.Idaho.gov
IT IS FURTHER ORDERED that all proceedings in this matter will be conducted pursuant
to Title 61 of the Idaho Code and the Commission's Rules of Procedure, IDAPA 31.01.01.000 et
seq.
IT IS FURTHER ORDERED that the Commission Secretary serve this Order to Show
Cause by Certified Mail (return receipt requested) upon the person designated to receive Notices
of Summonses and Complaints (IDAPA 31.01.01.016) and upon the person designated by the
utility to receive legal service in Idaho. Idaho Code § 61-615.
ORDER TO SHOW CAUSE
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ORDER NO. 36121 4

DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 261h day of
March 2024.
ERIC ANDERSON, PRESIDENT
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HN R. HAMMOND JR., COMMISSIONER
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EDWARD LODG . COMMISSIONER
ATTEST:
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Commission Secretary
IALega1\RAILBGR-R-24-01_BG&CM\BGRR2401_Ntc_SCH_md.docx
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