Court Opinion

ID: 2709852
Source: CourtListenerOpinion
Date Created: 2014-08-05 19:25:04.598269+00
Date Added: 2024-06-11T13:26:33.148263
License: Public Domain

Illinois Official Reports

                                      Appellate Court

                  Securus Technologies, Inc. v. Illinois Commerce Comm’n,
                                2014 IL App (1st) 131716

Appellate Court          SECURUS TECHNOLOGIES, INC., Petitioner, v. ILLINOIS
Caption                  COMMERCE COMMISSION and CONSOLIDATED COMMUNI-
                         CATIONS ENTERPRISE SERVICES, INC., d/b/a Consolidated
                         Communications Public Services, Respondents.

District & No.           First District, Sixth Division
                         Docket No. 1-13-1716

Filed                    May 16, 2014

Held                       The orders entered by the Illinois Commerce Commission granting
(Note: This syllabus respondent communication company’s petition for a declaratory
constitutes no part of the ruling concerning the special telephone calling services provided for
opinion of the court but inmates of corrections facilities operated by the Department of
has been prepared by the Corrections were vacated due to the Commission’s lack of
Reporter of Decisions jurisdiction, since respondent’s petition was related to its loss of a bid
for the convenience of for the contract to provide the services, but respondent was not an
the reader.)               “affected person” for purposes of being entitled to a declaratory
                           ruling, respondent failed to state that an actual controversy or
                           uncertainty existed, especially when the award of the contract was
                           moot, and the orders were outside the Commission’s authority under
                           the Administrative Procedure Act and its implementing regulations.

Decision Under           Petition for review of orders of Illinois Commerce Commission,
Review                   No. 12-0413.

Judgment                 Vacated.
     Counsel on                   Michael J. Hayes and Dawn L. Johnson, both of K&L Gates LLP, of
     Appeal                       Chicago, for petitioner.

                                  John E. Stevenson, of Freeborn & Peters LLP, of Springfield, for
                                  respondent Illinois Commerce Commission.

     Panel                        JUSTICE REYES delivered the judgment of the court, with opinion.
                                  Presiding Justice Rochford and Justice Lampkin concurred in the
                                  judgment and opinion.

                                                     OPINION

¶1         Petitioner Securus Technologies, Inc. (Securus), directly appeals to this court from orders
       of the respondent Illinois Commerce Commission (Commission) entered upon a verified
       petition for a declaratory ruling filed with the Commission by respondent Consolidated
       Communications Enterprise Services, Inc. (Consolidated),1 as well as an order denying
       rehearing on the matter. Securus argues: (1) the Commission lacked jurisdiction to enter the
       orders; (2) the Commission’s orders violate Illinois law; (3) the Commission’s procedures
       prior to entry of the orders violated Sercurus’s right to due process of law; and (4) the
       Commission’s findings were against the manifest weight of the evidence. The Commission
       not only takes the contrary position to all of the arguments raised by Securus, but also argues
       this court lacks jurisdiction to hear this appeal. For the following reasons, we conclude this
       court has jurisdiction to hear the appeal, the Commission lacked jurisdiction to enter the
       orders at issue, and the Commission’s orders must be vacated.

¶2                                           BACKGROUND
¶3          The record on appeal discloses the following facts. On July 3, 2012, Consolidated filed a
       verified petition for declaratory ruling from the Commission, pursuant to section 5-150 of the
       Illinois Administrative Procedure Act (5 ILCS 100/5-150 (West 2012)) and section
       200.220(a)(1) of the Commission’s Rules of Practice (83 Ill. Adm. Code 200.220(a)(1)
       (1996)). In the petition, Consolidated identified itself as a corporation engaged in the
       provision of telecommunications services and other telecommunications-related businesses in
       Illinois. The petition alleged Consolidated “provide[d] telephone calling services accessible
       by inmates of corrections facilities operated by the Illinois Department of Corrections
       (‘IDOC’), so that inmates may communicate with members of the general public.”
       Consolidated provided these services through equipment placed in the restricted areas of the
       IDOC facilities allowing inmates to place operator-assisted collect calls. The charges for the

             1
              Consolidated is not a party to this appeal.

                                                            -2-
     telephone calls are billed to the members of the public who have accepted responsibility to
     pay for the calls. IDOC allows only one such service provider at each corrections facility.
¶4       Consolidated sought a declaratory ruling from the Commission “as to whether a person or
     entity, such as Consolidated,” is providing “operator services” and thus is an “operator
     services provider[ ]” under section 13-901 of the Public Utilities Act (220 ILCS 5/13-901
     (West 2012)) and section 770.10 of the Commission’s regulations (83 Ill. Adm. Code 770.10
     (1994)). Consolidated also sought a declaratory ruling that such operator services providers
     were thus subject to the requirements of not only section 13-901 of the Public Utilities Act,
     but also sections 770.20(a) and 770.40(c) and (e) of the Commission’s regulations (83 Ill.
     Adm. Code 770.20(a), 770.40(c), (e) (1994)), which set standards of service and maximum
     rates for telephone calls.
¶5       Consolidated asserted in its petition that the request for a declaratory ruling was
     prompted by an actual controversy. In support of the petition’s assertion that an actual
     controversy existed, Consolidated alleged it had recently submitted a bid to the Illinois
     Department of Central Management Services (CMS) on a contract to provide services
     described in the petition to certain IDOC corrections facilities. The contract solicitation
     required bidders to submit the rates they would charge and the percent of revenues they
     would pay to IDOC as a commission. Consolidated, believing itself to be an operator services
     provider, specified it would charge no more than the maximum rates established by sections
     770.40(c) and (e) of the Commission’s regulations. CMS awarded the contract to a bidder
     (the record establishes this bidder was Securus) that represented it would charge rates above
     those maximum rates. On May 31, 2012, Consolidated protested the contract award. The
     chief procurement officer of CMS (CPO) denied the protest, based on his review of prior
     orders issued by the Commission and a review of the Commission’s regulations.
¶6       Consolidated further asserted in the petition that Consolidated needed to know “whether,
     in the future, it would be acting in violation of a Commission regulation if it were to charge
     higher rates than those established pursuant to sections 770.40(c) and (e) to members of the
     public in connection with the provision of the inmate telephone calling services described” in
     the petition.
¶7       Consolidated attached to its petition a copy of the CPO’s June 25, 2012, decision
     rejecting Consolidated’s protest as to the contract awarded to Securus. The CPO determined
     the key inquiry is whether the services at issue were within the Commission’s regulatory
     jurisdiction and subject to the restrictions of section 770.40, as the award would be required
     to be rescinded if the services were not exempt. The CPO relied on two prior orders issued by
     the Commission, Inmate Communications Corp., Ill. Com. Comm’n No. 96-0131 (June 5,
     1996) (Inmate Communications), and Infinity Networks, Inc., Ill. Com. Comm’n No. 05-0429
     (Oct. 19, 2005) (Infinity Networks), in which the Commission ruled: (1) telecommunications
     providers that do not locate pay telephones in public areas are not public utilities and are not
     subject to the Commission’s regulation with respect to such services; (2) prisoners are not
     members of the public and thus pay telephones for inmate-only use are not a public utility or
     telecommunications carrier under section 13-202 of the Public Utilities Act; and (3) operator
     services associated with the provision on nonpublic telephones in correctional institutions
     were exempt from the operator services requirements of Part 770 of Title 83 of the Illinois
     Administrative Code.

                                                -3-
¶8          The CPO noted the only opposing material Consolidated presented was an email from
       Kathy Stewart, who was employed by the Commission as an “Engineering Analyst IV.” The
       CPO observed he was not provided the question Consolidated presented to Stewart or any
       explanation for why Stewart was requested to provide a legal opinion. This “conundrum”
       prompted the CPO to contact the Commission’s general counsel’s office, which replied the
       opinion of any single employee was not the opinion of the Commission, and explained there
       is a formal mechanism called a declaratory ruling which allows the Commission to issue
       opinions regarding the applicability of its rules. Thus, the CPO concluded the Commission’s
       prior orders were determinative and the services at issue were not subject to regulation.
¶9          On July 30, 2012, Securus transmitted a letter regarding Consolidated’s petition for a
       declaratory ruling to an administrative law judge (ALJ) at the Commission. The letter
       requested the summary dismissal of Consolidated’s petition, arguing: (1) after the CPO
       rejected Consolidated’s protest of the contract award, Consolidated filed a lawsuit in the
       circuit court of Sangamon County regarding the contract bid dispute, which Consolidated
       failed to disclose in its verified petition; (2) the Commission had already ruled upon the issue
       raised in Consolidated’s petition; and (3) Consolidated was not an “affected person” with
       standing to request a declaratory ruling from the Commission. Securus attached a copy of
       Consolidated’s July 3, 2012, complaint filed in the circuit court against CMS, the CPO,
       Securus and other parties, challenging the award of the contract to Securus. The ALJ
       recorded the letter as an ex parte communication from an interested party.
¶ 10        On July 31, 2012, during a prehearing conference on Consolidated’s petition, the ALJ
       informed counsel for Securus they would be required to file a petition to intervene if they
       wished to participate in the proceedings on Consolidated’s petition.
¶ 11        On August 30, 2012, Securus filed a verified petition to intervene and be treated as a
       party in the proceedings on Consolidated’s petition for a declaratory ruling. Securus asserted
       its interest was based on its then-ongoing negotiation of the terms of the contract Securus
       was awarded to provide inmate pay telephone services at IDOC facilities. Securus proffered
       appearances of counsel and attached a copy of its July 30, 2012, letter to the ALJ. On
       September 14, 2012, the ALJ granted Securus’s petition to intervene.
¶ 12        On August 31, 2012, the Commission’s staff filed a response in support of
       Consolidated’s verified petition for a declaratory ruling. The response, prepared by Stewart,
       stated it would not respond directly to the points raised by Securus, because Securus had yet
       to file a petition to intervene when the response was drafted. The response, however, asserted
       Consolidated’s litigation of the contract bid in the circuit court was immaterial to the issues
       raised by the petition. The Commission’s staff also argued the Commission should revisit its
       prior decision in Inmate Communications, noting: (1) the Commission’s orders are not
       res judicata on the Commission; (2) the relevant portion of the order was dicta; and (3) the
       Commission staff’s opinion was that the services at issue should be subject to regulation to
       protect members of the general public who pay for telephone calls from inmates. The
       Commission’s staff further asserted Consolidated was an “affected person” insofar as the rate
       regulation affected not only Consolidated’s past contract bid, but also future bids.
¶ 13        On September 7, 2012, Consolidated filed a verified reply in support of its verified
       petition for a declaratory ruling. Responding to Securus, Consolidated observed it had filed
       an amended complaint in the circuit court alleging numerous flaws in the bid proposal
       submitted by Securus. Consolidated asserted the controversy prompting its petition was the

                                                  -4-
       award of the contract to Securus, which Consolidated disclosed in its verified petition.
       Consolidated also asserted its litigation was not relevant to the Commission’s resolution of
       the question in the petition for a declaratory ruling. Consolidated further argued the
       Commission should revisit its prior decisions in Inmate Communications and Infinity
       Networks. Consolidated additionally argued it was an “affected person” for the purpose of
       seeking a declaratory ruling because the contract award was in litigation and not final, and as
       the CPO indicated in his decision, the award must be rescinded if the rate regulations applied
       to the services at issue in the contract. Consolidated reiterated it required further guidance
       regarding whether it would be violating a Commission regulation in the future if it charged
       rates higher than those established by sections 770.40(c) and (e) of the Commission’s
       regulations. In addition, Consolidated asserted Securus had failed to challenge any of the
       underlying facts or policy considerations asserted by Consolidated and the Commission’s
       staff in the proceedings.
¶ 14       On October 23, 2012, the ALJ issued a proposed order recommending Consolidated’s
       petition for a declaratory ruling be granted. Securus filed a motion requesting briefing of
       exceptions to the proposed order be deferred, due to outstanding discovery requests. On
       November 13, 2012, the ALJ denied Securus’s motion to defer briefing. Securus sought
       interlocutory review of the ALJ’s decision. On December 19, 2012, the Commission denied
       interlocutory review.
¶ 15       On November 16, 2012, Securus filed its brief of exceptions to the ALJ’s proposed order.
       Securus again argued Consolidated is not an “affected person” entitled to request a
       declaratory ruling. Securus observed Consolidated’s lawsuit was dismissed by the circuit
       court on the basis Consolidated lacked standing to sue.2 Moreover, Securus and IDOC
       entered into their contract and the transition from Consolidated to Securus had already begun.
       Thus, Securus concluded, granting the petition would have no bearing on the litigation or
       IDOC’s contract with Securus. In addition, Securus argued Consolidated could not seek an
       advisory opinion from the Commission regarding unspecified future activities.
¶ 16       Securus also argued the proposed order was contrary to the Commission’s prior orders on
       the subject. Securus disputed the Commission staff’s assertion that a lack of regulation
       resulted in excessive and exorbitant prices for inmate telephone services, arguing the
       additional technological requirements for providing inmate-only telephone service, which are
       not required for ordinary collect telephone calls, accounted for the differences in pricing the
       telephone calls. Securus additionally sought a hearing and oral argument on the matters
       raised in the proposed order.
¶ 17       On November 20, 2012, the Commission’s staff moved to strike the portions of the brief
       of exceptions filed by Securus referring to facts outside the record of the proceedings on
       Consolidated’s petition. On December 18, 2012, the ALJ granted the Commission staff’s
       motion, ruling Securus had not timely filed or sought other relief regarding the Commission
       staff’s response. The ALJ also observed that in contested cases, parties must be notified and
       given the opportunity to contest materials which may be the subject of administrative notice

           2
            A copy of the October 24, 2012, circuit court order dismissing Consolidated’s complaint included
       in the record indicates the complaint was dismissed based not only on Consolidated’s lack of standing
       to sue, but also on the ground of sovereign immunity.

                                                     -5-
       (see 5 ILCS 110/10-40 (West 2012)). The ALJ did not specifically state this matter was a
       contested case.
¶ 18       On December 21, 2012, Consolidated filed its reply to the exceptions to the proposed
       order. Consolidated argued it was an “affected person” entitled to request a declaratory
       ruling. Consolidated noted it had previously provided the services at issue in its petition.
       Consolidated also noted it had appealed the dismissal of its lawsuit by the circuit court and
       filed a complaint with the Illinois Procurement Policy Board. Consolidated distinguished
       case law cited by Securus on the issue of whether an order from the Commission would
       affect the litigation or the contract between IDOC and Securus.
¶ 19       Consolidated’s reply also argued services offered to members of the general public are
       operator services subject to the Commission’s rate regulation. Consolidated maintained
       Securus’s reliance on Part 771 of the Commission’s regulations was inapposite. Consolidated
       further argued that the Commission’s prior orders generally addressed whether inmate pay
       telephone services providers were “telecommunications carriers” under the Public Utilities
       Act, not whether such providers were “operator services providers.” In Consolidated’s view,
       the Commission’s decision in Inmate Communications was the only order addressing the
       precise issue presented in Consolidated’s petition and should not be followed.
¶ 20       On January 9, 2013, the Commission denied Securus’s request for oral argument on the
       proposed order. On January 18, 2013, Securus sought interlocutory review of the ALJ’s
       ruling striking portions of its brief of exceptions. On January 29, 2013, the Commission
       denied interlocutory review of the ruling. On January 31, 2013, Securus renewed its request
       for a hearing on the proposed order.
¶ 21       On February 14, 2013, Consolidated’s petition was placed on the Commission’s regular
       meeting agenda. During the public comment portion of the meeting, Securus’s counsel
       argued there would be detrimental effects if the Commission declared inmate pay telephone
       services subject to Part 770 of the Commission’s regulations. At the request of a
       commissioner, the Commission held the matter over, as there was no deadline for taking
       action on the petition.
¶ 22       On March 6, 2013, the petition was placed on the Commission’s bench session agenda.
       During the public comment portion of the meeting, IDOC’s deputy chief of operations spoke
       regarding the need to restrict inmate telephone service to a single provider to facilitate the
       monitoring and regulation of such telephone calls to protect the safety and security of IDOC
       facilities and personnel. When Consolidated’s petition was called for discussion during the
       public utility portion of the meeting, a commissioner requested the ALJ to discuss her
       conclusions in the matter. The ALJ explained the issues raised by Consolidated’s petition and
       observed the Commission’s prior orders contained no factual basis or discussion of its
       findings regarding inmate telephone service. A commissioner inquired of the ALJ whether
       the proposed order would be limited to this case and would have no precedential value
       moving forward should someone attempt to cite it as authority in the future. The ALJ
       responded the proposed order would apply to inmate calling services unless someone filed
       another petition establishing the underlying facts were different. The Commission’s chairman
       indicated the matter would be held for later disposition.
¶ 23       On April 8, 2013, Securus, pursuant to section 200.190 of the Commission’s Rules of
       Practice (83 Ill. Adm. Code 200.190 (1996)), filed a verified motion to dismiss
       Consolidated’s petition as moot. Securus asserted that as of March 28, 2013, all telephone

                                                 -6-
       services for inmates at IDOC facilities were transitioned to Securus. Accordingly,
       Consolidated was no longer providing the services which were the subject of Consolidated’s
       petition. Securus relied upon prior Commission orders which declined to issue declaratory
       rulings where the Commission’s regulations did not apply to the requester and where the
       petitioner failed to establish business activities which would be affected by a declaratory
       ruling.
¶ 24       On April 9, 2013, without ruling on Securus’s motion to dismiss, the Commission entered
       a 26-page order granting Consolidated’s petition for a declaratory ruling. The order is not
       identical to the ALJ’s proposed order, but similar in substance. The Commission found
       Consolidated was an “affected person” entitled to seek a declaratory ruling, based on the
       rejection of its contract bid and subsequent litigation as to the denial of the bid protest and
       the award of the contract to Securus, as well as its request for future guidance regarding the
       applicability of the rate regulation. The Commission also found it had sufficient information
       to determine Consolidated’s request was within the parameters of the Commission’s
       authority for issuance of a declaratory ruling and that an actual controversy existed.
¶ 25       The Commission’s order adopted the Commission staff’s argument that, as a matter of
       public policy, the operator services within inmate calling services should be regulated to
       protect members of the public who engage in telephone calls with inmates. The
       Commission’s order did not discuss its prior decisions, other than to note the prior orders are
       not res judicata and the record here disclosed the nature of the operator services included in
       inmate calling services. Accordingly, the Commission ordered “that an entity providing
       telephone calling services accessible to inmates of correctional facilities that include operator
       services as described herein is subject to [s]ection 13-901 of the [Public Utilities] Act and
       [s]ections 770.20(a) and 770.40 of Part 770.”
¶ 26       On April 24, 2013, Securus filed a verified petition for rehearing. On April 25, 2013, the
       ALJ issued a memorandum recommending the Commission deny rehearing. On May 1,
       2013, the Commission denied the petition for rehearing and served the parties electronically
       the following day. On June 4, 2013, Securus filed a notice of appeal to this court.

¶ 27                                           ANALYSIS
¶ 28        On appeal, Securus argues: (1) the Commission lacked jurisdiction to enter the orders; (2)
       the Commission’s orders violate Illinois law; (3) the Commission’s procedures prior to entry
       of the orders violated Sercurus’s right to due process of law; and (4) the Commission’s
       findings were against the manifest weight of the evidence. The Commission not only takes
       the contrary position to all of Securus’s arguments, but also argues this court lacks
       jurisdiction to hear this appeal, because section 5-150(a) of the Administrative Procedure Act
       (5 ILCS 100/5-150(a) (West 2012)) and section 200.220(i) of the Commission’s Rules of
       Practice (83 Ill. Adm. Code 200.220(i) (1996)) provide that declaratory rulings are not
       appealable. A reviewing court has a duty to ascertain whether it has jurisdiction before
       addressing any issues on appeal. Secura Insurance Co. v. Illinois Farmers Insurance Co., 232
       Ill. 2d 209, 213 (2009).
¶ 29        The Commission’s authority to issue declaratory rulings is derived from section 5-150(a)
       of the Administrative Procedure Act and section 200.220(i) of the Commission’s Rules of
       Practice. Section 5-150(a) of the Administrative Procedure Act provides:

                                                   -7-
               “Each agency may in its discretion provide by rule for the filing and prompt
               disposition of petitions or requests for declaratory rulings as to the applicability to the
               person presenting the petition or request of any statutory provision enforced by the
               agency or of any rule of the agency. Declaratory rulings shall not be appealable.” 5
               ILCS 100/5-150(a) (West 2012).
       Pursuant to section 5-150(a), the Commission promulgated section 200.220 of the Rules of
       Practice for the Commission, which provides:
                    “a) When requested by the affected person, the Commission may in its sole
               discretion issue a declaratory ruling with respect to:
                        1) the applicability of any statutory provision enforced by the Commission or of
                    any Commission rule to the person(s) requesting a declaratory ruling[.]
                        ***
                    b) A request for a declaratory ruling:
                        1) shall be captioned as such and shall contain a complete statement of the facts
                    and grounds prompting the request, including a full disclosure of the requester’s
                    interest; a clear, concise statement of the controversy or uncertainty that is the
                    subject of the request; the requester’s proposed resolution of that controversy or
                    uncertainty; and citations to any statutes, rules, orders or other authorities
                    involved[.]
                                                      ***
                    i) Declaratory rulings shall not be appealable.” 83 Ill. Adm. Code 200.220(a)(1),
               (b)(1), (i) (1996).
       “It is our duty as officers of the court to respect this expression of legislative intent.”
       MidAmerican Energy Corp. v. Illinois Commerce Comm’n, 367 Ill. App. 3d 163, 167 (2006).
       In this case, the Commission found it had sufficient information to determine Consolidated’s
       request was within the parameters of the Commission’s authority for issuance of a
       declaratory ruling, an actual controversy existed, and Consolidated was an “affected person”
       entitled to seek a declaratory ruling. The jurisdictional issue here thus turns on whether the
       Commission’s order was a declaratory ruling under section 200.220.
¶ 30        Section 200.220 provides that a declaratory ruling regarding a “controversy or
       uncertainty” be requested by an “affected person.” 83 Ill. Adm. Code 200.220 (1996). These
       self-imposed limitations by the Commission do not appear in the text of section 5-150(a) of
       the Administrative Procedure Act, and thus the Commission’s determination of what is a
       “controversy or uncertainty” and who is an “affected person” arguably could be characterized
       as the Commission’s interpretations of its own regulation. This court has stated that “[a]
       court may overturn the Commission’s interpretation of its own rules if its construction is
       clearly erroneous, arbitrary, or unreasonable.” Ameren Illinois Co. v. Illinois Commerce
       Comm’n, 2012 IL App (4th) 100962, ¶ 61. Yet we stated this rule in the context of the
       Commission’s interpretation of a statute it is charged with administering and enforcing. See
       id. Section 200.220 is a Commission regulation promulgated pursuant to the Administrative
       Procedure Act, rather than the Public Utilities Act. The Commission’s interpretation of a
       statute it is not charged with administering and enforcing generally is not entitled to any
       deference and is reviewed de novo. Ameren Illinois Co., 2012 IL App (4th) 100962, ¶ 62
       (citing Business & Professional People for the Public Interest v. Illinois Commerce Comm’n,
       136 Ill. 2d 192, 204 (1989)). Furthermore, even in cases where some deference is to be

                                                    -8-
       afforded to an administrative agency’s statutory interpretations, “our supreme court has
       consistently indicated that ‘[a]n agency’s interpretation is not binding, however, and will be
       rejected when it is erroneous.’ ” AT&T Teleholdings, Inc. v. Department of Revenue, 2012 IL
       App (1st) 113053, ¶ 32 (quoting Shields v. Judges’ Retirement System of Illinois, 204 Ill. 2d
       488, 492 (2003)); see also Business & Professional People for the Public Interest, 136 Ill. 2d
       at 228 (less deference will be afforded the Commission when its decision is a departure from
       the Commission’s past practice). Lastly, we are not bound to accept the Commission’s
       conclusions regarding its jurisdiction. Peoples Gas Light & Coke Co. v. Illinois Commerce
       Comm’n, 222 Ill. App. 3d 738, 743 (1991). Accordingly, while we will consider the
       Commission’s interpretation of section 200.220 in this case, we remain free to reject that
       interpretation if it is unreasonable or otherwise erroneous. AT&T Teleholdings, Inc., 2012 IL
       App (1st) 113053, ¶ 32. We now turn to address whether the Commission’s April 9, 2013,
       order was a nonappealable “declaratory ruling” requested by an “affected person” under
       section 200.220(a)(1).
¶ 31       Securus argues the broad language of the Commission’s order, as well as the March 6,
       2013, public colloquy between a commissioner and the ALJ, establishes the order was
       intended to establish a generally applicable Commission policy. Securus contends section
       200.220 does not authorize the Commission to issue industry-wide conclusions regarding
       policy or practices in the context of a declaratory ruling. Instead, Securus argues section
       10-101 of the Public Utilities Act governs and provides in part:
               “Any proceeding intended to lead to the establishment of policies, practices, rules or
               programs applicable to more than one utility may, in the Commission’s discretion, be
               conducted pursuant to either rulemaking or contested case provisions, provided such
               choice is clearly indicated at the beginning of such proceeding and subsequently
               adhered to.” 220 ILCS 5/10-101 (West 2012).
       See also 5 ILCS 100/1-70(ii) (West 2012) (a “rule” does not include “informal advisory
       rulings issued under Section 5-150” of the Administrative Procedure Act). Thus, Securus
       argues, the Commission cannot establish a generally applicable policy regarding inmate pay
       telephone services in an order styled as a declaratory ruling. In response, the Commission
       asserts its ruling is a declaratory ruling because it applies only to Consolidated and any
       references to “an entity” in the order are limited to Consolidated offering the services set
       forth in Consolidated’s verified petition for a declaratory ruling.
¶ 32       Securus also maintains Consolidated is not an “affected person” entitled to a declaratory
       ruling. Securus argues that Consolidated’s interest in the existing contract for inmate
       telephone services is moot, as Consolidated no longer provided the services at issue and
       Consolidated’s lawsuit regarding the contract was dismissed by the circuit court of
       Sangamon County. Securus further argues that Consolidated’s assertion that it would like to
       know whether “in the future” charging rates higher than those provided in Part 770 would be
       a violation of the Commission’s regulations does not establish Consolidated is an affected
       person. In response to these arguments, the Commission contends Consolidated is an affected
       person, based on the rejection of Consolidated’s contract bid, the ongoing litigation in
       Sangamon County, and Consolidated’s request for guidance regarding future contract bids.
¶ 33       Neither section 5-150(a) of the Administrative Procedure Act nor section 200.220 of the
       Rules of Practice for the Commission defines the term “declaratory ruling,” and section
       200.220 does not define who is an “affected person.” Accordingly, we resort to basic

                                                 -9-
       principles of judicial interpretation. Administrative regulations are construed according to the
       same standards that govern the construction of statutes; accordingly, the best indicator of the
       agency’s intent is found in the plain, ordinary and popularly understood meaning of the
       language of the regulation. See People v. Hanna, 207 Ill. 2d 486, 497-98 (2003). In this
       regard, we note section 2-701(a) of the Illinois Code of Civil Procedure (Code) (735 ILCS
       5/2-701(a) (West 2010)) provides that a court “may, in cases of actual controversy, make
       binding declarations of rights *** of the rights of the parties interested.” “By the very terms
       of the statute, a declaratory judgment action may not be maintained unless and until an actual
       controversy exists ***.” Great West Casualty Co. v. Cote, 365 Ill. App. 3d 100, 105 (2006).
       An actual controversy is one of the essential elements of an action for declaratory relief. See
       Beahringer v. Page, 204 Ill. 2d 363, 372 (2003). “As used in this phrase, ‘actual’ does not
       mean that a wrong must have been committed and an injury inflicted; rather, the term
       requires a showing that the underlying facts and issues of the case are not moot or premature
       with the result that a court passes judgment upon mere abstract propositions of law, renders
       an advisory opinion, or gives legal advice concerning future events.” Messenger v. Edgar,
       157 Ill. 2d 162, 170 (1993). It is also generally understood that a party seeking declaratory
       relief be “interested” in the controversy. Pekin Insurance Co. v. Cincinnati Insurance Co.,
       157 Ill. App. 3d 404, 406 (1987). “ ‘[I]nterested’ does not mean merely having a curiosity
       about or a concern for the outcome of the controversy [citation]; rather, the party requesting
       the declaration must possess a personal claim, status, or right that is capable of being affected
       by the grant of such relief [citation].” Messenger v. Edgar, 157 Ill. 2d at 171.
¶ 34       The Commission has relied on these basic principles regarding declaratory relief in its
       interpretation of section 200.220(a). Section 200.220 requires a requester of a declaratory
       ruling provide a clear and concise statement of the “controversy or uncertainty” prompting
       the request. 83 Ill. Adm. Code 200.220 (1996). Moreover, in Illinois Industrial Energy
       Consumers’ Request for Declaratory Ruling Pursuant to 200.220 re: Section 16-102 of an Act
       Entitled “Electric Service Customer Choice and Rate Relief Law of 1997,” Ill. Com. Comm’n
       No. 98-0607 (Mar. 10, 1999) (Consumers’ Request), the Commission was asked to clarify the
       meaning of a provision of the Public Utilities Act, but the Commission concluded it had “no
       authority to declare what a particular statute means in some abstract sense.” The Commission
       concluded that the “ ‘controversy or uncertainty’ ” embodied in section 200.220 “must be
       sufficiently immediate or ripe to enable [the Commission] to evaluate and resolve the matter
       with a declaratory ruling.” Id. (citing Weber v. St. Paul Fire & Marine Insurance Co., 251 Ill.
       App. 3d 371 (1993)). The Commission also determined the requesters’ allegations failed to
       establish the requesters were “affected” persons or constituted “a full disclosure of the
       requester’s interest.” (Emphasis added.) Id.; see 83 Ill. Adm. Code 200.220(b)(1) (1996).
       Given the requirement that an “affected person” set forth an actual “controversy or
       uncertainty,” petitions for declaratory relief must establish the issues of the case are not moot
       or premature. See Consumers’ Request, Ill. Commerce Comm’n, No. 98-0607; Continental
       Casualty Co. v. Howard Hoffman & Associates, 2011 IL App (1st) 100957, ¶ 19. It is central
       to the purpose of a proceeding for declaratory relief that it allow the decision-making body to
       take hold of a controversy one step sooner than normally, i.e., after the dispute has arisen, but
       before steps are taken which give rise to claims for damages or other relief. See Kaske v. City
       of Rockford, 96 Ill. 2d 298, 306 (1983); see also Beahringer, 204 Ill. 2d at 372-73.

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¶ 35       Moreover, in Resource Technology Corp. v. Commonwealth Edison Co., 343 Ill. App. 3d
       36 (2003), this court addressed the issue of whether a Commission order was a declaratory
       ruling, as well as whether the order was sought by an affected person. This court first
       observed Illinois case law and Commission actions did not offer much guidance on the types
       of issues that are appropriate subjects for a declaratory ruling, as section 200.220 of the
       Commission’s Rules of Practice was not promulgated by the Commission until 1996. Id. at
       43. We noted the Commission declined to issue a declaratory ruling in Consumers’ Request
       because the Commission concluded it had “ ‘no authority to declare what a particular statute
       means in some abstract sense.’ ” Id. at 44.
¶ 36       The Resource Technology Corp. court rejected a broad interpretation of section 200.220
       urged by the Commission and petitioner Commonwealth Edison (ComEd), reasoning one
       could argue for a declaratory ruling each time the Commission makes a decision concerning
       the Public Utilities Act, as almost everything the Commission does involves the applicability
       of the statute. Id. Accordingly, this court determined that whether the order was a declaratory
       ruling must be determined by examining the substance of ComEd’s petition. Id.
¶ 37       Turning to the substance of ComEd’s petition, the Resource Technology Corp. court
       observed that while ComEd’s petition was “dressed up in language that sought the
       Commission’s view of statutory application,” the petition actually sought to have the
       Commission interpret a 1997 order governing the relationship between ComEd and
       Resources Technology Corp. (RTC). Id. The court also observed “[t]he ‘affected person’ was
       not ComEd, but RTC.” Id. RTC was an intervenor in the proceedings on ComEd’s petition
       for a declaratory ruling. Id. at 41. Accordingly, the court concluded the Commission’s order
       was not a declaratory ruling within the meaning of section 200.220 and denied the
       Commission’s motion to dismiss the appeal. Id. at 44.
¶ 38       In this case, as in Resource Technology Corp., we must determine whether the
       Commission’s order at issue is a declaratory ruling by examining the substance of
       Consolidated’s petition. See id. In its petition for a declaratory ruling, Consolidated alleged
       an actual controversy existed, based on the fact that Consolidated submitted a bid to CMS for
       an inmate services calling contract, which was not accepted. Consolidated also relied upon
       the CPO’s rejection of Consolidated’s bid protest regarding the contract award.
       Consolidated’s petition did not refer to the lawsuit it subsequently filed in the circuit court of
       Sangamon County.
¶ 39       Consolidated’s petition for a declaratory ruling is contrary to the central purpose of
       seeking declaratory relief. At the time of its filing, steps had already been taken which
       allegedly gave rise to claims for damages or other relief. See Kaske, 96 Ill. 2d at 306.
       Consolidated’s petition sought a declaratory ruling regarding the application of a regulation
       to a contract bidding process which had already terminated. Indeed, after losing its bid
       protest, Consolidated filed a claim for damages or other relief. In this most basic sense,
       Consolidated’s petition for a declaratory ruling is obviously untimely, as it sought a ruling
       regarding a course of action Consolidated had already undertaken. Thus, regarding the
       submission of the bid to CMS, any actual controversy or uncertainty is moot. See Continental
       Casualty Co., 2011 IL App (1st) 100957, ¶ 19.
¶ 40       Consolidated also alleged in its petition that an actual controversy existed because it
       needed to know “whether, in the future, it would be acting in violation of a Commission
       regulation if it were to charge higher rates than those established pursuant to § 770.40(c) and

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       (e) to members of the public in connection with the provision of the inmate telephone calling
       services described” in the petition. The record establishes Consolidated is no longer
       providing the services described in its petition. Moreover, Consolidated’s petition fails to
       identify any immediate or concrete set of facts regarding the future provision of these
       services. Furthermore, the specific nature, terms, and conditions of the telephone services
       IDOC may seek to provide to inmates pursuant to future contracts is also unknown.
       Consequently, it is unknown whether Consolidated would be successful in any future bid
       process. Accordingly, Consolidated’s petition can only be construed as seeking an abstract
       opinion on the applicability of the existing regulations under some set of unknown future
       circumstances. Consolidated’s claim to be an affected person thus presents precisely the type
       of abstract and conjectural interest the Commission rejected in Consumers’ Request.
¶ 41        The Commission concluded Consolidated was an affected person in part because of
       pending litigation brought by Consolidated as to the contract award. Although not alleged in
       the petition for a declaratory ruling, Consolidated’s reply to Securus further relied upon the
       fact that the award of the contract is the subject of ongoing litigation. On this point, we note
       Consolidated and the Commission staff initially took the position in these proceedings that
       the litigation in the circuit court of Sangamon County was immaterial or irrelevant to
       Consolidated’s statement of its interest in the petition for a declaratory ruling. Securus argued
       it was improper for Consolidated to file its verified petition for the purpose of advancing
       Consolidated’s position in the litigation. Thus, in this case, only the Commission concluded
       the litigation was material and a basis to conclude Consolidated was an “affected person”
       under section 200.220. The Commission’s order, however, contains no explanation for this
       conclusion.
¶ 42        More significantly, the Commission’s conclusion in this respect is inexplicable, given our
       decision in Resource Technology Corp. The Commission attempts to distinguish Resource
       Technology Corp. as a case where the Commission was interpreting a prior order governing
       the relationship between ComEd and RTC, rather than issuing a declaratory ruling. See
       Resource Technology Corp., 343 Ill. App. 3d at 44. Similar to Resource Technology Corp.,
       however, Consolidated has requested a declaratory ruling after litigation has commenced in
       another forum, contrary to the basic point of seeking a declaratory ruling. See Kaske, 96 Ill.
       2d at 306. In addition, as in Resource Technology Corp., the actual “affected person” in this
       case would be the intervenor and successful bidder, Securus. See Resource Technology
       Corp., 343 Ill. App. 3d at 44. Accordingly, we conclude Resource Technology Corp. is
       applicable to this case.
¶ 43        In addition, Consolidated’s lawsuit was dismissed by the circuit court of Sangamon
       County based on Consolidated’s lack of standing to sue and the doctrine of sovereign
       immunity. These issues are issues unrelated to the subject of Consolidated’s petition and the
       Commission’s order. Thus, even assuming for the sake of argument that the dismissal was
       reversed on appeal, the effect of a declaratory ruling upon the litigation–if any–is unknown,
       as the record on appeal does not describe all of the issues which may be involved in the
       litigation. It is also unclear whether a declaratory ruling issued after the contract was already
       awarded to Securus would affect the outcome of the litigation. There is no indication in this
       record that the Commission’s order would have any effect on the ongoing litigation. Thus,
       Consolidated’s supposed interest in obtaining a declaratory ruling based on pending litigation
       ultimately is hypothetical or conjectural.

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¶ 44        In short, Consolidated’s allegations regarding the submission of its contract bid do not
       establish an actual controversy because that controversy is moot. Consolidated’s allegations
       regarding its possible future activities are too abstract and hypothetical to constitute a full
       statement of the requester’s interest. Neither Consolidated nor the Commission established
       the ongoing litigation in Sangamon County would be affected by the Commission’s order.
       Accordingly, for all of the aforementioned reasons, we conclude the Commission’s order in
       this case was not a declaratory ruling, as the party requesting the order was not an affected
       person and there was no controversy or uncertainty within the meaning of section 200.220 of
       the Commission’s regulations. Accordingly, the Commission’s order is not a nonreviewable
       declaratory ruling under section 200.220(i). See Resource Technology Corp., 343 Ill. App. 3d
       at 44.
¶ 45        Our resolution of the jurisdictional question, however, is decisive on the merits of the
       propriety of the Commission’s order. In evaluating the propriety of an order issued by the
       Commission, our scope of review is governed by section 10-201 of the Public Utilities Act
       (see 220 ILCS 5/10-201 (West 2012)). Section 10-201 provides in relevant part that a
       reviewing court shall reverse a Commission’s order or decision, in whole or in part, if it finds
       that: (a) the findings of the Commission were not supported by substantial evidence based on
       the entire record of evidence presented to or before the Commission for and against such
       order or decision; (b) the order or decision was without the jurisdiction of the Commission;
       (c) the order or decision was in violation of the state or federal constitution or laws; or (d) the
       proceedings or manner by which the Commission considered and entered its order or
       decision were in violation of the state or federal constitution or laws, to the prejudice of the
       appellant. 220 ILCS 5/10-201(e)(iv) (West 2012).
¶ 46        In this case, based on our foregoing analysis, the decisive issue is whether the
       Commission’s ruling was made outside the jurisdiction of the Commission. “ ‘The term
       “jurisdiction,” while not strictly applicable to an administrative body, may be employed to
       designate the authority of the administrative body to act ***.’ ” Business & Professional
       People for the Public Interest, 136 Ill. 2d at 243 (quoting Newkirk v. Bigard, 109 Ill. 2d 28, 36
       (1985)). As our supreme court has stated:
                “[I]n administrative law, the term ‘jurisdiction’ has three aspects: (1) personal
                jurisdiction–the agency’s authority over the parties and intervenors involved in the
                proceedings, (2) subject matter jurisdiction–the agency’s power ‘to hear and
                determine causes of the general class of cases to which the particular case belongs’
                [citation], and (3) an agency’s scope of authority under the statutes.” Id.
       “Consequently, to the extent an agency acts outside its statutory authority, it acts without
       jurisdiction.” Id. Thus, for example, this court vacated portions of a Commission order which
       constituted a declaratory ruling prior to the promulgation of section 200.220. See
       Harrisonville Telephone Co. v. Illinois Commerce Comm’n, 176 Ill. App. 3d 389, 393 (1988).
¶ 47        The Commission purported to act pursuant to section 5-150(a) of the Administrative
       Procedure Act and section 200.220 of the Commission’s Rules of Practice, which empower
       the Commission to issue declaratory rulings. As previously noted, when requested by an
       affected person, the Commission may issue a declaratory ruling where there is a clearly
       stated controversy or uncertainty. For the reasons already stated, Consolidated was not an
       “affected person” entitled to request a declaratory ruling from the Commission and
       Consolidated failed to clearly state an actual controversy or uncertainty. Thus, we conclude

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       the Commission’s order was outside the Commission’s authority under the Administrative
       Procedure Act and the Commission’s own implementing regulation. See Harrisonville
       Telephone Co., 176 Ill. App. 3d at 393. Accordingly, the Commission’s order must be
       vacated. Moreover, as the Commission lacked jurisdiction to enter the order at issue in this
       case, we need not address the merits of the Commission’s ruling as this court was required to
       do in Resource Technology Corp.

¶ 48                                       CONCLUSION
¶ 49      For all of the aforementioned reasons, the Commission’s April 9, 2013, order is vacated.
       The Commission’s May 1, 2013, order denying rehearing is similarly vacated.

¶ 50      Vacated.

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