*1 argues also that the motion for a trial Cabututan new without the availabil- ity transcripts of continuance his of denial rendered of the other trials. They he insuffi counsel ineffective because had are now available. We therefore re- a prepare Denying denying cient time to a defense. verse the order a new trial and continuance result the violation of remand the case to the trial court con- right defendant’s Amendment hearing Sixth duct anew on the motion for a interpreting counsel. In the standard set new trial. Washington,
out in Strickland v. U.S. (1984), 104 S.Ct. L.Ed.2d PREJUDICE claiming we stated that when ineffective decline to consider defendant’s asser- counsel, assistance of the defendant has prejudice of part jury, tions on the (1) demonstrating of that coun burden court, justice system and the because representation “objec sel’s falls below an provide legal analysis he failed of (2) tive standard reasonableness” these issues. deficiency prejudicial Frame, defendant. v. State in part Affirmed and reversed and re- (Utah 1986). Although Cabututan part. manded charges several instances of conduct his attorney objective which fell below an stan HALL, C.J., STEWART, DURHAM reasonableness, dard of he fails to show ZIMMERMAN, JJ., concur. alleged how preju these deficiencies were result, dicial to him. As a find
violation Cabututan’s Sixth Amendment
right to effective assistance of counsel.
DENIAL OF MOTION FOR NEW TRIAL
Cabututan next contends that the
trial court abused its in denying discretion his motion for new trial that he made on MOUNTAIN FUEL SUPPLY
the ground newly discovered evidence. Petitioner, COMPANY, testimony He asserts that his three co- gave subsequently defendants at their held exculpates supports trials him and his PUBLIC SERVICE COMMISSION claim of self-defense. The co-defendants UTAH, Respondent. OF testify trial, refused to at Cabututan’s in No. 910051. voking the protection of the Fifth Amend ment. He if trial new Supreme Court Utah. granted him again and the co-defendants Sept. testify, refuse transcript of their testi mony at their trials could be relied on. hearing
At the time on Cabutu- trial,
tan’s motion transcripts for a new
the other being prepared trials were but yet
were not arguing available.
motion, only Cabututan’s counsel could
generally testimony refer to the of the co- attempted
defendants. Counsel to show testimony
that their corroborated Cabutu-
tan’s testimony at his own trial that he had
acted in self-defense.
We conclude that the trial court was
unable fairly determine the merits *3 21, 1990, establishing new
ed November charges gas delivery for natural rates (i) challenges in Utah. Mt. Fuel “an historical test mission’s decision use rates; utility’s new year” determine (ii) “a fu- its refusal to admit evidence of (iii) refusal to make year”; ture test its adjustments on information obtained based (iv) year; after the historical average year- than a rate base rather base; (v) to reduce end rate its decision *4 rate of return on the Mt. Fuel’s authorized equity. Under the relevant shareholders’ decisions, for standards of review has not hold that the Commission com- making mitted reversible error However, because these determinations. the basis for the Com- we cannot discern the rate of decision reduce mission’s did, quantity so return it we remand may explain rea- that the Commission any necessary findings of soning make and fact. setting charged
The Commission Fuel, gas public the rates for Mt. a natural must establish utility. The Commission “just and reasonable” rates that are adjudication. through formal Utah 7—12(2)(b); id. 54-3-1. On see § 54— 31, 1989, notified the Commission October commencing it an inves- Mt. Fuel was utility’s and ordered tigation into the rates Gary E. G. Sackett and Charles Green- prehearing conference. it to attend hawt, City, for Mountain Fuel Salt Lake held on prehearing conference was Supply. allowing any 7, 1989. Before November Dam, Gen., Atty. David S. R. Paul Van its in- discussion, declared the Commission Christensen, Stott, Walgren, Kent David L. specifi- year, test an historical tent use Noda, Gen., Attys. L. Salt and Laurie Asst. year, to new test establish cally, City, and Lake for Public Service Com’n recognizing utility.1 While for the rates Utilities, intervenors Div. of Public Com- year test was of an historical use Services, Energy mittee of Consumer issue,” rea- significant the Commission “a Office. supported its decision was soned that it had used or was “precedent” because
ZIMMERMAN, Justice: year in two other using an historical test (“Mt. The Commission also rate-making cases. Supply Company Mountain Fuel although had used a future Fuel”) for of a Public Ser- noted that petitions review rate-making proceedings (“Commission”) past year dat- test order vice year projec- year” relies on generally 12- recorded. A future test The "test refers 1. utility's operations, Eugene period Rasmus- month costs, revenues, over which a M. Howe & F. tions. See Keith analyzed sen, investment are Utility 70-72 Economics and Finance Public year An determine new rates. test (1982) & Rasmussen]. Howe [hereinafter that have been concluded relies on events Fuel, involving an historical test On petitioned March relief, justified arguing was because there was “less[] that the Commission at least pressure inflation” and on rates” should use a “less year-end rate base4 and should make past. Finally, in the than adjustments number of noted that the choice of a changes compa- account various policy decision committed to its discretion ny's operations Following since 1989. 54-4-4(3). Nonetheless, by Code section evidentiary hearings, number of hearing the Commission ordered a to allow mission issued an order November argue Mt. Fuel to for the of a future 1990, setting period Mt. Fuel’s rates for the beginning December setting 21, 1989, On November is- rates, relied on sue came before the Commission. Mt. Fuel year, 1989 historical test did make argued that the Commission should use a post-1989 proposed adjustments, future test because would better average used an rate base rather than approximate period2 than rate-effective year-end rate base. The Commission also an historical test Mt. Fuel offered to reduced Mt. Fuel’s authorized rate re- *5 submit evidence of years, stating both test turn equity on from 12.2% 12.1%. that the evidence would show that a future petitioned rehearing, which the given test “makes more sense” “a full Commission denied. Mt. Fuel now seeks presentation analysis.” However, and ... review the Commission’s order. Mt. Fuel admitted that it did not know challenge We view Mt. Fuel’s as compris- give higher “which the two would or ing claims, five distinct which we address Although lower answers.” both Utah the following First, the order: we consider (“Division”) Division Public Utilities and Mt. Fuel’s on attack the Commission’s deci- the Committee of Consumer Services sion to use a 1989 (“Committee”)3 agreed that some evidence Second, we address Mt. con- Fuel’s related issue, should be on taken the the tention that the Commission improperly re- Commission ruled would not take company’s proffer fused the of future-test- any evidence on the matter and would use Third, data. we consider whether the the 1989 historical The Commis- in refusing Commission erred to make ad- sion provide any did not rationale other justments to the historical test based suggesting than “dueling models” post-1989 Fourth, on data. turn we to Mt. would consume too much “regulatory Fuel’s de- Commission’s closed, the hearing time.” Before average cision to use an year- rather than a taking said mission that it was official no- end supported by rate base is not the evi- previous tice of the years’ budget five fil- Finally, dence. we company’s address the ings made Mt. Fuel and the Division and claim that the Commission’s decision to re- rate of inflation for the last five duce the rate equity of return on is years. within statutory power 2. The period period during gating compliance rate-effective is the with Commission orders. which new rates would be in effect. At the Utah Code Ann. § 54-4a-l. The Committee proceedings, time of the November the rate- Legislature "was created to serve as 'ad period given effective was unknown. positions advantageous vocate ... of most to a ” filing, the time of the the earliest the rates were majority of residential consumers.’ MCI Tele. likely to become effective about De- Comm’n, Corp. Public v. Serv. 840 P.2d 767 1, 1990, expiration 240-day cember of the (Utah 1992) (quoting Utah Code §Ann. 54-10- imposed limit on final Commission action 4(3)); Dep't see also Utah Admin. Servs. 54-7-12(3)(b) (c). section Comm’n, Public Serv. 2 604 n. 54-7-12(3)(b), (c). (Utah 1983). with, alia, charged repre The Division is inter senting sion, public 4.Rate base interest is the investment base on before Commis which cases, investigating making policy rec is entitled earn a return. See & Howe Commission, ommendations and investi Rasmussen at 88. year is and Mt. alternative, moot and, unsupported by request for appeal simply the evidence. generally opinion, which is disfa advisory the standard of review. We first state by this v. Jack court. See McRae vored Adminis- parties agree The that the Utah (Utah 1974). son, 526 P.2d (“UAPA”) governs Procedures Act trative concludes, Therefore, the 63- present Code Ann. case. Utah §§ the issue of the should refuse to address -22; Corp. v. Pub- 46b-l to see MCI Tele. ques- related appropriate test (Utah 840 P.2d lic Serv. tions. 1992). provides in relevant The UAPA suggestion. decline the Commission’s part: Fisher, Wickham v. (4) appellate grant shall re- court 1981), recognized exception this court if, only agency’s lief basis “is the mootness rule when issue record, person seek- determines interest, concern, wide affects the ing substantially judicial review has been manner, and, likely to recur in a similar following: any of the prejudiced by person of the brief time one because affected, likely escape ju- would otherwise (e) agency engaged in an un- (citations dicial Id. at 899 omit- review.” decision-making pro- procedure lawful below, ted). For the reasons discussed cess, prescribed or has failed to follow all instant case meets four criteria. procedure; To consider whether the Wickham crite- here, met we must first determine
ria are
of the Commission’s decision
nature
upon a
(g) the
action is based
*6
Com-
regarding the
issue. The
fact,
implied by
or
determination of
made
historical
decision to use the 1989
mission’s
agency,
supported
the
is not
sub-
essentially the result of
year
test
was
two
light
stantial evidence when viewed in
of
actions. The first
discrete administrative
court;
the
the whole record before
policy
action
a
decision to create a
was
(h)
agency
is:
the
action
using
of
historical
presumption in favor
(i) an
discretion dele-
abuse
the
rate-making proceed-
in all future
year
test
statute;
gated
agency
to the
application
the
ings. The second was
(ii)
contrary
agency;
to rule
to
case.
policy
Mt. Fuel’s
(iii)
prior
contrary
agency’s
Commission’s
Our characterization
practice,
justifies
unless the
presump-
first
the creation
action as
giving
inconsistency by
facts and
favoring
year
test
is dic-
tion
an historical
reasons that demonstrate a fair and
the Com-
proceedings
before
tated
inconsistency;
rational basis for the
or
final order.
mission and the Commission’s
(iv)
capri-
arbitrary
otherwise
7, 1989, prehearing con-
At the November
cious.
ference,
the Commis-
before
discussion
63-46b-16(4).
Ann.
We will
§
use an
that it intended to
sion announced
apply
pertinent
ap-
UAPA
as
standard
explained that its
historical test
It
propriate.
based,
part,
in
on the fact that
decision
claims,
using an
test
turning
used or was
Before
to Mt. Fuel’s
had
rate-making
year in
other
cases.
first
two
address
parties
appeal
invited the
in this case is moot. The Commission nonetheless
year
points
why
test
would be
out that Mt. Fuel has
to show
another
hearing
case
more
and scheduled
requested
that we remand the
spe-
the November
require the
to consider a
to air that
issue. At
argu-
1989, hearing,
presented
Fuel
its
period
cific
and that the
Mt.
future test
why
should
year sought by
detailing
the Commission
future test
the ment
Thus,
is no evi-
proceedings
passed.
future test
There
below
now
contends,
dispute
suggest
over dence before us
adopted a
interpretive
not have
future
Understood
as
mission would
argued
year
company
guideline,
if the
had
suc-
the commission’s
to use
test
decision
cessfully
year
year
test
pre
that the future
would an historical test
as a rebuttable
approximated
sumption easily
have better
the rate-effective
meets the Wickham crite
facto,
period.
adopted
challenge.
De
the Commission
ria
avoid mootness
Obvi
year
pre-
rebuttable
ously,
concern,
the historical
as a
“is of
decision
wide
sumption.
interest,
affects the
likely
[and]
Wickham,
recur.”
test
was not
as a formal
first to
claim
that the
rule
policy
interpretive guideline
but constitutes a
favoring
decision of
an historical
application,
year
broad
it is an
rule
supported by
informal
or
test
is not
substantial
interpretive guideline.
evidence,
Gray
See
v. De
we conclude that Mt. Fuel cannot
partment
Sec.,
Employment
rely
particular ground
681 P.2d
on this
for relief in
(Utah 1984).
recognized
We have
challenging
guideline.
interpretive
An
interpretive guidelines
that the
guideline
agency’s
creation
is the
interpre
informal
legitimate
practice.
is a
administrative
See
tation of a
or formal rule.
statute
See
Congress
815-16;
Salt Lake Citizens
v.
Gray,
Mountain
P.2d at
Ken
see also
Co.,
1245,1252-
Davis,
States Tel. Tel.
846 P.2d
&
neth C.
Administrative Law the
(Utah 1992);
7:5,
(1989).
see also
Eighties
such,
SEMECO State
at 235
As
it is
§
Comm’n,
Tax
849 P.2d
essentially
legal
policy
1172-74
a
or
determination.
(Utah 1993) (Durham, J., dissenting).
Gray,
Although
Of See
P.2d at 815.
course,
agency
certain
setting
guideline may
adopted
decisions
have been
with cer
policy
mind,
must be made
formal rule mak
adopting
tain factual
scenarios
See,
ing.
e.g.,
agency typically
Williams v. Public Serv.
does not look to the evi
(Utah 1986).
it,
776-77
dence before
nor does it
to. Be
need
case,
In
however,
the instant
Mt.
63-46b-16(4)(g)
Fuel does
cause section
restricts the
not claim that the Commission should
inquiry
have
substantial evidence
situations
promulgated
preference
using
for
an
agency
upon
which “the
action is
a
based
year
fact,”
as a formal
ground
rule.
determination of
for re-
minimizing the
of forecasted data de-
a facial
use
invoked to mount
lief cannot be
guideline.
rived
technical and debatable methods.”
challenge
interpretive
order,
Also in the final
eontrary-to-prior-
As Mt. Fuel’s
for
major
had
had a
noted that Mt. Fuel
practice
it fails on the merits.
argument,
proceeding
since
which
com-
46b—16(4)(h)(iii)permits relief
Section 63—
mented
“unusual” and “undesirable.”
was
“contrary
agency
from
action that
using
The Commission stated that
an his-
prior practice” unless the
agency’s
year
torical
better allow it to
would
demon
“giv[es] facts and reasons that
of a
learn the actual circumstances
for the
a fair and rational basis
strate
thoroughly
that
“had
examined
At
7th hear
inconsistency.”
the November
years.”
some
prior
admitted that its
ing, the Commission
year
practice
a future test
had been
sum,
foregoing
that the
we hold
Fuel.
setting rates for Mt.
when
adequate
provide
a
more than
fair and
gave
think that the Commission
both
rational
for the. Commission’s deci-
basis
demonstrating a fair
and reasons
facts
is buttressed
sion. Our conclusion
adopting
the historical-
rational basis
adopted
an histor-
fact that the
test-year presumption.
presumption.
year only
ical test
noted
the No-
The Commission also
at
indeed, encouraged
Fuel was free—
—to
hearing
7th
of test
vember
choice
convince the Commission that a future test
year
policy
decision within its discre-
appropriate.
be more
tion,
does not
proposition
importantly,
contest. More
the Commis-
however,
argues,
although
a future test
sion indicated
supporting
record
is devoid of
appropriate
when interest rates and
reasoning to use
his
the Commission’s
unstable,
inflation are
an historical test
torical test
rather than
future
case be-
in the instant
rec
example,
For
it asserts
rates
are rela-
cause interest
and inflation
ord contains
indication of
actual
tively
grounds
static. These
were more
rate,
changed
it has
over
inflation
how
formally adopted at the November 21st
time,
approach to
how a
standardized
hearing, in which the Commission stated
in a
result
stan
test-year
issue would
taking
it was
official notice Mt.
approach to
issue
dardized
filings
budget
and the rate of infla-
manageable
in more
would result
years.
tion over the last five
See
This argu
proceeding.
less burdensome
63-46b-8(l)(b)(iv).
First,
interpretive
too
ment asks
much.
guidelines, especially flexible ones such as
hearing,
At the November 21st
presumption
favor
*8
using
stated
it
an
mission also
that was
year, do not need to
using
historical test
an
year
regulato-
as
historical test
a standard
by
quantum
same
of rea
supported
be
increasing
ry approach to
bureaucratic effi-
formal rule
soning
that a
and evidence
explained
ciency. The Commission
that a
815-16;
P.2d at
requires.
.Gray, 681
See
approach
lengthy
standardized
would avoid
Frohnmayer,
Trends in
Dave
National
evidentiary hearings regarding the most
cf.
Action:
Agency
Review
Some
Court
year. The
order re-
appropriate test
final
of
on Model
Adminis
State
proceed-
future
flected
decision: “[I]n
Reflections
Act
New Utah Ad
Procedure
and
trative
decide
con-
ings, the Commission will
issues
Act, 3 B.Y.U. J.
Procedure
ministrative
cerning
year
on the then
test
... based
1,
(1989)(“Many
the theoretical
6
Pub.L.
existing
conditions of the
and the
process—
the administrative
values
economy
it
operating.”
in which
The
efficiency, superior expertise and
speed,
“Actual
Commission reasoned:
quasi-legisla
if
lost
flexibility
advantages
simplicity
has
and
data
—can
process is
excessive over
general,
tive
fossilized
accountability.
such data can
lays
required procedure.”).
analysis,
thereby
be used for
case
422
Second,
Dep’t
perhaps
impor
more
Reg.,
and
Utah
Business
underlying the Commission’s Comm Cal.3d 217 43, 49, Cal.Rptr. (1985) guideline year historical test 387 favoring an (en banc); admits, must, Ayres as L.S. & Indianapo- Co. v. unsound.5 Mt. Fuel Co., Ind.App. 652, lis granted Light Power & legislature that has the Com (1976). However, 351 N.E.2d 828-29 public utility mission discretion under the why we see no reason the Commission can- year. code to choose the adopt historical-test-year not an presump- 54-4-4(3).6 However, § goal.7 Moreover, tion still reach this in point anything Mt. Fuel does not cited, Mt. Fuel nor we have found grounds record that undermines relied any authority supporting, an establishing an presumption that such somehow under- interpretive guideline favoring the use of goal.8 mines this an historical test appli- We now consider the Commission's level, aOn more fundamental the historical-test-year presump- cation of Fuel that Commission must tion to Mt. Fuel’s case. claims choose the “as nearly arbitrarily that the Commission acted representative pos of future conditions as capriciously, engaged proce- in an unlawful Dep’t Reg. sible.” Utah Business dure, company’s pro- and violated the due ’n, Public Serv. Comm rights refusing cess proffer (Utah 1980). principle, From this future-test-year The data. Commission ar- apparently contends the commission gues properly excluded the evidence presumption cannot establish a in favor of explain because Mt. Fuel had failed to and, historical test for each rate- degree pro- “how and what the use of making proceeding, must make factual jected opposed data as data actual demonstrating findings that the test [change] the Company’s require- revenue approximates chosen pe rate-effective ultimately ment or rates arrived at agree riod than better other. We Commission.” goals one of the fundamental of rate mak ing is to select a reasonably agree Commission that approximates period. the rate-effective Mt. Fuel failed to establish the relevance of 5. The standard of practice, review under the UAPAfor an tional unless the Commission deter- guidelines agency’s interpretive is unclear. Be- mined that economic called conditions for the parties cause the have briefed the issue and use of a future test answer, suggests our own research no clear we attempt appropri- do not at this time to set the traditionally service Public commissions have only ate standard. We note that even under the years, used historical test and the use of histori- rigorous UAPA’smost standard for review of years predominates today. cal test See Howe & determinations, agency policy find Com- surprising; at 71. Rasmussen This is not mission’s rationale to be sufficient. 1935, ”[P]rophecy, Justice Cardozo wrote in honest, states, 54-4-4(3) commission, generally poor 6. Section however "The substitute rates, just experience.” its determination of and reasonable West Ohio Gas Co. v. Public may changes utility’s 79, 82, consider 324, 325, recent fi- Util. 294 U.S. 55 S.Ct. adopt appro- nancial condition ... (1935). L.Ed. priate period." future test Utah Code Ann. 54-4-4(3) added). (emphasis legislature *9 only 8. The authorities Mt. Fuel cites stand for provision added this in 1975. 1975 Utah Laws proposition public the that service commis- 166, time, ch. 1.§ Prior to that the Commis- rely particular year sion cannot on a as an year an sion used in all rate- exclusive standard when the evidence shows making proceedings similar to that at issue approximate that another test would better legislative history respect here. The See, period. e.g., the rate-effective West Ohio change sparse, appears is but it Co., 81-82, Gas 294 U.S. at at 55 S.Ct. 325. As change was made to allow the Commission to text, explained we have the Commission’s high rap- better take into account idly increasing inflation and suggests using presumption in favor an historical test costs. This that the only presumption. that —a legislature envisioned that apply year, would an historical test as was tradi- Second, recognizes, as At the November proffered the evidence. utility law that the public tenet of basic offered to submit hearing, Fuel 21st Mt. establishing “just utility the data, has burden future-test-year historical- and both Dep’t rates. and reasonable” Utah filings “give would the stating that the two 1245. It would Reg., 614 P.2d at Business every opportunity to decide with this tenet to allow a be inconsistent representative test what the utility engage the Commission to to force attempt argue Fuel did not year.” Mt. rate-making analysis in an of two models ap- better why a future test would utility any itself does have when the period than proximate the rate-effective actually will analysis idea what such an year, commenting only that historical test produce. what that we can show that “we believe year.” projected sense is ... a makes more Third, reviewing for a court added.) Indeed, Mt. ex- (Emphasis Fuel UAPA, it must deter grant relief under having knowledge pressly disavowed “substantially party mine that the been fact evidence would in regarding what the prejudiced” complained-of agency Company doesn't know establish: 63-46b-16(4). “[T]he Ann. action. Utah Code give which of two would even now words, In other we must be able to deter ” higher or lower answers.... alleged mine error was not harm Int’l, v. Auditing less. Morton Inc. See Mt. that as a matter Fuel (Utah 1991). Thus, Div., 814 P.2d law, utility the Commission should aggrieved party must able to demon be put it on the have allowed future-test- preju agency’s action has strate how Otherwise, be year evidence. we would (noting 584 n. 3 diced it. id. at Cf. seeking relief “impos[ing] utility 63-46b-16(4) patterned after the section pres- impossible evidentiary standard of Procedure Act Model State Administrative This has no in law.” cience that basis showing “requires provision argument is unfounded. appellate court prejudice for an substantial case, grant relief”). In instant noth First, authority legal Fuel cites ing in indicates that the Commis the record supporting position, explain nor does proffer, even rejection sion’s “impossible” it to why would be error, substantially prejudiced the util if show, evidence, putting on short of ity. traditional harmless er Applying our the use of a future test would better formulation, simply say cannot ror period. approximate the rate-effective Un- preclude decision to UAPA, the Commission has discre- der assuming it future-test-year evidence— immaterial, “irrelevant, to exclude tion our confidence incorrect—undermines unduly repetitious” evidence. Utah See, e.g., v. Fire Crookston the outcome. 46b—8(l)(b)(i); Ann. see also § 63— (Utah Exch., 796-97 Ins. why no reason this R.Evid. 403. We see 1991). should more constrained discretion in this than other administrative context Finally, of exhaustion the doctrine that, at a proceedings. It seems to us may require Mt. remedies of administrative minimum, utility infor- could take the relevancy of the demonstrate the models, mation calculate general, party two excluded evidence. generated requirements rates and revenue administrative remedies must exhaust its model, inform the Commission seeking judicial each prerequisite review. 46b—14(2); This at least alert of the difference. S & Utah Code See § 63— in G, Commission that the models result 797 P.2d Morgan, Inc. 1990); (Utah also could sum- v. Iver different rates. Tax Comm’n State 1989). son, comparative 524-25 Un marize for the Commission the principle derpinning doctrine is the strengths and weaknesses of each model *10 ap on an error is considered economy the and the needs that before relation to opportuni- the peal, should have company. the 424 See,
ty Iverson, argues 782 P.2d Mt. Fuel also that e.g., to correct it. the Commis- 524-26; Express unlawfully to post-1989 at Intermountain sion refused make Pacific Comm’n, 15, adjustments v. 7 Utah 2d to the historical test Co. State Tax 19, 549, (1957). party 552 order 316 P.2d If The Commission’s final recites seven relevancy post-test-year adjustments proposed to attempt by does not establish the it, of evidence it seeks to introduce but is Fuel. Based on the evidence before the challenge agen the allowed on review Commission determined that the effect cy’s finding adjustments irrele in- decision evidence these “would be a small vant, abridged. period in test principle this South crease revenues and a much Cf. Corp. larger period land 23 increase in expenses.” v. Industrial 96-97, (1969) Nonetheless, rejected Utah 2d the the (recognizing petition adjustments company’s proposed rule that for rehear- because ing sup- they certainly evidence be “almost the upset based on new must [would] revenues, ported by give proffer enough expenses, detailed match of itself). agency opportunity implicit to correct This It investment.” the Commis- particularly agency’s the ex- order that it post- true when sion’s also found that pertise gauge signifi- test-year adjustments it to required would allow the were not reasonably proffered approximate cance of the evidence than better future circum- a reviewing court. As we said in Union stances. Steel Railroad Structural & Pacific Forge Mt. Fuel the essentially contends that Co., 2d 9 Utah refusing adopt Commission erred in the (1959), raising “In issues fact not cases post-1989 adjustments because the Com- experience within the conventional showing did not findings mission make judges ..., agencies the created unadjusted historical test legislative regulating branch sub- approximate better would the rate-effective
ject matter should first be
Id. at
heard.”
period
adjusted
than an
one. Mt. Fuel
318, 344 P.2d
at
part
this
general
makes
of its
claim that the
Commission’sdecision to
requiring
Mt. Fuel
sup-
historical test
is not
it to
significance
proffered
show the
ported
substantial evidence. We have
evidence is inconsistent with “the character
already ruled on
respect
this issue with
legislative
rate-making as
function.”
adopt
Commission’s decision to
Although
agree
making
guideline favoring
an historical test
function,
largely
legislative
Dep’t
guideline’s application
and the
to Mt. Fuel’s
Reg.,
Business
P.2d at
of
does not entitle
case.
we have not considered
present
what
Mt. Fuel’s
lack-of-substantial-evidence
ever
having
evidence it wishes
at
without
respect
claim with
to the
de-
Commission’s
least some firm idea of what it
show.
will
cision to use an unadjusted 1989 historical
hand,
On the other
if a utility makes a
post-1989
the face
evi-
proffer,
sufficient
put
dence Mt. Fuel
it.
before
obligated
be
accept the
evidence and
necessary
make the
findings.
factual
Such
To the extent that Mt. Fuel’s
made,
a showing
example,
could
challenge
rejecting
post-
decision
demonstrating
proffered
data
test-year adjustments is
meant
to be
significant
would result in a
difference
claim that the
was not
decision
based
showing,
rates. After
such
the Commis
evidence,
substantial
such an attack fails
sion
accept
should
the evidence.
because
Fuel has
marshaled
short,
prepare
supporting
wanted to
the Commission’s deci
case at
presented
UAPA,
the same time it
it. The
aggrieved
sion. Under the
par
well
ty
sup
acted
within its discretion
“must
marshal all
the evidence
in refusing
porting
to invest its time in such an
findings
despite
and show that
facts,
endeavor.
supporting
See Utah
63-46b-
the [agency’s] find
8(l)(b)(i).
ings
supported by
are not
evi-
substantial
*11
31,1989,
day
last
v. December
the
of the 1989
Bank
Boston
First Nat’l
dence.”
of
799 P.2d historical test
the Commis-
County
Equalization,
Bd. of
1990);
1163,1165 (Utah
adopted
average
accord Hales
rate
Sand
sion
an
base
the
Div.,
is,
Gravel,
average
year,
Inc. v. Audit
that
the
value of the
&
test
court,
1992).
In its briefs to
over 1989. The Commission rea-
rate base
final
only
Fuel
the Commission’s
(i)
methodology
Mt.
cites
that
had
soned
used this
neglects
any
to cite
of the evi-
order and
most recent
West
the
U.S.
Communica-
record,
paginated
contained
Light
dence
Company
tions and Utah Power &
3,000 pages long.
nearly
Howev-
cases;
which
(ii)
average rate
rate
an
base allows
er,
itself indicates that evidence
the order
matching
expenses,
of revenues and
where-
supported the Commis-
presented that
was
year-end
poten-
as
rate
creates a
the
base
post-1989 adjust-
of the
rejection
sion’s
tially misleading picture of the rate base at
pre-
the
example,
ments. For
Committee
(iii)
point;
year-end
the use of a
one
testimony showing
post-test-
that
sented
substantial,
requires
difficult ad-
rate base
necessary
period adjustments were
justments
expenses.
to revenues and
approximate future circumstances.
reasons,
Fuel
indi-
Mt.
that these
that Mt. Fuel’s chal
To the extent
concert,
vidually or in
are insufficient to
the
lenge is
the
Com
reasonableness
decision to use
support
Commission’s
unadjusted
use an
test
mission’s decision to
average
Again,
an
rate base.
Mt. Fuel
company’s claim
fails.
year, the
also
We primarily
theme
relies on the
that
there
already
rejected Mt. Fuel’s
have
claims
showing
must be substantial evidence
that
adopted
improperly
an
that the Commission
using
selected test
an
—calculated
basis,
From this
we
average
rate base—best models
rate-
say
cannot
that the Commission’s decision
period.
effective
adjust
not to
historical test
response,
contends
In
Commission
persuaded
unreasonable. We are
improperly
if it had
ordered an
that even
making
that
selec
Commission’s rationale
base,
average rate
not shown
post-test-year adjustments
tive
to the his
required by section
prejudice as
substantial
result in a
torical test
chosen would
63-46b-16(4)
provision
the UAPA. This
revenues,
in
mismatching
expenses,
if,
grant
“only
on the
courts to
relief
allows
importantly,
more
Perhaps
vestment.
record, it
agency’s
determines
basis
show,
argue,
Fuel
much less
failed
judicial review has
person seeking
post-test-year adjustments
proposed
its
substantially prejudiced” by the com-
been
In
would not result in such mismatch.'
63-
plained-of action. Utah Code
sum,
challenge
to the Commis
46b-16(4).
brief,
its
rejecting
post-test-year
sion’s decision
average
use of an
demonstrated
using
unadjusted
adjustments and
year-end
re-
than a
base
rate base rather
year fails.
$148,290 in
revenue.
additional
sulted
argument, Mt.
closely
In a
related
agree with the
improperly
claims
the Commission
showing
belies a
of sub
average
rather than a
that this increase
used an
rate base
prejudice.9 Mt. Fuel makes
at
rate
to calculate the value of
stantial
year-end
base
calcula
purpose
tempt
dispute
company’s
for the
assets
company
explain
or to
how
determining the authorized rate
return.
tions
by an increase in
filing
substantially prejudiced
Mt. Fuel made its rate
on the basis
we
basis
company’s rate
Nor do
see
obvious
the value of the
base
revenue.
so,
made certain factual
done
Mt. Fuel admits that
decision
base,
findings
support
appropri-
its decision
aver-
like
for the
rate
base,
age
findings
Fuel now
year,
basically
policy
which Mt.
decision com-
ate
text,
stated
the reason
mitted
discretion. Howev-
contests. For
to the Commission’s
er, here,
rejection
not reach Mt. Fuel’s lack-of-substantial-
unlike
Commission’s
need
data,
future-test-year
because we find
error
had taken
Having
year-end
rate base.
harmless.
evidence as
*12
matter,
determining
in
for
Fuel
As
the record
Mt.
a threshold
we
note
Mt.
substantially prejudiced.
would be
Conse- Fuel does not claim that the Commission’s
if the
quently, even
Commission erred in decision to lower the
rate
authorized
of
base,
average
using an
rate
we are
return
confiscatory
any way
or in
vio-
grant relief on
permitted
ground.
this
lated the United States or the Utah Consti-
Int’l, Inc.,
The commission
holding
that a
service commission
supervise and
jurisdiction
power
utility’s
authority
has no
decrease
state,
public utility
regulate every
equity
penalty
of return on
for mis
supervise all of the business
and to
*13
management.
especially
It
relies on South
state,
utility in this
and
every
public
such
Utility
Telephone
Regu
Bell
Co. v.
Cent.
specifi-
herein
things,
do all
whether
to
Commission,
(Ky.
From review of we cation of the evidence before the Commis find that there is sion, substantial evidence to by suggested excerpts above, as support the Commission’s decision to de bottom, obvious. At say we cannot crease the rate of return as a means to the Commission must to act wait until modify encourage Mt. Fuel to its affiliate specific there is irrefutable evidence of the relationships. ample There was evidence impact on consumer costs. suggest before the Commission to that Mt. However, question of whether the relationships Questar with and vari support evidence is sufficient to ous affiliates potential carried the for costs mission’s decision to decrease rate of and risks Mt. Fuel they to customers that by return remains. The 0.1% incur in setting. a true market attempt explain does not to or to refer us For one example, Division witness testified any suggesting to why evidence a 0.1% that Mt. was a “captive customer” of appropriate, opposed to, decrease is as for Questar Questar and therefore had no in example, a decrease. 0.05% Rath- 0.2% centive to deliver service efficient to Mt. er, the Commission contends that it can Fuel. The witness also said because any establish the rate of return at level it Questar engaged in other businesses in long range determines so as it is within the competitive markets, may “there be an in by expert testimony established and is not higher proportion centive to allocate a Thus, confiscatory. the Commission ar- Furthermore, the costs” to Mt. Fuel. gues, because Fuel does not claim that Division, witness testified that the based on reduction instant case is confisca- investigation, its had observed “a number tory and the rate of return 12.1% autho- examples of [Questar] policy decisions rized falls to range within 11.6% 13% and actions that to appear contrary ... by expert testimony, established Mt. Fuel’s to the best interests of the customers” of rejected. must be Mt. Fuel. true, asserts, It is as Mt. Fuel recognize that it be diffi approved Mt. Fuel’s relation- cult why particular to articulate decrease ship Questar with in a 1984 order formally of return rate is more authorizing reorganization than prompt result- another as a to method ed in the current corporate utility mismanagement structure. to correct or ineffi However, one ciency. condition of order was the Commission must that Mt. Fuel maintain “arms-length” provide choice, some rationale for its if for Questar relationship with and its affiliates. no other reason than insure its testimony power Commission heard equitably that this respect is exercised with condition been had several jurisdiction. violated times. all under its utilities See Co., substantially prejudiced show that it was Lighting & Power Houston Otherwise, decision to use an once the at 104. Com- S.W.2d average year-end in- rate rather than a utility mismanagement or base mission finds judicial any it rate and thus not entitled to efficiency, it could order reduction base wishes, (v) ground; long so as relief the Commis- reason wishes to reduce rate return is within the sion acted within discretion resulting testimony. rate of return a method range expert Without some the authorized mismanagement or ineffi- cannot be assured that correct explanation, we arbitrary capricious. ciency explain adequately failed but has such action is 63-46b-16(4)(h)(iv); of return why see reduced rate 0.1%.12 Therefore, Lines, affirm the Commission’s or- Truck Inc. Public also Milne explanation der remand but Serv.
1986). reasoning respect to Commission’s issue. rate-of-return
Here, attempt the Commission makes explain why it reduced the authorized HALL, C.J., HOWE, C.J., Associate 0.1%, of return much less cite concur. supporting its decision. We *15 think, however, not this failure do J., STEWART, in concurs the result. setting the aside Commission’s warrants Justice, DURHAM, dissenting: rate of re- determination the authorized rejected respectfully have all the I dissent. Utah Code Ann. turn. Because we order, 63-46b-16(4)(g) appellate an challenges requires to the Commission’s other opportuni- to the record to deter should have the court review whole explain why supported the action ty to it settled on mine whether is 0.1% reopen party chal being reduction before forced to the substantial evidence. “[The] findings rate-making proceeding. lenging re- the of fact We therefore [Commission’s] may explain mand so that the Fuel this must marshal Commission case] [Mountain and, any supporting findings make all the the reasoning possible, if evidence supporting facts, findings. despite the and show that light conflicting and in or contradic (i) sum, following: In we hold the The evidence, findings sup the are not tory improperly did act decid- not ported by substantial evidence.” Grace ing to use an historical deter- Drilling v. Board Review Indus. of 63, rates; utility’s (ii) mine the the new Com- (Utah Ct.App. in re- mission did not abuse its discretion 1989) (emphasis original); Cornish cf. fusing to admit evidence of a future test Roller, Town (iii) year; Mt. Fuel has failed to marshal 1988) (to the trial mount an attack on challenge sufficiency evidence to the the fact, appellant must findings of “an court’s supporting the Commission’s deci- evidence supporting the trial marshal the evidence utility’s proffered reject post- sion to the findings”). court’s test-year adjustments, and the Commis- persuades the me unadjusted My record sion’s decision review reasonable; (iv) competent simply there evidence Fuel failed dissent, see the Commission’s deci- In her Justice Durham first states And we cannot how future-test-year accept she not to the data finds no substantial evidence in the sion it supporting Fuel admitted that did decision to unreasonable when Mt. record rely goes know would show. Under on an historical test and then on what data view, utility apparently, say the had no reasonable Justice Durham’s possibly ger- justification refusing put to take fu- on or rational ture-test-year entitled rate-making proceeding arguments without Both miss evidence. mane any clear, showing opinion the evidence has the As our makes the whether mark. adoption Nothing probative of the historical-test- value. Commission’s year presumption code, UAPA, supports interpretive guide- law such a the or our case created such, finding. it as a rule of position, As nor does make sense was not factual line: substantial evidence standard is procedure. inapposite. administrative supporting put to to regarding Commission’s decision on evidence then, rely on an historical test in this issue. ease. Even was only appears only basis for decision responding to the request Committee’s precedent, speculation potential about that the Commission take official notice models, problems competing economic budget inflation rate all filings given and some financial considerations the Division and Mountain Fuel only cursory after treatment the Commis- past years. The response five re- to that sion denied proposal. Mountain Fuel’s quest simply that “the Commission None of these considerations rise to the passing will do so on whether it is ... of satisfying level the substantial evidence necessary or interpretation an accurate test. statement, responsive APA.” This rendered, made after its decision was does years The fact that historical test have not indicate that the Commission took eco- past rate-making been used in some cases nomic into circumstances account in decid- reasonably support does not itself ing to use an historical test test-year period decision to use such a fact, case. Commission has Mountain main argument at years used both and future 21, 1989, hearing November was that in prior Indeed, rate-making cases. since opportunity should have the present 1970s, general approach has been data it believed was to estab- for Mountain Fuel’s rates to be determined just lish and reasonable rates for the 1990s. the basis of future test Mountain proposed that it file both an case, historical- future-test-year and a al- expressed The Commission concern at lowing parties to make pre- whatever hearing November pos- about *16 arguments sentations they and fit problems saw “dueling” sible with models used based on the in information from fil- future-test-year those possibility case. The ings. might The Commission problems then consider purely speculative such giv- filings, along both any presentations en that the models were not even exis- arguments, and and make tence a reasonable at the time the Commission deter- judgment as one representative most mined to year. use an historical test Fur- period ther, for which the rates were to Mountain Fuel indicated that compet- apply. Although ing Mountain Fuel present indicated problems models would not argue it would for the future test past have arisen because year, propose it did not that the now uses a Commis- technique “budgeting called the simply sion process.” future-test-year pe- choose explained Mountain Fuel riod. go Mountain Fuel was willing this is superior method to those used forward with both an previously histori- straightfor- because it more cal and a future test ward The Commis- analysis. and more amenable Ne- sion, however, rejected vertheless, Mountain Fuel’s explore the Commission did not proposal, thereby declining budgeting process, details of undertake nor any comparative analysis of did it the historical raise further concerns about and point, future At dueling majori- data. models. ty’s assertion that the Commission was only plausible The basis for the Commis- merely relying presump- on a “rebuttable sion’s impact general decision is the eco- tion” in favor of historical test circumstances, nomic such as inflation fails. Simply put, Mountain de- Fuel was rates, period. brief, on a test-year In its opportunity nied an to rebut the Commis- it took into sion’s “presumption.” account economic deciding circumstances in There was no reasonable or jus- rational the record indicates that the Commission in tification for the Commission’s refusal fact never raised or discussed parties economic take evidence from on the test- circumstances until it rendered its issue. record The reveals that after rejecting decision involved, Mountain proposal parties other the Division and the
431 other treated Committee, reach issues position that it would took the majority opinion. appropriate for the helpful probably and on the issue to take evidence as to the determination then make its and test-year period. Committee
proper “there should be a specifically that
stated hearing so that the Commis- factual
brief something to base its conclusion
sion ha[s] has some Although the Commission
on.” period,1 choosing discretion Utah, Appellee, Plaintiff and STATE of upon rest some sound its decision must basis, upon evidentiary fiat. First v. County Bd. Boston v. Nat’l Bank DELI, Defendant Edward Steven (Utah P.2d Equalization, Appellant. 1990); Review In Hurley v. Board of (Utah P.2d 526-27 dus. No. 910306. 1988). The abused its discre- Supreme Court of Utah. opportu- denying Mountain Fuel tion nity fully to be heard. Oct. competent
Because the record reveals no justification for
basis was, view,
decision, in my unrea- action arbitrary capricious as an act.
sonable
In Milne Truck Lines Public Service
Commission,
1986), this court found essential findings subsidiary
Commission make so as demonstrate a
sufficient detail con-
logical legal basis its ultimate “[Findings sufficiently
clusions: should be *17 steps by which the
detailed to disclose conclusions, or conclusions
ultimate factual law, are Id. I mixed fact and reached.” case, Milne, this that in this
believe “perform findings needs
court detailed reviewing the Commission’s
its dut[ies] legal with established
order accordance protecting parties
principles arbitrary capricious from Id.; action.” see also administrative Found, v. Legal States Public
Mountain Comm’n, 636 P.2d
Serv.
1981) legitimacy of the Com- (legality and rest well-articulated
mission’s orders reasons).
findings and The Commission sufficiently findings
has not made detailed case. foregoing,
Based on the I would reverse order, for a remand hear-
ing test-year question, and decline to on the 54-4-4(3).
1. Utah Code Ann.