| 1 | 1 | | S.B. No. 1016 |
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| 2 | 2 | | |
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| 3 | 3 | | |
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| 4 | 4 | | AN ACT |
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| 5 | 5 | | relating to the consideration of employee compensation and benefits |
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| 6 | 6 | | in establishing the rates of electric utilities. |
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| 7 | 7 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 8 | 8 | | SECTION 1. Subchapter B, Chapter 36, Utilities Code, is |
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| 9 | 9 | | amended by adding Section 36.067 to read as follows: |
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| 10 | 10 | | Sec. 36.067. CONSIDERATION OF COMPENSATION AND BENEFIT |
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| 11 | 11 | | EXPENSES. (a) In this section, "employee compensation and |
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| 12 | 12 | | benefits" includes base salaries, wages, incentive compensation, |
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| 13 | 13 | | and benefits. The term does not include: |
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| 14 | 14 | | (1) pension or other postemployment benefits; or |
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| 15 | 15 | | (2) incentive compensation for an officer of an |
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| 16 | 16 | | electric utility related to attaining: |
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| 17 | 17 | | (A) financial metrics; or |
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| 18 | 18 | | (B) metrics adverse to customers' interests as |
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| 19 | 19 | | determined by the commission. |
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| 20 | 20 | | (b) When establishing an electric utility's rates, the |
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| 21 | 21 | | regulatory authority shall presume that employee compensation and |
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| 22 | 22 | | benefits expenses are reasonable and necessary if the expenses are |
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| 23 | 23 | | consistent with market compensation studies issued not earlier than |
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| 24 | 24 | | three years before the initiation of the proceeding to establish |
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| 25 | 25 | | the rates. |
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| 26 | 26 | | SECTION 2. (a) Section 36.067, Utilities Code, as added by |
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| 27 | 27 | | this Act, applies only to a proceeding for the establishment of |
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| 28 | 28 | | rates for which the regulatory authority has not issued a final |
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| 29 | 29 | | order or decision before the effective date of this Act. |
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| 30 | 30 | | (b) A proceeding for which the regulatory authority has |
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| 31 | 31 | | issued a final order or decision before the effective date of this |
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| 32 | 32 | | Act is governed by the law in effect immediately before that date, |
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| 33 | 33 | | and that law is continued in effect for that purpose. |
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| 34 | 34 | | SECTION 3. This Act takes effect immediately if it receives |
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| 35 | 35 | | a vote of two-thirds of all the members elected to each house, as |
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| 36 | 36 | | provided by Section 39, Article III, Texas Constitution. If this |
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| 37 | 37 | | Act does not receive the vote necessary for immediate effect, this |
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| 38 | 38 | | Act takes effect September 1, 2023. |
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| 39 | 39 | | ______________________________ ______________________________ |
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| 40 | 40 | | President of the Senate Speaker of the House |
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| 41 | 41 | | I hereby certify that S.B. No. 1016 passed the Senate on |
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| 42 | 42 | | April 3, 2023, by the following vote: Yeas 31, Nays 0. |
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| 43 | 43 | | ______________________________ |
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| 44 | 44 | | Secretary of the Senate |
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| 45 | 45 | | I hereby certify that S.B. No. 1016 passed the House on |
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| 46 | 46 | | April 20, 2023, by the following vote: Yeas 141, Nays 1, |
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| 47 | 47 | | two present not voting. |
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| 48 | 48 | | ______________________________ |
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| 49 | 49 | | Chief Clerk of the House |
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| 50 | 50 | | Approved: |
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| 51 | 51 | | ______________________________ |
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| 52 | 52 | | Date |
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| 53 | 53 | | ______________________________ |
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| 54 | 54 | | Governor |
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