An Act To Provide for Fairness and Accuracy in Utility Rate Setting
Maine Legislature, Session 123, LD 2104
Committee: Utilities and Energy
Sponsors: BERRY, BARTLETT, BLISS, BOLAND, BRIGGS, CONNOR
Amends: 35-A MRSA §301, 35-A MRSA §9106

Legislative Document 
No. 2104 
H.P.1490 
House of Representatives, December 27, 2007 
An Act To Provide for Fairness and Accuracy in Utility Rate Setting 
Approved for introduction by a majority of the Legislative Council pursuant to Joint Rule 
203. 
Reference to the Committee on Utilities and Energy suggested and ordered printed. 
Presented by Representative BERRY of Bowdoinham. 
Cosponsored by Senator BARTLETT of Cumberland and 
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MILLICENT M. MacFARLAND 
Clerk 
Representatives: BLISS of South Portland, BOLAND of Sanford, BRIGGS of Mexico, 
CONNOR of Kennebunk. 
Printed on recycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 35-A MRSA §301, sub-§5 is enacted to read: 
5. Utility misconduct. To preserve the integrity of the rate-making process, the 
commission shall, upon a finding that a regulated 
utility 
made a material 
misrepresentation or omission or engaged in any other misconduct in the course of a 
previous rate proceeding, apply a penalty against the utility. Any penalty applied under 
this subsection must be calculated to recover, at a minimum, the excess revenues 
collected by the utility resulting from the misrepresentation, omission or misconduct and 
must be refunded to ratepayers in the form of a credit on customer bills. 
Sec. 2. 35-A MRSA §9106 is enacted to read: 
II 
§9106. Just and reasonable rates 
In determining the reasonableness of any rate-adjustment mechanism established 
under this chapter, the commission shall apply the standards of section 30 I to ensure that 
the rates resulting from the implementation of the mechanism are just and reasonable. 
Prior to the adoption of a new or replacement alternative form of regulation or renewal of 
any existing alternative fonn of regulation, the commission shall, in order to ensure that 
rates at the starting point of the alternative fonn of regulation are just and reasonable, 
conduct a revenue requirement and earnings review pursuant to the standards of section 
I. In conducting such a review under this section, the commission, at its discretion, 
may conduct the review in a manner designed to minimize the cost of the review to 
ratepayers. 
Sec. 3. Remediation of past excessive rates. The Public Utilities Commission 
shall, in reference to the 2005 remand to the commission by the Maine Supreme Judicial 
Court in the case of Office of Public Advocate v. Public Utilities Commission, 2005 ME 
15, 866 A.2d 851, conduct a traditional rate-of-return proceeding and determine just and 
reasonable rates for local telephone service provided by the telephone utility based on the 
test-year costs and revenues in the year 2000, the year that the commission was first 
obligated to conduct a proceeding pursuant to the Maine Revised Statutes, Title 35-A, 
section 9103, subsection I. 
Based on the determination of the rate proceeding, the 
commission shall compute the excess revenues that have resulted from the difference 
between actual local telephone rates charged and the just and reasonable level of local 
telephone rates detennined in the proceeding required by this section for the period from 
2000, when the commission was obligated to determine new rates pursuant to the Maine 
Revised Statutes, Title 35-A, chapters 3 and 91, to the present. At the conclusion of the 
proceeding, the commission shall promptly order a refund to customers of all such excess 
revenues received by the utility or its successor in interest. 
SUMMARY 
This bill requires the Public Utilities Commission to conduct a revenue requirement 
and earnings review of a utility before the adoption of a new or replacement alternative 
form of regulation or the renewal of an alternative form of regulation in order to ensure 
Page I - 123LR3304(OI)-1 
that rates are just and reasonable. It also requires the Public Utilities Commission, upon a 
finding that a regulated utility made a material misrepresentation or omission or engaged 
in any other misconduct in the course of a previous rate proceeding, to apply a penalty 
against the utility. Any such penalty must be calculated to recover, at a minimum, the 
excess revenues collected by the utility resulting from the misrepresentation, omission or 
misconduct and must be refunded to ratepayers in the form of a credit on customer bills. 
The bill further requires the Public Utilities Commission to determine whether rates 
charged for local telephone service since 2000 have been excessive and, if the 
commission determines that rates have been excessive, to order a refund to customers.