Court Opinion

ID: 9681432
Source: CourtListenerOpinion
Date Created: 2023-08-24 07:50:07.890742+00
Date Added: 2024-06-11T18:17:33.964312
License: Public Domain

BLACKMAR, Judge,
dissenting.
I agree that the matters properly preserved for review were not rendered moot by subsequent rate proceedings. I believe, however, that the decision of the Public Service Commission was properly entered and within its authority, and so would reverse the judgment of the circuit court and remand with directions to sustain that order.
In 1980 the Public Service Commission approved a “rate design” showing how the charges for the sale and distribution of its product were to be allocated among various classes of customers. The “industrial users,” who are the parties challenging the Commission’s 1983 order and are respondents here, participated in the proceedings and consented to the rate design.1 In two subsequent rate proceedings these customers made no protest of uniform rate increases based on the existing rate design.2 It is reasonable to hold that the rate design so approved and perpetuated has presumptive validity.
The rate design distinguishes between large and small volume customers. For small volume customers there is a monthly customer charge, higher during the winter months, a per therm3 charge for the first 65 therms consumed in any month and a lower per therm charge for the excess. There is some variation among customers in different geographic areas. For large volume service there is a monthly customer charge, much higher than for residential users, a per therm “demand charge,” which is paid whether or not the full quantity paid for is used, and a “commodity charge” per therm which is substantially lower than the commodity charge to residential customers. Volume purchasers may also contract for “interruptible service” in which no demand charge is assessed. The profit factor from gas supplied to the several classes of customers is not readily apparent from examination of the rate design, but rather requires analysis.
The present proceeding began with Lac-lede’s claim that it was entitled to a rate increase because of increased costs of distribution.4 No party seriously challenged its claim that it was entitled to more money. The only protest came from the industrial users, who argued that a new rate design was in order because, under the existing rate design, the rates charged them were disproportionate to the cost of servicing them, so that they were effectively subsidizing other customers.
The Public Service Commission heard their evidence and decided that it had internal flaws, by reason of which it was not persuasive of a need to change the rate design. One problem is that it was based on a study of costs during the year 1976. It was also based on a limited sample. The Commission was not obliged to accept this evidence, even though no other cost studies were presented in the proceeding then pending. The Commission has the same prerogative that any trier of the fact has. State ex rel. Rice v. Public Service Commission, 359 Mo. 109, 220 S.W.2d 61 (1949). It set forth its reasons for rejecting the industrial users’ evidence, in great detail.
The groundwork for the existing rate design had already been laid in prior proceedings. In a long-range matter such as rate design, the Commission was justified *798in imposing on the industrial users the burden of demonstrating that a change should be made. It could make use of all of the data and studies supporting the existing rate design and could properly order a uniform increase in rates, based on the existing rate design, in order to compensate Laclede for its increased costs of distribution.
The procedural arguments in opposition to the Commission’s order are not substantial. Complaint is made that the Commission adopted a nonunanimous stipulation, citing State ex rel. Fischer v. Public Service Commission, 645 S.W.2d 39 (Mo.App.1982), cert. denied 464 U.S. 819, 104 S.Ct. 81, 78 L.Ed.2d 91 (1983). The point is not well taken. The Commission was careful to avoid the problems in Fischer, in which there was a non-unanimous stipulation and a limited hearing. The Commission accepted the stipulation as representing the positions of the parties agreeing to it, and afforded the industrial users a full hearing with opportunity to offer all the evidence they desired on the points they placed in issue. Having done this, it was perfectly entitled to express its agreement with the stipulating parties and to make use of the stipulation in framing its findings and conclusions. The practice is similar to that of a circuit judge, who may invite all parties to submit requested findings and conclusions, and may then adopt and enter those which he considers to be supported by the record.
Nor is the Commission’s decision infirm because of inadequacy in its findings and conclusions.5 The findings respond to the issue presented by the industrial users, that is, whether the existing rate design was faulty. There was no need to repeat the rationale of the prior proceedings in which the rate design was established. The only required affirmative finding is that the increased costs of distribution make it necessary for the utility to have more money. State ex rel. Fee Fee Trunk Sewer, Inc. v. Public Service Commission, 550 S.W.2d 945 (Mo.App.1977) is not in point because the findings here as to the existing rate design and the increased need, though brief, are dispositive. Fee Fee lacked the starting point of a prior rate design proceeding and held that the Commission had a duty to go forward to show what rates were proper on the basis of admitted increases in cost, even though it was not satisfied with the applicant’s evidence and conclusions. Here, the criticism of the industrial users’ evidence responds to their request for change.
The circuit court was wrong in holding that “the Commission erred in allocating the rate increase in proportion to revenues which included purchased gas revenues.” Inasmuch as the existing rate design was presumably correct, it was entirely proper to allow for increased cost of distribution by approving the uniform percentage increases to the established rates.
The circuit court also went wrong in holding that the Commission’s order lacked evidentiary support. It matters not that the only evidence in the record as to the propriety of the rate design was that of the industrial users. They had the burden of showing that the existing rate design was inappropriate and, if they fail to do so, the Commission is justified in denying the relief sought. It does not have to replow the *799ground of the earlier rate design proceedings.
No error is shown in the Commission’s evidentiary rulings. The Commission has wide discretion as to its own procedures. It could properly call on the parties to prefile their testimony, and could maintain the integrity of its ruling by excluding direct testimony which was not prefiled. It could also reject exhibits belatedly offered, on the ground that the other parties did not have the chance to inspect and to respond to them. It had no duty to reopen the record. It is important to move rate cases promptly, and the Commission may insist on strict scheduling.
The Commission has demonstrated its adherence to its duty by directing reconsideration of the rate design, and directing the utility to provide revised cost studies. Rate making and rate design are continuing processes. Flaws may not be capable of immediate adjustment; correction may be a continuing process. The Commission is better equipped than courts are to determine the suitability of technical studies and to direct studies on its own. The principal opinion countenances a serious interference with the Commission’s proceedings by sanctioning a premature alteration of the rate design.
The principal opinion also errs in directing return of the funds paid pursuant to the stay order. It remands the case to the Public Service Commission to correct the perceived inadequacies in evidence and findings. The Commission’s revised order may hold that Laclede is entitled to all or part of the impounded funds. It is more practical, and neither illegal nor inequitable, to provide for the retention of these funds pending final adjudication. The funds are earning interest, which will inure to the benefit of the parties ultimately found to be entitled.
The judgment of the circuit court should be reversed and the case remanded with directions to enter an order sustaining the decision of the Commission.

. Commission Case No. GO 78-38 involved the filing of numerous cost of service studies, was the product of years of prolonged work by the parties, including the Industrial Intervenor’s, and was resolved by stipulation of all the parties, except Public Counsel.

. Commission Case No. GR-82-158; Case No. GR-82-200.

. A therm is a unit of the quantity of heat; one therm is the equivalent of 100,000 British thermal units or 100 cubic feet of gas. Webster’s New Third International Dictionary (3d ed. 1981).

.Increases in the cost of gas supplied to Lac-lede by its wholesale distributor are automatically passed on to Laclede’s customers through a procedure approved by the Public Service Commission.

. In its Report and Order, the Commission provided specific findings to support its conclusions 1) that the Industrial Intervenor’s cost of service study, due to its flaws and deficiencies should be rejected; 2) that, with the agreement of all parties, on or before May 15, 1984, the company would institute a proceeding concerning the appropriateness of its overall rate design; and 3) that, because it was based on the contribution of cost of service studies by all factions of Laclede’s ratepayers, it was more reasonable to maintain the present rate design
than to adopt the discredited cost of service study tendered by a single body of ratepayers.
The Commission’s findings leave no doubt as to "what part of the evidence it will believe and find to be true and what part it will reject," and thus meet the standard required for findings of fact for administrative agencies. Century State Bank v. State Banking Board of Missouri, 523 S.W.2d 856, 859 (Mo.App.1975); State ex rel. Fischer v. Public Service Commission, 645 S.W.2d 39, 42 (Mo.App.1982), cert. denied 464 U.S. 819, 104 S.Ct. 81, 78 L.Ed.2d 91 (1983).