Missouri 2025 Regular Session

Missouri Senate Bill SB136 Compare Versions

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Old	New	Differences
1	1
2	2	FIRST REGULAR SESSION
3	3	SENATE BILL NO. 136
4	4	103RD GENERAL ASSEMBLY
5	5	INTRODUCED BY SENATOR TRENT.
6	6	1305S.01I KRISTINA MARTIN, Secretary
7	7	AN ACT
8	8	To repeal section 393.150, RSMo, and to enact in lieu thereof one new section relating to the test
9	9	year for certain utilities.
10	10
11	11	Be it enacted by the General Assembly of the State of Missouri, as follows:
12	12	Section A. Section 393.150, RSMo, is rep ealed and one new 1
13	13	section enacted in lieu thereof, to be known as section 393.150, 2
14	14	to read as follows:3
15	15	393.150. 1. Whenever there shall be filed with the 1
16	16	commission by any gas corporation, electrical corporation, 2
17	17	water corporation or sewer corpor ation any schedule stating 3
18	18	a new rate or charge, or any new form of contract or 4
19	19	agreement, or any new rule, regulation or practice relating 5
20	20	to any rate, charge or service or to any general privilege 6
21	21	or facility, the commission shall have, and it is her eby 7
22	22	given, authority, either upon complaint or upon its own 8
23	23	initiative without complaint, at once, and if it so orders 9
24	24	without answer or other formal pleading by the interested 10
25	25	gas corporation, electrical corporation, water corporation 11
26	26	or sewer corporation, but upon reasonable notice, to enter 12
27	27	upon a hearing concerning the propriety of such rate, 13
28	28	charge, form of contract or agreement, rule, regulation or 14
29	29	practice, and pending such hearing and the decision thereon, 15
30	30	the commission upon filing with su ch schedule, and 16
31	31	delivering to the gas corporation, electrical corporation, 17
32	32	water corporation or sewer corporation affected thereby, a 18 SB 136 2
33	33	statement in writing of its reasons for such suspension, may 19
34	34	suspend the operation of such schedule and defer the use of 20
35	35	such rate, charge, form of contract or agreement, rule, 21
36	36	regulation or practice, but not for a longer period than one 22
37	37	hundred and twenty days beyond the time when such rate, 23
38	38	charge, form of contract or agreement, rule, regulation or 24
39	39	practice would otherwise go into effect; and after full 25
40	40	hearing, whether completed before or after the rate, charge, 26
41	41	form of contract or agreement, rule, regulation or practice 27
42	42	goes into effect, the commission may make such order in 28
43	43	reference to such rate, charge, fo rm of contract or 29
44	44	agreement, rule, regulation or practice as would be proper 30
45	45	in a proceeding initiated after the rate, charge, form of 31
46	46	contract or agreement, rule, regulation or practice had 32
47	47	become effective. 33
48	48	2. If any such hearing cannot be conc luded within the 34
49	49	period of suspension, as above stated, the commission may, 35
50	50	in its discretion, extend the time of suspension for a 36
51	51	further period not exceeding six months , the last day of 37
52	52	which period shall be considered the operation of law date . 38
53	53	At any hearing involving a rate sought to be increased, the 39
54	54	burden of proof to show that the increased rate or proposed 40
55	55	increased rate is just and reasonable shall be upon the gas 41
56	56	corporation, electrical corporation, water corporation or 42
57	57	sewer corporation, and the commission shall give to the 43
58	58	hearing and decision of such questions preference over all 44
59	59	other questions pending before it and decide the same as 45
60	60	speedily as possible. 46
61	61	3. (1) Beginning July 1, 2026, the test year for 47
62	62	proceedings under this section shall, if requested by a gas 48
63	63	corporation, water corporation, or sewer corporation, be a 49
64	64	future year consisting of the first twelve full calendar 50 SB 136 3
65	65	months after the operation of law date determined as 51
66	66	provided in subsections 1 and 2 of this s ection for 52
67	67	schedules stating new base rates filed by a gas corporation, 53
68	68	water corporation, or sewer corporation under this section, 54
69	69	unless the commission makes a determination that using a 55
70	70	future test year under this section is detrimental to the 56
71	71	public interest. For ratemaking purposes, the projected 57
72	72	total rate base at the end of the future test year as 58
73	73	authorized by the commission shall be used to establish new 59
74	74	base rates. Unless otherwise ordered by the commission, new 60
75	75	base rates shall not go into effect before the first day of 61
76	76	the future test year. 62
77	77	(2) With respect to gas corporations, water 63
78	78	corporations, or sewer corporations that elect to utilize a 64
79	79	future test year and notwithstanding section 393.270 to the 65
80	80	contrary, within forty -five days of the end of the future 66
81	81	test year, such gas corporation, water corporation, or sewer 67
82	82	corporation shall update its base rates that were approved 68
83	83	by the commission in its report and order issued under 69
84	84	subsections 1 and 2 of this section to refl ect the total 70
85	85	rate base, annualized depreciation expense, income tax 71
86	86	expense, payroll expense, employee benefits (other than 72
87	87	pensions and other post -retirement benefits) and rate case 73
88	88	expense at the end of the future test year. The total 74
89	89	ending rate base and expense items reflected in this update 75
90	90	shall not be greater than the total ending rate base and 76
91	91	expense items approved by the commission in its report and 77
92	92	order establishing base rates. The commission and parties 78
93	93	to the case shall have sixty days to review the accuracy of 79
94	94	the updated information provided by a gas corporation, water 80
95	95	corporation, or sewer corporation. The commission shall 81
96	96	order the corporation to file new tariff sheets that reflect 82 SB 136 4
97	97	the update, unless any party who was a par ty to the rate 83
98	98	case files a request for a hearing at which point the 84
99	99	commission shall suspend the filed tariffs and order a 85
100	100	procedural schedule. 86
101	101	4. A gas corporation, water corporation, or sewer 87
102	102	corporation that requests a test year under subsect ion 3 of 88
103	103	this section shall not recover the costs of any plant 89
104	104	investments made during the test year period under any of 90
105	105	the mechanisms provided for in sections 393.1000, 393.1003, 91
106	106	393.1006, 393.1009, 393.1012, 393.1015, 393.1500, 393.1503, 92
107	107	393.1506, or 393.1509. 93
108	108	5. For a gas corporation, water corporation, or sewer 94
109	109	corporation that elected to use a future test year, a 95
110	110	reconciliation of the rate base at the end of the future 96
111	111	test year shall be provided to the commission within forty - 97
112	112	five days of the end of the future test year. If the actual 98
113	113	rate base is less than the rate base used to set base rates 99
114	114	in the prior general rate proceeding under subsections 1 and 100
115	115	2 of this section, and notwithstanding section 393.270 to 101
116	116	the contrary, the por tion of the annual revenue requirement 102
117	117	comprising the rate base difference shall be returned to 103
118	118	customers. The revenue requirement shall be calculated 104
119	119	using rate base, depreciation expense, income tax expense, 105
120	120	and the pre-tax rate of return from the p rior general rate 106
121	121	proceeding under subsections 1 and 2 of this section. The 107
122	122	difference in revenue requirement shall be placed into a 108
123	123	regulatory liability to be returned to customers in the next 109
124	124	general rate proceeding with such regulatory liability to 110
125	125	accrue carrying costs at the utility's weighted average cost 111
126	126	of capital. 112
127	127	6. The commission may take into account any change in 113
128	128	business risk to the corporation resulting from 114 SB 136 5
129	129	implementation of the adjustment mechanism in setting the 115
130	130	corporation's allowed return in any rate proceeding, in 116
131	131	addition to any other changes in business risk experienced 117
132	132	by the corporation. 118
133	133	7. For a gas corporation, water corporation, or sewer 119
134	134	corporation that elected to use a future test year, a 120
135	135	reconciliation of payroll expense, employee benefits except 121
136	136	for pensions and other post retirement benefits, and rate 122
137	137	case expense at the end of the future test year shall be 123
138	138	provided to the commission within forty -five days of the end 124
139	139	of the future test year. If the actual amounts for these 125
140	140	expenses are less than the amounts used to calculate the 126
141	141	revenue requirement in the prior general rate proceeding 127
142	142	under subsections 1 and 2 of this section, and 128
143	143	notwithstanding section 393.270 to the contrary, the 129
144	144	differences shall be returned to customers. The difference 130
145	145	in revenue requirement shall be placed into a regulatory 131
146	146	liability to be returned to customers in the next general 132
147	147	rate case with such regulatory liability to accrue carrying 133
148	148	costs at the utility's wei ghted average cost of capital. 134
149	149	8. The commission may promulgate rules to implement 135
150	150	the provisions of this section. Any rule or portion of a 136
151	151	rule, as that term is defined in section 536.010, that is 137
152	152	created under the authority delegated in this se ction shall 138
153	153	become effective only if it complies with and is subject to 139
154	154	all of the provisions of chapter 536 and, if applicable, 140
155	155	section 536.028. This section and chapter 536 are 141
156	156	nonseverable and if any of the powers vested with the 142
157	157	general assembly pursuant to chapter 536 to review, to delay 143
158	158	the effective date, or to disapprove and annul a rule are 144
159	159	subsequently held unconstitutional, then the grant of 145 SB 136 6
160	160	rulemaking authority and any rule proposed or adopted after 146
161	161	August 28, 2025, shall be invalid an d void. 147
162	162	9. For purposes of this section, the following terms 148
163	163	shall mean: 149
164	164	(1) "Base rates", rates or charges for public utility 150
165	165	service other than rates or charges under any rate 151
166	166	adjustment mechanism including, but not limited to, those 152
167	167	approved under the provisions of sections 386.266, 393.1000, 153
168	168	393.1009, 393.1030, 393.1075, and 393.1500; 154
169	169	(2) "Revenue requirement", the amount of retail 155
170	170	revenues from base rates charged to retail customers for 156
171	171	public utility service needed for a publi c utility to 157
172	172	recover its cost to provide utility service including 158
173	173	reasonable and necessary expenses, prudent investments, and 159
174	174	the cost of capital. 160
175	175	