## Illinois Official Reports

Appellate Court

Securus Technologies, Inc. v. Illinois Commerce Comm ’ n , 201 4 IL App ( 1st ) 131716

Appellate Court Caption SECURUS TECHNOLOGIES, INC

. , Petitioner , v. ILLINOIS

COMMERCE COMMISSION and CONSOLIDATED COMMUNI

CATIONS ENTERPRISE SERVICES, INC., d/b/a Consolidated

Communications Public Services

, Respondents

.

District & No. First District , Sixth Division

Docket No. 1

- 13

- 1716

Filed May 16, 2014

Held

( Note: This syllabus constitutes no part of the opinion of the court but has been prepared by the Reporter of Decisions for the convenience of

the reader. ) The orders entered by the Illinois Commerce Commission granting respondent communication company ’ s petition for a declaratory ruling concerning th e special telephone calling services provided for inmates of corrections facilities operated by the Department of

Corrections were vacated due to the Commission ’ s lack of jurisdiction, since respondent ’ s petition was related to its loss of a bid

for the co ntract to provide the services

, but respondent was not an

“ affected person ” for purposes of being entitled to a declaratory ruling, respondent failed to state that an actual controversy or uncertainty existed, especially when the award of the contract was moot, and the orders were outside the Commission ’ s authority under the Administrative Procedure Act and its implementing regulations.

Decision Under

Review Petition for review of order s of Illinois Commerce Commission,

No. 12

- 0413.

Judgment Vacated.- 2

-

Counsel on
Appeal Michael J. Hayes and Dawn L. Johnson , both of K&L Gates LLP, of Chicago, for petitioner

.

John E. Stevenson, of Freeborn & Peters LLP, of Springfield, for respondent Illinois Commerce Commission

.

Panel JUSTICE REYES delivered the judgment of the court, with opinion

. Presiding Justice Rochford and Justice Lampkin concurred in the judgment and opinion.

OPINION

¶ 1 Petitioner Securus Technologies, Inc. (Securus), directly appeals to this court from orders

of the respondent Illinois Commerce Commission (Commission) entered upon a verified petition for a declaratory ruling filed with the Commission by respondent Consolidated Communications Enterprise Services , Inc. (Consolidated), 1 as well as an order denying

rehear ing on the matter. Securus argues: (1) the Commission lacked jurisdiction to enter the orders; (2) the Commission ’ s orders violate Illinois law; (3) the Commission ’ s procedures prior to entry of the orders violated Sercurus ’ s right to due process of law; a nd (4) the

Commission ’ s findings were against the manifest weight of the evidence. The Commission not only takes the contrary position to all of the arguments raised by Securus, but also argues this court lacks jurisdiction to hear this appeal. For the fol lowing reasons, we conclude this court has jurisdiction to hear the appeal, the Commission lacked jurisdiction to enter the orders at issue, and the Commission ’ s orders must be vacated.

¶ 2 BACKGROUND
¶ 3 The record on appeal discloses the following facts. O n July 3, 2012, Consolidated filed a

verified petition for declaratory ruling from the Commission, pursuant to section 5

- 150 of the Illinois Administrative Procedure Act (5 ILCS 100/5

- 150 (West 2012)) and section 200.220(a)(1) of the Commission ’ s Rules of Practice (83 Ill. Adm. Code 200.220 (a)(1) (1996)). In the petition, Consolidated identified itself as a corporation engaged in the provision of telecommunications services and other telecommunications

- related businesses in

Illinois. The petition alleged Co nsolidated “ provide[d] telephone calling services accessible by inmates of corrections facilities operated by the Illinois Department of Corrections ( ‘ IDOC ’ ), so that inmates may communicate with members of the general public. ” Consolidated provided these services through equipment placed in the restricted areas of the IDOC facilities allowing inmates to place operator

- assisted collect calls. The charges for the

1 Consolidated is not a party to this appeal.- 3

-

telephone calls are billed to the members of the public who have accepted responsibility to

pay for the calls. IDOC allows only one such service provider at each corrections facility.
¶ 4 Consolidated sought a declaratory ruling from the Commission “ as to whether a person or

entity, such as Consolidated, ” is providing “ operator services ” and thus is an “ operator services provider[ ] ” under section 13

- 901 of the Public Utilities Act (220 ILCS 5/13

- 901 (West 2012)) and section 770.10 of the Commission ’ s regulations (83 Ill. Adm. Code 770.10 (1994)). Consolidated also sought a declaratory ruling that such o perator services providers were thus subject to the requirements of not only section 13

- 901 of the Public Utilities Act, but also sections 770.20(a) and 770.40(c) and (e) of the Commission ’ s regulations (83 Ill. Adm. Code 770.20(a), 770.40(c), (e) (1994)), which set standards of service and maximum rates for telephone calls.
¶ 5 Consolidated asserted in its petition that the request for a declaratory ruling was

prompted by an actual controversy. In support of the petition ’ s assertion that an actual

controversy existed, Consolidated alleged it had recently submitted a bid to the Illinois Department of Central Management Services (CMS) on a contract to provide services described in the petition to certain IDOC corrections facilities. The contract solicitation

req uired bidders to submit the rates they would charge and the percent of revenues they would pay to IDOC as a commission. Consolidated, believing itself to be an operator services provider, specified it would charge no more than the maximum rates established by sections 770.40(c) and (e) of the Commission ’ s regulations. CMS awarded the contract to a bidder (the record establishes this bidder was Securus) that represented it would charge rates above

those maximum rates. On May 31, 2012, Consolidated protested the contract award. The chief procurement officer of CMS (CPO) denied the protest, based on his review of prior orders issued by the Commission and a review of the Commission ’ s regulations.
¶ 6 Consolidated further asserted in the petition that Consolidated n eeded to know “ whether,

in the future, it would be acting in violation of a Commission regulation if it were to charge higher rates than those established pursuant to section s 770.40(c) and (e) to members of the public in connection with the provision of t he inmate telephone calling services described ” in the petition.
¶ 7 Consolidated attached to its petition a copy of the CPO ’ s June 25, 2012, decision

rejecting Consolidated ’ s protest as to the contract awarded to Securus. The CPO determined the key inquiry i s whether the services at issue were within the Commission ’ s regulatory jurisdiction and subject to the restrictions of section 770.40, as the award would be required to be rescinded if the services were not exempt. The CPO relied on two prior orders issue d by the Commission, Inmate Communications Corp

. , Ill. Com. Comm ’ n No. 96

- 0131 (June 5, 1996) ( Inmate Communications ), and Infinity Networks, Inc

. , Ill. Com

. Comm ’ n No. 05

- 0429 (Oct. 19, 2005) ( Infinity Networks ), in which the Commission ruled: (1) telecom munications providers that do not locate pay telephones in public areas are not public utilities and are not subject to the Commission ’ s regulation with respect to such services; (2) prisoners are not members of the public and thus pay telephones for inmat e

- only use are not a public utility or

telecommunications carrier under section 13

- 202 of the Public Utilities Act; and (3) operator services associated with the provision on nonpublic telephones in correctional institutions were exempt from the operator s ervices requirements of Part 770 of Title 83 of the Illinois

Administrative Code.- 4

- ¶ 8 The CPO noted the only opposing material Consolidated presented was an email from

Kathy Stewart, who was employed by the Commission as an “ Engineering Analyst IV. ” The

CPO o bserved he was not provided the question Consolidated presented to Stewart or any explanation for why Stewart was requested to provide a legal opinion. This “ conundrum ” prompted the CPO to contact the Commission ’ s general counsel ’ s office, which replied the opinion of any single employee was not the opinion of the Commission, and explained there is a formal mechanism called a declaratory ruling which allows the Commission to issue opinions regarding the applicability of its rules. Thus, the CPO concluded the Commission ’ s prior orders were determinative and the services at issue were not subject to regulation.
¶ 9 On July 30, 2012, Securus transmitted a letter regarding Consolidated ’ s petition for a

declaratory ruling to an administrative law judge (ALJ) at th e Commission. The letter requested the summary dismissal of Consolidated ’ s petition, arguing: (1) after the CPO rejected Consolidated ’ s protest of the contract award, Consolidated filed a lawsuit in the circuit court of Sangamon County regarding the contra ct bid dispute, which Consolidated failed to disclose in its verified petition; (2) the Commission had already ruled upon the issue

raised in Consolidated ’ s petition; and (3) Consolidated was not an “ affected person ” with standing to request a declaratory ruling from the Commission. Securus attached a copy of

Consolidated ’ s July 3, 2012, complaint filed in the circuit court against CMS, the CPO, Securus and other parties, challenging the award of the contract to Securus. The ALJ

recorded the letter as an ex parte communication from an interested party.
¶ 10 On July 31, 2012, during a prehearing conference on Consolidated ’ s petition, the ALJ

informed counsel for Securus they would be required to file a petition to intervene if they wished to participate in the pr oceedings on Consolidated ’ s petition.
¶ 11 On August 30, 2012, Securus filed a verified petition to intervene and be treated as a

party in the proceedings on Consolidated ’ s petition for a declaratory ruling. Securus asserted

its interest was based on its then

- ongoing negotiation of the terms of the contract Securus was awarded to provide inmate pay telephone services at IDOC facilities. Securus proffered appearances of counsel and attached a copy of its July 30, 2012, letter to the ALJ. On September 14, 2012, t he ALJ granted Securus ’ s petition to intervene.
¶ 12 On August 31, 2012, the Commission ’ s staff filed a response in support of

Consolidated ’ s verified petition for a declaratory ruling. The response, prepared by Stewart, stated it would not respond directly to the points raised by Securus, because Securus had yet to file a petition to intervene when the response was drafted. The response, however, asserted

Consolidated ’ s litigation of the contract bid in the circuit court was immaterial to the issues raised by the petition. The Commission ’ s staff also argued the Commission should revisit its prior decision in Inmate Communications , noting: (1) the Commission ’ s orders are not

res judicata on the Commission; (2) the relevant portion of the order was dicta ; and (3) the

Commission staff ’ s opinion was that the services at issue should be subject to regulation to protect members of the general public who pay for telephone calls from inmates. The

Commission ’ s staff further asserted Consolidated was an “ affected person ” insofar as the rate regulation affected not only Consolidated ’ s past contract bid, but also future bids.
¶ 13 On September 7, 2012, Consolidated filed a verified reply in support of its verified

petition for a declaratory ruling. Responding to Securus, Consol idated observed it had filed an amended complaint in the circuit court alleging numerous flaws in the bid proposal submitted by Securus. Consolidated asserted the controversy prompting its petition was the- 5

-

award of the contract to Securus, which Consolidat ed disclosed in its verified petition. Consolidated also asserted its litigation was not relevant to the Commission ’ s resolution of the question in the petition for a declaratory ruling. Consolidated further argued the Commission should revisit its prior d ecisions in Inmate Communications and Infinity

Networks

. Consolidated additionally argued it was an “ affected person ” for the purpose of seeking a declaratory ruling because the contract award was in litigation and not final, and as

the CPO indicated in hi s decision, the award must be rescinded if the rate regulations applied

to the services at issue in the contract. Consolidated reiterated it required further guidance regarding whether it would be violating a Commission regulation in the future if it charg ed rates higher than those established by sections 770.40(c) and (e) of the Commission ’ s regulations. In addition, Consolidated asserted Securus had failed to challenge any of the underlying facts or policy considerations asserted by Consolidated and the C ommission ’ s staff in the proceedings.
¶ 14 On October 23, 2012, the ALJ issued a proposed order recommending Consolidated ’ s

petition for a declaratory ruling be granted. Securus filed a motion requesting briefing of exceptions to the proposed order be deferred , due to outstanding discovery requests. On November 13, 2012, the ALJ denied Securus ’ s motion to defer briefing. Securus sought interlocutory review of the ALJ ’ s decision. On December 19, 2012, the Commission denied interlocutory review.
¶ 15 On November 16, 2012, Securus filed its brief of exceptions to the ALJ ’ s proposed order.

Securus again argued Consolidated is not an “ affected person ” entitled to request a declaratory ruling. Securus observed Consolidated ’ s lawsuit was dismissed by the circuit

court on t he basis Consolidated lacked standing to sue. 2 Moreover, Securus and IDOC entered into their contract and the transition from Consolidated to Securus had already begun. Thus, Securus concluded, granting the petition would have no bearing on the litigation or IDOC ’ s contract with Securus. In addition, Securus argued Consolidated could not seek an advisory opinion from the Commission regarding unspecified future activities.
¶ 16 Securus also argued the proposed order was contrary to the Commission ’ s prior orders on

the subject. Securus disputed the Commission staff ’ s assertion that a lack of regulation resulted in excessive and exorbitant prices for inmate telephone services, arguing the additional technological requirements for providing inmate

- only telephone ser vice, which are not required for ordinary collect telephone calls, accounted for the differences in pricing the telephone calls. Securus additionally sought a hearing and oral argument on the matters raised in the proposed order.
¶ 17 On November 20, 2012, the Commission ’ s staff moved to strike the portions of the brief

of exceptions filed by Securus referring to facts outside the record of the proceedings on

Consolidated ’ s petition. On December 18, 2012, the ALJ granted the Commission staff ’ s motion, ruling Se curus had not timely filed or sought other relief regarding the Commission

staff ’ s response. The ALJ also observed that in contested cases, parties must be notified and given the opportunity to contest materials which may be the subject of administrative n otice

2 A copy of the October 24, 2012, circuit court order dismissing Consolidated ’ s complaint included in the record indicates the complaint was dismissed based not only on Consolidated ’ s lack of standing to sue, but also on the ground of sovereign immunity.- 6

-

(see 5 ILCS 110/10

- 40 (West 2012)). The ALJ did not specifically state this matter was a

contested case.
¶ 18 On December 21, 2012, Consolidated filed its reply to the exceptions to the proposed

order. Consolidated argued it was an “ affected person ” enti tled to request a declaratory ruling. Consolidated noted it had previously provided the services at issue in its petition. Consolidated also noted it had appealed the dismissal of its lawsuit by the circuit court and filed a complaint with the Illinois Pro curement Policy Board. Consolidated distinguished case law cited by Securus on the issue of whether an order from the Commission would affect the litigation or the contract between IDOC and Securus.
¶ 19 Consolidated ’ s reply also argued services offered to mem bers of the general public are

operator services subject to the Commission ’ s rate regulation. Consolidated maintained

Securus ’ s reliance on Part 771 of the Commission ’ s regulations was inapposite. Consolidated further argued that the Commission ’ s prior ord ers generally addressed whether inmate pay telephone services providers were “ telecommunications carriers ” under the Public Utilities Act, not whether such providers were “ operator services providers. ” In Consolidated ’ s view,

the Commission ’ s decision in I nmate Communications was the only order addressing the precise issue presented in Consolidated ’ s petition and should not be followed.
¶ 20 On January 9, 2013, the Commission denied Securus ’ s request for oral argument on the

proposed order. On January 18, 2013, Securus sought interlocutory review of the ALJ ’ s ruling striking portions of its brief of exceptions. On January 29, 2013, the Commission denied interlocutory review of the ruling. On January 31, 2013, Securus renewed its request for a hearing on the prop osed order.
¶ 21 On February 14, 2013, Consolidated ’ s petition was placed on the Commission ’ s regular

meeting agenda. During the public comment portion of the meeting, Securus ’ s counsel argued there would be detrimental effects if the Commission declared inmat e pay telephone services subject to Part 770 of the Commission ’ s regulations. At the request of a commissioner, the Commission held the matter over, as there was no deadline for taking action on the petition.
¶ 22 On March 6, 2013, the petition was placed on t he Commission ’ s bench session agenda.

During the public comment portion of the meeting, IDOC ’ s deputy chief of operations spoke regarding the need to restrict inmate telephone service to a single provider to facilitate the monitoring and regulation of such telephone calls to protect the safety and security of IDOC facilities and personnel. When Consolidated ’ s petition was called for discussion during the public utility portion of the meeting, a commissioner requested the ALJ to discuss her

conclusions in th e matter. The ALJ explained the issues raised by Consolidated ’ s petition and

observed the Commission ’ s prior orders contained no factual basis or discussion of its findings regarding inmate telephone service. A commissioner inquired of the ALJ whether

the proposed order would be limited to this case and would have no precedential value moving forward should someone attempt to cite it as authority in the future. The ALJ responded the proposed order would apply to inmate calling services unless someone filed another petition establishing the underlying facts were different. The Commission ’ s chairman indicated the matter would be held for later disposition.
¶ 23 On April 8, 2013, Securus, pursuant to section 200.190 of the Commission ’ s Rules of

Practice (83 Ill. Ad m. Code 200.190 (1996)), filed a verified motion to dismiss

Consolidated ’ s petition as moot. Securus asserted that as of March 28, 2013, all telephone- 7

-

services for inmates at IDOC facilities were transitioned to Securus. Accordingly,

Consolidated was no lo nger providing the services which were the subject of Consolidated ’ s petition. Securus relied upon prior Commission orders which declined to issue declaratory rulings where the Commission ’ s regulations did not apply to the requester and where the petitione r failed to establish business activities which would be affected by a declaratory ruling.
¶ 24 On April 9, 2013, without ruling on Securus ’ s motion to dismiss, the Commission entered

a 26

- page order granting Consolidated ’ s petition for a declaratory ruling. T he order is not

identical to the ALJ ’ s proposed order, but similar in substance. The Commission found

Consolidated was an “ affected person ” entitled to seek a declaratory ruling, based on the rejection of its contract bid and subsequent litigation as to th e denial of the bid protest and the award of the contract to Securus, as well as its request for future guidance regarding the applicability of the rate regulation. The Commission also found it had sufficient information

to determine Consolidated ’ s request was within the parameters of the Commission ’ s authority for issuance of a declaratory ruling and that an actual controversy existed.
¶ 25 The Commission ’ s order adopted the Commission staff ’ s argument that, as a matter of

public policy, the operator services within inmate calling services should be regulated to protect members of the public who engage in telephone calls with inmates. The

Commission ’ s order did not discuss its prior decisions, other than to note the prior orders are

not res judicata and the rec ord here disclosed the nature of the operator services included in inmate calling services. Accordingly, the Commission ordered “ that an entity providing telephone calling services accessible to inmates of correctional facilities that include operator

serv ices as described herein is subject to [s]ection 13

- 901 of the [Public Utilities] Act and [s]ections 770.20(a) and 770.40 of Part 770. ”
¶ 26 On April 24, 2013, Securus filed a verified petition for rehearing. On April 25, 2013, the

ALJ issued a memorandum reco mmending the Commission deny rehearing. On May 1, 2013, the Commission denied the petition for rehearing and served the parties electronically the following day. On June 4, 2013, Securus filed a notice of appeal to this court.

¶ 27 ANALYSIS
¶ 28 On appeal, Sec urus argues: (1) the Commission lacked jurisdiction to enter the orders; (2)

the Commission ’ s orders violate Illinois law; (3) the Commission ’ s procedures prior to entry

of the orders violated Sercurus ’ s right to due process of law; and (4) the Commission ’ s findings were against the manifest weight of the evidence. The Commission not only takes the contrary position to all of Securus ’ s arguments, but also argues this court lacks jurisdiction to hear this appeal, because section 5

- 150(a) of the Administrativ e Procedure Act (5 ILCS 100/5

- 150(a) (West 2012)) and section 200.220(i) of the Commission ’ s Rules of Practice (83 Ill. Adm. Code 200.220(i) (1996)) provide that declaratory rulings are not appealable. A reviewing court has a duty to ascertain whether it h as jurisdiction before addressing any issues on appeal. Secura Insurance Co. v. Illinois Farmers Insurance Co ., 232

Ill. 2d 209, 213 (2009).
¶ 29 The Commission ’ s authority to issue declaratory rulings is derived from section 5

- 150(a)

of the Administrative Pro cedure Act and section 200.220(i) of the Commission ’ s Rules of

Practice. Section 5

- 150(a) of the Adminis trative Procedure Act provides:- 8

- “ Each agency may in its discretion provide by rule for the filing and prompt disposition of petitions or requests for de claratory rulings as to the applicability to the person presenting the petition or request of any statutory provision enforced by the agency or of any rule of the agency. Declaratory rulings shall not be appealable. ” 5

ILCS 100/5

- 150(a) (West 20 12).

Pursua nt to section 5

- 150(a), the Commission promulgated section 200.220 of the Rules of

Practice for the Commission , which provides:

“ a) When requested by the affected person, the Commission may in its sole discretion issue a declaratory ruling wi th respect to : 1) the applicability of any statutory provision enforced by the Commission or of any Commission rule to the person(s) req uesting a declaratory ruling [.]

*** b) A re quest for a declaratory ruling:
1) shall be captioned as such and shall contain a comp lete statement of the facts and grounds prompting the request, including a full disclosure of the requester ’ s interest; a clear, concise statement of the controversy or uncertainty that is the subject of the request; the requester ’ s proposed resolution of that controversy or uncertainty; and citations to any statutes, rules, orders or other authorities involved[.]

* * *
i) Declaratory rulings shall not be appealable. ” 83 Ill. Adm. Code 200.220(a) (1), (b)(1)

, (i) ( 1996 ).

“ It is our duty as officers of the court to respect this expression of legislative intent. ” MidAmerican Energy Corp. v. Illinois Commerce Comm ’ n , 367 Ill. App. 3d 163, 167 (2006). In this case, the Commission found it had sufficient information to determine Consolidated ’ s request was within the parameters of the Commission ’ s authority for issuance of a declaratory ruling, an actual controversy existed, and Consolidated was an “ affected person ” entitled to seek a declaratory ruling. The jurisdictional issue here thus turns on whether th e Commission ’ s order was a declaratory ruling under section 200.220.
¶ 30 S ection 200.220 provides that a declaratory ruling regarding a “ controversy or

uncertainty ” be requested by an “ affected person. ” 83 Ill. Adm. Code 200.220 ( 1996 ). These

self

- imposed lim itations by the Commission do not appear in the text of s ection 5

- 150(a) of

t he Administrative Procedure Act, and thus the Commission ’ s determination of what is a

“ controversy or uncertainty ” and who is an “ affected person ” arguably could be characterized

as the Commission ’ s interpretations of its own regulation. This court has stated that “ [a] court may overturn the Commission ’ s interpretation of its own rules if its construction is clearly erroneous, arbitrary, or unreasonable

. ” Ameren Illinois Co. v. Ill inois Commerce

Comm ’ n , 2012 IL App (4th) 100962, ¶ 6 1. Yet we stated this rule in the context of the

Commission ’ s interpretation of a statute it is charged with administering and enforcing

. See

id

. S ection 200.220 is a Commission regulation promulgated pursuant to the Administrative Procedure Act, rather than the Public Utilities Act. T he Commission ’ s interpretation of a statute it is not charged with administering and enforcing generally is not entitled to any

def erence and is reviewed de novo

. Ameren Illinois Co.

, 2012 IL App (4th) 100962, ¶ 6 2 (citing Business & Professional People for the Public Interest v. Illinois Commerce Comm ’ n , 136 Ill. 2d 192, 204 (1989) ). Furthermore, even in cases where some deference is to be- 9

-

afforded to an administrative agency ’ s statutory interpretations, “ our supreme court has consistently indicated that ‘ [a]n agency ’ s interpretation is not binding, however, and will be rejected when it is erroneous. ’ ” AT& T Teleholdings, Inc. v. Depa rtment of Revenue , 2012 IL App (1st) 113053, ¶ 32 (quoting Shields v. Judges ’ Retirement System of Illinois , 204 Ill. 2d 488, 492 (2003)); see also Business & Professional People for the Public Interest , 136 Ill. 2d at 228 (l ess deference will be afforded the Commission when it s decision is a departure from

the Commission ’ s past practice )

. Lastly, we are not bound to accept the Commission ’ s conclusions regarding its jurisdiction. Peoples Gas Light & Coke Co. v. Illinois Commerce

Comm ’ n , 222 Ill. App. 3d 738, 743 (1991). A ccordingly , while we will consider the

Commission ’ s interpretation of section 200.220 in this case, we remain free to reject that interpretation if it is unreasonable or otherwise erroneous

. AT& T Teleholdings, Inc. , 2012 IL App (1st) 1130 53, ¶ 32

. We now turn to address whether the Co mmission ’ s April 9, 2013, order was a nonappealable “ declaratory ruling ” requested by an “ affected person ” under section 200.220(a)(1).
¶ 31 Securus argues the broad language of the Commission ’ s order, as well as the March 6,

2013, public colloquy between a commissioner and the ALJ, establish es the order was intended to establish a generally applicable Commission policy. Securus contends section 200.220 does not authorize the Commission to issue industry

- wide concl usions regarding policy or practices in the context of a declaratory ruling. Instead, Securus argues section

10

- 101 of the Public Utilities Ac t governs and provides in part:

“ Any proceeding intended to lead to the establishment of policies, practices, rules or programs applicable to more than one utility may, in the Commission ’ s discretion, be conducted pursuant to either rulemaking or contested case provisions, provided such choice is clearly indicated at the beginning of such proceeding and subsequent ly

adhered to. ” 22 0 ILCS 5/10

- 101 (West 2012).

See also 5 ILCS 100/1

- 70(ii) (West 2012) (a “ rule ” does not include “ informal advisory rulings issued under Section 5

- 150 ” of the Administrative Procedure Act). Thus, Securus argues, the Commission cannot establish a generally applicable policy regarding inmate pay telephone services in an order styled as a declaratory ruling. In response, the Commission asserts its ruling is a declaratory ruling because it applies only to Consolidated and any

references to “ an entity ” in the order are limited to Consolidated offering the services set

forth in Consolidated ’ s verified petition for a declaratory ruling.
¶ 32 Securus also maintains Consolidated is not an “ affected person ” entitled to a declaratory

ruling. Securus a rgues that Consolidated ’ s interest in the existing contract for inmate telephone services is moot, as Consolidated no longer provided the services at issue and

Consolidated ’ s lawsuit regarding the contract was dismissed by the circuit court of Sangamon Cou nty. Securus further argues that Consolidated ’ s assertion that it would like to

know whether “ in the future ” charging rates higher than those provided in Part 770 would be

a violation of the Commission ’ s regulations does not establish Consolidated is an af fected

person. In response to these arguments, the Commission contends Consolidated is an affected person, based on the rejection of Consolidated ’ s contract bid, the ongoing litigation in Sangamon County, and Consolidated ’ s request for guidance regarding f uture contract bids.
¶ 33 Neither section 5

- 150(a) of the Administrative Procedure Act nor section 200.220 of the

Rules of Practice for the Commission define s the term “ declaratory ruling, ” and section

200.220 does not define who is an “ affected person

. ” Accor dingly, we resort to basic- 10

-

principles of judicial interpretation. A dministrative regulations are construed according to the same standards that govern the construction of statutes ; accordingly, the best indicator of the

agency ’ s intent is found in the plai n, ordinary and popularly understood meaning of the language of the regulation. See People v. Hanna , 207 Ill. 2d 486, 497

- 98 (2003). In this regard, we note s ection 2

- 701(a) of the Illinois Code of Civil Procedure (Code) (735 ILCS

5/2

- 701(a) (West 2010)) provides that a court “ may, in cases of actual controversy, make binding declarations of rights *** of the rights of the parties interested. ” “ By the very term s of the statute, a declaratory judgment action may not be maintained unless and until an actual controversy exists ***. ” Great West Casualty Co. v. Cote , 365 Ill. App. 3d 100, 105 (2006). An actual controversy is one of the essential elements of an action for declaratory relief. See Beahringer v. Page , 204 Ill. 2d 363, 372 (2003). “ As used in this phrase

, ‘ actual ’ does not mean that a wrong must have been committed and an injury inflicted; rather, the term requires a showing that the underlying facts and i ssues of the case are not moot or premature with the result that a court passes judgment upon mere abstract propositions of law, renders an advisory opinion, or gives legal advice concerning future events. ” Messenger v. Edgar

, 157 Ill. 2d 162, 170 (1993). It is also generally understood that a party seeking declarat ory relief be “ interested ” in the controversy. Pekin Ins urance Co. v. Cincinnati Insuran ce Co.

, 157 Ill. App. 3d 404, 406 (1987)

. “ ‘ [I]nterested ’ does not mean merely having a curiosity

about or a concern for the outcome of the controversy [citation]; rather, the party requesting the declaration must possess a personal claim, status, or right that is capable of being affected by the grant of such relief [citation]

. ” Messenger v. Edgar

, 157 Ill. 2 d at 171.
¶ 34 The Commission has relied on these basic principles regarding declaratory relief in its

interpretation of section 200.220(a). Section 200. 220 requires a requester of a declaratory ruling provide a clear and concise statement of the “ controversy or uncertainty ” prompting the request. 83 Ill. Adm. Code 200.220 ( 1996 ). Moreover, i n Illinois Industrial Energy

Consumers ’ Request for Declaratory Ruling P ursuant to 200.220 re: Section 16

- 102 of an Act

Entitled “ Electric Service Customer Choice and Rate Relief Law of 1997

, ” Ill. Com

. Comm ’ n No. 98

- 0607 (Mar

. 10, 1999) ( Consumer s ’ Request ), t he Commission was asked to clarify the meaning of a provision of the Public Utilities Act , but t he Commission conclude d it ha d “ no authority to declare what a particul ar statute means in some abstract sense. ” The Commission

concluded that the “ ‘ controversy or uncertainty ’ ” embodied in section 200.220 “ must be sufficiently immediate or ripe to enable [the Commission] to evaluate and resolve the matter

with a declarator y ruling. ” Id. (citing Weber v. St. Paul Fire & Marine Insurance Co

., 251 Ill. App. 3d 371 ( 1993) ). The Commission also determined the requesters ’ allegations failed to establish the requesters were “ affected ” persons or constituted “ a full disclosure of t he

requester ’ s interest

. ” (Emphasis added.) Id .; see 83 Ill. Adm. Code 200.220(b)(1) ( 1996 ). Given the requirement that an “ affected person ” set forth an actual “ controversy or uncertainty, ” petition s for declaratory relief must establish the issues of the case are not moot

or premature

. See Consumer s ’ Request

, Ill. Commerce Comm ’ n , No. 98

- 0607 ; Continental Casualty Co. v. Howard Hoffman & Associates , 2011 IL App (1st) 100957, ¶ 19

. It is central to the purpose of a proceeding for declarat ory relief that it allow the decision

- making body to take hold of a controversy one step sooner than normally, i.e

., after the dispute has arisen, but before steps are taken which give rise to claims for damages or other relief. See Kaske v. City of Rockfo rd , 96 Ill. 2d 298, 306 (1983); see also Beahringer , 204 Ill. 2d at 372

- 73.- 11

- ¶ 35 Moreover, in Resource Technology Corp. v. Commonwealth Edison Co. , 343 Ill. App. 3d

36 (2003), this court addressed the issue of whether a Commission order was a declaratory

rulin g, as well as whether the order was sought by an affected person. This court first

observed Illinois case law and Commission actions d id not offer much guidance on the type s of issues that are appropriate subjects for a d eclaratory r uling , as section 200.220 of the

Commission ’ s Rules of Practice was not promulgated by the Commission until 1996

. Id . at
43. We noted t he Commission declined to issue a declaratory ruling in Consumer s’ Request

because t he Commission conclude d it ha d “ ‘ no authority to decl are what a particular statute

means in some abstract sense. ’ ” Id . at 44.
¶ 36 The Resource Technology Corp. court rejected a broad interpretation of section 200.220

urged by the Commission and petitioner Commonwealth Edison (ComEd), reasoning one could argue for a declaratory ruling each time the Commission makes a decision concerning

the Public Utilities Act , as almost everything the Commission does involves the applicability

of the statute. Id

. Accordingly, this court determined that whether the order was a declaratory ruling must be determined by examining the substance of ComEd ’ s petition. Id

. ¶ 37 Turning to the substance of ComEd ’ s petition, the Resource Technology Corp . court

observed that while ComEd ’ s petition was “ dressed up in language that sought the

Commission ’ s view of statutory application

, ” the petition actually sought to have the Commission interpret a 1997 order governing the relationship between ComEd and Resources Technology Corp. (RTC). Id

. The court also observed “ [t] he ‘ affected person ’ was not ComEd, but RTC

. ” Id

. RTC was an intervenor in the proceedings on ComEd ’ s petition for a declaratory ruling. Id . at 41. Accordingly, the court conclude d the Commission ’ s o rder was not a declaratory ruling within the meaning of section 200.220 and den ied the

Commission ’ s motion to dismiss th e appeal. Id . at 44.
¶ 38 In this case, as in Resource Technology Corp ., we must determine whether the

Commission ’ s order at issue is a declaratory ruling by examining the substance of

Consolidated ’ s petition. See id

. In i ts petition for a declaratory ruling, Consolidated alleged an actual controversy existed, based on the fact that Consolidated submitted a bid to CMS for an inmate services calling contract, which was not accepted. Consolidated also relied upon

the CPO ’ s re

jection of Consolidated ’ s bid protest regarding the contract award.

Consolidated ’ s petition did not refer to the lawsuit it subsequently filed in the circuit court of Sangamon County.
¶ 39 Consolidated ’ s petition for a declaratory ruling is contrary to the cen tral purpose of

seeking declaratory relief. At the time of its filing, steps had already been taken which allegedly gave rise to claims for damages or other relief

. See Kaske , 96 Ill. 2d at 306.

Consolidated ’ s petition sought a declaratory ruling regarding the application of a regulation to a contract bidding process which had already terminated. Indeed, after losing its bid protest, Consolidated filed a claim for damages or other relief. In this most basic sense,

Consolidated ’ s petition for a declaratory r uling is obviously untimely, as it sought a ruling regarding a course of action Consolidated had already undertaken. Thus, regarding the submission of the bid to CMS, any actual controversy or uncertainty is moot. See Continental Casualty Co. , 2011 IL App (1st) 100957, ¶ 19

. ¶ 40 Consolidated also alleged in its petition that an actual controversy existed because it

needed to know “ whether, in the future, it would be acting in violation of a Commission regulation if it were to charge higher rates than those est ablished pursuant to § 770.40(c) and- 12

-

(e) to members of the public in connection with the provision of the inmate telephone calling

services described ” in the petition. The record establishes Consolidated is no longer providing the services described in its petition. Moreover, Consolidated ’ s petition fails to identify any immediate or concrete set of facts regarding the future provision of these

services. Furthermore, the specific nature, terms, and conditions of the telephone services IDOC may seek to provi de to inmates pursuant to future contracts is also unknown. Consequently, it is unknown whether Consolidated would be successful in any future bid

process. Accordingly, Consolidated ’ s petition can only be construed as seeking an abstract opinion on the app licability of the existing regulations under some set of unknown future

circumstances. Consolidated ’ s claim to be an affected person thus presents precisely the type of abstract and conjectural interest the Commission rejected in Consumers ’ Request

. ¶ 41 The C ommission concluded Consolidated was an affected person in part because of

pending litigation brought by Consolidated as to the contract award. Although not alleged in the petition for a declaratory ruling, Consolidated ’ s reply to Securus further relied up on the fact that the award of the contract is the subject of ongoing litigation. On this point, we note Consolidated and the Commission staff initially took the position in these proceedings that the litigation in the circuit court of Sangamon County was i mmaterial or irrelevant to

Consolidated ’ s statement of its interest in the petition for a declaratory ruling. Securus argued it was improper for Consolidated to file its verified petition for the purpose of advancing

Consolidated ’ s position in the litigati on. Thus, in this case, only the Commission concluded the litigation was material and a basis to conclude Consolidated was an “ affected person ”

under section 200.220. The Commission ’ s order, however, contains no explanation for this

conclusion.
¶ 42 More significantly, the Commission ’ s conclusion in this respect is inexplicable, given our

decision in Resource Technology Corp. The Commission attempts to distinguish Resource Technology Corp . as a case where the Commission was interpreting a prior order gover ning the relationship between ComEd and RTC, rather than issuing a declaratory ruling. See Resource Technology Corp. , 343 Ill. App. 3d at 44. Similar to Resource Technology Corp.

, however, Consolidated has requested a declaratory ruling after litigation ha s commenced in another forum, contrary to the basic point of seeking a declaratory ruling. See Kaske , 96 Ill.

2d at 306. In addition, as in Resource Technology Corp. , the actual “ affected person ” in this case would be the intervenor and successful bidder, Securus. See Resource Technology Corp. , 343 Ill. App. 3d at 44. Accordingly, we conclude Resource Technology Corp

. is applicable to this case.
¶ 43 In addition, Consolidated ’ s lawsuit was dismissed by the circuit court of Sangamon

County based on Consolidated ’ s lack of standing to sue and the doctrine of sovereign immunity. These issues are issues unrelated to the subject of Consolidated ’ s petition and the

Commission ’ s order. Thus, even assuming for the sake of argument that the dismissal was reversed on appeal , the effect of a declaratory ruling upon the litigation

– if any

– is unknown, as the record on appeal does not describe all of the issues which may be involved in the litigation. It is also unclear whether a declaratory ruling issued after the contract was a lready awarded to Securus would affect the outcome of the litigation. There is no indication in this

record that the Commission ’ s order would have any effect on the ongoing litigation. Thus,

Consolidated ’ s supposed interest in obtaining a declaratory rulin g based on pending litigation ultimately is hypothetical or conjectural.- 13

- ¶ 44 In short, Consolidated ’ s allegations regarding the submission of its contract bid do not

establish an actual controversy because that controversy is moot. Consolidated ’ s allegations regarding its possible future activities are too abstract and hypothetical to constitute a full statement of the requester ’ s interest. Neither Consolidated nor the Commission established the ongoing litigation in Sangamon County would be affected by the Co mmission ’ s order. Accordingly, for all of the aforementioned reasons, we conclude the Commission ’ s order in this case was not a declaratory ruling, as the party requesting the order was not an affected person and there was no controversy or uncertainty within the meaning of section 200.220 of

the Commission ’ s regulations. Accordingly, the Commission ’ s order is not a nonreviewable declaratory ruling under section 200.220(i). See Resource Technology Corp. , 343 Ill. App. 3d

at 44.
¶ 45 Our resolution of the jur isdictional question, however, is decisive on the merits of the

propriety of the Commission ’ s order. In evaluating the propriety of an order issued by the Commission, o ur scope of review is governed by section 10

- 201 of the Public Utilities Act (see 220 IL CS 5/10

- 201 (West 201 2 )). Section 10

- 201 provides in relevant part that a reviewing court shall reverse a Commission ’ s order or decision, in whole or in part, if it finds

that : (a) the findings of the Commission were not supported by substantial evidence b ased on the entire record of evidence presented to or before the Commission for and against such order or decision; (b) the order or decision was without the jurisdiction of the Commission; (c) the order or decision was in violation of the state or federal constitution or laws; or (d) the proceedings or manner by which the Commission considered and entered its order or decision were in violation of the state or federal constitution or laws, to the prejudice of the appellant. 220 ILCS 5/10

- 201(e)(iv) (West 2 01 2 ).
¶ 46 In this case, based on our foregoing analysis, the decisive issue is whether the

Commission ’ s ruling was made out side the jurisdiction of the Commission

. “ ‘ The term

“ jurisdiction, ” while not strictly applicable to an administrative body, may be emp loyed to designate the authority of the administrative body to act ***. ’ ” Business & Professional People for the Public Interest , 136 Ill. 2d at 243 ( quoting Newkirk v. Bigard , 109 Ill. 2d 28, 36 (1985))

. As our supreme court has stated:

“ [I]n administrative law, the term ‘ jurisdiction ’ has three aspects: (1) personal jurisdiction

– the agency ’ s authority over the parties and intervenors involved in the proceedings, (2) subject matter j urisdiction

– the agency ’ s power ‘ to hear and

determine cau ses of the general class of cases to which the particular case belongs ’ [citation] , and (3) an agency ’ s scope of authority under the statutes. ” Id

.

“ Consequently, to the extent an agency acts outside its statutory authority, it acts without jurisdiction. ” Id

. Thus, for example, this court vacated portions of a Commission order which constituted a declaratory ruling prior to the promulgation of section 200.220. See Harrisonville Telephone Co. v. Illinois Commerce Comm ’ n , 176 Ill. App. 3d 389, 393 (1988).
¶ 47 Th e Commission purported to act pursuant to section 5

- 150(a) of the Administrative

Procedure Act and section 200.220 of the Commission ’ s Rules of Practice, which empower the Commission to issue declaratory rulings. As previously noted, w hen requested by an

a ffected person, the Commission may issue a declaratory ruling where there is a clearly stated controversy or uncertainty. For the reasons already stated, Consolidated was not an

“ affected person ” entitled to request a declaratory ruling from the Commission and Consolidated failed to clearly state an actual controversy or uncertainty. Thus, we conclude- 14

-

the Commission ’ s order was outside the Commission ’ s authority under the Administrative

Procedure Act and the Commission ’ s own implementing regulation. See Har risonville Telephone Co. , 176 Ill. App. 3d at 393

. Accordingly, the Commission ’ s order must be

vacated. Moreover, as the Commission lacked jurisdiction to enter the order at issue in this case, we need not address the merits of the Commission ’ s ruling as this court was required to

do in Resource Technology Corp.

¶ 48 CONCLUSION
¶ 49 For all of the aforementioned reasons, the Commission ’ s April 9, 2013, order is vacated.

The Commission ’ s May 1, 2013, order denying rehearing is similarly vacated.

¶ 50 V acated.