State Ex Rel. Aquila, Inc. v. Public Service Commission
326 S.W.3d 20
| Mo. Ct. App. | 2011Background
- Aquila sought a general rate increase (~$119 million); the PSC approved ~$59 million and ordered revised tariffs.
- Aquila filed revised tariffs; the Regulatory Law Judge (RLJ) issued Tariff Compliance Orders (TCOs) finding compliance.
- Public Counsel and Industrial Intervenors sought rehearing; the PSC denied rehearings.
- Circuit court affirmed the PSC’s Report and Order and the TCOs; appeals followed.
- Industrial Intervenors challenged the TCOs as non-delegable or improperly delegated under §386.240.
- The central legal issue concerns whether the PSC can delegate tariff-compliance decisions to a Regulatory Law Judge and whether such delegation was properly authorized or ratified.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether delegation to an RLJ of Tariff Compliance Orders was lawful | Industrial Intervenors: delegation is unlawful under §386.240 | Aquila/PSC: delegation permissible; RLJ issued compliant orders | Delegation permissible; orders binding if properly authorized or ratified |
| Whether PSC ratification after rehearing petitions validates TCOs | Intervenors: no express pre-authorization; delegation invalid | PSC effectively ratified by denying rehearings | Yes; PSC denial of rehearings ratified the RLJ’s actions under §386.240 |
| Whether rate-base treatment for unamortized Sibley costs is supported by evidence | Public Counsel: findings inadequate; costs are expenses, not capital | Evidence supports treating unamortized costs as capital for rate-base return | Findings sufficient; rate-base treatment proper in light of prior decisions |
| Whether MGE departure was arbitrary or improper | Public Counsel: decision inconsistent with MGE | Not bound by stare decisis; here, relied on earlier rulings | Not reversible; no error given reliance on prior AO decisions and similar facts |
| Whether findings of fact were adequate to support the decision | Public Counsel: inadequate or conclusory | Findings sufficiently definite to permit review | Findings adequate; supported by the record |
Key Cases Cited
- State ex rel. AG Processing, Inc. v. Pub. Serv. Comm'n, 120 S.W.3d 732 (Mo. banc 2003) (review standard; de novo legal questions; substantial evidence required for reasonableness)
- Philipp Transit Lines, Inc. v. Public Serv. Comm'n, 552 S.W.2d 696 (Mo. banc 1977) (delegation and final act by commission contrasted with notational voting)
- Missouri Gas Energy v. Public Service Comm'n, 186 S.W.3d 376 (Mo. App. W.D. 2005) (AAO mechanism; rate-base versus amortization context)
- State ex rel. Washington Univ. v. Pub. Serv. Comm'n, 272 S.W.972 (Mo. banc 1925) (policy of reasonable returns for investors; rate-base rationale)
- State ex rel. City of St. Louis v. Public Service Commission, 110 S.W.2d 749 (Mo. Supreme Court 1937) (capability to charge and amortize; not to provide perpetual rate-base)