20120328Petition for Reconsideration.pdf

J. Frederick Mack, ISB # 1428
HOLLAND & HART LLP
Suite 1400, U.S. Bank Plaza
101 South Capitol Boulevard
P.O. Box 2527
Boise, Idaho 83701-2527
Telephone: [phone]
Facsimile: [phone]
fmack@hollandhart. corn
Attorneys for Build Idaho Inc.
RECEIVED
!012 MAR 28 PM t:23
iDAHO PUi3UC
U1IL1TES COMM1SSN
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE
APPLICATION OF IDAHO POWER
COMPANY FOR AUTHORITY TO
MODIFY ITS RULE H LINE
EXTENSION TARIFF RELATED TO
NEW SERVICE ATTACHMENTS
AND DISTRIBUTION LINE
INSTALLATIONS
CASE NO. IPC-E-08-22
BUILD IDAHO INC'S PETITION
FOR RECONSIDERATION
Comes Now Build Idaho Inc. (hereinafter "Build Idaho"), by and through its attorneys of
record, Holland & Hart LLP and pursuant to Idaho Code § 61-626 submits this Petition for
Reconsideration of the Idaho Public Utilities Commission's (hereinafter "Commission" or
"IPUC") Order No. 32476, dated March 7, 2012 (hereinafter "March 7, 2012 Order") and
pursuant to the express directive of such Order that "any person interested in this Order" shall
have 21 days in which to file a motion for reconsideration. Build Idaho is a non-profit
organization working with commercial and residential builders in its request for reconsideration
of IPUC's Order No. 32476.
BUILD IDAHO INC'S PETITION FOR RECONSIDERATION -1
I. INTRODUCTION
On October 30, 2008, Idaho Power filed an Application with the IPUC seeking regulatory
authority to modify its Line Extension Tariff, referred to as the Rule H" Tariff, specifically
relating to New Service Attachments and Distribution Line Installations. The proposed modified
Tariff included a new section, Section 10, which attempted to allocate responsibility for the costs
incurred "for utility relocations required by public road improvement projects on public rights-
of-way." As proposed, Section 10 required Private Beneficiaries to pay to Idaho Power a
percentage of relocation costs equal to the extent to which the public road improvement project
is for the benefit of Private Beneficiaries. On July 1, 2009, the Commission filed its Order No.
30853 granting Idaho Power's Application to modify Rule H. ACHD petitioned for
reconsideration, noting that Section 10 exceeded the Commission's authority and encroached
upon ACHD's Resolution 330, a Resolution that fully regulated utility relocations on public
rights-of-way that fell within the jurisdiction of ACHD. The Commission rejected ACHD's
objections and thereafter issued its Order No. 30995 which approved Section 10, and added a
new Section 11 to the Rule H Tariff. ACHD pursued review of the Commission Order with the
Idaho Supreme Court which issued its decision on May 25, 2011 setting aside Sections 10 and 11
of the amendments to Rule H approved by IPUC Order No. 30995. Ada County Highway
District v. Idaho Public Utilities Commission, 253 P.3d 675 (Idaho 2011) (hereinafter "ACHD v.
IPUC").
Subsequent to entry of the Opinion by the Supreme Court and pursuant to I.C. § 61-629,
Idaho Power sought Commission approval of a modified version of section 10, purportedly
seeking to "alter or amend the order appealed from to meet the objections of the court." Pursuant
to Order No. 32476, the Commission approved the revised version of section 10. However, the
BUILD IDAHO INC'S PETITION FOR RECONSIDERATION -2
revised version, approved by the Commission, does not "meet the objections of the court" and, in
fact, blatantly ignores the Supreme Court directives.
II. ARGUMENT
The authority of a Public Road Agency to compel a utility to relocate its facilities within
a public right-of-way is well established. In State ex rel Rich v. Idaho Power Co., 81 Idaho 487,
501 (Idaho 1959), the court unambiguously stated: "Under the common law a utility placing its
facilities along streets and highways, gains no property right and upon demand must move its
facilities at its expense." The Supreme Court interpreted Idaho Code 62-705 and affirmed this
common law rule in ACHD v. IPUC, noting:
When ACHD determines that a utility must remove or locate its facilities that are
within the public right-of-way, the Public Road Agency is not required to bear
any of the utilities cost of doing so. (citations omitted). The utility must proceed
with the relocation. The utility is required to complete the relocation regardless of
whether it is reimbursed by a third party.
253 P.3d at 680-81. The Commission is respectfully requested to temper its consideration of this
Petition for Reconsideration with the directive of the Supreme Court in mind. At no point in its
Opinion did the Supreme Court overrule or otherwise place in to question its prior precedent set
forth in State ex rel Rich v. Idaho Power, Supra.
In concluding that Section 10 did not usurp ACHD's exclusive jurisdiction over public
rights of way, the Court held:
Section 10 provides that when Company is required to relocate its distribution
facilities within a public right of way for the benefit of a Private Beneficiary, such
entity may be required to pay some or all of the costs incurred by company in
doing so. (footnote omitted). When ACHD determines that a utility must remove
or relocate its facilities that are within a public right of way, ACHD is not
required to bear any of the utilities costs of doing so. Mountain States Tel. &
Telegraph Co. v. Boise Redevelopment Agency, 101 Idaho 30, 33, 607 P.2d 1084,
1087 (1980). The utility must proceed with the relocation. Because ACHD does
not bear any of that cost, there is no need for it to have authority to determine
whether some third party should reimburse the utility for all or a portion of the
cost. Whether some third party reimburses the Company after the relocation has
BUILD IDAHO INC'S PETITION FOR RECONSIDERATION -3
been completed is not an issue of concern to ACHD. Determining whether there
will be reimbursement from a third party is simply not necessary in Order for
ACHD to freely and efficiently exercise powers expressly granted it.
253 P.3d at 680-81. The conclusion of the Court that ACHD has neither a reimbursement
obligation nor any enforceable interest in determining if and to what extent reimbursement from
a third party is compelled does not establish the right of the utility to seek reimbursement from
third parties. In fact, the IPUC's attempt to regulate the obligations of third parties to a utility
when the utility relocates its facilities within a public right of way is the exact reason the
Supreme Court concluded that by adopting Section 10 the IPUC exceeded its authority.
In reaching the conclusion that IPUC exceeded its authority, the Court held:
IPUC certainly has the authority to determine the costs that Company charge a
private person who requests services from Company. (Emphasis added)
253 P.3d at 682. Thus, if a third party including a real estate developer within Build Idaho
requests a line extension or other relocation of utility services, Idaho Power has the right to
charge that third party the costs incurred by the utility in making such change. However, the
Court continued:
However, Section 10 goes further than that. Under Section 10, when a Public
Road Agency requires that Idaho Power relocate its distribution facilities, IPUC
has the authority to determine whether the relocation, in whole or in part, is for
the benefit of a third party. If it determines that it is, then Section 10 would
allocate all or a portion of the costs of relocation to that third party. Thus, [under
Section 10] IPUC could require a third party to pay for services that the third
party did not request from Company if IPUC determined that a relocation required
by a Public Road Agency benefitted the third party. IPUC has not pointed to any
statute granting it that authority. We hold that the provisions of Section 10
discussed above exceed the authority of IPUC. Therefore, we set aside Section
10.
253 P.3d at 683. The Supreme Court thus reached two indisputable conclusions: First, the Court
confirmed ACHD's exclusive right to compel a utility to relocate its facilities located within a
public right-of-way, without any cost to be imposed upon ACHD. Second, relocation expense
BUILD IDAHO INC'S PETITION FOR RECONSIDERATION -4
can be charged to a private person or entity or if that private person "requests services from
Company." All attempts by the IPUC to "require a third party to pay for services that the third
party did not request from [the utility]" were rejected by the Court as exceeding the authority of
IPUC.2 The Court could not have stated the principle more succinctly and clear: Even if a
relocation benefitted a private party, IPUC would exceed its authority by any attempt to compel
the private party to pay for the [beneficial] service it did not request.3
The third paragraph of Section 10 does not "meet the objections of the court" because it
authorizes the Commission to treat public agencies relocation request as if it is a request for
service from a third party.
1 In fact, Section 6 of Rule H specifically addresses a relocation request by a third party, and
requires that third party to pay "a non-refundable charge equal to the Cost Quote."
2 Surprisingly, IPUC continues to assert the right to determine whether a relocation, demanded
by a Road Agency, nonetheless benefits a third party and further to determine the amount of
reimbursement of costs that the third party must pay to the utility. This assertion is in direct
contradiction to the admissions made by IPUC before the Supreme Court:
During oral argument, IPUC admitted that it could not adjudicate the dispute between the
third party and Company. It also admitted that if Company wanted to recover relocation
costs from a third party, it would have to sue in court and Section 10 would not apply.
(footnote omitted).
253 P.3d at 683.
The Supreme Court recognized that under Idaho Code section 6 1-507, the IPUC can "prescribe
rules and regulations for the performance of any service. . . by any public utility." The IPUC
can, therefore, "determine the costs that [Idaho Power] can charge a private person who requests
services from [Idaho Power]." 253 P.3d at 682. However, as the Supreme Court noted, IPUC
failed to point to any statute granting it the authority to "require a third party to pay for services
that it did not request from [Idaho Power] if IPUC determined that A, relocation required by a
Public Road Agency benefitted the third party." 253 P.3d at 683. Thus, a demand for relocation
of services asserted by a Public Road Agency, that expressly or nominally benefits a third party,
is not the "performance of any service" by a utility so as to grant regulatory authority to the
IPUC.
BUILD IDAHO INC'S PETITION FOR RECONSIDERATION -5
III. CONCLUSION
For the reasons stated herein, Build Idaho respectfully requests that the IPUC reconsider
its decision as set forth in Order No. 32476. The Commission is bound by the decisions issued
by the Idaho Supreme Court. Any alterations or amendments must fully "meet the objections of
the court". The Court made clear in its decision, ACHD v. IPUC, that the Commission has no
statutory authority to determine if, under what circumstances, and in what amount a private party
must reimburse a utility that relocates its facilities within a public right-of-way where the
relocation request is made by a Public Road Agency. Under the Commission's enabling
legislation, a relocation request/demand by a Public Road Agency cannot be construed as an
implied relocation request by private individuals or entities that the Commission or the utility
determine are beneficiaries of the relocation.
RESPECTFULLY SUBMITTED.
Dated thiday of March, 2012.
HOLLAND & HART LLP
By: /
Frederick s for the ftrm-
BUILD IDAHO INC'S PETITION FOR RECONSIDERATION -6
CERTIFICATE OF SERVICE
I hereby certify that on thi 'day of March 2012, I caused to be served a true and
correct copy of the foregoing by the method indicated below, and addressed to the following:
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BUILD IDAHO INC'S PETITION FOR RECONSIDERATION -7