Opinion ID: 1655575
Heading Depth: 1
Heading Rank: 1

Heading: Does Section 476.5 Prohibit the Proposed Discount?

Text: The commission contends that the first paragraph of section 476.5 expressly prohibits the proposed employee discount, while the second paragraph provides a single exception for utilities furnishing communication servicesfor example, telephone utilities. The company, in contrast, focuses on the word unreasonable in the second clause of the statute's first paragraph: [N]o such public utility shall make or grant any unreasonable preferences or advantages as to rates or services to any person or subject any person to any unreasonable prejudice or disadvantage. It contends that this language only prohibits it from granting unreasonable preferential rates, arguing that the second paragraph then permits communications utilities to grant any preferences, even unreasonable preferences. Both parties contend that the statute is unambiguous. We disagree and resort to principles of statutory construction to determine the meaning of section 476.5. We have repeatedly held that statutory construction ultimately is a judicial function, though a court will give weight to an agency's construction of a statute so long as the agency does not purport to make law or change the meaning of the law. Burlington Community School District v. Public Employment Relations Board, 268 N.W.2d 517, 521 (Iowa 1978); see Saydel Education Association v. Public Employment Relations Board, 333 N.W.2d 486, 489 (Iowa 1983); Welp v. Iowa Department of Revenue, 333 N.W.2d 481, 483 (Iowa 1983). In construing statutes, our ultimate goal is to effectuate the intent of the legislature. Kohrt v. Yetter, 344 N.W.2d 245, 246 (Iowa 1984); Hoctel v. State, 343 N.W.2d 832, 833 (Iowa 1984); Iowa R.App.P. 14(f)(13). We presume that the entire statute is intended to be effective and that a reasonable result is intended. Iowa Code § 4.4(2), (3). We consider all parts of the statute together, without attributing undue importance to any single or isolated portion. Beier Glass Co. v. Brundige, 329 N.W.2d 280, 283 (Iowa 1983). Where a statute enumerates certain exceptions, it is presumed the legislature intended to create no others. Iowa Farmers Purchasing Association, Inc. v. Huff, 260 N.W.2d 824, 827 (Iowa 1977); In re Estate of Wilson, 202 N.W.2d 41, 44 (Iowa 1972). These principles support the commission's construction of Iowa Code section 476.5 (1983). The first clause of the statute's first paragraph expressly prohibits a public utility from varying the charges specified in the tariff, while the second clause specifically mentions and outlaws unreasonable preferences or advantages as to rates or services to any person. The second paragraph then exempts from that prohibition only utilities furnishing communications services. We agree with the commission's stated reason for adopting its construction of the statute: Our interpretation of section 476.5 ... gives effect to the entire statutory section, pursuant to Iowa Code section 4.4(2) (1983). There would be no need to specifically allow communication utility employee discounts if the paragraph to which the exception has been added did not already prohibit the offering of utility employee discounts. The company's construction places undue reliance on the word unreasonable in the second clause of the statute's first paragraph and cannot be harmonized with the fundamental requirement of the entire statutory scheme that all rates be reasonable and just. If we were to adopt the company's reading of the statute, most utilities would be allowed to grant preferences deemed reasonable, but communications utilities would be allowed to grant unreasonable preferences and advantages by reason of the exception provided by the statute's second paragraph. Other provisions of chapter 476, however, require the commission to assure the public that all utility charges, including charges by communications utilities, be reasonable and just. Section 476.4 provides in pertinent part: [R]ates and charges shall be subject to investigation by the commission ... and upon such investigation the burden of establishing the reasonableness of such rates and charges shall be upon the public utility filing the same. In addition, section 476.8 states: The charge made by any public utility... shall be reasonable and just, and every unjust or unreasonable charge for such service is prohibited and declared unlawful. The legislature clearly stated and certainly intended that all utility rates be reasonable, and we therefore must reject the company's construction which would allow communications utilities to grant unreasonable preferences. See State v. Link, 341 N.W.2d 738, 740 (Iowa 1983) ([W]e will seek a reasonable interpretation and construction which will best effect the purpose of the statute, seeking to avoid absurd results.). The company argues that the commission for the past twenty years placidly acquiesced in its reading of section 476.5 to allow preferential rates and, in the absence of legislative intervention, is bound by its previous interpretation of the statute. We disagree. The legality of the company's employee discount has not previously been litigated. The commission may not by acquiescence in previous rates alter the meaning of the statute. See City of Fort Dodge v. Iowa Public Employment Relations Board, 275 N.W.2d 393, 396 (Iowa 1979); 2A Sutherland Statutory Construction § 49.04 (4th ed. 1984). If an agency concludes that its application of a statute is in error, it is not required to go on indefinitely misapplying the statute; it may alter the application. Bair v. Estate of Biggins, 356 N.W.2d 551, 555 (Iowa 1984). We hold that the district court erred in construing section 476.5 to allow the company's preferential employee rate, because that section prohibits public utilities that are not communications utilities from granting any preferential rates.