Code of Maine Rules › 65 - DEPARTMENT OF PUBLIC UTILITIES COMMISSION › 407 - PUBLIC UTILITIES COMMISSION › Chapter 720 - COMPLIANCE WITH THE GAAP REQUIREMENTS OF SFAS NO. 106 › Section 407-720-3 - Compliance Required for Regulatory Accounting Purposes

Current through 2024-29, July 17, 2024
A. SFAS 106 Accounting Compliance Required.
				All public utilities that are required to do so for financial reporting
				purposes shall adopt the requirements set forth in SFAS 106 for regulatory
				accounting and reporting purposes.
B. Accounting Requirements. Each public
				utility shall record the effects of SFAS 106 in the appropriate accounts as
				defined in the Uniform System of Accounts applicable to the utility. Each
				public utility shall maintain sufficient detail to allow identification of the
				components of the SFAS 106 expenses that are recorded in the accounting books.
				Each public utility shall maintain sufficient detail to allow specific
				identification of any related amounts that are recorded as deferred tax assets
				or liabilities. Should the regulatory body whose Uniform System of Accounts has
				been approved for use in this State designate or establish specific accounts or
				subaccounts to be used for recording the effects of SFAS 106, those accounts
				shall also be used for state regulatory accounting purposes.
C. Transition obligation. Utilities shall
				have the option of either: 1) immediately expensing the transition obligation;
				or 2) amortizing the transition obligation ratably over the greater of: (a) the
				average remaining service period of active employees; or (b) twenty years,
				whichever is longer. The ratemaking treatment of the transition obligation
				approach selected by the utility is subject to the approval by the Commission
				in the first rate case proceeding following the implementation of this rule by
				the utility.
D. Deferral Period.
				Upon initial implementation of the requirements of this rule, OPEB expenses may
				be deferred only if a specific waiver is granted by the Commission. In
				requesting a waiver the utility shall specify one of the two alternatives
				listed below. OPEB expenses as calculated in accordance with SFAS 106 which
				exceed the amount of expenses as calculated under the pay-as-you-go (cash
				basis) methodology may be:
i Deferred for a
				period of up to two years from the date of adoption of SFAS 106, or until the
				completion of the first rate case proceeding involving the utility following
				adoption, whichever occurs first. A waiver for up to two years will be granted
				if the utility demonstrates that it is not overearning for Maine-jurisdictional
				purposes; or,
ii Deferred for a
				longer period, not to exceed five years, from the date of adoption of SFAS 106,
				if it is a part of a plan to gradually phase-in for ratemaking purposes SFAS
				106-related costs. Waivers for two to five years will be granted only if: a)
				the utility demonstrates that it is not overearning for Maine-jurisdictional
				purposes; and b) the utility develops a plan, which would take effect as part
				of a rate case proceeding, to gradually phase-in the SFAS 106 costs for
				ratemaking purposes.