Senate Bill No. 514–Committee on Commerce and Labor

 

March 26, 2001

____________

 

Referred to Committee on Commerce and Labor

 

SUMMARY—Revises authority of public utilities commission of Nevada to regulate certain public utilities, holding companies and other entities. (BDR 58‑188)

 

FISCAL NOTE:    Effect on Local Government: No.

                                 Effect on the State: No.

 

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to utilities; excluding persons who are engaged in providing commercial mobile radio service from the definition of “public utility”; revising the authority of the public utilities commission of Nevada to regulate mergers, acquisitions and changes in control of public utilities, holding companies and other entities; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1    Section 1. NRS 704.030 is hereby amended to read as follows:

1-2    704.030  “Public utility” or “utility” does not include:

1-3    1.  Persons engaged in the production and sale of natural gas, other than

1-4  sales to the public, or engaged in the transmission of natural gas other than

1-5  as a common carrier transmission or distribution line or system.

1-6    2.  Persons engaged in the business of furnishing, for compensation,

1-7  water or services for the disposal of sewage, or both, to persons within this

1-8  state if:

1-9    (a) They serve 25 persons or less; and

1-10    (b) Their gross sales for water or services for the disposal of sewage, or

1-11  both, amounted to $5,000 or less during the immediately preceding 12

1-12  months.

1-13    3.  Persons not otherwise engaged in the business of furnishing,

1-14  producing or selling water or services for the disposal of sewage, or both,

1-15  but who sell or furnish water or services for the disposal of sewage, or

1-16  both, as an accommodation in an area where water or services for the

1-17  disposal of sewage, or both, are not available from a public utility,

1-18  cooperative corporations and associations or political subdivisions engaged

1-19  in the business of furnishing water or services for the disposal of sewage,

1-20  or both, for compensation, to persons within the political subdivision.

2-1    4.  Persons who are engaged in the production and sale of energy,

2-2  including electricity, to public utilities, cities, counties or other entities

2-3  which are reselling the energy to the public.

2-4    5.  Persons who are subject to the provisions of NRS 590.465 to

2-5  590.645, inclusive.

2-6    6.  Persons who are engaged in the sale or use of special fuel as defined

2-7  in NRS 366.060.

2-8    7.  Persons who are licensed as alternative sellers to provide electric

2-9  services.

2-10    8.  Persons who provide water from water storage, transmission and

2-11  treatment facilities if those facilities are for the storage, transmission or

2-12  treatment of water from mining operations.

2-13    9.  Persons who are engaged in providing commercial mobile radio

2-14  service. As used in this subsection, “commercial mobile radio service”

2-15  has the meaning ascribed to it in 47 C.F.R. § 20.3.

2-16    Sec. 2.  NRS 704.329 is hereby amended to read as follows:

2-17    704.329  1.  Except as otherwise provided in subsection [4, no person

2-18  may] 6, a person shall not merge with, directly acquire , indirectly acquire

2-19  through a subsidiary or affiliate, or otherwise directly or indirectly obtain

2-20  control of a public utility doing business in this state or [an entity] a

2-21  holding company that holds a controlling interest in [such] a public utility

2-22  doing business in this state without first submitting to the commission an

2-23  application for authorization of the proposed merger, acquisition or other

2-24  transaction and obtaining authorization from the commission pursuant to

2-25  subsection [2.] 4.

2-26    2.  Except as otherwise provided in subsection 6:

2-27    (a) A public utility doing business in this state shall not merge with,

2-28  directly acquire, indirectly acquire through a subsidiary or affiliate, or

2-29  otherwise directly or indirectly obtain control of an entity; and

2-30    (b) A holding company that holds a controlling interest in a public

2-31  utility doing business in this state shall not merge with, directly acquire,

2-32  or indirectly acquire through a subsidiary or affiliate, or otherwise

2-33  directly or indirectly obtain control of an entity,

2-34  without first submitting to the commission an application for

2-35  authorization of the proposed merger, acquisition or other transaction

2-36  and obtaining authorization from the commission pursuant to
subsection 4.

2-37    3.  Any merger, acquisition or [change in control in violation] other

2-38  transaction that violates the provisions of this section is void and

2-39  unenforceable and is not valid for any purpose.

2-40    [2.] 4.  Before authorizing [the] a merger, acquisition or [change in

2-41  control of a public utility doing business in this state,] other transaction

2-42  described in subsection 1 or 2, the commission shall consider the effect of

2-43  the proposed merger, acquisition or other transaction. If the commission

2-44  finds that the proposed merger, acquisition or [change in control] other

2-45  transaction is in the public interest, the commission shall authorize the

2-46  proposed merger, acquisition or other transaction.

 

3-1    [3.] 5.  If the commission does not issue a final determination regarding

3-2  the proposed merger, acquisition or other transaction within 180 days

3-3  after the date on which an application or amended application for

3-4  authorization of the proposed merger, acquisition or other transaction was

3-5  filed with the commission, the proposed merger, acquisition or other

3-6  transaction shall be deemed [approved.

3-7    4.] to be authorized by the commission.

3-8    6.  The provisions of this section do not apply to the transfer of stock

3-9  [of a public utility doing business in this state or to the transfer of the

3-10  stock] of an entity [holding a controlling interest in such a public utility,] if

3-11  a transfer of not more than 25 percent of the common stock of [such a

3-12  public utility or] the entity is proposed.

3-13    7.  As used in this section, unless the context otherwise requires:

3-14    (a) “Affiliate” means a person who, directly or indirectly through one

3-15  or more intermediaries, controls, is controlled by or is under common

3-16  control with an entity.

3-17    (b) “Entity” means any person other than a natural person, including,

3-18  without limitation, a public utility and a holding company.

3-19    (c) “Person” means:

3-20      (1) A natural person.

3-21      (2) Any form of business or social organization and any other

3-22  nongovernmental legal entity, including, without limitation, a

3-23  corporation, partnership, association, trust or unincorporated

3-24  organization.

3-25      (3) A government, a political subdivision of a government or an

3-26  agency or instrumentality of a government or a political subdivision of a

3-27  government.

3-28    Sec. 3.  1.  If, on or after January 1, 1999, and before the effective

3-29  date of this act, an electric utility doing business in this state or a holding

3-30  company that holds a controlling interest in such an electric utility entered

3-31  into any transaction to merge with, directly acquire, indirectly acquire

3-32  through a subsidiary or affiliate, or otherwise directly or indirectly obtain

3-33  control of an entity, the provisions of NRS 704.329, as amended by this

3-34  act, apply retroactively to the transaction unless, before the effective date

3-35  of this act:

3-36    (a) All terms and conditions of the transaction have been satisfied; and

3-37    (b) All parties to the transaction have fully performed all promises,

3-38  covenants and obligations under the transaction.

3-39    2.  As used in this section, “electric utility” means any public utility or

3-40  successor in interest that:

3-41    (a) Is in the business of providing electric service to customers;

3-42    (b) Holds a certificate of public convenience and necessity issued or

3-43  transferred pursuant to chapter 704 of NRS; and

3-44    (c) In the most recently completed calendar year or in any other

3-45  calendar year within the 7 calendar years immediately preceding the most

3-46  recently completed calendar year, had a gross operating revenue of

3-47  $250,000,000 or more in the State of Nevada.

3-48  The term does not include a cooperative association, nonprofit corporation,

3-49  nonprofit association or provider of electric service which is declared to be

4-1  a public utility pursuant to NRS 704.673 and which provides service only

4-2  to its members.

4-3    Sec. 4.  This act becomes effective upon passage and approval.

 

4-4  H