Court Opinion

ID: 8483111
Source: CourtListenerOpinion
Date Created: 2022-11-10 20:12:44.567158+00
Date Added: 2024-06-11T16:49:44.036160
License: Public Domain

FILED
                                                                                 November 10, 2022
                                                                                          released at 3:00 p.m.
                                                                                      EDYTHE NASH GAISER, CLERK
                                                                                      SUPREME COURT OF APPEALS
                                                                                           OF WEST VIRGINIA

No. 22-0351 – Mason County Public Service District v. The Public Service Commission
              of West Virginia and Ralph and Carla Huff

WOOTON, Justice, dissenting, joined by Chief Justice Hutchison:

                The complainants, Ralph and Carla Huff, had their water service terminated

due to nonpayment and later sought to have that service reconnected. The petitioner,

Mason County Public Service District (“the District), charged the Huffs separate fees for

disconnection of water service ($50.00) and then for reconnection ($50.00). The Huffs

complained to the respondent, The Public Service Commission (“PSC”), that they were

required to pay the arrearage they owed before the District would restore their water

service, raising no specific complaint as to either the disconnect fee or the reconnect fee.

Nonetheless, the PSC exercised jurisdiction over the fee issue, determining that the

disconnect fee was not really a fee, but “the practice” of charging a disconnect fee. The

PSC determined that the District’s “practice” of charging a disconnect fee was an

“unreasonable practice” under the PSC’s jurisdictional authority as set forth in West

Virginia Code section 24-2-7(a) (2018). 1 See also W. Va. Code § 24-2-1(b)(2) & (7) (Supp.

       1
           West Virginia Code § 24-2-7(a) provides:

                (a) Whenever, under the provisions of this chapter, the
                commission shall find any regulations, measurements,
                practices, acts or service to be unjust, unreasonable,
                insufficient or unjustly discriminatory, or otherwise in
                violation of any provisions of this chapter, or shall find that any
                                                1
2022). 2 The majority affirms the PSC’s exercise of jurisdiction in this case and, in so

doing, disregards the Legislature’s 2015 transfer of the authority to set rates, fees and

               service is inadequate, or that any service which is demanded
               cannot be reasonably obtained, the commission shall determine
               and declare, and by order fix reasonable measurement,
               regulations, acts, practices or services, to be furnished,
               imposed, observed and followed in the state in lieu of those
               found to be unjust, unreasonable, insufficient, or unjustly
               discriminatory, inadequate or otherwise in violation of this
               chapter, and shall make such other order respecting the same
               as shall be just and reasonable.
      2
          West Virginia Code section 24-2-1(b)(2) & (7) provides:

               (b) The jurisdiction of the commission over political
               subdivisions of this state providing separate or combined water
               and/or sewer services and having at least 4,500 customers and
               annual combined gross revenues of $3 million or more that are
               political subdivisions of the state is limited to:

                      ....

               (2) Regulation of measurements, practices, acts, or services,
               as granted and described in § 24-2-7 of this code;

                      ....

               (7) Customers of water and sewer utilities operated by a
               political subdivision of the state may bring formal or informal
               complaints regarding the commission’s exercise of the powers
               enumerated in this section and the commission shall resolve
               these complaints: Provided, That any formal complaint filed
               under this section that is based on the act or omission of the
               political subdivision shall be filed within 30 days of the act or
               omission complained of and the commission shall resolve the
               complaint within 180 days of filing. The 180-day period for
               resolution of the dispute may be tolled by the commission until
               the necessary information showing the basis of the matter
               complained of is filed by the political subdivision: Provided,
               however, That whenever the commission finds any regulations,
                                              2
charges for a Locally Rate Regulated Public Service District (“LLR”), which includes the

District, from the PSC to the county commission which created the PSD. See W. Va. Code

§ 16-13A-9(a)(2)(E) (2021). 3 Therefore, I respectfully dissent.

                measurements, practices, acts, or service to be unjust,
                unreasonable, insufficient, or unjustly discriminatory, or
                otherwise in violation of any provisions of this chapter, or finds
                that any service is inadequate, or that any service which is
                demanded cannot be reasonably obtained, the commission
                shall determine and declare, and by order fix reasonable
                measurement, regulations, acts, practices, or services, to be
                furnished, imposed, observed, and followed in lieu of those
                found to be unjust, unreasonable, insufficient, or unjustly
                discriminatory, inadequate, or otherwise in violation of this
                chapter, and shall make such other order respecting the same
                as shall be just and reasonable: Provided further, That if the
                matter complained of would affect rates, fees, and charges so
                fixed by the political subdivision providing separate or
                combined water and/or sewer services, the rates, fees, or
                charges shall remain in full force and effect until set aside,
                altered, or amended by the commission in an order to be
                followed in the future.
       3
           West Virginia Code section 16-13A-9(a)(2)(E) provides:

                (2) The board of a public service district with at least 4,500
                customers and annual combined gross revenue of $3 million
                providing water or sewer service separately or in combination
                may make, enact, and enforce all needful rules in connection
                with the enactment or amendment of rates, fees, and charges
                of the district. At a minimum, these rules shall provide for:

                       ....

                (E) Rates, fees, and charges approved by resolution of the
                board shall be forwarded in writing to the county commission
                with the authority to appoint the members of the board. The
                county commission shall publish notice of the proposed
                revised rates, fees, and charges by a Class I legal
                                                3
               This Court recognized the transfer of the authority to set rates, fees and

charges from the PSC to the District, an LLR, in Pool v. Greater Harrison County Public

Service District, 241 W. Va. 233, 821 S.E.2d 14 (2018), as follows:

                     Prior to 2015, when any public service district wanted
              to change the rates it charged for water or sewer service, state
              law required the public service district to obtain approval from
              the PSC. In 2015, the Legislature adopted deregulation
              measures to limit the PSC’s jurisdiction and to exempt larger
              public service districts from this requirement. After 2015,
              “larger” public service districts are statutorily defined as
              having at least 4,500 customers and are only required to obtain
              approval of a rate change from a local elected body, such as a
              county commission. The Legislature based the 2015
              amendments on its finding that larger public service districts
              are “most fairly and effectively regulated by the local
              governing body with respect to rates, borrowing and capital
              projects.” W.Va. Code § 24-1-1(j) [2015].

241 W. Va. at 236, 821 S.E.2d at 17 (emphasis added and footnotes omitted). We also

stated in Pool that

                     [t]he Legislature plainly intended to limit the PSC’s
              jurisdiction when it adopted West Virginia Code §§ 16-13A-

              advertisement in compliance with the provisions of § 59-3-1
              et seq. of this code. Within 45 days of receipt of the proposed
              rates, fees, and charges, the county commission shall take
              action to approve, modify, or reject the proposed rates, fees,
              and charges, in its sole discretion. If, after 45 days, the county
              commission has not taken final action to approve, modify, or
              reject the proposed rates, fees, and charges, as presented to the
              county commission, shall be effective with no further action
              by the board or county commission. In any event, this 45-day
              period shall be mandatory unless extended by the official
              action of both the board proposing the rates, fees, and charges,
              and the appointing county commission.

                                              4
              9(a)(2) and 24-2-4a. When the Legislature modified those
              statutes in 2015, it perceived that the water and sewer rates
              charged by larger public service districts are best regulated by
              local elected officials and not the PSC. See W.Va. Code § 24-
              1-1(j). These statutes limited the PSC to regulating only the
              rates charged by smaller public service districts.

241 W. Va. at 240, 821 S.E.2d at 21 (emphasis added).

              Notwithstanding this Court’s acknowledgment of the District’s jurisdiction

to fix its rates and fees it charges and the Legislature’s action in limiting the jurisdiction of

the PSC in this regard, in the instant case the majority simply disregards the legislative

grant of authority to the District. Critically, West Virginia Code section 16-13A-9

expressly allows the District to establish fees in accordance with the provisions of West

Virginia Code sections 16-13A-1 to -25 (2021), entitled “Public Service Districts,” as

follows:

              (a)(1) The board may make, enact, and enforce all needful rules
              in connection with the acquisition, construction, improvement,
              extension, management, maintenance, operation, care,
              protection, and the use of any public service properties owned
              or controlled by the district. The board shall establish, in
              accordance with this article, rates, fees, and charges for the
              services and facilities it furnishes, which shall be sufficient at
              all times, notwithstanding the provisions of any other law or
              laws, to pay the cost of maintenance, operation, and
              depreciation of the public service properties and principal of
              and interest on all bonds issued, other obligations incurred
              under the provisions of this article, and all reserve or other
              payments provided for in the proceedings which authorized the
              issuance of any bonds under this article. The schedule of the
              rates, fees, and charges may be based upon:

                                               5
                      ....
              (E) Any other basis or classification which the board may
              determine to be fair and reasonable, taking into consideration
              the location of the premises served and the nature and extent
              of the services and facilities furnished.

Id. § 16-13A-9(a)(1)(E) (emphasis added). Accordingly, the District did exactly that which

the Legislature commanded: it adopted and approved charges for the services and facilities

it furnishes to “pay for the cost of maintenance, operation, and depreciation” of its

“properties and principal of and interest on all bonds issued, other obligations incurred

under the provisions of this article, and all reserve or other payments provided for in the

proceedings which authorized the issuance of any bonds under this article.” Id. The

District represented that it

              is the largest physical public service district (“PSD”) in the
              state – with 519 miles of main, serving all of the
              unincorporated areas of Mason County and reaching into three
              other counties. The average round trip from the District’s home
              base to terminate water service is 60 miles and takes two hours
              of personnel time. On average, the District incurs expenses of
              $116.10 per disconnection or reconnection performed. The
              disconnect and reconnect fees do not fully recover the
              District’s expenses in performing these services; however,
              these fees diminish the extent to which the District’s regular
              paying customers subsidize those who fail to make
              arrangements to continue service.
(Internal citations to appendix record omitted).

              Despite the District’s express grant of statutory authority to establish its rates

and fees using a cost-based approach, the PSC undertook its own investigation into whether

                                              6
the disconnect and reconnect fees charged in this case were reasonable. The PSC based its

exercise of its jurisdiction on its conclusion that the “disconnect fee” was not actually a fee

but a “practice of charging the fee.” W. Va. Code § 24-2-1(b)(2) & (7) and § 24-2-7(a);

see supra notes 1 & 2.

              In support of its position, the PSC first relied upon its Rules for the

Government of Water Utilities, W. Va. Code R. §§ 150-7-1 to -11.7.6 (2021) (“Water

Rules”). The PSC argued that under the Water Rules, customers can only be charged

reconnect fees, not disconnect fees. See id. § 150-7-6.8.3.a (effective September 14, 2021). 4

The PSC also argues that historically it has disfavored disconnect fees and denied requests

by utilities to charge such fees because “disconnect fees amount to a double-recovery

       4
         West Virginia Code of State Rules section 150-1-6.8.3.a allows for a charge for
reconnection of water supply as follows: “Whenever the supply of water is turned off for
violation of rules, non-payment of bills, or fraudulent use of water, the utility may make a
charge as set forth in its tariff for reestablishment of service.” Id. (emphasis added).
However, neither party mentioned nor argued the fact that the Water Rules also provide
for a “disconnect fee” under the express subsection heading “Utility discontinuance of
service” as follows:

              6.8.2. Once a disconnected customer has paid his delinquency
              in full, or the utility has agreed to enter into a deferred payment
              agreement with the customer, and all disconnect and/or
              reconnect fees have been paid, the utility shall reconnect the
              customer’s water service as soon as possible but no later than
              twenty-four (24) hours from the time the customer pays all
              disconnect and reconnect fees.

Id. (emphasis added). Moreover, a review of the Water Rules reveals no clearly expressed
“disapproval” of disconnect fees.
                                              7
because expenses associated with disconnecting services are part of it operation and

maintenance expenses for which the Commission or the county commission allows

recovery when establishing service rates.” See Jane Lew Pub. Serv. Dist., Case No. 08-

1867-PWD-T-PC-CN, at p.15 (Recommended Decision entered Mar. 13, 2009) (“It is

reasonable to deny the inclusion of a disconnection fee in Jane Lew’s tariff since it is

current Commission policy to only allow a disconnection fee when a water utility is

termination water service for a delinquent sewer bill under contract with a sewer utility.”)

and Fountain Pub. Serv. Dist., Case No. 09-0443-PWD-T-PW, at 2 (Recommended

Decision entered Sept. 8, 2009) (“Allowing a water utility to impose a disconnect fee may

ostensibly result in double recovery by the utility, since normally this cost of service item

is recouped in a utility’s base rates.”).

               Despite the PSC’s claim that its Water Rules only allow fees for reconnecting

service, not disconnecting it, and its pronouncement that disconnect fees are disfavored, 5

       5
         Interestingly, neither party mentions the order entered in Mason County Public
Service District and Point Pleasant Water Works, Case No. 08-1831-PSD-W-PC-T
(Commission Order entered January 28, 2009), wherein the Commission, discussing
certain fees including disconnect, reconnect, and administrative, explains that
                      [r]egarding approval of the fees, it is established
               Commission policy to permit utilities, with the exception of
               motor carrier utilities, to institute a charge for disconnecting
               and reconnecting customers who are disconnected due to
               failure to pay bills, provided the charge is reasonable and is
               reflected in the utility’s tariff on file with the Commission.
               Arlington & Glen Falls Water Ass’n, Case No. 95-1234-W-T
               (Comm’n Order Aug. 7, 1996). The Commission policy is
                                              8
neither of the relevant Water Rules nor the aforementioned recommended decisions

support the PSC’s overarching position in regard to the determinative jurisdictional issue:

that a disconnect fee is not actually a fee but rather a “practice of charging the fee.” Indeed,

the recommended decisions and the Water Rules belie the PSC’s argument, as there is no

mention of a disconnect fee “practice” discussed in either. In short, what is readily gleaned

from an examination of the foregoing is that the PSC created its “practice of charging the

fee” rubric out of whole cloth in order to justify its exercise of jurisdiction under the

auspices of West Virginia Code section 24-2-1(b)(2) & (7) and section 24-2-7(a). See

supra notes 1 & 2.

               The PSC’s assertion of jurisdiction – which is, essentially, an argument that

its general grant of jurisdictional authority trumps the specific grant of jurisdictional

authority given to LLRs and the District – is untenable under our well-established rules of

statutory construction. Ordinarily, where two statutes apply to the same subject matter, the

more specific statute prevails over the general statute. “When faced with a choice between

              based on reasoning that a utility should be permitted to recover
              costs associated with disconnecting and reconnecting a
              delinquent customer directly from the customer incurring the
              cost in order to directly match the cost causer to the cost, rather
              than spreading the cost throughout the entire customer base.
No. 08-1831-PSD-W-PC-T, at p. 2 (emphasis added). However, the existence of any PSC
policy disfavoring the assessment of a disconnect fee is of no moment to the determinative
issue in this case, which is that the PSC lacks jurisdiction over LLR’s in regard to the
establishment of rates and fees. See W. Va. Code § 16-13A-9(a)(1)(E).

                                               9
two statutes, one of which is couched in general terms and the other of which specifically

speaks to the matter at hand, preference generally is accorded to the specific statute.”

Newark Ins. Co. v. Brown, 218 W. Va. 346, 351, 624 S.E.2d 783, 788 (2005) (emphasis

added). We previously have held that “[t]he general rule of statutory construction requires

that a specific statute be given precedence over a general statute relating to the same subject

matter where the two cannot be reconciled.” Syl. Pt. 1, UMWA by Trumka v. Kingdon, 174

W. Va. 330, 325 S.E.2d 120 (1984) (emphasis added). Accordingly, between the general

authority of the Commission to investigate unreasonable acts or practices by a utility, § 24-

2-7, and the specific delegation of authority to LLRs and locally elected county

commissions to enact rates, fees and charges, § 24-1-1 (j) and § 16-13A-9(a), the specific

grant of authority prevails.

              To hold otherwise, as the majority has done in this case, invalidates the

District’s statutory jurisdiction to impose a disconnect fee based solely on the PSC’s use

of semantics. The majority’s decision to uphold the PSC’s exercise of jurisdiction over the

disconnect fees herein effectively transfers jurisdiction over any “rates, fees, and charges”

established by an LLR for the services and facilities it furnishes, see W. Va. Code § 16-

13A-9(a)(1)(E), back to the PSC. Stated otherwise, anytime the PSC decides it wants to

exercise jurisdiction in a case, all it has to do in order to circumvent the Legislature’s

transfer of jurisdiction to LLRs is to designate the fees as “measurements, practices, acts,

                                              10
or services.” See id. § 24-2-1(b)(2) & (7). This clearly was not what the Legislature

intended.

              Based upon the foregoing, I respectfully dissent. I am authorized to state that

Chief Justice Hutchison joins in this dissenting opinion.

                                             11