State Regulatory Relations

NARUC Water Committee Chairman John E. Howard

NARUC Names New Water Committee Chairman

Commissioner John E. “Butch” Howard, vice chairman of the South Carolina Public Service Commission has been named chairman of the NARUC Water Committee.

Vice Chairman Howard assumed his commissionership on March 4, 2004, and was elected vice chairman in July 2008.

Vice Chairman Howard received a BS in business administration at the University of South Carolina. He has attended numerous regulatory schools including:

• Regulatory Studies Program - 2004
• NARUC Utility Rate School - 2005
• Institute of Regulatory Law and Economics - 2005
• National Judicial College - 2006
• Merging Issues - 2007

Vice Chairman Howard served in the U.S. Army from 1963–1966. While stationed in Germany, he served on the board of Frankfort Area American Youth Activities.

Vice Chairman Howard has been active in many different organizations, including: Boy Scouts of America; Girl Scouts of America; Palmetto Touchdown Club; Kiwanis Club of Charleston; Charleston Trident Chamber of Commerce; Charleston Advertising Federation; Blessed Sacrament School Board; St. Joseph Parish Council; St. Joseph’s Men’s Club; South Carolina Trucking Association; South Carolina Trucking Association Safety Council; Southeastern Association of Regulatory Commissioners (SEARUC); and the Greater Charleston Printer’s Association.

Vice Chairman Howard was previously the vice chair of the Water Committee. He replaces outgoing Water Committee chairman, Commissioner David King.

NARUC Elects New President

NARUC President David Coen

Vermont Public Service Board Commissioner David Coen has been elected president of the National Association or Regulatory Commissioners. Commissioner Coen replaces outgoing President Frederick Butler of New Jersey, whose term expired Nov. 18. Under the NARUC Constitution, association presidents serve one-year terms.

NARUC members also elected Commissioner Tony Clark of North Dakota as first vice president and Commissioner Susan Parker of Alabama as second vice president; each will serve one-year terms.

“My aim as NARUC president was to break down the silos between state and federal agencies and better serve our constituents,” said Immediate Past President Butler. “As I reflect on the past year, I believe we have accomplished a great deal and I am grateful that NARUC is so well-positioned to impact our nation’s utility policy debates. I want to thank my colleagues and staff for their hard work and support, and I congratulate President Coen, First Vice President Clark, and Second Vice President Parker on their elections.”

“I am truly humbled to lead this association,” President Coen said. “With Congress and the Administration debating profound changes to our utility landscape, our role as state regulators will be critical to ensuring consumer protection and reliable service. We as a nation are facing changing times, and regulators must remain focused on the public interest. I look forward to working with my colleagues and congratulate Commissioners Clark and Parker on their elections. I also want to particularly thank Commissioner Butler for his inclusive leadership this past year.”

As president, Commissioner Coen will provide general oversight of the association. He will serve as NARUC’s primary voice, leading the association before Congress, the courts and administrative agencies. He will also be responsible for designating members to the NARUC board of directors and other association committees.

President Coen was appointed to the Vermont Public Service Board in June 1995 and subsequently reappointed for two successive terms. He is a vice chairman of the Consumer Affairs Committee, chairman of the National Regulatory Research Institute’s board of directors, and a member of NARUC’s Electricity, Gas, and Finance and Technology committees. President Coen also serves on the Subcommittee on Nuclear Issues – Waste Disposal, and the Task Force on Climate Policy.

President Coen holds a bachelor’s degree from Colgate University and pursued graduate study at Trinity College, Hartford, Conn. Before joining the Vermont PSB, his government service included the Vermont Goals 2000 Commission, the Lake Champlain Management Conference, and the Governor’s Blue Ribbon Commission on Educational and Municipal Financing Reform. He also served as Deputy Mayor, Alderman, and Water Commissioner in the City of Vergennes. He has held a wide variety of community leadership positions, including serving on and/or chairing the boards of directors of the Vermont Business Roundtable, the Addison County Chamber of Commerce, the Addison County Regional Economic Development Corporation, Porter Medical Center and the Snelling Center for Government. He previously served as president and CEO of Fishman’s Department Stores.

NARUC Elects Officers

NARUC Vice President Tony Clark

NARUC Vice President Tony Clark

First Vice President Clark was elected to the North Dakota Public Service Commission in 2000 and won reelection in 2006. Within NARUC, he served as chairman of the association’s Telecommunications Committee from 2005–2008 and is a member of the Executive Committee, the board of directors and the Electricity Committee. First Vice President Clark also serves on the board of directors of the National Regulatory Research Institute. Prior to his election to the PSC, he was Labor Commissioner in the cabinet of former Gov. Ed Schafer. From 1997–1999, he was the administrative officer for the State Tax Department. He is a former state legislator, representing Fargo in the State House from 1994–1997. First Vice President Clark is a graduate of Fargo North High School and holds bachelor’s degrees from North Dakota State University. He holds a master’s degree in public administration from the University of North Dakota.

Vice President Susan Parker

Vice President Susan Parker

Second Vice President Susan Parker was elected to the Alabama Public Service Commission in 2006. Within NARUC, she serves on the Executive Committee, the Electricity Committee and the Subcommittee on Education and Research. In addition, she serves as president of the Southeastern Association of Regulatory Utility Commissions and is a member of the Gas Technology Institute Advisory Board. Prior to becoming involved in politics, Second Vice President Parker had a 25-year career in public education.

In 1972, at the age of 16, she started working at Calhoun Community College as a file clerk and rose through the ranks to become an associate dean. Parker worked her last eight years in higher education at Athens State University, where she served as development officer and assistant to the president.

NARUC Treasurer Charles Box

NARUC Treasurer Charles Box

Chairman Charles Box of the Illinois Commerce Commission remains as treasurer of the association. He was confirmed to the position by the NARUC membership in November 2008. Chairman Box was appointed to the ICC in January 2006. Before that, he served 12 years, from 1989-2001, as mayor of Rockford, Ill. He has also served as the city’s administrator and legal director.

Commissioner Philip Jones

Commissioner Philip Jones

Additionally, NARUC President David Coen of Vermont appointed Commissioner Philip Jones of Washington to the association’s Executive Committee, replacing Commissioner Marsha Smith of Idaho, whose term on the committee expired. Commissioner Jones was also appointed to the NARUC board of directors.

NARUC Passes IFRS Resolution at Annual Convention

At the NARUC 121st Annual Convention the NARUC Board of Directors adopted a resolution pertaining to an accounting rule critical to the utility industry.

The resolution, titled Resolution on the International Accounting Standards Board (IASB) Exposure Draft Regarding Rate-Regulated Activities, commends the IASB for seeking comments and gathering input on rate-regulated activities, directs NARUC to file comments on the International Accounting Standards Board Exposure Draft ED/2009/8 regarding rate regulated activities, and encourages NARUC members to also file comments.

The resolution states that NARUC “generally supports the stated objectives to (a) establish criteria for the recognition of assets and liabilities arising from rate regulation; (b) clarify that regulated entities follow the requirements of all other IFRSs; and (c) require disclosures to enable users to understand the nature and financial effects of rate regulation.”

For a copy of the resolution, please click here.

Federal Court Sides With Oklahoma In Water Export Case

On Nov. 18, 2009, the United States District Court for the Western District of Oklahoma dismissed a complaint brought by the Tarrant (Texas) Regional Water District, which challenged the constitutionality of certain Oklahoma statutes that imposed restrictions on out-of-state water sales. Tarrant Regional Water District v. Herrmann, 2009 U.S. Dist. LEXIS 107520. The Court agreed with Tarrant that the Commerce Clause of the U.S. Constitution generally precluded a state from providing its residents a preferred right of access to natural resources located within its borders: “Water, regardless of its status as property or non-property under state law, is an ‘article of commerce’ to which the Commerce Clause is applicable.” The Court held, however, that the regional water allocation agreement executed by Oklahoma, Texas, Arkansas and Louisiana (the Red River Compact), and approved by the U.S. Congress, insulated the Oklahoma statutes from Commerce Clause attached:

[T]he court concludes the plain import of [the Red River Compact] is to effect an allocation or division of the waters covered by the compact and that the essence of that process - - allocating some portion of the resource in issue to a particular state or its citizens - - is inherently inconsistent with the standards that would otherwise apply based on dormant Commerce Clause analysis. Those standards are ordinarily directed to preventing protectionist state measures designed to secure an economic or other advantage for the state or its citizens . . . The principal purpose and effect of the RRC, however, through its provisions for allocation and apportionment of the Red River’s waters between the various states, is to do precisely that. As a result, the approval of the RRC by Congress necessarily constituted its consent to a legal scheme different from that which would otherwise survive Commerce Clause scrutiny.

Federal Court Rules In California Delta Smelt Case

In December 2008, the United States Fish and Wildlife Service (FWS) issued a biological opinion (BiOp) in which it concluded that the planned coordinated operation of California’s two major water delivery systems — the Central Valley Project and the State Water Project — was likely to “jeopardize the continued existence of the delta smelt and/or adversely modify its critical habitat.” The FWS therefore proposed a “Reasonable and Prudent Alternative.” which, when implemented by the United States Bureau of Reclamation, reduced water deliveries to end-users in the Central Valley and Southern California by several hundred thousand acre feet annually (an acre foot is the equivalent of approximately 326,000 gallons). On Nov. 13, 2009, the United States District Court for the Eastern District of California ruled that FWS’ “Reasonable and Prudent Alternative ‘constituted a’ major federal action” within the meaning of the National Environmental Policy Act, and that the Bureau of Reclamation had erred in implementing it without first conducting an environmental analysis of the impact of the reduced water deliveries. Delta Smelt Consolidated Cases, 2009 U.S. Dist. LEXIS 105951.

Pennsylvania-American Granted Rate Increase

By Order issued Nov. 6, 2009, the Pennsylvania Public Utility Commission approved a settlement granting Pennsylvania-American Water Company an increase in its annual operating revenues of $30.75 million (Pa. P.U.C. v. Pennsylvania-American Water Company, Docket No. R-2009-2097323).

In addition to providing PAWC needed rate relief, the settlement resolved a number of outstanding issues, including the ratemaking treatment of certain acquired contributed plant and customer advances and the deferral of 2009 increases in pension and other post-employment benefit costs. Among various commitments, PAWC agreed to increase its annual corporate contribution to its H2O (Help to Others) program to $250,000. In voting to approve the settlement, Commissioner Kim Pizzingrilli commented as follows:

“PAWC should also be recognized for its continued efforts to acquire water systems throughout the Commonwealth that are faced with aging infrastructure, reliability concerns and high replacement costs. Bringing its technical experience and economies of scale to these areas of the Commonwealth ensures long term service reliability and fire protection for customers and supports the Commission’s goal of promoting water system viability and regionalization.”

Court Rules On Water Efficiency Standards

Reversing a lower court decision, the United States Court of Appeals for the Ninth Circuit remanded for further proceedings a request by the California Energy Commission that the Department of Energy waive preemption under the Energy Policy and Conservation Act and allow California to establish water efficiency standards for residential clothes washers California Energy Commission v. Department of Energy, 2009 U.S. App. LEXIS 23715. The Court ruled that DOE had failed to meaningfully address CEC’s application for a waiver and that the reasons DOE offered for doing so were unsupported.

Pa. DEP Addresses Methane Spill

Pennsylvania’s Department of Environmental Protection (DEP) has directed a natural gas company to provide a permanent supply of water to 13 residences whose wells were contaminated with elevated levels of methane. According to DEP’s consent order, eight natural gas wells failed due to either excessive pressures or insufficient well casings, causing methane to infiltrate the local aquifer.