Regulations (or a successor regulation)) that 
had, in each of the 3 previous calendar years, 
sales or transmission services that exceeded— 
(i) 1,000,000 megawatt-hours of total 
annual sales; 
(ii) 100 megawatt-hours of annual 
sales for resale; 
(iii) 500 megawatt-hours of annual 
power exchanges delivered; or 
(iv) 500 megawatt-hours of annual 
wheeling; 
(B) a major natural gas company; and 
(C) a centralized service company. 
(5) MAJOR NATURAL GAS COMPANY.—The term 
‘‘major natural gas company’’ means a natural-gas 
company (as defined in section 2 of the Natural Gas 
Act (15 U.S.C. 717a)) whose combined gas trans-
ported or stored for a fee exceed 50,000,000 Dth in 
each of the 3 previous calendar years. 
(6) POLITICAL
INFLUENCE
ACTIVITY.—The 
term ‘‘political influence activity’’ includes— 
(A) any expense for the purpose of directly 
or indirectly influencing the possible— 
(i) adoption of Federal, State, or local 
regulations, legislation, or ordinances; or 
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(ii) repeal or modification of existing 
Federal, State, or local regulations, legisla-
tion, or ordinances; 
(B) any expense for the purpose of directly 
or indirectly influencing elections or appoint-
ments of public officials or referenda; 
(C) any expense for the purpose of directly 
or indirectly influencing the approval, modifica-
tion, or revocation of utility franchises; 
(D) any expense for the purpose of directly 
or indirectly influencing the public opinion with 
respect to Federal, State, or local— 
(i) regulations, legislation, or ordi-
nances; 
(ii) elections; 
(iii) referenda; or 
(iv) utility rate setting; 
(E) any expense for the purpose of directly 
or indirectly influencing the decisions of Fed-
eral, State, or local government officials; 
(F) any expense relating to attendance or 
participation in, preparation for, or appeal of 
any formal proceeding before a regulatory com-
mission; 
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(G) dues or fees paid to trade associations 
or industry associations; 
(H) any contributions or other payments 
to an organization described in paragraph (3) 
or (4) of section 501(c) of the Internal Revenue 
Code of 1986; and 
(I) advertising, marketing, or public rela-
tions expenses designed for the purpose of— 
(i) influencing public opinion; 
(ii) increasing goodwill toward a cov-
ered utility from the public or from public 
officials; 
(iii) improving the reputation of a cov-
ered utility; or 
(iv) promoting or retaining the service 
provided by a covered utility. 
SEC. 3. PROHIBITION AGAINST RECOVERING POLITICAL 
ACTIVITY EXPENSES FROM RATEPAYERS. 
(a) REGULATIONS.—Not later than 18 months after 
the date of enactment of this Act, the Commission shall 
promulgate regulations— 
(1) to prohibit covered utilities from recovering 
covered expenses from ratepayers in proceedings be-
fore the Commission, in accordance with this sec-
tion; and 
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(2) to amend the applicable Uniform System of 
Accounts in title 18, Code of Federal Regulations 
(or successor regulations), to instruct covered utili-
ties to place covered expenses in accounts that are 
presumptively not recoverable from ratepayers, in 
accordance with this section. 
(b) REPORT.— 
(1) IN GENERAL.—The Commission shall re-
quire that, not later than 18 months after the date 
of enactment of this Act, and annually thereafter, 
each covered utility shall submit to the Commission 
a report containing— 
(A) an itemized list of expenses of the pre-
ceding year recorded in accounts relating to— 
(i) covered expenses; 
(ii) outside services or vendors; and 
(iii) the operations of the covered util-
ity with respect to administrative and gen-
eral expenses; and 
(B) for each expense or cost described in 
clauses (i) through (iii) of subparagraph (A), 
unredacted information with respect to each of 
the matters described in paragraph (2) that are 
applicable to that expense or cost. 
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(2) MATTERS
DESCRIBED.—The matters re-
ferred to in paragraph (1)(B) for the expenses and 
costs described in clauses (i) through (iii) of para-
graph (1)(A) are the following: 
(A) Billing amounts. 
(B) Billing dates. 
(C) The identity of each payee for any ex-
ternal consultants or contracts. 
(D) In the case of a payment made to a 
third-party vendor by a centralized service com-
pany, parent company, or other corporate affil-
iate of the covered utility, the identity of that 
third-party vendor. 
(E) The job title, portion of salaries, and 
expenses, and all Uniform System of Account 
codes to which compensation was recorded for 
the employee, of covered utility staff with re-
spect to any work performed relating to a cov-
ered expense. 
(F) An explanation of the expense or cost 
that is sufficient to describe the purpose of the 
expense or cost. 
(3) REPORTING MINIMUM REMOVED.—With re-
spect to any annual form that a covered utility sub-
mits to the Commission having a reporting threshold 
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of $250,0000, the Commission shall remove that re-
porting threshold for the reporting of transactions 
with associated or affiliated companies on that an-
nual form. 
(c) ENFORCEMENT.— 
(1) IN GENERAL.—The Commission shall mon-
itor and investigate compliance and noncompliance 
with the regulations promulgated under this section. 
(2) PENALTY.— 
(A) IN GENERAL.—In addition to any re-
funds that the Commission orders a covered 
utility to pay ratepayers, the Commission shall 
assess a penalty in accordance with subpara-
graph (B) against a covered utility that violates 
or fails or refuses to comply with the regula-
tions promulgated under this section by charg-
ing a ratepayer a covered expense. 
(B) AMOUNT OF PENALTY.— 
(i) IN
GENERAL.—Subject to clause 
(ii), a penalty assessed under subpara-
graph (A) shall be— 
(I) for a covered expense charged 
to ratepayers in an amount less than 
$1,000,000, not less than the amount 
of that covered expense; 
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