Opinion ID: 2582369
Heading Depth: 3
Heading Rank: 1

Heading: the rate-making process contemplated by the rea includes both general rate cases and automatic adjustment clause recovery, depending on the type of cost involved

Text: {18} The REA authorizes public utilities to recover the reasonable costs of compliance thereto through the rate-making process. Section 62-16-6(A). As a threshold matter, we note that EPE's REA compliance costs are presumed reasonable, as the Commission approved EPE's 2004 and 2005 Plans. Thus, we must determine what constitutes the rate-making process referred to in Section 62-16-6(A). {19} Statutory interpretation is an issue of law, which we review de novo. Pub. Serv. Co. of N.M. v. N.M. Pub. Util. Comm'n, 1999-NMSC-040, ¶ 14, 128 N.M. 309, 992 P.2d 860 (quoting State v. Rowell, 121 N.M. 111, 114, 908 P.2d 1379, 1382 (1995)). We will reverse the agency's interpretation of a law if it is unreasonable or unlawful. NMSA 1978, § 62-11-5 (1982); Morningstar Water Users Ass'n, 120 N.M. at 583, 904 P.2d at 32. Where as here an agency is construing the same statutes by which it is governed, we accord some deference to the agency's interpretation. Morningstar Water Users Ass'n, 120 N.M. at 583, 904 P.2d at 32. The deference we accord the agency's interpretation depends on the legal question involved. As we have explained in the past, [t]he court will confer a heightened degree of deference to legal questions that implicate special agency expertise or the determination of fundamental policies within the scope of the agency's statutory function. However, the court is not bound by the agency's interpretation and may substitute its own independent judgment for that of the agency because it is the function of the courts to interpret the law. Id. (internal citations and quotations marks omitted). Because statutory construction itself is not a matter within the purview of the Commission's expertise, we afford little, if any, deference to the Commission on this matter. Pub. Serv. Co. of N.M., 1999-NMSC-040, ¶ 14. Indeed, we are troubled by the multiple references, at the Commission hearing, in the Commission's and EPE's briefing, and at oral argument, to the legal conclusions of Commission staff with respect to matters of statutory construction as well as the Commission's apparent reliance on those legal conclusions in its Final Order. {20} When construing statutes, our guiding principle is to determine and give effect to legislative intent. Id. ¶ 18. In ascertaining the Legislature's intent, we are aided by classic canons of statutory construction. Id. We look first to the plain language of the statute, giving the words their ordinary meaning, unless the Legislature indicates a different one was intended. Id. In addition, we strive to read related statutes in harmony so as to give effect to all provisions: In ascertaining legislative intent, the provisions of a statute must be read together with other statutes in pari materia under the presumption that the legislature acted with full knowledge of relevant statutory and common law. . . . Thus, two statutes covering the same subject matter should be harmonized and construed together when possible, in a way that facilitates their operation and the achievement of their goals. Id. ¶ 23 (quoting State ex rel. Quintana v. Schnedar, 115 N.M. 573, 575-76, 855 P.2d 562, 564-65 (1993)). {21} We thus begin with the plain language of Section 62-16-6(A) to ascertain the legislative intent. The Legislature did not define or specify the rate-making process in the REA, so we look to a related statute, the PUA, to inform the meaning of Section 62-16-6(A). The Legislature, through the PUA, has granted the Commission 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). In Section 62-8-7 of the PUA, entitled Change in rates, the Legislature set forth the framework for setting and changing utility rates. See Otero County Elec. Coop., Inc. v. N.M. Pub. Serv. Comm'n, 108 N.M. 462, 464, 774 P.2d 1050, 1052 (1989). Section 62-8-7(E) states, in pertinent part: Except as otherwise provided by law, any increase in rates or charges for the utility commodity based upon cost factors other than taxes or cost of fuel, gas or purchased power . . . shall be permitted only after notice and hearing as provided by this section. Thus, the normal process a utility must follow for setting or changing its rates includes a notice, hearing, and approval process. However, utilities can recover specifically enumerated costs automatically through an automatic adjustment clause. {22} Reading the related provisions of the REA and the PUA together, we agree with the Commission and conclude that by rate-making process in Section 62-16-6(A) of the REA, the Legislature meant the process set forth in Section 62-8-7 of the PUA, i.e., both general rate cases involving a Commission notice, hearing, and approval process as well as automatic adjustment clauses, depending on the type of cost involved.