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Nebraska Supreme Court Advance Sheets

311 Nebraska Reports

IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

Cite as 311 Neb. 813

In re Application No. P-12.32 of Black 

Hills Nebraska Gas, LLC.

Metropolitan Utilities District, appellant, v. 

Black Hills Nebraska Gas, LLC, 

et al., appellees.

___ N.W.2d ___

Filed June 17, 2022. No. S-21-620.

1. Public Service Commission: Appeal and Error. Under Neb. Rev. Stat. 

§ 75-136(2) (Reissue 2018), an appellate court reviews an order of the 

Public Service Commission de novo on the record. In a review de novo 

on the record, an appellate court reappraises the evidence as presented 

by the record and reaches its own independent conclusions concerning 

the matters at issue.

2. Administrative Law: Appeal and Error. When an appellate court 

makes a de novo review, it does not mean that the court ignores the 

findings of fact made by the agency and the fact that the agency saw and 

heard the witnesses who appeared at its hearing.

3. ____: ____. Where the evidence is in conflict, an appellate court will 

consider and may give weight to the fact that the agency hearing examiner observed the witnesses and accepted one version of the facts rather 

than another.

4. Administrative Law: Statutes: Appeal and Error. The meaning and 

interpretation of statutes and regulations are questions of law for which 

an appellate court has an obligation to reach an independent conclusion 

irrespective of the decision made by the court below.

5. Public Service Commission: Time: Presumptions. The determination of the public interest with regard to a specific application to the 

Public Service Commission pursuant to Neb. Rev. Stat. § 66-1863 

(Reissue 2018) is based on the conditions presented by the application 

and relates directly to the time and conditions presented, and it does 

Nebraska Supreme Court Online Library

www.nebraska.gov/apps-courts-epub/

08/05/2022 01:07 AM CDT
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IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

Cite as 311 Neb. 813

not amount to an adjudication for the future. Therefore, the conclusive 

presumption under § 66-1863(3) is conclusive as to the determination 

of the public interest based on the time and conditions presented by 

the specific application, and it does not constitute a permanent determination or a conclusive presumption as to an application that may be 

presented to the Public Service Commission under different conditions 

in the future.

Appeal from the Public Service Commission. Affirmed.

Mark A. Fahleson, Andrew S. Pollock, and Jennifer L. 

Ralph, of Rembolt Ludtke, L.L.P., and Mark Mendenhall and 

Marc Willis, of Metropolitan Utilities District, for appellant.

Trenten P. Bausch and Megan S. Wright, of Cline, Williams, 

Wright, Johnson & Oldfather, L.L.P., and Douglas J. Law, 

Associate General Counsel, Black Hills Energy, for appellee 

Black Hills Nebraska Gas, L.L.C.

Douglas J. Peterson, Attorney General, and L. Jay Bartel, for 

appellee Nebraska Public Service Commission.

Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke, 

and Freudenberg, JJ., and Dougherty, District Judge.

Miller-Lerman, J.

NATURE OF CASE

Metropolitan Utilities District (MUD) appeals the order of 

the Public Service Commission (PSC) which approved the 

application of Black Hills Nebraska Gas, LLC, doing business 

as Black Hills Energy (Black Hills), seeking an enlargement or 

extension of its natural gas mains in Sarpy County, Nebraska. 

MUD generally argues that the application was contrary to a 

2010 order which it asserts conclusively established that it was 

in the public interest for MUD to provide natural gas service 

to the area that was the subject of Black Hills’ application. We 

affirm the PSC’s order.
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Nebraska Supreme Court Advance Sheets

311 Nebraska Reports

IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

Cite as 311 Neb. 813

STATEMENT OF FACTS

Black Hills’ Application.

On February 23, 2021, Black Hills filed an application with 

the PSC pursuant to Neb. Rev. Stat. § 66-1863 (Reissue 2018) 

in which it sought a determination that Black Hills’ proposed 

extension of its natural gas mains to provide service to a site 

in Sarpy County was in the public interest. The application 

was designated by the PSC as “Application No. P-12.32.” 

Black Hills asserted that it would be providing service to 

Omaha Public Power District (OPPD) at a site in the area 

of 168th Street and Fairview Road in Sarpy County and that 

OPPD planned to build new generation facilities at the site. 

The approval of Application No. P-12.32 is the subject of 

this appeal.

Black Hills asserted in the application that the site at issue 

was within the extraterritorial zoning jurisdiction of Papillion, 

Nebraska, and that Black Hills served Papillion and its extraterritorial jurisdiction under a current and valid natural gas 

franchise. Black Hills noted that there had been litigation 

between Papillion and Springfield, Nebraska, and that following such litigation, the two cites had agreed that the site at 

which OPPD planned to build its facilities would be within the 

boundaries of Papillion and not within Springfield. Black Hills 

asserted that because the site was within Papillion’s extraterritorial jurisdiction, under Neb. Rev. Stat. § 66-1861(2) (Reissue 

2018), there was a rebuttable presumption that it was in the 

public interest for Black Hills to provide service to the area. 

Black Hills also stated that MUD did not possess a current and 

valid franchise to serve areas within Papillion and that pursuant to Neb. Rev. Stat. § 66-1858 (Reissue 2018), MUD could 

not solicit a franchise from Papillion.

Black Hills asserted in Application No. P-12.32 that the 

facilities to be built by OPPD would “support growth in 

the region while ensuring high reliability of electric generation” and that the facilities would require a high volume of 

natural gas which would require installation of a new main. 
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IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

Cite as 311 Neb. 813

Black Hills stated its preferred route for a new main would 

be almost entirely within the extraterritorial jurisdiction of 

Papillion and that the small portion that was not located within 

such jurisdiction was not presently located within the zoning 

jurisdiction of any community. Black Hills provided a map 

depicting known existing infrastructure in the area of OPPD’s 

proposed site, and it stated that it was not aware of any MUD 

mains within a quarter mile of the proposed service area.

Black Hills finally asserted that extension of its gas distribution system into the site at issue would “contribute to the 

orderly development of natural gas utility infrastructure,” and 

it noted that as Papillion expanded into its extraterritorial zoning jurisdiction, Black Hills would be the service provider to 

customers in those areas. Black Hills therefore requested an 

order from the PSC determining that the proposed extension by 

Black Hills was in the public interest.

MUD’s Protest.

On March 3, 2021, MUD filed a protest and motion to 

dismiss Black Hills’ Application No. P-12.32. MUD generally asserted that the site of Black Hills’ extension was within 

MUD’s service area as established by a 2010 order of the 

PSC and that the proposed extension by Black Hills would be 

duplicative of MUD’s planned extension into the area. MUD 

asserted that the 2010 order established a conclusive presumption that MUD’s extension into the area was in the public interest and that presumption could not be overcome by additional 

evidence or argument. MUD therefore requested that the PSC 

“summarily dismiss and deny Black Hills’s [a]pplication, as a 

matter of law.”

MUD asserted that in 2010, Black Hills and MUD had filed 

a joint application with the PSC, setting forth their plans to 

extend and enlarge their respective service areas. MUD further 

asserted that no objections were filed to the joint application in 2010 and that therefore, pursuant to § 68-1863(3), the 

application was “conclusively presumed to be in the public 
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IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

Cite as 311 Neb. 813

interest” and the two utilities were therefore allowed to proceed with their plans without further action by the PSC.

The joint application of Black Hills and MUD, upon which 

MUD relies, was filed with the PSC on April 19, 2010, and 

was designated by the PSC as “Application No. P-0014.” In 

the application, Black Hills and MUD provided a map showing 

areas within Sarpy County into which each intended to extend 

or enlarge its respective service area. Black Hills and MUD 

stated in the application that they stipulated and agreed that 

such extensions or enlargements satisfied relevant statutory 

requirements. They further asserted that they had discussed 

the matter with representatives of Sarpy County and of cities 

within the county, including Papillion and Springfield, and that 

the application had received the support of those governmental 

entities. They also attached to the application an exhibit setting forth applicable conditions and providing that, except for 

certain stated exceptions, neither Black Hills nor MUD would 

maintain gas facilities within the other’s service area as shown 

in the map. One of the exceptions was when “[t]he parties 

determine by agreement that it is more practical and efficient 

for one party to provide gas service to a customer or customers 

within the other party’s area of service.”

On May 12, 2010, the PSC filed an order regarding 

Application No. P-0014 in which it stated that it had sent 

required notices and posted notice of the joint application filed 

by Black Hills and MUD on April 19 and that such notices 

stated that protests or formal interventions must be filed on or 

before May 11. In the May 12 order, the PSC stated that no 

protests or petitions for intervention had been filed and that 

therefore, pursuant to § 66-1863(3), “the proposed enlargement or extension is presumed to be in the public interest and 

Applicants may proceed with the extension or enlargement 

without further [PSC] action.” The PSC therefore ordered that 

the docket in Application No. P-0014 be closed without further action.
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IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

Cite as 311 Neb. 813

In its protest to Application No. P-12.32, MUD asserted 

that the proposed OPPD site at issue in Black Hills’ current 

application was within MUD’s service area established by 

Application No. P-0014 in 2010 and that MUD was planning 

to extend service to the site. MUD asserted that in Application 

No. P-0014, Black Hills had agreed that MUD’s extension of 

service to the area was in the public interest and that the PSC’s 

order in Application No. P-0014 recognized the conclusive presumption that MUD’s extension of service to the area was in 

the public interest. MUD further asserted that Black Hills’ plan 

to extend service to the site would be duplicative of MUD’s 

planned extension and that therefore, Black Hills’ extension 

would not be in the public interest.

In sum, MUD denied that Black Hills’ extension of service 

proposed in Application No. P-12.32 was in the public interest 

or that it would contribute to the orderly development of natural gas utility infrastructure. MUD therefore requested that the 

PSC summarily dismiss and deny Black Hills’ application.

Hearing Before PSC.

The PSC held a hearing on Black Hills’ Application 

No. P-12.32 and MUD’s objection thereto on June 9, 2021. At 

the hearing, exhibits offered by Black Hills and by MUD, as 

well as by the PSC, were entered into the record. Both Black 

Hills and MUD presented testimony by their respective witnesses in the form variously of prefiled direct testimony, live 

testimony, and cross-examination.

Among other evidence and testimony, Black Hills presented 

testimony by Kevin Jarosz, Black Hills’ vice president of operations. Jarosz provided general background regarding Black 

Hills’ history, its franchise with Papillion, and Black Hills’ plan 

to extend service to the site of the planned OPPD facility. He 

generally testified regarding how the proposed extension would 

improve the financial profile of Black Hills and would benefit 

its ratepayers.
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IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

Cite as 311 Neb. 813

Jarosz also testified regarding his involvement with 

Application No. P-0014 in 2010. Jarosz stated, inter alia, that 

the joint application was filed in an attempt to resolve ongoing 

service area disputes between Black Hills and MUD. He stated 

that the parties had determined as a general matter that MUD 

would serve Springfield and its future growth and that Black 

Hills would serve the rest of Sarpy County. Jarosz testified that 

in 2010, the parties were attempting to estimate how the cities 

would grow in the future and that the parties knew at that time 

there would be occasions in the future where they may need to 

adjust the service area lines because of changed circumstances. 

Jarosz also testified that pursuant to the resolution of a dispute 

between Springfield and Papillion regarding boundary issues, 

the area at issue in the present application was determined to 

be in the extraterritorial jurisdiction of Papillion serviced by 

Black Hills rather than that of Springfield. Jarosz further testified regarding extensions made by both Black Hills and MUD 

since 2010 that were made following agreement between the 

two utilities.

MUD presented evidence, including the application filed and 

the order entered in 2010 regarding Application No. P-0014. 

MUD highlighted portions of the map included in that application which indicated that the site at issue in Black Hills’ current application was in MUD’s service area at the time of the 

2010 application.

MUD also presented testimony by Jim Knight, MUD’s vice 

president of gas operations. Knight testified, inter alia, that 

the site at issue in the present application was within MUD’s 

service area pursuant to Application No. P-0014. He testified 

that since 2010, Black Hills and MUD had followed their 

agreement with rare exception, and that MUD had relied on 

the service area maps throughout that time. Knight testified 

that if Black Hills’ application was denied, MUD would provide service to the OPPD site, and that it would not need to 

seek approval to do so because the site was already within its 

service area pursuant to Application No. P-0014. He testified 
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IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

Cite as 311 Neb. 813

that service to the area would be provided by extending a 

pipeline through territory that was not currently in Black 

Hills’ service area and that it would not be duplicative infrastructure. Knight also testified that if MUD were to provide 

service at the site, it would be of financial benefit to MUD 

and its ratepayers.

PSC Order on Application No. P-12.32.

After the hearing, on June 29, 2021, the PSC filed an order 

in which it approved Black Hills’ Application No. P-12.32. At 

the beginning of its analysis, the PSC stated that because the 

site at issue was within Papillion’s extraterritorial jurisdiction 

and because Black Hills held a franchise with Papillion, under 

§ 66-1861(2), there was a rebuttable presumption that it was 

in the public interest for Black Hills to provide service to the 

area. The PSC further stated that because of the rebuttable 

presumption, MUD had the burden of proof to show that Black 

Hills’ application was not in the public interest.

Reviewing the evidence presented at the hearing, the PSC 

stated that Black Hills had presented evidence to support 

each of the five statutory factors listed in Neb. Rev. Stat. 

§ 66-1860 (Reissue 2018) to show that its proposal was in 

the public interest. In contrast, the PSC stated that MUD had 

presented “minimal evidence” to dispute that the factors were 

met. Instead, the PSC stated, MUD’s argument was narrowly 

focused on the 2010 order in Application No. P-0014 and 

MUD’s contention that any consideration of the public interest in the current application was foreclosed by the 2010 order 

and the conclusive presumption under § 66-1863(3). The PSC 

rejected MUD’s argument and stated that although there was 

a conclusive presumption as to Application No. P-0014, the 

presumption did not apply to Application No. P-12.32 which 

was a separate and distinct application. The PSC stated that 

Application No. P-0014 was closed on May 12, 2010, and that 

Application No. P-12.32 was a new application for which new 

evidence could be adduced.
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IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

Cite as 311 Neb. 813

The PSC further rejected MUD’s argument that the PSC’s 

approval of Application No. P-12.32 would amount to a revocation of its order in Application No. P-0014. The PSC stated 

that the action requested by Black Hills was not to revoke the 

previous order, but instead was to expand or enlarge its service area. The PSC stated it was required to consider the present application based on “current public interest needs” and 

that it was not “bound to inflexible limits of past practice.” 

The PSC stated it would be a “curious state of affairs” if it 

“could never revise any of its previous findings to better serve 

the current public interest.” The PSC stated that its determination of the current public interest with regard to Application 

No. P-12.32 would not revoke its order on Application No. 

P-0014 and that the conclusions regarding “what was in the 

public interest in 2010 remain untouched.” The PSC stated 

that its task with regard to the current application was to 

“decide what is in the public interest when Black Hills and 

MUD are unable to reach an agreement as to their respective 

service territories.”

The PSC then reviewed the evidence submitted in this matter, and it found that MUD had not met its burden of proof to 

overcome the rebuttable presumption in favor of Black Hills. 

The PSC stated that Black Hills had presented evidence on 

each of the factors under § 66-1860, and it found that “none 

of the factors set out [therein] weigh against Black Hills.” 

The PSC noted MUD’s argument that granting the application 

could disrupt the orderly development of natural gas infrastructure as set forth in the maps in Application No. P-0014. 

The PSC found, however, that the maps filed in 2010 were 

no longer accurate because of significant changes that had 

been made without notice to the PSC. The PSC also stated 

that it was “unclear to what extent the parties themselves 

relied on these maps in the past eleven years.” The PSC stated 

that ruling on the current application based on “inaccurate, 

outdated maps” would subvert its responsibility to determine the current public interest and would not contribute to 
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IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

Cite as 311 Neb. 813

the orderly development of the natural gas infrastructure in 

Sarpy County.

One commissioner dissented and generally reasoned that the 

order in Application No. P-0014 was controlling and should be 

respected in the interest of finality. The commissioner noted 

that since 2010, both Black Hills and MUD had made extensions and enlargements based on the conclusive presumption 

that such actions were in the public interest based on the 2010 

order. The commissioner reasoned that because the order in 

Application No. P-0014 was final, the PSC should not have 

engaged in a new analysis of public interest and no rebuttable 

presumption in favor of Black Hills applied. The commissioner 

further reasoned that even if the PSC could revoke the 2010 

order, it should not do so because MUD was willing and able 

to provide service to the area at issue, and that therefore, it was 

not in the public interest to allow Black Hills to provide service 

to the area. However, the majority of commissioners concluded 

that the application was in the public interest, and the PSC 

therefore approved Application No. P-12.32.

MUD appeals the PSC’s order approving Black Hills’ 

application.

ASSIGNMENTS OF ERROR

MUD generally claims that the PSC erred when it approved 

Black Hills’ Application No. P-12.32. MUD specifically claims, 

restated and renumbered, that the PSC erred when it (1) found 

it had authority to determine what was in the public interest in 

this case; (2) generally disregarded its May 12, 2010, order on 

Application No. P-0014 and in particular disregarded (a) the 

conclusive presumption under § 66-1863(3) that Application 

No. P-0014 and the service areas set forth therein were in 

the public interest, (b) provisions of Application No. P-0014 

describing what was to happen in the event Black Hills and 

MUD could not reach agreement on service areas, and (c) 

the extent Black Hills and MUD had relied on the maps set 

forth in the approved Application No. P-0014; and (3) found 
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IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

Cite as 311 Neb. 813

that MUD did not overcome the rebuttable presumption under 

§ 66-1861(2) that Black Hills’ Application No. P-12.32 was in 

the public interest.

STANDARDS OF REVIEW

[1-3] Under Neb. Rev. Stat. § 75-136(2) (Reissue 2018), 

an appellate court reviews an order of the PSC de novo on 

the record. In a review de novo on the record, an appellate 

court reappraises the evidence as presented by the record and 

reaches its own independent conclusions concerning the matters at issue. In re Application No. OP-0003, 303 Neb. 872, 

932 N.W.2d 653 (2019). When an appellate court makes a de 

novo review, it does not mean that the court ignores the findings of fact made by the agency and the fact that the agency 

saw and heard the witnesses who appeared at its hearing. Id. 

Where the evidence is in conflict, an appellate court will consider and may give weight to the fact that the agency hearing 

examiner observed the witnesses and accepted one version of 

the facts rather than another. Id.

[4] The meaning and interpretation of statutes and regulations are questions of law for which an appellate court has an 

obligation to reach an independent conclusion irrespective of 

the decision made by the court below. Id.

ANALYSIS

MUD generally claims that the PSC erred when it approved 

Black Hills’ Application No. P-12.32, and it sets forth various respects in which it asserts the PSC erred in reaching its 

decision to approve the application. MUD’s claims of specific 

error focus on the PSC’s May 12, 2010, order on Application 

No. P-0014 and the effect of that prior order on the current 

proceedings. MUD asserts, inter alia, that because of the 

prior order, the PSC did not have authority in this case to 

determine whether Black Hills’ current application was in the 

public interest. We therefore begin by reviewing the PSC’s 

statutory authority with respect to the current proceedings and 
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IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

Cite as 311 Neb. 813

then address MUD’s specific arguments regarding the effect 

of the order in Application No. P-0014 and the other evidence 

submitted with respect to Application No. P-12.32

PSC Had Statutory Authority to Determine 

Whether Black Hills’ Application 

Was in the Public Interest.

The proceedings in this case are generally governed by 

relevant provisions of the State Natural Gas Regulation Act, 

Neb. Rev. Stat. §§ 68-1801 through 68-1868 (Reissue 2018), 

specifically §§ 68-1858 through 68-1864, regarding enlargement or extension of service areas of metropolitan utilities 

districts and of jurisdictional utilities that operate in the same 

county. In the present case, it appears undisputed that MUD 

is a metropolitan utilities district and Black Hills is a jurisdictional utility and that both operate in Sarpy County. Also, it 

appears undisputed that Black Hills has a natural gas franchise 

with Papillion.

Of particular relevance in this case are the following statutes: § 68-1863, which sets forth when a proposed enlargement 

or extension of a service area is required to be submitted to the 

PSC for review and which provides that, under certain circumstances, a proposed enlargement or extension will be conclusively presumed to be in the public interest; § 6-1861, which 

provides for a rebuttable presumption that certain enlargements 

or extensions are in the public interest; and § 66-1860, which 

sets forth factors for the PSC to consider when determining 

whether an enlargement or extension is in the public interest. 

Section 66-1863 provides in relevant part:

(1) Except as provided in subsections (2) and (3) 

of this section, no jurisdictional utility or metropolitan 

utilities district proposing to extend or enlarge its natural gas service area or extend or enlarge its natural gas 

mains or natural gas services after July 14, 2006, shall 

undertake or pursue such extension or enlargement until 

the proposal has been submitted to the [PSC] for its 
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IN RE APP. NO. P-12.32 OF BLACK HILLS NEB. GAS

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determination that the proposed extension or enlargement 

is in the public interest. . . . In making a determination 

whether a proposed extension or enlargement is in the 

public interest, the [PSC] shall consider the factors set 

forth in sections 66-1860 and 66-1861. . . .

. . . .

(3) If no person or entity has filed with the [PSC] a 

protest alleging that the proposed extension or enlargement is not in the public interest within fifteen business 

days after the date upon which the application was made 

public, the enlargement or extension shall be conclusively 

presumed to be in the public interest and the jurisdictional utility or metropolitan utilities district may proceed with the extension or enlargement without further 

[PSC] action.

Section 66-1861 provides in relevant part:

In determining whether an enlargement or extension of 

a natural gas service area, natural gas mains, or natural 

gas services is in the public interest pursuant to section 66-1860, the following shall constitute rebuttable 

presumptions:

. . . .

(2) Any enlargement or extension by a jurisdictional 

utility within a city other than a city of the metropolitan 

class in which it serves natural gas on a franchise basis 

or its extraterritorial zoning jurisdiction is in the public interest[.]

Section 66-1860 provides in relevant part:

No jurisdictional utility or metropolitan utilities district may extend or enlarge its natural gas service area 

or extend or enlarge its natural gas mains or natural gas 

services unless it is in the public interest to do so. In 

determining whether or not an extension or enlargement 

is in the public interest, the district or the utility shall 

consider the following:
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(1) The economic feasibility of the extension or 

enlargement;

(2) The impact the enlargement will have on the existing and future natural gas ratepayers of the metropolitan 

utilities district or the jurisdictional utility;

(3) Whether the extension or enlargement contributes to the orderly development of natural gas utility 

infrastructure;

(4) Whether the extension or enlargement will result 

in duplicative or redundant natural gas utility infrastructure; and

(5) Whether the extension or enlargement is applied in 

a nondiscriminatory manner.

Applying these statutes, the proceedings in this case were 

initiated because, in the ordinary course, Black Hills was 

required under § 66-1863(1) to submit to the PSC its proposal 

for extension or enlargement of its service area so that the PSC 

could determine whether the proposed extension or enlargement was in the public interest. Because MUD protested the 

application, Black Hills could not rely on § 66-1863(3) and 

“proceed with the extension or enlargement without further 

commission action” on the basis that its application was “conclusively presumed to be in the public interest.” Instead, the 

PSC was required to determine whether the proposed extension or enlargement was in the public interest. But under 

§ 66-1861(2), there was a rebuttable presumption that the 

enlargement or extension proposed by Black Hills was in 

the public interest because Black Hills was a jurisdictional 

utility which served Papillion on a franchise basis and the 

proposed service area was within Papillion’s extraterritorial 

zoning jurisdiction.

Therefore, pursuant to these statutes, the PSC had authority to determine whether Application No. P-12.32 was in the 

public interest. We address below MUD’s argument that the 

PSC’s order on Application No. P-0014 precluded the PSC 

from exercising that authority with respect to Application 

No. P-12.32.
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PSC Order in Application No. P-0014 Did 

Not Preclude PSC From Determining 

Public Interest With Respect to 

Application No. P-12.32.

MUD’s protest and its arguments on appeal focus mainly on 

the relevance of the PSC’s order on Application No. P-0014 in 

2010. Because no protest was filed against that application, the 

PSC’s order stated that it was “‘conclusively presumed’” under 

§ 66-1863(3) that the application was in the public interest and 

that no further action was required of the PSC. MUD claims 

that the entry of the order in Application No. P-0014 and the 

conclusive presumption under § 66-1863(3) preclude the PSC 

from determining whether the current application by Black 

Hills in Application No. P-12.32 is in the public interest. MUD 

further argues that even if the conclusive presumption does not 

preclude the PSC’s consideration of public interest with respect 

to the current application, the PSC disregarded the terms of 

Application No. P-0014 and the course of dealings between 

Black Hills and MUD since the entry of the PSC’s order in 

2010. We reject these arguments.

First, MUD argues that the operation of the conclusive 

presumption under § 66-1863(3) is such that the presumption 

applies to a subsequent application that is at odds with the 

earlier application and that the conclusive presumption cannot 

be overcome with evidence of current conditions at the time of 

the subsequent application. MUD therefore asserts that because 

in Application No. P-12.32 Black Hills proposes an extension 

of its service area into an area that was previously assigned to 

MUD in Application No. P-0014, the conclusive presumption 

precludes Black Hills from showing that its current application 

is in the public interest.

In this regard, MUD relies on, inter alia, Nebraska P. P. 

Dist. v. Huebner, 202 Neb. 587, 276 N.W.2d 228 (1979), in 

which this court determined that once an order entered by 

the PSC approving an application became final, it could not 

thereafter be revoked. This court reasoned in that case that 
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“[t]here must be some finality to judgments and persons must 

be able to rely at some point in time upon the action of an 

administrative body.” Id. at 594, 276 N.W.2d at 232. MUD 

argues that the order on Application No. P-0014 conclusively 

determined that it was in the public interest for the site at issue 

in this case to be in MUD’s service area and that the PSC 

effectively revoked that order when it determined that Black 

Hills’ application to extend its service area to the site was in 

the public interest.

In response, Black Hills and the PSC cite authority in 

other contexts which indicate that an agency’s determination on a specific application does not foreclose the agency 

from determining issues in later applications. In First Nat. 

Bank of Bellevue v. Southroads Bank, 189 Neb. 748, 753, 205 

N.W.2d 346, 349 (1973), this court held that “an order of the 

Department of Banking denying an application for a bank 

charter does not amount to an adjudication for the future and 

is not res judicata as to another application of the same nature 

subsequently filed.” This court reasoned in First Nat. Bank 

of Bellevue v. Southroads Bank that the prior determination 

did not “prevent[] further inquiry into the issue,” particularly 

“where there has been a substantial or material change in the 

circumstances or conditions intervening between the two decisions.” 189 Neb. at 751, 205 N.W.2d at 348. The decision in 

First Nat. Bank of Bellevue v. Southroads Bank relied in part 

on In re Application of Union P. R. R. Co., 149 Neb. 575, 578, 

31 N.W.2d 552, 554 (1948), in which this court stated:

“The ruling of the railway commission or of this court 

on the question of discontinuance of an agency at any 

given time does not amount to an adjudication for the 

future. It is only a judgment on the condition presented 

by the application and relates only to the time and conditions presented.”

(Quoting Thomson v. Nebraska State Railway Commission, 

142 Neb. 477, 6 N.W.2d 607 (1942).) This court in First 

Nat. Bank of Bellevue v. Southroads Bank described In re 
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Application of Union P. R. R. Co. as “demonstrat[ing] the time 

frame reference of orders involving issues of public convenience and necessity.” 189 Neb. at 752, 205 N.W.2d at 348. 

This court noted that both the Department of Banking and the 

Nebraska State Railway Commission were authorized by statute to act upon applications made to the agency “based upon a 

determination of public convenience and necessity.” Id.

[5] Under the statutes set forth earlier in our opinion, the 

PSC is charged to act upon applications made by utilities and 

to make determinations of the public interest with respect 

to such applications. Similar to the statutes governing other 

agencies, the statutes governing the PSC inherently include a 

timeframe for determinations of the public interest and require 

the PSC to determine the public interest at the time of a specific application. The determination of the public interest with 

regard to a specific application is based on the conditions 

presented by the application and relates directly to the time 

and conditions presented, and it does not amount to an adjudication for the future. Therefore, the conclusive presumption 

under § 66-1863(3) is conclusive as to the determination of the 

public interest based on the time and conditions presented by 

the specific application, and it does not constitute a permanent 

determination or a conclusive presumption as to an application 

that may be presented to the PSC under different conditions in 

the future.

In this case, the conclusive presumption was limited to the 

determination that Application No. P-0014 was in the public 

interest at the time that the application was filed in 2010. The 

order gave Black Hills and MUD authority to extend service 

to the referenced areas at that time. But it did not foreclose 

consideration of what would be in the public interest at any 

future date. In our view, MUD attributes greater strength 

to the “conclusively presumed” language in § 66-1863(3) 

than is warranted by the statutory language. Compare, Salem 

Grain Co. v. City of Falls City, 302 Neb. 548, 924 N.W.2d 

678 (2019) (describing weight to be given to “conclusively 
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deemed” in the public interest under Neb. Rev. Stat. § 18-2129 

(Reissue 2012)). To conclude that the 2010 consensus of 

Black Hills and MUD embodied in the order in Application 

No. P-0014 and the conclusive presumption applied under 

§ 66-1863(3) prevents the PSC from considering the public 

interest in the context of the current application would render 

meaningless the provisions of § 66-1863(1) and the role of 

the PSC authorizing and requiring the PSC to determine the 

public interest with regard to applications presented to it. See

In re Guardianship of Eliza W., 304 Neb. 995, 938 N.W.2d 

307 (2020) (courts strive, if possible, to give effect to all 

parts of a statute such that no sentence, clause, or word is rendered meaningless).

MUD also argues that even if the conclusive presumption 

under § 66-1863(3) with regard to Application No. P-0014 

did not preclude any consideration of the public interest in the 

present case, the PSC disregarded terms of Application No. 

P-0014 that set forth how future disagreements between Black 

Hills and MUD would be resolved. MUD also argues that the 

PSC mischaracterized the utilities’ adherence to the terms of 

Application No. P-0014 when it stated that it was “unclear to 

what extent the parties themselves relied on these maps in the 

past eleven years.”

Application No. P-0014 provided for certain exceptions to 

the service areas set forth therein under specific circumstances, 

including, inter alia, when Black Hills and MUD “determine by 

agreement that it is more practical and efficient for one party to 

provide gas service to a customer or customers within the other 

party’s area of service.” MUD argues that this provision means 

that if the utilities do not agree to an adjustment of or exception to the agreed-upon service areas, then the service areas 

previously agreed upon in the application controlled.

But, as set forth above, the statutes require the PSC to 

determine public interest when an application and protest are 

filed. Just as the PSC’s order on Application No. P-0014 did 

not preclude it from considering the current application, the 
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terms agreed to by the utilities do not override the statutory 

requirement for the PSC to determine the current public interest with regard to a subsequent application. The utilities may 

not render those statutes meaningless based on the terms to 

which they agree.

In the same respect, the utilities’ reliance or lack of reliance on the service areas and terms set forth in Application 

No. P-0014 do not control the statutory requirement for the 

PSC to determine the public interest with regard to the current 

application. Therefore, whether the PSC was correct when it 

said that the extent to which Black Hills and MUD relied on 

the maps was unclear, such reliance or lack of reliance would 

not preclude the PSC from exercising its statutory authority 

with respect to the current application.

In summary, the order in Application No. P-0014 and the 

conclusive presumption of public interest thereunder did not 

preclude the PSC from determining public interest with regard 

to the current application. The terms of Application No. P-0014 

and the utilities’ intervening reliance on those terms also did 

not preclude the PSC’s determination of the current public 

interest. Instead, as discussed below, these matters are among 

factors for the PSC to consider when determining the public 

interest with respect to the current application.

PSC Did Not Err When It Determined 

That MUD Did Not Overcome 

Rebuttable Presumption.

MUD finally argues that the PSC erred when it determined 

that MUD did not overcome the rebuttable presumption in 

favor of Black Hills’ application’s being in the public interest. MUD generally focuses its argument on the effect of 

the 2010 order in Application No. P-0014. As we discussed 

above, that order did not preclude the PSC from determining 

whether Black Hills’ current application was in the public 

interest. However, Application No. P-0014 was among the 

factors for the PSC when considering the current application. 
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Considering all the evidence before the PSC, we conclude that 

the evidence supported the PSC’s determination that MUD did 

not overcome the rebuttal presumption under § 66-1861(2) 

and that Application No. P-12.32 should be approved as in the 

public interest.

Because Black Hills was a jurisdictional utility with a 

franchise to serve Papillion and because the proposed OPPD 

site was within the extraterritorial jurisdiction of Papillion, 

under § 66-1861(2) there was a rebuttable presumption that 

Black Hills’ extension of its service area to the site was in 

the public interest. The PSC therefore needed to consider the 

evidence presented to determine whether that rebuttable presumption was overcome by MUD. Although the 2010 order in 

Application No. P-0014 did not preclude the PSC’s consideration of the public interest in this case, the terms and effect of 

Application No. P-0014 were properly among the factors for 

the PSC to consider in determining whether MUD overcame 

the rebuttable presumption.

We acknowledge that the service areas set forth in the 2010 

application were a relevant consideration, but the PSC’s determination of the public interest was properly focused on conditions at the time of Application No. P-12.32. In addition to what 

had been agreed to between Black Hills and MUD in 2010, it 

was proper for the PSC to consider what had happened since 

2010 and how conditions relevant to the public interest had 

changed since that time. In particular, OPPD had announced 

its need for service at 168th Street and Fairview Road in Sarpy 

County. Further, Papillion and Springfield had resolved their 

dispute, and pursuant to their agreement, the OPPD site came 

within the extraterritorial jurisdiction of Papillion, which was 

serviced by Black Hills.

Conditions existing when Application No. P-12.32 was 

filed in 2021 supported the determination that the current 

application was in the public interest. In 2010, Black Hills 

and MUD had agreed in Application No. P-0014 that the site, 

which is at issue in the current application, should be part of 
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MUD’s service area. However, as noted above, the evidence 

in this case indicates that the determination of service areas in 

Application No. P-0014 was based on expectations of future 

growth in Sarpy County and that in 2010, Black Hills and 

MUD expected that the site at issue in this case would be 

in the area of growth for Springfield. Because MUD served 

Springfield, the site was included in MUD’s service area in 

Application No. P-0014. However, in the intervening years, 

Papillion and Springfield resolved ongoing disputes by agreeing that, inter alia, the site at issue in this case would be in the 

extraterritorial jurisdiction of Papillion, which was serviced 

by Black Hills. Therefore, the expectation of 2010 was contrary to the reality of 2021 and the public interest shifted to 

the site’s being served by Black Hills, which had a franchise 

with Papillion.

Furthermore, Black Hills indicated in Application No. 

P-12.32 that there were no MUD mains within a quarter mile 

of the proposed OPPD site. The site was within MUD’s service 

area under Application No. P-0014, and based on the conclusive presumption under § 66-1863(3), MUD was permitted at 

the time in 2010 to “proceed with the extension or enlargement 

without further [PSC] action.” But there was no evidence in 

the present proceeding to indicate that between 2010 and 2021, 

MUD had taken demonstrable action to extend service to the 

site based on the authority of Application No. P-0014. More 

particularly, after OPPD announced its plan to build facilities 

on the site, there is no indication that MUD actively took steps 

to extend service to that site based on the order in Application 

No. P-0014, nor did it seek specific approval to extend service 

to the site.

Our review of the record indicates that the PSC did not err 

when it determined that MUD had not overcome the rebuttable 

presumption that Application No. P-12.32 was in the public 

interest. The record instead indicates that the application was 

shown to be in the public interest and that the PSC did not err 

when it approved Application No. P-12.32.
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CONCLUSION

We conclude that the PSC had authority to determine the public interest with respect to the current application, Application 

No. P-12.32, and that the PSC’s 2010 order in Application 

No. P-0014 did not preclude the PSC’s consideration of the 

public interest with respect to the current application. We 

further conclude that the PSC did not err when it determined 

that in light of all the evidence, including evidence related to 

Application No. P-0014, MUD had not overcome the rebuttable presumption that the proposed extension or enlargement 

sought by Black Hills to extend service to the OPPD site at 

168th Street and Fairview Road under Application No. P-12.32 

was in the public interest. We therefore affirm the PSC’s order 

approving Application No. P-12.32.

Affirmed.

Papik, J., not participating.