2001111_dh.doc

DECISION MEMORANDUM

TO: COMMISSIONER HANSEN
COMMISSIONER SMITH
COMMISSIONER KJELLANDER
JEAN JEWELL
RON LAW
ALDEN HOLM
TERRI CARLOCK
WORKING FILE (Barb)
FROM:
DATE:
JANUARY 11, 2001 RE: EASTERN IDAHO RAILROAD’S PETITION FOR A REFUND OF ITS ANNUAL ASSESSMENTS FOR YEARS 1999 AND 2000; CASE NO. EIR-R-01-1

On January 8, 2001, Eastern Idaho Railroad filed a “request for relief of fees” in a letter from the Railroad’s Director of Government Affairs. In the letter, the Railroad stated that it has “over reported [its] revenue for the past three years resulting in the overpayment of [regulatory fees] to the Idaho Public Utilities Commission by more than $100,000.” EIRR Letter at 1. In essence, the Railroad states that it over-reported its gross intrastate operating revenues which, in turn, resulted in the Railroad’s regulatory fee being much higher than the Railroad allegedly owes. The Railroad’s letter requesting a refund is attached.
BACKGROUND
As the Commission is aware, its operating budget is derived from the assessment of regulatory fees upon utilities and railroads subject to the Commission’s jurisdiction. Idaho Code § 61-1003 provides that on or before April 1st of each year, each railroad corporation shall report its gross operating revenues from its intrastate railroad business in Idaho for the preceding calendar year. Based upon the total amount of gross intrastate revenues reported by all the railroads, the Commission then determines the proportionate assessment applicable to each railroad to recover the Legislature’s authorized appropriation.
Once each railroad’s assessment is determined, the Commission notifies the railroad of its regulatory fee no later than May 1st of each year. Such fee shall be paid to the Commission in equal semi-annual installments. Idaho Code § 61-1005. Any utility or corporation may object to the fee “on or before the time specified for payment for the first installment of the assessment made against it.” Idaho Code § 61-1007.
As alleged in the letter, Eastern Idaho requests that its 1999 and 2000 annual assessments be refunded. The Railroad became aware that it over-reported its gross intrastate revenues for the calendar years 1998 and 1999 (use to calculate the 1999 and 2000 regulatory fees, respectively) and notified the Commission’s Fiscal section before the first payment was due on May 15, 2000. The Staff subsequently audited Eastern Idaho and issued the Railroad an Audit Report. The Staff’s Audit Report calculated that Eastern Idaho should be assessed a regulatory fee for 2000 in the amount $3,754.71 (based upon the Staff’s audit of the Railroad’s 1999 intrastate operating revenues).
The Railroad requests relief for both the 1999 and 2000 assessments. First, the Railroad requests that the Commission “waive” the Staff-calculated 2000 fee of $3,754.71. Second, Eastern Idaho claims that its paid 1999 regulatory fee of $37,024.78, should have been only $3,461.81 (reflecting the difference in reported revenues of $9,354,416 vs. adjusted intrastate revenue of $37,024.78). To expedite the refunds, the Railroad has offered to compromise and accept a refund of $29,808.26 for the two years. EIRR Letter at 3. The Railroad has not requested a hearing.
STAFF RECOMMENDATION
Without addressing the specific allegations contained in Eastern Idaho’s letter, Staff recommends that this matter be processed as a formal case. Staff suggests that the Commission direct the Staff to file an Answer to the letter within 14 days after which the Railroad may file a reply and/or request a hearing.

Commission Decision
Does the Commission wish to process this matter as a formal case?
Does the Commission wish to direct the Staff to file a formal Answer and for the Railroad to be provided an opportunity to file a reply?

vld/M:EIR-R-01-01_dh

DECISION MEMORANDUM 2