20190709notice_of_hearing_order_no_34367.pdf

Office of the Secretary
Service Date
July 9,2019
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF BG &CM RAILROAD,)INC.'S SPECIAL REGULATORY FEE )CASE NO.BGR-R-19-01
PURSUANT TO IDAHO CODE §§61-1001 )THROUGH 61-1005 )ORDER TO SHOW CAUSE
)NOTICE OF HEARING
)ORDER NO.34367
BG &CM Railroad,Inc.("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 Company 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 2018,as
required by Idaho Code §§61-1001 through 61-1005.
BACKGROUND
1.Commission RegulatoryFees
The Commission's operating funds are derived by assessing regulatory fees upon
utilities and railroads subject to the Commission's jurisdiction.Each year,the 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 "[o]n 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 in
Idaho for the preceding calendar year during which it carried on such intrastate utilityor railroad
business."Idaho Code §61-1003.
Idaho Code §61-1001 requires "each 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 regulatoryfee in such amount as the commission shall find and determine to be
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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.;see also Idaho
Code §61-1003.
Idaho Code §61-1004 sets forth the duties of the Commission with regard to 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.34033 &34032;see also Affidavit of
Nancy Ashcraft.
In a Decision Memorandum dated June 21,2019,Commission Staff alleged the
Railroad failed to pay its assessed fees for 2018.Specifically,on April 20,2018,the Company
was notified through Invoice No.2018-256 that it owed $15,411.83 for its annual assessment (the
"Assessment").See Affidavit ofNancyAshcraft,Exhibit A.Furthermore,on multipleoccasions,
the Commission Staff ("Staff")attempted to collect the Railroad's Assessment,sending invoices,
demand letters,and notification that failure to comply could result in legal action.See Exhibit No.
1 to Decision Memorandum,dated June 21,2019;see also Affidavit ofAshcraft.Nevertheless,the
Railroad has failed,refused,or neglected to meet the requirements of the statutes and the
Commission Staff's demands that it pay its Assessment.Id.
The Railroad has failed to pay its statutorilyrequired annual regulatory fees to the
Commission for 2018.See Affidavit ofNancy Ashcraft.Each failure to pay violates Idaho Code
§§61-1003 and 61-1005.
In December of 2018,the Railroad was assessed $924.71 in interest on its outstanding
balance of $15,411.83 (6%).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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The Railroad's current outstanding balance is $16,336.54.
JURISDICTIONAL STATEMENT
The Commission has jurisdiction in this matter under Idaho Code §§61-101,et seq.,
includingIdaho Code §61-501,which vests the Commission with the authorityand 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 also Idaho Code §§61-1001 through61-1005 (relating
to regulatory fees of railroads).
CLAIM
1.Violations ofIdaho 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 2018.In May and November 2018,the Railroad failed or
refused to pay the annual regulatory fee totaling $15,411.831 to the Commission in violation of
Idaho Code §§61-1001 and 61-1005.See Affidavit ofAshcraft.Because of the Railroad's failure
to pay its annual regulatory fees,it has incurred $924.71 in fees.2 At the time of the entry of this
Order,BG &CM Railroad,Inc.owes the Commission $16,336.54 in regulatory fees and interest
charges.Id.
O RD ER
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 AT 10:45
A.M.(MDT)ON JULY 18,2019,IN THE COMMISSION HEARING ROOM,472 WEST
WASHINGTON STREET,BOISE,IDAHO,to show cause why the followingshould 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
2018 annual fees,plus interest,in the amount of $16,336.54;
*This amount represents an outstanding balance for failing to pay its annual regulatory fee for 2018.
2 Idaho Code §61-1005 requires that any outstanding balances be charged an annual fee of 6%interest on the balance.
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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,totaling
$2000.
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 needingthe help of a sign language interpreter or other assistance
in order 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)workingdays before the hearingby contacting the
Commission Secretary at:
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE,IDAHO 83720-0074
[phone] (Telephone)
[phone] (FAX)
E-Mail:[e-mail]
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.
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DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of July 2019.
PAUL K LLAND ,PRESIDENT
KRISTINE RAPER,CO SSIONER
ERIC ANDERSON,COMMISSIONER
Diane M.Hanian
Commission Secretary
I:\Legal\Railroad\BGR-R-19-01\Orders\BGRRl901_OSC_jrh final.docx
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