K N Energy, Inc. v. City of Casper

ENERGY, INC., doing K N business as

Northern Utilities Division of K N En Inc.,

ergy, corporation, Appel a Kansas (Plaintiff),

lant

v. CASPER, Wyoming

CITY OF

municipal corporation, Appellee

(Defendant).

No. 86-69.

Supreme Wyoming. Court of

May 1988.

Rehearing Denied June Sullivan,

Michael J. Tim I. Munson and Brown, Drew, William H. Apostó- Brown los, Sullivan, Massey Casper, & Robert C. McHugh Carroll, III, and Thomas J. Lake- wood, Colo., for appellant. Harden, Jr., City Atty.,

H.B. and Robert Mullen, Deputy L. City Atty., Casper, for appellee. McClintock, Gen., Atty.

A.G. Steven R. Shanahan, Gen., Atty. Roger Sr. Asst. C. Fransen, Gen., Atty. Asst. amicus curiae Wyoming. for Public Service Com’n of Lathrop Nicholas G. Kalokathis of & Uchner, P.C., Cheyenne, amicus curiae for Wyoming Ass’n of Natural Gas Utilities. BROWN, C.J., THOMAS, Before MACY, JJ., CARDINE and GUTHRIE, J., Retired.

THOMAS, portions gas company certain li- Justice. censing City Casper, ordinance of the directly question presents This case Wyoming. State municipality authority Wyoming of a of the city authority “2. had Whether regulate public utility enactment of adopt gas licensing company ordi- Inc., licensing Energy, K N ordinance. nance. doing as Northern Utilities Divi- business gas company licensing “3. Whether (Northern), Energy, Inc. insti- sion of K N City Casper ordinance of uncon- in declaratory judgment action tuted stitutional.” seeking district court a declaration that the adopted by City Casper Wyoming ordinance PSC and the Association (Casper) sought The district court de- Natural is void. Gas Utilities and received specific provisions permission clared of the ordinance to file amicus In curiae briefs. briefs, they suggest single to be invalid and unenforceable because of their issues. regulatory authority over The PSC the court conflict with to decide: asks assigned by public utilities statute to the Wyoming “What is the extent of cities’ Wyoming Public Service Commission regulate and towns’ and to (PSC), of the but it sustained the balance grant utilities, franchises to rela- adopted by Casper. ordinance We cannot powers tive to the of the Public Service agree Casper any authority to had regulate Commission to and to cer- issue, adopt the ordinance and we re- authority tificate to those utilities?” of the district court. It verse the decision Wyoming Association of Natural Gas is our conclusion that the ordinance is void Utilities wants court to decide: entirety in its because there exists no au- municipalities “Whether have thority city adopt for a such an ordi- regulate adoption utilities of a nance. licensing ordinance?” Northern, in Appellant, its Brief of sets public utility furnishing Northern is a appeal: forth these issues in the gas Wyoming natural service in several “1. District Whether the Court erred Among Casper. pub- cities. those is As a declaring Municipal not Ordinance No. PSC, utility subject regulation by lic Casper, of the 16-85 State and, rules, in accordance with Northern invalid, Wyoming, entirely leg- since the obtained a certificate of convenience Wyoming islature of the State of has necessity to furnish natural exclusively preempted totally occu- Casper. to residents of Northern had ob- pied public utility licensing the field of permission tained use the streets and regulation? property by entering city into a “2. erred in Whether District Court agreement Casper, franchise which declaring Municipal not Ordinance No. provided also that Northern furnish would Casper, 16-85 of the State of Casper natural in accordance with invalid, Wyoming, entirely since the agreement. the terms This fran- not, now, Casper did and does not 31, 1984, expired chise on December statutory the constitutional or au- have Casper Northern and been suc- thority municipal to ordain a ordinance agreeing upon cessful in the terms of a requiring licensing regulating and franchise. renewal public utilities? hiatus, During legislature this Municipal No. “3. Whether adopted Wyoming Ch. S.L. of Casper, City State of 16-85 of the compiled since it sin- Wyoming, is unconstitutional 15-1-103(a)(xxxiii)(C) 15-1-103(b), gles to the exclusion of out utilities (1987 Cum.Supp.). This statute W.S.1977 competing utilities?” 23, 1985, and, May became effective be way: Casper the issues restates significance its text is of cause under issues, standing Ap Dis- it is attached “1. Whether the Seventh Judicial declaring pendix opinion. Responding A valid to this trict Court was correct statute, adoption Casper, claratory on judgment action in the District 2, 1985, July adopted Ordinance No. 16-85 Court of the Seventh Judicial District of entitled: the State of Wyoming in and for Natrona

“AN ORDINANCE ESTABLISHING County 16,1985. on July alleged Northern PROCEDURE AND REGULATIONS that the ordinance rights violated its to due FOR NON-EXCLUSIVE LICENSE process, equal protection, to be free from TO ANY GAS COMPANY WITHIN arbitrary laws and to uniform administra- CASPER, WYOMING, THE CITY OF tion of the alleged laws. It also that Cas- OPERATING WITHOUT A FRAN- per did not authority adopt CHISE, CONSTRUCT, A LICENSE TO ordinance. In addition request to its MAINTAIN, IN, AND OPERATE ON relief, declaratory sought Northern pre- OR THE UNDER PRESENT AND FU- liminary injunction restraining Casper from STREETS, ALLEYS, TURE AND PUB- enforcement of provisions of the CASPER, THE LIC WAYS OF CITY OF ordinance until such time as the district COUNTY, WYOMING, NATRONA court could rule on its validity. Briefs GAS DISTRIBUTION PLANT OR SYS- argument were filed and was heard with TEM FOR THE PURPOSE OF SUPPLY- respect requested to the preliminary injunc- ING AND GAS GAS SERVICE THE TO tion, preliminary and the injunction was CASPER, CITY OF THE INHAB- denied. THEREOF, ITANTS AND OTHERS: day injunctive The same SUBJECT TO THE TERMS AND relief was CON- denied, AND DITIONS TO THE Northern filed MAKING OF its motion for sum mary judgment PAYMENTS SPECIFIED IN THE requesting OR- the district DINANCE.” court to find the ordinance void whole or part. filed; Additional argu briefs were significance Because of its in under- heard; ment was and the court then found standing case, the issues of the Ordinance that the ordinance did not violate No. 16-85 is attached Appendix hereto as and, rights, B. Northern’s constitutional ex cept regulatory for certain provisions in the An examination of Ordinance No. 16-85 ordinance, the district court held that Cas- Casper evidences company that a per authority adopt had it. The district operating without a franchise from the court provi declared to be void selected city, or one as grant to which the or fran- sions of the ordinance which it found to expired chise has and which has not ob- regulation effect public utility, holding of a tained a license or a city franchise from the council, municipality is deemed to had no authority violation of city adopt ordinances of the provisions those because of the ex therefor, penalties which include a fine of regulatory authority granted clusive per day day sepa- $200 with each deemed a statute to the PSC. court sustained rate violation.1 The ordinance contains a the balance of the coming ordinance as comprehensive regulatory set of conditions within City’s police power, “the residual pursuant to which such a license would be power pursuant franchises specifically issued. It provides in 21 that § 15-1-103(a)(xxxiii), Wyoming Statutes § implement intended to Enrolled Act 70 1977, license, and the tax and Forty-eighth Legislature (Ch. 172, of the regulate pursuant businesses Wyoming 1985). S.L. of 15-1-103(a), 1977, Wyoming Statutes responded savings clause, adoption

Northern Section 23 of said Ordi by filing this ordinance this case as a de- nance.” Code, provides: By Casper City

1. Section 22 of the ordinance Section 1.7 of the violation punishable of the ordinance is “Penalties. Violation of this any provision a misdemeanor Ordinance punishable thereof shall be imprison- a fine of not more $200 than Casper City accordance with Section 1.7 city jail period ment in the for a not to exceed day Code. Each of violation shall be deemed together three months with costs. separate violation." order, 810, 989, entry Casper court’s 2d reh. denied 380 After U.S. S.Ct. 26-85, adopted simply No. (1965); v. Gorrell L.Ed.2d provisions of Ordinance No. deleted those City Casper, Wyo., 371 P.2d 835 nullified the court. 16-85 that had been Except specific for the sections of the ordi- 13, 1985, Northern then filed On December nance which it found to conflict with the judgment, amend the a motion to alter or PSC, regulatory authority of the the dis- specifically requesting the court also to trict court held the ordinance to be valid. (the No. 16-85 declare 21 of Ordinance We are unable to sustain this ordinance provision providing that the ordinance is adopted by theories the district Wyo- adopted implement Ch. S.L. of court, theory. We conclude 1985) This ming to be void. latter motion questions that the constitutional need 23, 1986, January and this was denied on Casper be considered because was without appeal summary judg- from the was taken adopt ordinance an like one denying ment and the order the mo- order in issue in this case. judgment. tion to alter or amend the Cas- per appealed concept has not the nullification of Neither will we invoke a similar 8, 11, 15, 2(6), 9, 16(1), 18 19 of preemption principles federal as North- §§ 16-85, aspect Ordinance No. and that urges perceive ern us to do. We do not a ruling appeal. in court’s is not at issue this concept preemption present of in case, preemption generally at least as has 15-1-103(a)(xxxiii)(C),W.S.1977, (1987 preemption been understood. The federal Cum.Supp.), grants municipalities authority provisions pow- to include certain cases address a conflict between the initially granted, in a franchise or renewed sovereign ers reserved to each state in its condemnation, renewed after but the au sovereign power granted role and the (C) thority granted subparagraph in of that See, government. e.g., the federal Gulf is statute not different from the au Corporation Wyoming v. Oil Oil and Gas (A) thority granted subparagraphs in Commission, Wyo., 693 P.2d Conservation (B). (b) 15-1-103, Subsection details § Siting Industrial (1985); Council of 227 provisions those be included Wyoming Chicago v. State & North agreement. legisla such a franchise Transportation Company, Western Wyo., tion, however, require municipal does not a (1983). municipality 660 P.2d 776 is not ity upon provisions to insist those in a possessed any sovereign power, either franchise, and, fact, operative verb question inherent or reserved. The then “may.” becomes not whether the exercise of a argu We need not address Northern’s preempted power state has a re- concerning constitutionality ment instead, municipality, served to a but No. many 16-85. We have said legislature, some whether act of questions times that constitutional will not granted municipality has been the authori- appropriate ground if be discussed another ty claimed. Nehring E.g., exists to resolve the issue. Russell, Wyo., v. (1978); 582 P.2d 67 Wyoming unequivo rule in Our County v. Board Schoeller sioners, Commis Municipalities, being cal. creatures of the (1977); Wyo., 568 P.2d 869 Stam state, powers possess have no inherent but State, baugh v. (1977); Wyo., 566 P.2d 993 only authority legisla conferred Trucking Company, Bowers v. Getter ture. Pan American (1973); Wyo., 514 P.2d 837 “ * * * [Municipalities only can exercise Corporation Wyoming Petroleum v. Oil powers government those which are Commission, Wyo., & Gas Conservation conferred.” expressly impliedly (1968); State ex rel. Fire 446 P.2d 550 Joslyn, Wyo., v. 527 P.2d 279, Fighters Kingham, Local I.A.F.F. v. of Buffalo 1106, (1974), citing May City v. 1107 (1966); Marion v. Wyo., 420 P.2d 254 Laramie, 240, 131 300, Lander, Wyo. 58 P.2d 312 (1964), Wyo., 394 P.2d 910 cert. 925, 929, (1942). denied 380 U.S. 85 S.Ct. L.Ed. analyze any pertinent Libonati, A court must consti & M. Local Government Law proviso appropriate (1982). tutional statute 15.11 at 15-44 § purpose determining whether ex Ordinance No. 16-85 cannot be sustained press implied authority has been con under authority delegated municipal upon municipality. ferred Haddenham 15-1-103(a)(xiii), W.S.1977, ities (1987 § Laramie, Wyo., v. 648 P.2d 551 Cum.Supp). The title of this ordinance (1982); City Joslyn, supra. v. suggest does way pur that its of Buffalo deciding In whether has been pose revenue, is to raise and the balance of granted municipality pursue to a the ordinance Casper discloses that did not governmental purpose, apply claimed adopt we it for purpose of raising revenue. construction, resolving any rule of strict Other potential than the fines to be collect against violation, ed for purpose doubt the existence of the munici raising rev appears pal power. only enue Whipps v. Town 14 of Greybull, Ordinance No. 16-85, 355, 805, and that Wyo. appears section to perpetu P.2d 146 A.L.R. 596 ate the consideration expired for the appropriate If we find that fran authori Instead, chise. purpose real ty has been conferred a municipality ordinance is set forth in which states legislature, liberally we then con that Casper implement Wyo “intends to strue method invoked to exercise the ming Statutes Enrolled Act Forty- power, asking conferred only if it is reason eighth Legislature 172, S.L. Wyo [Ch. Whipps Greybull, supra. able. v. Town of ming 1985], by way ordinances, resolu McQuillin, See also 2 E. Municipal Corpora tions, and rules regulations.” This 10.18(a) through tions 10.21 at 789-800 §§ specific by Casper, statement of intent (rev. 1979). 3rd ed. coupled when with its failure to accommo relied, part, The district court general date to the attaching limitations to 15-1-103(a)(xiii), upon (1987 W.S.1977 § the authority to purpose license for the of Cum.Supp.), to justify adoption the of those raising revenue, justification forecloses the portions of Ordinance No. 16-85 that were of this ordinance under authority statutory provision not stricken. That au license, regulate. tax and thorizes cities and towns to: regard Our conclusion is rein- “License, regulate any tax and business apparent disregard forced on the whatsoever conducted or trafficked part Casper of upon of other limitations within the city limits of the or town for authority municipalities license, of tax or revenue, purpose raising regulate purpose raising for the reve- imposed license taxes shall be uniform in nue. imposes requirement The law respect the class of business respect reasonableness with to the business * * imposed; McQuillin, Municipal classification. 16 E. utilities, Northern, Public such are in- Corporations (rev. 44.20 at 72 3d ed. § phrase “any cluded within the business 1984). nothing There is about Ordinance language whatsoever.” If this were not justifies No. 16-85 that the choice to li- utilities, way limited some as to Instead, only gas companies. cense ap- however, power granted to the pears broad imposed by that the license the ordi- municipality regulate required would conflict with nance uniformly has not been with “general power regu- respect appropriate to an and exclusive class of business. utility general policy recognized Another supervise every public late and with- is avoid provi- in the state in double taxation. accordance with delegated sions of this act” to the PSC in “Although protect- double taxation is not 37-2-112, Any is W.S.1977. conflict Constitution, § ed the United States legislative language avoided favored, double taxation is not and all municipality limits the concerning doubt a conflict between a license, regulate purpose municipality tax and for “the relating and state to taxa- raising style limita- against revenue.” This tion is resolved dual taxation.” McQuillin, tion is Municipal Corporations, not an unusual one. See 3 C. Sands 16 E. (Footnotes prevailing country omit- in this is that the supra, 44.23 at 82. view § ted.) police power municipalities exists sole- ly by legislative virtue of or constitution- provided for a regard, In this the state has * * *” grant.’ al Blumenthal v. utilities uniform state assessment Cheyenne, Wyo. 186 P.2d expenses of defray the administrative (1947). supervising regulating and the PSC for 37-2-106, W.S.1977. The them. Section Drag Company, See also Nation v. Giant defray expenses is invoked to state tax (1964). Wyo., parties 396 P.2d 431 accomplishing, under the au state discovered, suggest, only we two PSC, exactly thority delegated to the possible police sources of a of a 16- regulation kind of that Ordinance No. municipalities the constitution impose. face purports On the and statutes. ordinance, public purpose suggested no statute, By cities towns have author- payments Casper re for the license ity to: ordinance, quired under 14 of that § ordinances, “Adopt regu resolutions and defraying expenses regula than lations, including regulations not in con tory Casper. redundancy activities of necessary flict this act and for the charges suspect of such makes them health, safety city welfare of 13, 3 of the Constitution of the Art. State town, necessary give effect Wyoming.2 City Chey See Powers v. powers conferred this act and enforce enne, (1967), Wyo., 435 P.2d 448 reh. de by imposing all ordinances fines not ex nied 436 P.2d 961 ($750.00), ceeding fifty hundred seven prospect for There is no better sus exceeding (6) imprisonment not six taining this ordinance under residual * * months, both; police power Casper. The record does 15-1-103(a)(xli), (1987 W.S.1977 Cum. clarify what the district court contem Supp.). plated by police its reference to a residual By provision, legislature did not that, power. The law is settled other than general police power extend a to the munic- America, only the United States of ipalities, independent which would exist state, sovereign, possessed of inherent express powers granted in 15-1-101 §§ police McQuillin, powers. Municipal 6 E. through 15-10-117, (1987 W.S.1977 Cum. (rev. Corporations 24.35 at 107 3d ed. § Supp.). Any police power justi- that would 1988). explained police This court has fy this ordinance must relate to an authori- power municipal governments in vested in ty expressed in statutory otherwise those way: provisions, appears. i<* * * and none There is no jrpjg onjy p0wers possessed by police power residual contemplated that is municipalities delegated are those by statutory scheme. Chey them. Stewart et al. v. general The alternative source for some enne, 497, Wyo. 60 154 P.2d 355. The grant police power municipalities police power exception. is no It is not 1(b) 13, Wyoming Art. Constitu- § municipalities. inherent in It is said in (referred frequently tion as the “home ‘In of direct 37 AmJur. 905: the absence amendment), provides: rule” authorization, general constitutional empow- “All hereby cities and towns are ly accepted any police power is that view ered to local affairs and municipal corporation attempts determine their which a government by come from as established ordinance to exercise must the source passed governing body, subject police power, legisla the state the state page prescribed by leg- ture.’ And on 902 it is said: ‘The referendum when 13, prevent 2. Art. 3 of the Constitution of the State of and contract debts so as to the abuse § Wyoming provides: power, and no tax or assessment shall such or debts contracted legislature powers be levied or collected restrict "The corporations except pursuance corporations] municipal corporations [municipal such assessments, specified by levy money public purposes to borrow of law for law.” taxes and

213 islature, subject only general power granted 13, and further to stat- Art. 3 of § uniformly applicable, Wyoming to all cities and utes Constitution.

towns, prescribing and to statutes limits regulation supervision State-wide taxes, levying of indebtedness. public utilities is the of Title 37 of excises, fees, charges shall Wyoming Statutes 1977. “The ser prescribed by legislature.” vice of Wyoming,” commission created 37-2-101, W.S.1977, “general has and ex § The court considered this constitutional power regulate supervise clusive provision in Laramie Citizens Good every public utility within the state in ac Laramie, Wyo., v. Government provisions cordance with the of this act.” 474, (1980), 617 P.2d and said: “ * * * 37-2-112, Normally, W.S.1977. Plainly ambiguity it without power police to license accordance with legislation [municipal makes such ordi power implies authority regulate. See 9 ‘subject uniformly to’ statutes nances] McQuillin, E. Municipal Corporations applicable to all cities and towns and to (rev. 1986). 26.27 at 70 3d ed. While § prescribing those limits of indebtedness. “ ‘ * * * some courts have held that allocation of “subject The term to” means regulatory power agency to a state does “subordinate to” or “subservient * * *’ to.” license, power not foreclose the we 209, Kelly Smythe, Wyo. v. suggesting no discovered case that a mu 226, 157 (1945). P.2d See Chan nicipality can license accordance with its N.D., Hjelle, dler v. 126 N.W.2d police power activity some which it cannot Furthermore, regulate. generally it is un “Legislation by cities and towns must license, power pursu derstood that the uniformly ap- not conflict with statutes police power, encompasses power ant to towns, plicable to cities and and it must prohibit activity. See Blumenthal be subordinate to such and subservient Cheyenne, supra; McQuil v. 9 E. statutes. Each enactment must be mea- lin, Municipal Corporations, supra, 26.31 right sured its own to determine if it at 79-80. The a certifi pertains if to a ‘local affair’ and it is necessity cate of convenience and ‘subject uniformly applica- to’ statutes public utility city to furnish services ble.” or town and to terminate such services is in though language Even of this constitu- approve the PSC. It must the commence broad, provision quite tional public utility opera ment or termination of legislature to control even the local in municipality tions whether or not a municipality activities of the cannot de- granted franchise has been or terminated bated. municipality utility. between the and the “ * * * is, accordingly, It noted W.S.1977; 37-2-205, See Rules of the recognized very begin- has been from the Service Commission of the Public State ning Wyoming legislature 2, (1984). has Wyoming, scope 208 Ch. The right prescribe powers granted authority of the demon PSC municipalities duties of and these include legislative police strates a intent that the state, only governmental affairs power but strict- of the to the extent that it utilities, ly local affairs as well.” Stewart v. relates be exercised 497, 514, Wyo. preserve Cheyenne, 60 154 P.2d the PSC and to none of that 355, (1944). power municipalities. 360 To the extent that a statute of the state in any implied police power Neither can way power some conflicts with a claimed invoked to sustain ordinance. mu municipal provision municipality, nicipality authority does not have the to do yield, respect any police must even with indirectly anything that it has not been application principle power. authority directly. The of that afforded to do See Rob power results in a conclusion that the Housewrecking ert Anderson and Ex W. Trustees, adopt licensing cavating, in this in- v. Board ordinance Inc. School Wyo., County, stance could not be sustained under the District No. Fremont 214 (1984). approved by majority In accordance with submitted to and P.2d 1326 construction, we hold that city voting

our rule of strict of the electors town 13, 1(b), of the State of Art. Constitution question on the at a one-time election provision provides, in public utilities is to be implication, public utility. es tion Wyoming, neither management of its local including tion distribute natural may provide in the franchise that son served franchisee shall furnish a subsection buildings city or newal after condemnation of a company pany “(C) necessary “(B) streets, ever and: exclusive son any utility company, provided no fran- and towns chise as the “(A) “(xxxiii) “(a) pursuant argument affords ^[*] (1987 Cum.Supp.). system through The Upon renewal or initial The Contract for a Grant to may governing body for the town; which that alleys or Grant franchises privilege major emphasis by Casper is on franchisee electric for the governing right in the installations ^[*] be entered (b) to § may: - authority that the of this franchisee, lighting the distribution expressly 15-1-103(a)(xxxiii), ^[*] necessary energy avenues; to install and maintain franchisee any purpose requirements specified person pertinent part: bodies authority section, affairs, to license a found, into ^[*] deems That Casper, grant for such terms nor streets, with any supplier, provided by of all cities light or over time utility at least ^[*] by implica- franchise, to license proper given statutory franchis sell and any per- distribu- any per- system, whatso- in the period or re- ^[*] com- W.S. an Safeway W.S.1977 express wording in § (1977); Wyoming reh. denied 627 P.2d 163 is to be express language of the lature. McArtor v. thority tion. 626 P.2d 61 County v. pal authority from statute is to discern the intent of the this because County examination that the to be tion changeably closes the terms “license” and “franchise” inter- isdictions, courts use the terms “license” contention, be more semantical than substantive. This argument onstrating tion franchises, and “franchise” Because the called for that Casper candidly recognizes that this sec- Casper, Wyo., 551 P.2d 687 authority granted by (1985); pertinent only encompasses (1985); synonymous. this case. must be resolved Wyoming legislature Stores, Inc., (1987 Cum.Supp.), found, Commissioners primary objective does not assist us Ridenour, any difference contrary. but it Hurst v. we or, (1981). of the Sanches rule of question necessarily our interchangeably, thus dem- any if argues If purpose.”3 State Treasurer v. legislative grants. duty we were to State, Wyo., That possible, statutory We would have to do State, Wyo., 698 Wyo., event, Wyo., 568 P.2d 908 statutory v. authority 15-1-103(a)(xxxiii), (1981); of the claimed au statute, statute, that, only in legislative Sanches, would conclude discern is that in 623 P.2d these terms to intended them has used the construing with first a determina- in other scheme dis- Johnson v. accept we invoke Campbell Board construc 699 P.2d the mu munici- respect intent Wyo., grant legis P.2d jur- An nicipalities are afforded the any city provided that before or town grant The word “license” does franchises. implements subparagraph, ques- appear do so shall not in the section. tion of whether or not to be (C) 15-1-103(a)(xxxiii) history leading Subparagraph general was review of the § 3. Wyoming passage provisions part At of these can be found in Dee of Ch. S.L. of Harris, time, (b) Pridgen Wyoming & Edward W. § same subsection 15-1-103 was Experi adopted, requirements Gas Consumers’Act 1985: An which sets forth several Natural Controlling Natural Gas Prices and a that must be satisfied under contract en ment in Clauses, granted Response pursuant power Price Escalation tered into to the 15-1-103(a)(xxxiii)(C). Indefinite (1986). municipality by 21 Land & Water L.Rev. 141 A § analysis statutory provi- municipal of this municipal Further license and a franchise legislature sion makes it evident that the is that privilege the franchise extends a power exist, not intend the to franchise to did that would not otherwise while the power restricts, include the to license or that those by governmental license authori- synonymously. terms treated ty, private be right a independent that has an states, in part: existence, 15-1-101 way but has been limited in some by a “(a) through municipality through appropriate As used W.S. 15-1-101 police revenue-raising power. 15-10-117: thority carry governing body “(v) * ¤ n ‘Franchise’ means the on the ^[*] any person operation ^[*] any city of a ^[*] or firm public utility; grant or town to ^[*] of au- ^[*] pliance with the licensed conditions. 9 E. McQuillin, Municipal Corporations, supra, granting of a license then restores the right § 26.01a at Permits, pursue 8-9; that supra, 51 Am.Jur.2d Licenses activity subject §§ through to com- 4 at 7-13. general It is in accord with this ostensibly The definition is in found there proposition Wyoming legislature that accepted generally accord with the under- granted municipalities has authority standing of the term “franchise.” license, regulate tax and businesses for the “ * * * Speakihg generally, a franchise purpose raising In light revenue. special privilege is a of a nature provisions, leg- these we conclude that the by governmental authority conferred applied islature knew and a distinction be- such, per- individuals as or artificial tween the terms “license” and “franchise” usually corporations, sonalities called and did not use synonymously those terms privilege belong that did not to the indi- in the statute. generally viduals as a matter of common expression legislative We also find an right. generic embracing It is a term all power intent that the to franchise should rights granted corporations by leg- not include the to license in the state, rights islature of the or such as relating municipali restriction to when the granted only can the state in the ty may authority granted exercise the to it instance, that, by delegated first authori- 15-1-103(a)(xxxiii)(C). may only It do § ty, municipal corpo- are conferred “upon renewal or initial or re ration, designated public body, or other newal after condemnation of the fran acting in agency such relation as an instance, chise.” In each such the fran right the state. The to conduct a busi- accept, reject propose chisee can modifi public utility ness of and use of the cations the franchise terms offered public ways purpose, streets and for this contrast, municipal government. In no example, supply water, limitations are invoked as to when a munic light, transportation and other ipality may exercise its to license comforts and conveniences in crowded (1987 centers, 15-1-103(a)(xiii), con- under W.S.1977 required urban to be § by public Cum.Supp.). ferred this con- authority, and * * *” giving stitutes the of a franchise. Further, distinguished from the uni McQuillin, Corporations Municipal 12 E. prerogative im municipality lateral of a (rev. 1986). 34.04 at 19 3d ed. license, pose a conditions on this court has 1 at See also 36 Am.Jur.2d Franchises § recognized negotiation of condi (1968). 722-723 process granting in the tions a franchise municipal license, distinguished accepted by A creates a valid contract when franchise, franchisee, en generally from a is understood and its conditions granting privilege general ap rules to have the effect forced accordance with permission pro- plicable do an act that would be to contracts. Northern Gas Com Sinclair, pany Wyo., in the license. Town 592 P.2d hibited absence of the See v. 51 Am.Jur.2d and Permits at license does structure Licenses (1970). imposes a contract but reasonable restric- 7 The critical distinction between

tions or conditions on all members of a conclude that the license is not essential or given similarly class situated. See 9 E. necessary carry purpose out the ex- McQuillin, Municipal Corporations, supra, pressed by the authority to franchise. See 26.14 at 32-33. This is the reason that § Rawlins, Wyo., Coulter v. 662 P.2d required legislature the that all license tax- (1983); City Cheyenne, Blumenthal v. imposed by municipality es a be uniform in supra; McQuillin, 2 E. Municipal Corpora- respect to the class of business which tions, supra, 10.12 at 768-776. Because § imposed. tax is Section 15-1- negotiated agree- terms a franchise 103(a)(xiii), (1987 Cum.Supp.). W.S.1977 In ment result a valid contract accept- when contrast, requirement there is no such that franchisee, by ed adequate there is an equivalent all franchisees be afforded remedy available in the event of breach Rather, municipality may grant terms. agreement. We also note that govern- franchises “for such terms attempt by municipality impose a addi- ing body proper.” deems Section 15-1- tional conditions on a valid by franchise 103(a)(xxxiii), (1987 Cum.Supp.). W.S.1977 invoking police revenue-raising power its Finally, legislature’s grant broad of would lead to constitutional concerns relat- regulatory power supports to the PSC our ing impairment of contracts. In the conclusion that it intended a restricted any suggestion absence of legisla- that the meaning applied authority to the intended, ture so this court will extend 15-1-103(a)(xxxiii). franchise under § through judicial legislature fiat what the broad definition of “franchise” set forth at has express not chosen to in statute. McQuillin, Municipal Corporations, E. supra, 34.04 very severability at is like There is a that which clause in Ordi- adopted this court in Tri-County Electric nance No. purpose 16-85. We see no Association, Gillette, Inc. v. 584 parsing however, provisions, the several (1978), P.2d 1001 n. 6 to describe the because the stated intent of this ordinance privileges granted public by utilities beyond was the authority granted to a mu- apparent, PSC. It is in examining Ordi nicipality by legislature. We declare 16-85, nance No. encompasses being adopted ordinance be void as degree substantial regulatory au statutory authority. without thority assigned by statute to the PSC. The dilemma that Casper confronts Indeed, why that is the trial court struck respect public utility to a operating without specific provisions of the ordinance. If the franchise not an issue in this case. It regulatory authority delegated to the PSC be, clean, with the slate now appropriately described the word Casper can address the situation in some “franchise,” compelled we are to construe manner authority. Furthermore, within its language 15-l-103(a)(xxxiii), W.S. presence public utility of a operating in (1987 Cum.Supp.), very narrowly. municipality without franchise is not Otherwise, legislature might unique. The contractual relationship repre- structured a municipal conflict between the prior sented franchise authority PSC, and the between Cas- authority of the which, course, per longer and Northern no would be the result if the exists. The words “franchise” general and “license” are inter rule seems to be that the utilization changeable. potential Avoidance city’s property, of a such as its streets and for conflict is an additional reason to con alleys, franchise, without a is unlawful. Casper clude that had no authority adopt Recognizing regulatory authority of licensing pursuant ordinance PSC, which must be invoked to termi- franchising provision. nate Northern’s certificate of conve- necessity, may nience and demand that the grant

We hold that no municipal au- city approach Annotation, the PSC. See thority to license utilities un- exists Right Duty der the conferred and Public Utili- statute to ty upon Expiration franchises. In accordance with the Limitation construction, Franchise, rule of strict we furthermore Street 112 A.L.R. 625 damages It be that an action for sell plant domain then to some trespass appropriate. corporation with which newa fran- could accomplishing chise be made clear, however, It is city, more no Casper state, sought to coerce virtue of than the has no seize property utility, directly ouster, of a either No. 16-85. Short of con- through licensing indirectly process damages, demnation an action for Cas- case, attempted by Casper such per may choose to involve the PSC its its der dictate business decisions in agreement effort reach with Northern ogation rights the constitutional by petitioning for a franchise the PSC to corporation providing compensa without take these into issues account its rate- tion. Cf. Nollan v. Coastal California making process. Mountain States Tele- — U.S. -, Commission, 107 S.Ct. phone Telegraph Company & and U S English (1987); First Evan 97 L.Ed.2d 677 Company West Direct v. Public Service gelical v. Lutheran Church Glendale Wyoming, Wyo., Commission 745 P.2d — County Angeles, California, Los (1987). U.S. -, 2378, 96 107 S.Ct. L.Ed.2d Casper Should choose exercise The case is reversed with direction to domain, statutory power its of eminent it judgment declaring enter Ordinance No. municipal public then could become utili adopted 16-85 be void because was through ty, operating proprietary rather authority. without governmental than capacity, Tri-Coun jurisdiction See PSC. CARDINE, J., specially filed a Association, ty Electric Inc. v. MACY, Gillette, concurring J., opinion, which An supra. approach alternative joined. would be to utilize the of eminent

APPENDIX WYOMING, OF LAWS 1985 286 SESSION Ch. 172 CHAPTER

Original Senate File No. 85 NATURAL GAS FRANCHISES 15-l-103ia)(xxxiii> (C) by creating subparagraph W.S. by AN to amend a new ACT and <b) franchises; relating creating gas providing new subsections and <c> natural such may gas providing system only thereby be for franchises a natural allowing distribution system; any requiring through person gas electors; providing to deliver natural of the for a vote commission; reports public prohibiting annual certain increases holders; purchase price gas in cost m for the and contracts resale of specifying franchise liability; including providing franchise conditions repeal for unless act continued by legislature; providing for an effective date. by Be It Enacted Legislature of the Wyoming: State of 15-l-103(a)(xxxiii) Section 1. W.S. by creating a new subparagraph (C) (b) (c) by creating new subsections amended to read: 15-1-103. powers General of governing bodies.

(a) governing The may: bodies of all cities and towns (xxxiii) Grant governing franchises for body such terms as any deems proper utility company, no franchise provided any into with person entered right an given in which that exclusive person for purpose whatsoever and: (C) Upon renewal or after initial or renewal condemnation franchise, may of a provide in the franchise that franchisee shall gas system through supplier, furnish a distribution including franchisee, by may section, provided sell subsec- and distribute natural (b) system, by tion the distribution any person served provided any city subparagraph, implements that before town approved to and question whether or not to do so shall be submitted at majority city voting question or town on the electors of the for that purpose. one-time election called (a)(xxxiii)(C)

(b) Any subparagraph granted pursuant franchise subject following: this section is

(i) for agreement specify responsible shall who is The franchise deliverability; (ii) utility system public continue to be a shall The distribution The service commission. regulated public charges

whose are management nongas costs the reasonable shall reflect charges necessary plus deems a reasonable public service commission audit as the investment; on return an (iii) act representative shall Any city or town or its authorized terms system negotiating agent any person for served franchisee person, and the gas to that supply conditions for the of natural delivery served person system accept shall distribution system, any supplier; natural from WYOMING, SESSION OF LAWS Ch. 172

(iv) a place places service commission designate shall vicinity system in the distribution natural acceptance franchisee; supplied by (v) service commission enforce adopt minimum quality gas system. standards for all delivered to the distribution These standards shall reflect the practices of the the operators distribution system good unless cause is shown for The different standards. standards designed shall be to facilitate the gas from comingling different suppliers; (vi) (2) As soon as there are at least two suppliers offering natural gas to all customers served the franchisee and as soon as the additional supplier suppliers are capable of gas delivering in at least one-third (1/3) of required the volume the entire system distribution provided public that the service commission control, finds that the suppliers own and have committed guaranteed delivery, gas reserves natural suffi- (10) cient to supply years ten level, of demand at that persons then all supplying gas shall have the authority to prices. set their own proposed supplier has the of proving adequate burden reserves and deliverability. The Wyoming gas oil and report commission shall to the public service commission on adequacy deliverability the and when a utility gas act; supply is proposed displaced to be under this (vii) Subject to availability pipeline capacity require- and the ments of law federal and regulations public service may, commission after notice and hearing necessary, if designate point the state on a gas pipeline operated purpose gas for the delivering to the distribu- system tion parent or its subsidiary point company receipt as for gas system to the regulate charges and shipping gas from for point the system. If a pipeline capacity has public insufficient service commission may require consistent with W.S. 30-5-125 it to accept gas that has price a lower preference higher price consumer in gas. public may impose require- service commission conditions or necessary ments health, pursuant protect public this subsection that are welfare, safety operation to ensure the efficient the natural gas system possible the lowest supply price distribution to ensure customers, including proper assignment to retail but limited system; to the connecting suppliers costs of (viii) city grants supply renews or a franchise When a (a)(xxxiii)(C) section, public gas subparagraph

natural service commission surrounding under

may require gas in the distribution of terms of areas also be made unincorporated franchise; same (1)

(ix) gas only supplier has natural system If a one distribution subject to W.S. 37-2-121 prices all 37-2-122; that franchise are charged in (x) annually system shall All to the suppliers gas distribution of nat- consumption the annual report commission service their report the date ural their of record at customers (5) five are less than a reserves natural reserves. If their natural WYOMING, OF LAWS SESSION Ch. 172 any supplier commission year supply, forbid from (5) year until the a five serving new customers reserves are equal customers; for all supply (xi) system Any supplier entering under subsection liable damages injuries, or other losses to to which the extent injuries, damages are proximately supplier’s or other losses caused oper- system ations and are due to within supplier failure of exercise, reasonable, that standard care which a would prudent person exercise or similar the same circumstances an*undue risk to avoid of harm or are ural supplier's due failure deliver contracted amounts of nat- gas. (c) Any provision purchase contract which contains .creates clause, an escalator indefinite otherwise known as a "favored nation treaty” provision, contrary is state policy of the and is void if: unenforceable (i) The contract is to sell gas to aof the holders municipality supplies franchise which state; retail customers in the (ii) The contract provides for the produced sale the state state; within the (iii) The contract gas price general price excess of market which would otherwise exist in the absence of the indefinite escalator clause; and

(iv) higher price resulting from application the escalator clause is required by not provision enforceable of statutes regu- tp lations enacted or adopted pursuant Policy National Gas Act of 1978 or appropriate and regulations statutes of the United States. Section 2. If any provision act application person of this or its invalid, or circumstance is invalidity held not does affect other provi- sions of application act given the which can be effect without the invalid end, provision or application provisions and to this of this act are severable. (b) (a)(xxxiii)(C) 1,1988,

Section 3. Effective July W.S. 15-1-103 repealed legislature. are repeal pursuant unless continued an affirmative act agreement made provisions

of these does not affect franchise provisions prior these to the effective date their repeal. 23,1985. Section May 4. act is effective This 23,1985. February

Approved APPENDIX B NO.

ORDINANCE 16-85 AN ORDINANCE ESTABLISHING PROCEDURE AND A FOR

REGULATIONS LICENSE NON-EXCLUSIVE TO CASPER, COMPANY WITHIN THE ANY GAS WYOMING, OF CITY FRANCHISE, OPERATING WITHOUT A A CONSTRUCT, MAINTAIN, TO AND LICENSE OPERATE IN, THE OR UNDER AND ON PRESENT FUTURE STREETS, ALLEYS, PUBLIC AND OF WAYS THE CITY COUNTY, CASPER, WYOMING, NATRONA OF GAS SYSTEM PLANT OR FOR THE DISTRIBUTION PURPOSE AND GAS TO GAS SERVICE THE OF SUPPLYING CITY THEREOF, CASPER, THE OF INHABITANTS AND SUBJECT TO THE TERMS OTHERS: AND CONDITIONS THE MAKING OF SPECIFIED AND TO PAYMENTS IN THE ORDINANCE. BY THE CASPER, IT ORDAINED THE GOVERNING BODY OF BE CITY OF WYOMING: Title. 1. Short This shall known and Section Company Licensing "Gas Ordinance.” cited Ordinance, purposes following terms, For words, given meaning phrases, their derivation's context, plural words When not inconsistent herein. singular number, singular and words number number include always mandatory plural included number. The word "shall" directory. merely Wyoming. (1) "City" City Casper, is the of grantee (2) "Company" a under this of license is the Ordinance. Casper, City City of (3) of the Council is the "Council" Wyoming. association, firm, partnership, person, (4) any is "Person" organization kind. company, of corporation, or of the sale derived from all revenue (5) Revenue" is "Gross opera- Company by the indirectly in connection directly gas the or Ordinance; pro- City pursuant this to within the facilities tion of its upon sale or the however, taxes vided, not include this shall that directly Company, imposed by gas the of furnished distribution governmental City, Wyoming, or other the by of user the State or customer Wyoming, of State by Company behalf of said on entity, the and collected entity. governmental City, or gas con- of natural a foot cubic (6) is foot" cubic "Standard (BTU) when saturated per foot cubic 1,000 taining Thermal Units- British mercury at equal of inches 60®F, pressure to 30 vapor under with water at manufactured, natural, or apply of the case shall This standard 32*F. and pricing for all basis as the used shall be This standard mixed gas¿ established are standards other unless ordinance under this meASureme&ts or State Statute. Public Service Such Commission Wyoming other (cid:127)by the by as presently existing or be established State standards quality Commission, regulatory Wyoming body or other Public Statute, Service the apply. jurisdiction shall also competent of street, a than portion tne is that (7) "Sidewalk" curbs, barriers, markings, or other for by delineation apart roadway set property. private including travel, parxways on not pedestrian boundary is between the (8) the entire width lines "Street" use, publicly the and for every way to maintained the dedicated travel, alleys. pedestrian including vehicular and purposes "City Manager" designated (9) person by is the Council to capacity by Wyoming defined Statutes. in such act executedby (10) a Mayor "License" written instrument the or by City Manager City and to attested the Clerk authorized resolution granting gas company privilege a operating Council the within - pursuant to the term of Ordinance. "City (11) point gas Gate" shall be transfer a from Company proximity supplier corporate within City. limits Any gas company operating Section who is a without franchise City, grant or expired, whose Company from or franchise has and which resolution a has obtained license or franchise from the Council be violation deemed ordinances Wyoming penalties State and Statutes therefore. n . Request Company may through request Section for License. City Manager operate a license be for a issued City. request within Such shall conform to license provided Ordinance. Council at discretion and hereinafter may grant Company. a license Authority. approval S. Grant After Council resolu- granted Company right tion licenseshall gas erect, construct, operate, plant, privilege and and maintain both, system, import, transport, gas, sell and distribute and natural, manufactured, mixed, City, and for these within whether lay necessary equipment purposes and and facilities establish regulators, .mains, pipes, meters and other maintain along appurtenances necessary in and distribution sale alleys. streets right occupy (1) said use Grant. Non-Exclusive places streets, alleys, ways, purposes herein set the for and right exclusive, City a to and the reserves the forth shall not be any per- streets, ways, places, alleys, to and similar use of said during period any corporation son the of license. or at time The Applicable Compliance Section 6. Laws and Ordinances. with license, shall, to be Company the during of at life all times the City, by police such reason- all the and lawful exercise the of by or ordinance regulation able provide. hereafter resolution as shall the Company fully 7. Section Indemnification. shall indemnify, defend, officers, City, boards, the harmless its commissions, hold and employees and claims, suits, any actions, against and all liability, and to, damages, including, expenses but not limited for judgments for rea- legal fees and and disbursements liabilities. sonable O09? CD rt *C Ort *1O O' rt o’ rt O M-*C MO ff CD® C « (cid:127) pr »-» « O O’H* _+ fow OrtCO HO o- +J ® 2.o os CO o . , ^[0] CO (0 o e O c o CO u o a e cl (0 a. o o to S a,4a>; **'m u ® o, o E i a : qj C (cid:127) » n o U * n *“a u n aj » n u ? CO ^ wC o3 M «J til -> <Da n POO n cdc n ; w P « n (cid:127)o H-o P MH* n ° O 0 * p S ct h. rt CD Og > g* 2 o o p p H- S (cid:127)o OQ * P o a o C O H-O H*ft O o CO CD o n << P ft rt rt COex h- n c0co p 5S o “ ® ^[2] (D H e S c - Q. ^[0] rl S|° o £8 ' g-i »-* g *< cd £ 0 O*rt O n 1 CD h-*o * oq e p H o < H* rt O I Section Service Company Standards. The shall maintain and operate plant system, its and and render efficient service in accordance regulations are, with the rules and be, may as or by set forth the provided as for Council Ordinance, 13 of or the Public Commission of Wyoming. Service the State of (1) Odorizing of Gas. Gas furnished consumers within Wyoming, Caaper, shall quality required be of marketable as Public except Commission compound it shall Service contain some element or easily an detectable odor in an with amount to be sufficient noticeable released, gas the but not when sufficient to be harmful to human and life, or animal interfere with combustion. (2) sold, Heating supplied, Value. and Gas delivered according shall license be the determined standard conditions set 2(6) adjusted Casper, Wyoming; in Section at forth hereof to conditions and, (a) heating adjusted gas Deviation. The value the practicable be maintained with as little deviation as such shall heating vary plus percent shall never more than or minus value five monthly plus average or If thb value varies more than minus five (±5%). right penalize (+5%), Company percent Council shall have the the the monthly appropriate by requiring a refund to all customers on their bills resulting compensate the for inefficiencies from sufficient variation. excessive ( n ) Company Required. equip shall Tests The Calorimeter heat complete, shall determine standard calorimeter itself a daily. point at gas be The tests made at least value system. shall Test results be distribution within limits Manager within said test. 12 hours delivered office necessary gas or advisable City may as deems times test said at such Company. available tests its and shall make the results monthly Average. average Monthly (c) Ascertaining by averaging adjusted heat heating be obtained shall value provided periodic as calorimeter tests value found as result all Company permit hereunder. Council shall gas, proof quality tests lieu individual submit of* quality prepared mains, proof made on the where such being Company cities served same on by other accepted same supply accepted same source sources from pipeline Commission. Service Wyoming Public Accuracy. supplied through All shall service (3)Meter accurately supplied measure amount shall meters customer. (a) meter, Compulsory Every complained Check. whether otherwise, shall by be removed service at customer from least once (10) years thoroughly accuracy. Any tested ten meter each beyond per- test inaccurate reasonable tolerance two found (2%) properly adjusted returned until cent practical to zero variation. close (4)Notice Interruption of Repair. for Whenever it is necessary interrupt shut off or to purpose service the making for of installations, repairs Company or the shall at do so such time as will customers, of the least amount inconvenience to cause its and unless such immediately repairs are unforeseen and necessary, give shall reason- thereof to the notice able consumers. Company 9. Company Section Rules. The the shall to rules, regulations, terms, promulgate governing such and conditions the necessary of its business as conduct Company license, shall be to reasonable the enable rights obligations to perform exercise its and its under the uninterrupted and assure service each and all of its Provided, however, rules, terms, regulations, customers. that such and provision shall not in be conflict conditions with the hereof or with the Wyoming, approval by of the State of laws and shall be the Wyoming. Commission Service of the State of Public Occupancy. on Conditions Street natural, artificial, mains, or (1)All mixed pipes, and other by Company placed shall be so apparatus the laid or and equipment placed City alleys, streets, public the as in and other the in located sewers, drains, any pipes, or water or with interfere obstruct not The any already hereafter be installed. or installed structures other Company interfering of with the use shall, practicable, avoid when paving of the streets highway or surface alley, when the street, other or be disturbed. would pavement, any of of disturbance (2) In case Restoration. Company surfacing, own cost shall at its sidewalk, the driveway, or other replace by City Inspector, approved and the a expense, in manner and and alley sidewalk, any driveway, or of street or surface paving, all restore commenced, and good said work was as before in condition disturbed as period a approved of for condition an in restoration shall maintain the construction, post or bond such and shall (1) year completion of from one agents as shall be or its security required may the Council as be of section. necessary intent the to effectuate deemed any during perioc (3) the at In that time event Relocation. alter, change lawfully City the or the elect of the license shall street, line, way, alley, utility of, grade or other the City, the remove, relay, reasonable shall Company, notice and manholes, mains or pipes, and its at fixtures its relocate place Company The fixtures expense. shall not wnere the same will own City-owned the other or various with fixtures facilities interfere agrees Company The City. City residents of serving that the discretion, period may during Company in his time Engineer set construct, locate, repair, maintain or its facilities in arterial prevent congestion order and in traffic hazards on said streets streets, however, provided, emergency, that in the event an arterial nothing prevent Company performing necessary stated herein shall from repairs. Company required, place is file on office City Engineer complete a copy recent, true most its revisen maps, plats maps, or set showing mains, or or plat location valves, appurtenances, curb boxes as often revisions tne made; however, provided, are Company required same to be shall.not plat plats such revised or set frequently file more than once year. Company calendar required, shall be at expense, each its City plans replacement provide existing facility, or of new facilities existing within City installation or future streets one year proposed advance (1) replacement. construction or In addition, plans construction, construction repair, replacement being installed existing in or improved facilities under streets shall be City Engineer thirty (30) submitted a days prior minimum of work, except actual emergency. commencement in the an event Where practical, being facilities improved installed under streets shall pushed bored such existing streets such manner improved open cutting street is disturbed previously unless has been approved Engineer's Office. Company working any street, Whenever proper warning signs used, adequate required shall and to the satisfac- Engineer's any applicable tion Office unrepaired Statute. In the State event street left at end working day, Company perform necessary cleanup normal shall all work signs adequate provide and* and erect monitor such as are notice conditions, cleanup signage street said be sub- Engineer's ject approval by City to Office. the Any opening repair street for made installation or of (S) working days shall a maximum of facilities be closed within five of making opening; opening permanently repaired and said shall the of the be standards, City possible. and resurfaced any as soon as thereafter to as In event, opening subject permit approval by shall be to the said street City Engineer's any regulating in accordance with Office the during Company same the of license. In the event the shall fail term the any period specified opening to within the maximum close street herein. by be, Company repair City hereby and the to the shall authorized and is Company agrees pay opening; all and the to costs resurface the street city. by City doing the demand of the In incurred the in the same deposit City, Company shall and maintain cash or discretion of the the City post sum of Five Thousand Dollars bond in the lieu thereof the ($5,000.00) Company a a fails street to to in to close be used the event City Engineer's satisfactory the time to within condition Office the opening specified. Upon Company a in to close street the the failure of deposit post make suca or failure to cash for bond specified, time the so, both, City Engineer's oo or Office to the by the notified when permits required any or permit thereafter be to refused be Company shall any City the in until opening of streets such the for or obtained issued City Engineer. of the to the satisfaction rectified violation Discriminatory Preferential or Practices 11. Prohibited. Section not, rate, cnarges, facilities, rules, as Company shall The any any person, respect, make other or regulations, or nor sub- any disadvantage, provided prejudice any person or nothing ject that prohibit shall be gra- deemed the this license establishment of a charges of and classified any scale rate schedules which duated to. coming entitled, within subject such classification would be customer regulations may and as now in rules are or effect such lawfully hereafter be the Public made Wyoming. Service the Commission of State of Approval Company of 12. Transfer. The shall or not sell Section another, system plant any rights or nor transfer its under transfer approval. Provided, without to another Council License no sale this vendee, assignee, be effective until the shall or transfer lessee has or instrument, executed, City duly office of the an. the Clerk filed sale, lease, assignment accepting reciting of such or the fact the terms license, agreeing thereof, perform and all the conditions the and of as information be submitted the other Public Service such Commission. Regulations. Section 13. Rules and (1) Municipal City may adopt regu- Rules. The such rules necessary powers it deems

lations the exercise its further provisions the ordinance. (2) right Inspection. City The shall the but have duty inspect performed subject all or installation work construction provisions Ordinance. Nothing contained herein be shall construed a limita- of, on, prohibition right right tion to exercise its eminent domain. City. Payment Company pay Section 14. shall to the gas system privilege operating equiva- a under sum license lent to: payable (a) which to the sums would been due and All agreement, expiration former franchise from date per Company operating plus if under at 10X annum was thereon interest ordinance, operating franchise, agreement, or otherwise former City. company within (b) paid prior sum shall be issuance Said Company. License percent monthly gross (c) taken revenues One City, all sales shall be on within received paid monthly gross monthly determination after revenue. charged Rates Rates. the Company service’ reasonable, designed snail fair hereunder necessary to meet all service, including costs rate fair return on the thereto, properties devoted valuation net efficient and eco- management. Company nomical to all autnority now or possessed City, regulatory hereafter body having com- jurisdiction, just, petent reasonable, to fix compensatory rates. (1) during the Savings If to Customers. term of the License funds, Company natural, if Company or the cost of received the the manufactured, reduced, by the or sold mixed license order of having jurisdiction body competent Company regulatory pass the any sball any resulting or savings refunds its consumers such to therefrom. on Reports. City and Records to shall 16. The have Section at access all contracts, Company's plans, all of the hours engi- and reasonable finance, accounting, statistical, customer, neering, and*: service records property relating operations and Company to the the of the and to all required kept following to be records other reports hereunder. records and City be with filed the shall Clerk and in the local office of the Company: (1) Copies Calorimeter Tests. all of calorimeter tests required hereunder. (2) Company Regulations. Copies rules, Rules and of such terms, by adopted regulations, and conditions it the conduct of its relating delivery to of to natural customers within the business City. (3) City Gross sball be delivered Revenue. There to the monthly summary report showing gross by Manager revenues received the operations City during preceding Company from within the the month City request respect information the with such other as shall and expenses Company's City. properties within and related the the City's Company Manager, (4)* Complaints. shall deliver complaints copies which receives from customers of all written and/OB company"s performance relating the of Service Commission the Public complaints this ordinance. Such shall be the and conditions of terms days (30) receipt. thirty of within delivered granted rights License and herein of License. Section Term 17. adoption of resolution from and after be in force shall and take effect Company acceptance by City. file of the by shall an Council and issuance City the with this Ordinance as established of license terms Clerk, a term of in force effect shall continue and the License Provided, (1) license date of issuance. effective one month after Company acceptance be considered filed shall if an acceptance Upon Company, license this Ordinance. violation of until from month month effect force shall continue full provide writ- Manager Mayor City the Council shall at the direction or Company license. said termination ten notice thirty days date said from the effective shall become Termination notice. 3illing Procedures 18. Information Section Contained Thereon. billing City customers statements Company's within shall include required City. be as January After information such an itemization billings include shall cost MCF; distribution; tax; cost Company a standard and the cost customer. per therm Filing. Company Notice any Rate during Section shall term pursuant granted authorized license of notify writing any Manager or Federal or State making rate adjustments, filing, cost or action would monetary upon the it's any affect or inhabitants. On the date filing such Company City Manager's shall also file with duplicate Office copy ¿aid any all documents or agency. materials filed any 20. Waiver. any The waiver breach terms conditions or License shall be limited act-or acts consti- breach, tuting and shall such never being'a continuing construed or permanent waiver conditions, such terms all of which full force and remain withstanding and effect happenings acts future not- such individual waiver breach thereof. 21. State Regulation. Section City Statutes and iaple- intends Wyoming 70, Statutes Forty Enrolled Eighth Legislature, ment Act by way 'ordinances, resolutions, regulations. of and Any rules and license pursuant issued terms of this rights ordinance to all granted privileges City 70, and Forty Eighth Enrolled Act Legislature or Wyoming, statute of including State of right eminent domain. In event of conflict between this ordinance and or Statute Public Regulation State Service Commission the State Statute Regulation prevail. shall Section 22. Penalties. any provi- Violation this Ordinance punishable sion thereof shall be in accordance Section 1-7 City Casper day Code. Each separate violation shall be deemed violation. Severability. section, provision, clause, Section 23. If invalid, sentence hereof shall be held validity shall effect remaining portions this Ordinance. 2 n . Date, Repealer. Section Effective effective date 10, July shall 1985. 25. This Ordinance full force and effect from readings. passage and after on three reading day

PASSED on 1st 19th 1985. _March_, day reading PASSED on 21st 2nd _May_, July PASSED, day AND 2nd ADOPTED APPROVED. AS TO

(cid:127)APP^tfVED FORM: CASPER, OF CITY WYOMING Municipal Corporation ATTEST: A Chadsey Mary L. Calvin L. Benrens City Clerk Mayor' franchisee, expensive gas of such less to its CARDINE, Justice, specially Inc., Energy, through K N for distribution Justice, MACY, concurring, with whom gas system Energy’s K N distribution joins. municipalities. in the customers opinion I in the of the court be- concur 16-85 was not ordinance number cause satisfy require public utility A must two City conferred within precedent privi to the exercise of ments amending legislature in and reenact- by the municipality in leges public utility of a in a 172, Wyoming ing chapter Laws of Session Wyoming. public utility the State Franchises, 1985, entitled Natural Gas com must from the obtain 15-1-103, W.S.1977, Appel- as amended. § mission a certificate of convenience Energy, supplying Inc. natu- lant K N was 37-2-205, necessity, provided as W.S. § Casper gas City ral to residents must a franchise from obtain through gas system distribution at a 13, 4, municipality, required by Art. § appellee claimed far exceeded cost which Wyoming Constitution purchased price at which could be W.S.1977, 15-1-103(a)(xxxiii), amend K supplied to N open in the market and K Ener under which N ed. The franchise legisla- intent of the Energy. It was the expired Casper gy operates in the reenacting amending ture Casper City of (and 1984. The other December empower 15-1-103 expen- K N arrange for a less franchise of municipalities) to has not renewed the delivery then, provide oper- Energy, sive source K has been Energy. N ating illegally without end a franchise in and distributors toward an result that Casper. Wyoming be furnished to residents at expensive and least cost fairest obtain- 15-1-103(a)(xxxiii)(C), Section as amend presently Energy compe- able. K N has no ed, provides that: supplying gas tition in to residents of the * * * all governing “The bodies of cities municipality Casper. possibility The * * * * * * [u]pon provide may renewal competition, however, always present, is that franchisee the franchise purchasers and that a benefit gas gas system furnish distribution that is intended our constitutional and through supplier, including statutory public for regulating scheme util- franchisee, may sell and distribute ities. provided by (b) gas natural as subsection 15-1-103, amended, Section as left the 8c # * » licensing power supervisory regu- provides Section then that 15-1-103 latory authority in public service com- question supplier whether or not another provided 37, Wyoming mission as in Title gas could supply system to the franchisee’s Statutes, Casper 1977. The at- approved must be submitted 16-85, tempted, in ordinance number to as- majority city; of the electors of the that supervisory, regulatory, sume and licens- public utility regulated continue ing granted City by functions en- public service commission and be actment of amended 15-1-103. Had the § compensated non-gas in the costs deliv- City Casper only powers exercised those ery; public service commission granted in already 15-1-103 and dis- § adopt quality and enforce minimum stan- cussed, I would hesitancy up- have no delivered; gas dards for gas that the of- holding its ordinance. delivery public fered for to the utility be supply years demand; sufficient to ten requirements, including report-

ing sendee commission. amended, 15-1-103,

I find as entirely

appropriate as within the scheme of fran creation,

chising oper construction and

ation of Wyo utilities the State of ming. 15-1-103(a)(xxxiii) provides STORY, (Defendant), Appellant John H. v. “no franchise be entered into with any person person given which that Wyoming, STATE exclusive right an any purpose (Plaintiff). what- Appellee * * (Emphasis added.) soever No. 87-243. prohibits Because the statute issuance of franchise, an Casper exclusive Supreme Court Wyoming. (a) could issue a franchise to another utili May (b) ty; itself construct distribution lines alongside appellant those of and compete appellant for customers purchasing

gas; (c) appellant's gas condemn distribu

tion system provided 15-1-103(a)(xxxiii)(C),which makes refer

ence to “renewal after condemnation of a

franchise”; (d) require that its fran accept

chisee supplier from another it through distribute distribu system. statute,

tion amended,

seems clearly policy pro further a state

moting competition among suppliers

Case Details

Case Name: K N Energy, Inc. v. City of Casper

Court Name: Wyoming Supreme Court

Date Published: May 11, 1988

Citation: 755 P.2d 207

Docket Number: 86-69

Court Abbreviation: Wyo.