1. (a)

   1. (1) In this section the following words have the meanings indicated.

   2. (2)

      1. (i) “Bonus” means a form of direct or indirect payment, consideration, or compensation that is paid or conveyed to an employee of a public service company in addition to the employee's base pay.

      2. (ii) “Bonus” includes:

         1. 1. compensation that the public service company does not formally label as a bonus payment;
         2. 2. any form of incentive compensation the fact and amount of which is under the discretion of the public service company until a time close to the end of the period for which the incentive payment is paid; and
         3. 3. payments given in addition to base pay that are contingent on the occurrence of one or more events or conditions.

   3. (3)

      1. (i) “Compensation” means a form of payment or consideration conveyed to or for the benefit of an employee of a public service company, the parent company of a public service company, or any other affiliate of a public service company in connection with the employee's work for a public service company.

      2. (ii) “Compensation” includes:

         1. 1. direct and indirect methods of conferring benefits;
         2. 2. cash and noncash benefits;
         3. 3. salary, bonuses, period payments, and severance pay; and
         4. 4. the value of a perquisite, compensatory or paid leave, or other benefit not excluded under subparagraph (iii) of this paragraph.
      3. (iii) “Compensation” does not include any expenditure of a public service company for health, medical, dental, vision, or life insurance or disability pay.

   4. (4) “Supervisor” means an employee of a public service company, the parent company of a public service company, or any other affiliate of a public service company who:

      1. (i) using the employee's independent judgment:

         1. 1. is authorized by the employee's employer to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees;
         2. 2. is responsible for directing the work performance of other employees; and
         3. 3. is responsible for responding to employee complaints; or
      2. (ii) is employed in a bona fide executive capacity under the federal Fair Labor Standards Act.
2. (b) This section applies only to a public service company that is an investor-owned electric company, gas company, or combination gas and electric company.

3. (c) A public service company may not recover through rates any costs associated with:

   1. (1) membership, dues, sponsorships, or contributions to an industry trade association, group, or related entity exempt from taxation under § 501(c)(6) of the Internal Revenue Code;
   2. (2) the acquisition, use, or allocation of costs associated with a private plane that is owned or leased by the public service company or its holding company; or
   3. (3) compensation for a supervisor that exceeds 110% of the maximum annual salary payable to the chair of the Commission for the same calendar year.

4. (d)

   1. (1) The board of directors of each public service company shall adopt a company-wide policy placing reasonable cost limitations on expenditures that the public service company intends to recover through rates for:

      1. (i) entertainment and events;
      2. (ii) office and facility renovations;
      3. (iii) transportation services, including aviation;
      4. (iv) staff development activities or events;
      5. (v) performance incentives; and
      6. (vi) other activities outside the scope of the normal course of business operations.

   2. (2) Each public service company shall send a copy of the policy adopted under paragraph (1) of this subsection to the Commission:

      1. (i) as soon as practicable; and
      2. (ii) each time the policy is updated, but not less than once every 5 years.
   3. (3) The Commission may review in a base rate proceeding the reasonableness of the cost limitations in a policy adopted under paragraph (1) of this subsection.

Added by Acts 2025, c. 625, § 3, eff. June 1, 2025; Acts 2025, c. 626, § 3, eff. June 1, 2025. Amended by Acts 2026, c. 353, § 5, eff. May 12, 2026.