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IN THE SUPREME COURT OF THE STATE OF NEW MEXICO

Opinion Number: 2015-NMSC-013

Filing Date: April 6, 2015

Docket No. 34,182

TRI-STATE GENERATION AND

TRANSMISSION ASSOCIATION, INC.,

Appellant,

v.

NEW MEXICO PUBLIC REGULATION COMMISSION and

KIT CARSON ELECTRIC COOPERATIVE, INC.,

Appellees.

APPEAL FROM THE NEW MEXICO PUBLIC REGULATION COMMISSION

Modrall, Sperling, Roehl, Harris & Sisk, P.A.

John R. Cooney

Joan E. Drake

Emil John Kiehne

Albuquerque, NM

Lewis Roca Rothgerber LLP

Thomas J. Dougherty

Denver, CO

Sherman & Howard, LLC

Robert E. Youle

Brian G. Eberle

Denver, CO

for Appellant

New Mexico Public Regulation Commission

Richard L. Blumenfeld

Santa Fe, NM

for Appellee New Mexico Public Regulation Commission
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Cuddy & McCarthy, LLP

Charles V. Garcia

Albuquerque, NM

Cuddy & McCarthy, LLP

Arturo L. Jaramillo

Patrick T. Ortiz

Santa Fe, NM

for Appellee Kit Carson Electric Cooperative, Inc.

OPINION

DANIELS, Justice.

{1} In this precedential case of first impression, we address a number of issues related

to the New Mexico Public Regulation Commission’s authority and procedures in regulating

utility rates of a generation and transmission cooperative, which statutorily differ from the

Commission’s powers over the rates charged by public utilities. We vacate the order of the

Commission related to its suspension of a cooperative’s proposed rates and provide guidance

for similar situations that may arise in the future.

I. BACKGROUND

{2} As a generation and transmission cooperative (G&T Coop) owned by forty-four

distribution cooperatives that are each members of its board, Tri-State Generation and

Transmission Association, Inc., sells electric power exclusively to its members in four states.

To cover its costs, Tri-State charges rates in accordance with a revenue requirement and a

rate design approved by the Tri-State board. In 2012, the Tri-State board approved a new

revenue requirement and a new rate design to meet that revenue requirement for 2013 (the

2013 rate design) and to replace the rate design and revenue requirement in effect at that

time (the old rate design).

{3} As required by NMSA 1978, Section 62-6-4(D) (2003), Tri-State filed Advice Notice

15 (AN 15) informing the Commission of the 2013 rate design. For the first time since the

2000 enactment of Subsection (D) of Section 62-6-4, three of the twelve Tri-State New

Mexico members (the Kit Carson, Continental Divide, and Springer Electric Cooperatives)

protested the 2013 rate design, and the Commission opened Case No. 12-00375-UT (the

2013 rate case). The Commission found that the three protesting members had just cause

under Section 62-6-4(D) for the Commission to suspend the 2013 rate design, and it set a

hearing to consider whether the 2013 rate design was reasonable. One of the commissioners

suggested that Tri-State could file a proposal for interim rates if it wished.

{4} With the 2013 rate design suspended, the Tri-State board agreed to address its
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revenue requirement on an interim basis by billing the protesting members under the old rate

design and the nonprotesting members under the 2013 rate design. Pursuant to Section 62-6-

4(D), Tri-State filed Advice Notices 16, 17, and 18 (ANs 16, 17, and 18) with the

Commission. According to the letter Tri-State attached to its advice notices, AN 16 applied

the 2013 rate design contained in AN 15 to the nine nonprotesting members so that the

nonprotesting members could take advantage of the 2013 rate design as soon as possible.

Apparently, many of the nonprotesting members had already taken steps to implement the

2013 rate design. AN 17 sought to recover the portion of the 2013 revenue requirement

attributable to the three protesting New Mexico members using the old rate design. AN 18

was an alternative to AN 17 that would allow two additional months, compared to AN 17,

to recover the revenue required under AN 17 from the protesting members in case any of the

three elected to waive the contractual ninety-day notice requirement Tri-State incurred by

replacing the 2013 rate design with the old rate design.

{5} When the same members that protested AN 15 filed protests against ANs 16, 17, and

18, the Commission opened Case No. 13-00037-UT (the interim rate case) and issued an

order on March 13, 2013, rejecting ANs 16, 17, and 18 (the Order). The Order rejected a

public hearing of AN 16, concluding that “the rates in question are already before a Hearing

Examiner” because AN 16 applied rates “identical” to the rates pending in the 2013 rate

case. The Order rejected ANs 17 and 18, stating that they “would result in what would be

perceived as punishing the protestors.” On “separate and independent grounds,” the Order

rejected ANs 16, 17, and 18 for the failure of Tri-State to satisfy the interim rate pleading

burden imposed by a Commission regulation, 1.2.2.27 NMAC (Rule 27).

{6} Several months after the Commission issued the Order, Tri-State filed a notice of

withdrawal from the 2013 rate case in order to file Advice Notice 19 (AN 19) informing the

Commission of a rate increase to take effect as of January 1, 2014. The Commission stayed

discovery and vacated the procedural schedule on the 2013 rate case, pending responses by

the parties to Tri-State’s notice of withdrawal. Tri-State appealed to this Court from the

Order, arguing that the Commission exceeded its statutory authority and that the Order was

arbitrary or contrary to law. This Court reviews appeals from the final orders of the

Commission. See NMSA 1978, § 62-11-1 (1993). Appellee Kit Carson Electric Cooperative

filed a motion to dismiss this appeal on two grounds: that the Order was not final and that

the appeal was moot, issues we address in this opinion.

II. DISCUSSION

{7} Tri-State has the burden on appeal of showing that the Order is “unreasonable” or

“unlawful.” NMSA 1978, § 62-11-4 (1965). This Court considers only the evidence on the

record before the Commission, see NMSA 1978, § 62-11-3 (1982), and reviews in favor of

the Order to determine whether it was supported by substantial evidence, was neither

arbitrary nor capricious, and was within the Commission’s scope of authority. See Plains

Electric Generation & Transmission Coop. v. N.M. Pub. Util. Comm’n, 1998-NMSC-038,

¶ 7, 126 N.M. 152, 967 P.2d 827. This Court can either affirm or annul and vacate the Order
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The entire PUA is set forth in NMSA 1978, §§ 62-1-1 to -7 (1909, as amended

through 1993), 62-2-1 to -22 (1884, as amended through 2013), 62-3-1 to -5 (1967, as

amended through 2009), 62-4-1 (1998), 62-6-4 to -28 (1941, as amended through 2009), 62-

8-1 to -11 (1941, as amended through 2011), 62-9-1 to -7 (1941, as amended through 2005),

62-10-1 to -16 (1941, as amended through 1998), 62-11-1 to -6 (1941, as amended through

1993), 62-12-1 to -7 (1941, as amended through 1993), and 62-13-1 to -15 (1941, as

amended through 2010); see § 62-13-1 (specifying the range of articles in Chapter 62 that

comprised the PUA in 1993).

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but cannot modify it. See NMSA 1978, § 62-11-5 (1982).

{8} Section 62-6-4(D) of the Public Utility Act (PUA)1

 is the only statutory provision

that grants the Commission jurisdiction over G&T Coops like Tri-State. Section 62-6-4(D)

requires that a G&T Coop file its proposed New Mexico rates with the Commission in the

form of an advice notice and serve its member utilities. See id. If at least three New Mexico

member utilities file protests with “just cause,” the Commission “shall suspend the rates,

conduct a hearing concerning reasonableness of the proposed rates and establish reasonable

rates.” Id. Section 62-6-4(D) further defines the requirements of a protest. Id.

{9} Once the Commission’s jurisdiction and rate-making powers are invoked under

Section 62-6-4(D), as in this case, the Commission has plenary authority to set the utility’s

rates. City of Albuquerque v. N.M. Pub. Regulation Comm’n, 2003-NMSC-028, ¶ 8, 134

N.M. 472, 79 P.3d 297. And this Court defers to the “relatively broad policy-making

authority” that the Legislature delegates to the Commission unless the Commission’s

interpretation of its statutory authority is “unreasonable.” Doña Ana Mut. Domestic Water

Consumers Ass’n v. N.M. Pub. Regulation Comm’n, 2006-NMSC-032, ¶ 17, 140 N.M. 6,

139 P.3d 166.

{10} “When reviewing statutes this [C]ourt will read all relevant provisions together in

order to determine legislative intent.” Otero Cnty. Electric Coop. v. N.M. Pub. Serv.

Comm’n, 1989-NMSC-033, ¶ 9, 108 N.M. 462, 774 P.2d 1050. “In reviewing utility

regulations as applied to rate cases, this [C]ourt has interpreted the statutory language

broadly” consistent with the considerable discretion with which the Commission is vested

to determine whether rates are just and reasonable. Id.

A. Advice Notices 17 and 18 Did Not Unlawfully Discriminate Among Tri-State

Member Cooperatives

{11} The Order rejected ANs 17 and 18 because approving them “would result in what

would be perceived as punishing the protestors.” The Commission concluded that ANs 17

and 18 were discriminatory as a matter of law because, as it argues on appeal, “[t]he

Legislature has prohibited discriminatory treatment of ratepayers [in] Section 62-8-6.” The

Commission asks us to affirm its Order denying Tri-State’s interim rates because Tri-State
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cited no decision from this Court or the Commission supporting Tri-State’s method of

treating protestors and nonprotestors differently.

{12} The language of Section 62-8-6, however, expressly applies only to public utilities

and makes no reference at all to G&T Coops.

No public utility shall, as to rates or services, make or grant any

unreasonable preference or advantage to any corporation or person within

any classification or subject any corporation or person within any

classification to any unreasonable prejudice or disadvantage.

Id. The PUA is explicit in tailoring the Commission’s authority over the rates of different

kinds of utilities depending on whether a utility is, for example, a “public utility,” see § 62-

6-4(A) (defining the power and jurisdiction of the Commission over the rates of public

utilities), a “rural electric cooperative,” see § 62-8-7(G) (same for rural electric

cooperatives), or a “generation and transmission cooperative,” see § 62-6-4(D) (same for

G&T Coops). We find no support for the proposition that Section 62-8-6 is the source of

Commission authority to disapprove the rates of a G&T Coop. Instead, Section 62-6-4(D)

gives the Commission the authority to determine the reasonableness of the rates of a G&T

Coop after at least three of its members file protests that the Commission determines have

just cause.

{13} There are strong indications throughout the PUA that the Legislature intended the

Commission’s powers over a G&T Coop to be more limited than its powers over a public

utility. A public utility sells power to the general public, but a G&T Coop sells power

exclusively to other cooperatives that are its members. Compare § 62-6-4(E) (“‘[G]eneration

and transmission cooperative’ means a person with generation or transmission facilities

either organized as a rural electric cooperative . . . or organized in another state and

providing sales of electric power to member cooperatives in this state.” (emphasis added)),

with § 62-3-3(G)(1) (“‘[P]ublic utility’ or ‘utility’ means every person not engaged solely

in interstate business . . . that may own, operate, lease or control . . . any . . . facility for the

generation, transmission or distribution, sale or furnishing to or for the public of

electricity . . . .” (emphasis added)). The ownership and organization of a rural electric

cooperative or a G&T Coop differs from that of a public utility. Compare NMSA 1978, §

62-15-2 (1998) (stating that rural electric cooperatives are organized on a nonprofit or

cooperative basis under NMSA 1978, Sections 62-15-1 to -37 (1939, as amended through

2014), “for the primary purpose of supplying electric power [to] . . . and extending the use

of electricity in rural areas”), and § 62-6-4(E) (stating that a G&T Coop may be organized

as a rural electric cooperative), with § 62-3-2(A)(3) (describing public utilities as “investorowned” and “profit motivated”). See also Richard P. Keck, Reevaluating the Rural

Electrification Administration: A New Deal for the Taxpayer, 16 Envtl. L. 39, 45-47 (1985)

(describing the history of the federal Rural Electrification Act and electric cooperatives and

explaining how rural electric cooperatives and generation and transmission cooperatives

were born in the late 1930s as a result of that congressional enactment to incentivize the
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electrification of rural America by authorizing low-interest loans for generation and

transmission facilities as well as for distribution facilities).

{14} The PUA limits the Commission’s power and jurisdiction over cooperatives as

compared to public utilities. The Commission has “general and exclusive power and

jurisdiction to regulate and supervise every public utility in respect to its rates and service

regulations . . . .” Section 62-6-4(A). A public utility cannot change its rates without first

obtaining the Commission’s approval. See § 62-8-7(A)-(F). When a public utility requests

a rate change, the Commission “may” conduct a hearing concerning the reasonableness of

the rates; and the proposed rates are suspended until the Commission determines reasonable

rates. See § 62-8-7(C). At any hearing involving an increase in rates, the public utility carries

the burden of proving that the increase “is just and reasonable.” Section 62-8-7(A).

{15} In contrast, the Commission’s jurisdiction over a rural electric cooperative or a G&T

Coop is not general and exclusive but instead must be triggered by protests filed by a

prescribed number of members before the Commission has any power over proposed rates.

See § 62-6-4(A) (excluding the rates of G&T Coops from the general and exclusive power

of the Commission to regulate the rates of public utilities); § 62-6-4(D) (setting forth the

requirements of the protests that could cause the Commission to review the rates submitted

by a G&T Coop). The rates of a rural electric cooperative become effective “as proposed”

except “[u]pon the filing with the [C]ommission of a protest setting forth grounds for review

of the proposed rates” by the prescribed portion of customers with just cause. Section 62-8-

7(G). Although Section 62-6-4(D) does not expressly state that the rates of a G&T Coop are

effective as proposed, it specifically allows the Commission to suspend the rates submitted

by a G&T Coop only when the specified number of protests with just cause have been filed.

See id. (“If three or more New Mexico member utilities file protests [with just cause], the

[C]ommission shall suspend the rates . . . .”).

{16} The Legislature directed that rural electric cooperatives are to be regulated in a

“limited” manner because they are “substantially different” from public utilities. Section 62-

3-2(A)(3). Consumers have no control over the rates of investor-owned public utilities, id.,

and accordingly the PUA seeks a balanced regulation that addresses “the public interest, the

interest of consumers and the interest of investors.” Section 62-3-1(B). In contrast, the

interests of the purchasers of electric power from a G&T Coop, who own the G&T Coop,

are already addressed democratically through the owner-membership of the G&T Coop

board. See § 62-3-2(A)(2)-(3) (stating that members of cooperatives have “direct control

over the cooperative’s rates through an elected board of trustees”); see also Morningstar

Water Users Ass’n v. N.M. Pub. Util. Comm’n, 1995-NMSC-062, ¶ 20, 120 N.M. 579, 904

P.2d 28 (“The PUA attempts to distinguish on the one hand utilities that are required to serve

any and all members of the public who request [utility] service and on the other hand utilities

that operate more like a private coalition or club that chooses to limit its services only to its

own select members.”).

{17} The Legislature expressly recognized that there is no rational basis for treating rural
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electric cooperatives and public utilities the same as to their rates because a rural electric

cooperative is not investor-owned. Section 62-3-2(A)(3) (“Experience has shown that a

rational basis exists to provide procedures for setting rates of rural electric cooperatives

different from and more limited than those for setting rates of investor-owned utilities.”).

The Legislature’s language in Section 62-3-2(A)(3) echoes this Court’s holding that there

is not a rational basis for treating rural electric cooperatives and public utilities the same

under the PUA—a rationale which also applies to G&T Coops. See Cmty. Pub. Serv. Co. v.

N.M. Pub. Serv. Comm’n, 1966-NMSC-053, ¶¶ 1, 11, 14, 76 N.M. 314, 414 P.2d 675

(holding that a 1961 amendment to include rural electric cooperatives as public utilities

under the PUA denied equal protection to public utilities because there was no rational basis

for giving rural electric cooperatives PUA advantages without subjecting them to full PUA

regulation and the requirement to render service to the general public as prescribed for other

electric utilities under the PUA); see also Edington v. N.M. Pub. Serv. Comm’n, 1964-

NMSC-248, ¶ 6, 74 N.M. 647, 397 P.2d 300 (discussing history leading to the 1961

inclusion of rural electric cooperatives as public utilities under the PUA).

{18} The language of Section 62-8-6 restricting its application to a public utility is

significant because a G&T Coop is not investor-owned; the Legislature expressly limited the

Commission’s powers over utilities that are not investor-owned; and the Commission’s only

authority over G&T Coops comes from Section 62-6-4, Subsection (D), which the

Legislature enacted in its 2000 amendment of Section 62-6-4 without altering the language

that restricts application of Section 62-8-6 to public utilities.

{19} Although Section 62-8-6 makes no textual reference to a G&T Coop, its prohibition

against “unreasonable differences as to rates” established by a public utility is a prohibition

that applies to G&T Coops as well because Section 62-6-4(D) explicitly authorizes the

Commission to “conduct a hearing concerning reasonableness of the [G&T Coop] proposed

rates and establish reasonable rates.” Obviously, rates incorporating unreasonable

differences or discriminations, the focus of Section 62-8-6, would be unreasonable rates

under Section 62-6-4(D).

{20} Neither statute prohibits reasonable variations in rates. See § 62-8-6 (stating that a

public utility shall not grant an “unreasonable preference” or cause an “unreasonable

prejudice” in its rate-making); Albuquerque Bernalillo Cnty. Water Util. Auth. v. N.M. Pub.

Regulation Comm’n, 2010-NMSC-013, ¶ 61, 148 N.M. 21, 229 P.3d 494 (“[Section 62-8-6]

does not prohibit variations in rates, nor does it require ‘equal service.’ Rather, it prohibits

‘unreasonable differences’ in rates of service between localities. Section 62-8-6 thus forbids

arbitrary variations in rates, while permitting variations due to differing costs of service to

different areas.” (internal quotation marks and citation omitted)).

{21} Although no prior appellate decision has construed Section 62-6-4(D), there is

absolutely nothing in the statute or its legislative history to indicate that the Legislature

intended to impose a flat ban on reasonable variations in rates. While it is possible that a

majority of board members of a cooperative could engage in unreasonable discrimination
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against minority members and thus engage in unreasonable rate-making, there is no evidence

in this record to support a conclusion that Tri-State’s board unreasonably discriminated

against its minority members.

{22} Section 62-6-4(D) compels the Commission to look at the additional facts

surrounding the reasonableness of Tri-State’s interim rates, which is the purpose of the

required hearing: to give a voice to the nonprotesting members so that the Commission can

be fully informed of all members’ interests and concerns. As Tri-State points out on appeal,

“Because Tri-State is obligated to recover its revenue requirement from its Members, [the

Commission’s suspension of the 2013 rate design] left an estimated shortfall of over $14

million for New Mexico which would necessarily have to be borne in some fashion by all

Members.” Tri-State’s interim rates were designed to be fair to all of its members because

“the Protestors would pay under the old rate design (which they asked for), and the nonProtestors would pay under the new rate design (which they did not protest).”

{23} We conclude that the Order’s rejection of ANs 17 and 18 was improper because as

a matter of law the interim rates they prescribe are not unreasonably discriminatory and

because there is no evidence otherwise of unreasonable discrimination.

B. Rejecting the Advice Notices Without a Hearing Violated Section 62-6-4(D)

{24} Although the Commission’s regulations allow it great latitude in managing its own

proceedings, the Commission cannot apply its regulations contrary to Section 62-6-4. See,

e.g., Jones v. Emp’t Servs. Div. of Human Servs. Dep’t, 1980-NMSC-120, ¶ 3, 95 N.M. 97,

619 P.2d 542 (“If there is a conflict or inconsistency between statutes and regulations

promulgated by an agency, the language of the statutes shall prevail. An agency by

regulation cannot overrule a specific statute.”).

{25} When the Commission determines just cause in at least three protests of any G&T

Coop advice notice, Section 62-6-4(D) requires a Commission hearing on the reasonableness

of the protested rates without distinguishing between interim and permanent rates and

referring only to “rates” generally. The PUA defines “rate” broadly, stating that a “‘rate’

means every rate, tariff, charge or other compensation for utility service rendered or to be

rendered by a utility.” Section 62-3-3(H). Absent further legislative clarification, we take

this to mean that the “rate” referred to in Section 62-6-4(D) includes both interim and

permanent rates because, as we will discuss, a G&T Coop does not request interim rate

relief—it only needs to file new rates with the Commission pursuant to Section 62-6-4(D).

We address the Order’s two grounds of rejection separately.

1. Rejection of Advice Notice 16 Without a Hearing Based on a Prior Suspension

of the Same Rates Violated Section 62-6-4(D)

{26} The Order concluded that the AN 16 rate prescription for nonprotesting members was

“identical” to the suspended AN 15 rate prescription. The Order rejected AN 16 pursuant to
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the regulation that requires a utility to comply with Commission orders, see 17.1.210.11(H)

NMAC (stating that the Commission may reject rates, rules, or forms that “are not in

substantial compliance with Commission . . . orders”), “because when the Commission

suspended the rates [filed under AN 15], it did not limit the suspension to only those rates

to be charged to the protesting [members].” On appeal, the Commission states, “Ordinarily,

a rate either goes into effect or it is suspended—not in part, but in whole, so that the entirety

of the rate and its effects on various customer classes can be evaluated before it is made

permanent.”

{27} We recognize that AN 16 tests the Commission’s power to enforce its prior order

suspending AN 15 in the 2013 rate case. See NMSA 1978, § 8-8-4(B)(5) (1998) (“The

[C]ommission may . . . take administrative action by issuing orders not inconsistent with law

to assure implementation of and compliance with the provisions of law for which the

[C]ommission is responsible and to enforce those orders by appropriate administrative action

and court proceedings.”). Kit Carson describes Tri-State’s request for interim rates as an

attempt by Tri-State to charge rates on a temporary basis that were previously suspended in

the 2013 rate case. We must assume that the 2013 rate case is still pending because Tri-State

filed a withdrawal in the 2013 rate case and there is no indication in the record that such a

withdrawal has been granted. See 17.1.210.11(E) NMAC (“[A] filing which has been made

with the Commission may not be withdrawn or changed in any manner without the

Commission’s approval. Such approval may be granted by the Commission in its

discretion.”). The Order did not indicate that the Commission intended to consolidate a

hearing of the AN 16 interim rate with the hearing of the permanent rate in the 2013 rate

case or that AN 16 would be heard at a later time. Because Section 62-6-4(D) applies to both

permanent and interim rates, we conclude that this section requires the Commission to grant

a hearing of AN 16. The Order was contrary to Section 62-6-4(D) in its rejection of AN 16

without a hearing.

2. Rejection of Advice Notices 16, 17, and 18 Without a Hearing Based on Alleged

Rule 27 Noncompliance Violated Section 62-6-4(D)

{28} The Order rejected ANs 16, 17, and 18 and, having concluded that the advice notices

lacked the evidentiary support required by the Commission’s regulation establishing that a

utility has the burden of supporting its interim rate relief request with evidence, declined to

hear them pursuant to Rule 27(A)-(D). Rule 27(A) requires that pleadings for interim relief

“must allege such extraordinary facts of immediate and irreparable injury as would justify

the [C]ommission’s exercise of discretion by granting interim relief prior to a final decision,”

Rule 27(B) prescribes that the pleading “be accompanied by affidavit or testimony in support

of the request,” and Rule 27(C) specifies notice requirements. Rule 27(D) authorizes the

Commission to forego a public hearing on “requests for interim relief other than interim rate

relief.” Tri-State referred to interim rates in its letter to the Commission describing ANs 16,

17, and 18, and on appeal Tri-State describes these advice notices as the “rates . . . that

would apply only from March to December 2013” pursuant to Section 62-6-4(D) and not

Rule 27.
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{29} We recognize that the Commission’s rules of procedure, of which Rule 27 is a part,

apply “to all utility division . . . proceedings other than rulemaking[].” 1.2.2.2 NMAC. The

Commission’s rate-making authority over public utilities “carries with it the incidental and

implied power to grant interim rate relief, if the facts warrant” such relief. U.S. West

Commc’ns v. N.M. State Corp. Comm’n, 1999-NMSC-016, ¶ 16, 127 N.M. 254, 980 P.2d

37 (internal quotation marks and citation omitted). If the Commission suspends the proposed

rate change of a public utility for a period of time before the Commission determines the

rate, interim rate relief prevents, effectively, the Commission’s taking of the property of the

public utility without just compensation. See Mountain States Tel. & Tel. Co. v. N.M. State

Corp. Comm’n, 1977-NMSC-032, ¶¶ 38, 41, 50, 90 N.M. 325, 563 P.2d 588 (explaining that

the Commission may approve interim rate relief that applies until it decides the permanent

rates to prevent an unconstitutional confiscation of property without due process of law).

{30} The Commission suggests that the Legislature was aware of the Commission’s

powers over the interim rates of utilities and must have intended Rule 27 to “fill[] that gap”

in Section 62-6-4(D) as to interim rates. The Rule 27 predecessor governing interim rate

relief, 17.1.2.30 NMAC (12/31/1998), was in existence before 2000 when Subsection (D)

of Section 62-6-4 was enacted. See 9 N.M. Reg. 1414 (Dec. 31, 1998). Caselaw imposing

the interim rate relief burden existed even earlier than the Rule 27 predecessor. See, e.g., In

re Gas Co. of N.M., 28 P.U.R 4th 20, 41 (1978) (“A utility seeking the exercise of this

discretion has a heavy burden to bear. . . . The company must demonstrate that the granting

of interim rate relief prior to a rate design determination will not unduly burden its customers

and if not granted will result in an extreme hardship to the company.”).

{31} The Commission overlooks the fact that interim rate relief is a form of relief from the

rate-making powers the Commission exercises over public utilities and not cooperatives. See,

e.g., id. at 40-41 (stating that the legal basis of interim rate relief comes from the

constitutional duty of the Commission to fix interim rates that would minimize the

confiscation of the public utility’s property but that the Commission has the discretion to

consider whether the interim rate relief proposal is appropriate in the case at hand and to

impose the burden on the public utility to show that the rate proposal is appropriate);

Mountain States Tel. & Tel. Co. v. N.M. State Corp. Comm’n, 1985-NMSC-024, ¶¶ 6, 9-10,

102 N.M. 409, 696 P.2d 1002 (stating that the United States Supreme Court set the standard

for determining when a confiscation of a public utility company’s property has occurred and

affirming the Commission’s denial of a public utility request for interim rate relief because

the record did not adequately support the public utility’s confiscation claim).

{32} Interim rate relief is a concept unique to public utilities because the only way a public

utility can change its rates is by Commission approval. See § 62-6-4(A); § 62-8-7(A)-(F).

A public utility subject to confiscation of its property without due process may be justified

in seeking the Commission’s approval of its request for interim rate relief. In contrast, a

G&T Coop does not need to seek the Commission’s approval for interim rates because a

G&T Coop board can agree to a new rate and file that new rate pursuant to Section 62-6-

4(D) without requesting interim rate relief under Rule 27. The Legislature would not have
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necessarily considered confiscation implications of the interim rate relief pleading burden

as part of the Commission’s authority over G&T Coops because a G&T Coop does not seek

such interim rate relief but instead notifies the Commission of new rates as Section 62-6-

4(D) prescribes.

{33} Our determination here that the Legislature did not intend for the Commission to

have rate-making powers over the rates of G&T Coops independent of Section 62-6-4(D)

delineates the roles of the statute and Rule 27 in proposals for interim rates and requests for

interim rate relief. Section 62-6-4(D) is the only PUA source of the Commission’s authority

over the rates of a G&T Coop, and the broad references to “rates” in Section 62-6-4(D) do

not distinguish between interim and permanent rates. Rule 27(A)-(C) imposes a pleading

burden on a utility requesting interim rate relief while G&T Coops under Section 62-6-4(D)

do not seek administrative action to set rates in the first place. Unlike public utilities under

Section 62-8-7 that must first propose a rate and then obtain the Commission’s approval

before the rate is effective, the rates of G&T Coops, like rural electric cooperatives, are

effective immediately unless suspended under Section 62-6-4(D). If the Commission

suspends a G&T rate, interim or not, then the Commission under Section 62-6-4(D) must

“conduct a hearing concerning the reasonableness” of the rate; while Rule 27(D) allows the

Commission to “act[] upon [a request for interim relief] with or without public hearing.”

Rule 27(A)-(C) imposes the pleading burden on the utility seeking interim rate relief, see

also § 62-8-7(A) (imposing a pleading burden on a public utility that seeks the

Commission’s approval of its rate), while Section 62-6-4(D) does not require a G&T Coop

to carry any burden of proof or pleading in order to set its rates.

{34} To the extent that Rule 27 requires a utility to file a request for interim relief as a

“complaint, petition, application, or other pleading” with the Commission, Rule 27 is

applicable generally; and ANs 16, 17, and 18 are Tri-State’s pleadings for interim rates. But

Section 62-6-4(D) alone, and not Rule 27, dictates the Commission’s authority and its

obligations in reviewing any G&T Coop rate “filed in the form of an advice notice,”

including ANs 16, 17, and 18. Section 62-6-4(D) authorizes the Commission’s review of the

“reasonableness” of a rate—interim or otherwise—only when the Commission determines,

as the Order asserts it did in this case, that at least three G&T Coop members have protested

the rate in a showing of “just cause . . . for review.” Tri-State incurred no pleading burden

because Section 62-6-4(D) imposes a burden on each protesting member to state grounds for

its allegation that “the proposed rates are unreasonable,” specify the relief it requests,

describe its efforts to exhaust remedies for resolution of its dispute of the democratically

determined rate, and provide an authorization of the member’s protest from the G&T Coop

board.

{35} Having determined the required showing of “just cause,” the Commission was

obligated by Section 64-6-4(D) to “conduct a hearing concerning reasonableness” of the

rates specified in ANs 16, 17, and 18. The Order was contrary to Section 62-6-4(D) when

it rejected ANs 16, 17, and 18 without a hearing.
12

C. We Reject Kit Carson’s Mootness Claim and Deny Its Motion to Dismiss the

Order

{36} Kit Carson moved to dismiss Tri-State’s appeal of the Order on grounds that the

Order was not final and the issues were moot. We write to clarify for future cases the reasons

why we did not dismiss this appeal. We recognize that the interim rates are to some extent

“identical” to a rate that was already before the Commission and that this bears on whether

the Order is final for appeal. And if issues of the rates in ANs 16, 17, or 18 are pending in

another proceeding before the Commission, review by this Court would not be appropriate.

See § 62-11-1 (stating that only “final” orders of the Commission can be appealed to this

Court); B.L. Goldberg & Assocs., Inc. v. Uptown, Inc., 1985-NMSC-084, ¶ 3, 103 N.M. 277,

705 P.2d 683 (“For purposes of appeal, an order or judgment is not considered final unless

all issues of law and fact have been determined and the case disposed of . . . to the fullest

extent possible.”). However, we deny the motion to dismiss because the Commission

rejected Tri-State’s interim rate application and bypassed the hearing requirements of

Section 62-6-4(D) when it determined that ANs 16, 17, and 18 failed to meet the

Commission’s Rule 27 pleading burden for interim rates. The Commission later denied TriState’s motion for a rehearing of the interim rate case, stating that “[t]his Docket is closed.”

The Commission, by its own words, made a final determination that the case for Tri-State’s

interim rates would not be heard because Tri-State’s advice notices did not satisfy the burden

imposed by the Commission’s regulations.

{37} It is also the repetitive nature of issues such as those in this case that compels us to

deny the motion to dismiss this appeal based on mootness. See Cobb v. State Canvassing

Bd., 2006-NMSC-034, ¶¶ 23, 29-31, 140 N.M. 77, 140 P.3d 498 (holding that we may

review moot cases that either (1) present issues of substantial public interest or (2) are

capable of repetition yet evade review); Howell v. Heim, 1994-NMSC-103, ¶ 7, 118 N.M.

500, 882 P.2d 541 (affirming a state agency’s authority to promulgate a regulation during

a finite-term budgetary crisis—even after the crisis in question had passed—because the

appearance of similar issues in such time-limited circumstances is subject to repetition);

State ex rel. N.M. Press Ass’n v. Kaufman, 1982-NMSC-060, ¶ 23, 98 N.M. 261, 648 P.2d

300 (addressing moot issues regarding the right of the media to cover a trial, which

concluded before the appellate review of the denial of media access, because similar media

access questions would likely rise again in future trials). Tri-State’s briefing in this Court

represents that it attempted to withdraw the rate design in the 2013 rate case in order to

revise rates for 2014, pursuant to AN 19, because it was clear to Tri-State that the

Commission “would not permit the 2013 rates to be effective in New Mexico before TriState would need to file a new rate to be effective in 2014.” Tri-State reported in an October

11, 2013, pleading filed for this appeal that four Tri-State New Mexico members had already

filed protests concerning AN 19. This gives us reason to believe that this dispute is repetitive

and requires resolution for future guidance in similar situations. The suspension of rates in

this case forced Tri-State to set other rates even before a resolution in the suspended-rate

case. The Commission could repeatedly characterize Tri-State’s subsequent advice notices

as requests for interim rate relief and reject them for failure to meet the pleading burden for
13

interim rate relief requests in Rule 27(A)-(C) until this Court clarifies the Commission’s

authority over the rates of G&T Coops. Accordingly, we conclude that the issues in this case

are not moot, and we deny Kit Carson’s motion to dismiss.

III. CONCLUSION

{38} We vacate the Commission’s March 13, 2013, Order in Case No. 13-00037-UT and

remand for any proceedings that may be necessary in order to comply with this opinion.

{39} IT IS SO ORDERED.

____________________________________

CHARLES W. DANIELS, Justice

WE CONCUR:

____________________________________

BARBARA J. VIGIL, Chief Justice

____________________________________

PETRA JIMENEZ MAES, Justice

____________________________________

RICHARD C. BOSSON, Justice

____________________________________

EDWARD L. CHÁVEZ, Justice