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South Dakota Public Utilities Commission Meeting
Thursday, October 19, 2006, at 8:30 A.M. MT, 9:30 A.M. CT
Board Room, Rushmore Plaza Holiday Inn
505 N. Fifth St., Rapid City, South Dakota
MINUTES OF THE COMMISSION MEETING
Chairman Bob Sahr called the meeting to order in Rapid City, South Dakota. Present were Vice Chairman Dustin Johnson; Commissioner Gary Hanson; Commission Advisor Greg Rislov; Commission Attorneys Rolayne Ailts Wiest and John Smith; and Staff Analysts Keith Senger, Harlan Best, and Steve Wegman.
Present in Room 412 in Pierre were: Executive Director Patty Van Gerpen; Staff Attorneys Karen Cremer and Kara Van Bockern; Staff Analysts Nathan Solem, Phil Lusk, Dave Jacobson, and Bob Knadle; Consumer Affairs Supervisor, Deb Gregg; and Administrative Secretary Carol Zebroski.
Also present in Rapid City were: David Gerdes, May, Adam, Gerdes & Thompson, representing NorthWestern Energy; Bob Miller, South Dakota Electric Utility Companies; Jackie Sargent and Kyle White, Black Hills Corporation; Rich Coit, South Dakota Telecommunications Association; Talbot Wieczorek, Gunderson, Palmer, Goodsell & Nelson, representing Alltel Communications, Inc.; and Linn Evans, Black Hills Corporation.
Joining the meeting by telephone were Jeff Decker, NorthWestern Energy; Richard Haubensok, Cornerstone Energy; Dave Badura and Suzan Stewart, MidAmerican Energy; Bill Taylor, Woods, Fuller, Shultz & Smith, representing Heartland Consumers Power District and South Dakota Power Company; and Jim Berg, Basin Electric Power Cooperative.
Administration
1. Approval of the Minutes of the Commission Meetings Held on May 23, June 13, July 11, August 8, August 23, September 12, and September 26, 2006, and Ad Hoc Meetings Held on June 6, July 20, and August 21, 2006. (Staff: Tina Douglas)
Chairman Sahr moved to approve the Minutes of May 23, June 13, July 11, August 8, August 23, September 12, and September 26, 2006, Commission Meetings and Ad Hoc Commission Meetings of June 6, July 20, and August 21, 2006. Commissioner Hansen seconded and Commissioner Johnson concurred. Motion passed 3-0.
Consumer Reports
1. Status Report on Consumer Utility Inquiries and Complaints Received by the Commission. (Consumer Affairs: Deb Gregg)
Ms. Deb Gregg reported that the Commission had received a total of 1,964 consumer contacts during 2006. Since the last report was prepared for the September 26, 2006, Commission meeting, 186 of these contacts had been received; 46 contacts involved telecommunications services; 36 contacts involved electricity issues; 23 contacts involved natural gas issues; 28 contacts involved cellular phone issues; 20 contacts involved do not call issues; 3 contacts involved wind energy issues; and 30 contacts involved issues not regulated by the Public Utilities Commission. In 2006, 1,644 of the 1,964 complaints registered have been resolved informally. In 2005, 1,674 of the 1,885 complaints registered have been resolved informally.
Telecommunications
Mr. Phil Lusk stated that on July 7, 2006, Embarq Communications Inc. filed an application seeking a Certificate of Authority to provide a broad range of resold switched and dedicated 1+ interexchange telecommunications services to residential customers (voice only) and business customers (voice and data) within the State of South Dakota. Mr. Lusk recommended granting a Certificate of Authority to Embarq Communications, Inc. with the condition that Embarq Communications, Inc. carry a $ 25,000.00 bond.
Chairman Sahr moved to grant Embarq Communications, Inc.'s Certificate of Authority subject to a continuous $25,000.00 surety bond. Commissioner Johnson seconded and Commissioner Hanson concurred. Motion passed 3-0.
Mr. Nathan Solem stated that on July 12, 2006, Yestel USA, Inc. filed an application seeking a Certificate of Authority to resell interexchange services including 1+ outbound dialing, 800/888 Toll-Free inbound dialing, directory assistance, and postpaid calling card services throughout South Dakota. The applicant has requested a waiver from filing financial statements as required by ARSD 20:10:24:02(8) and has agreed to restrictions from offering any prepaid services and from collecting customer deposits or advanced payments. As the applicant has met the requirements for the granting of a Certificate of Authority, Mr. Solem recommended the Commission grant the waiver request and issue Yestel USA, Inc. an Interexchange Certificate of Authority subject to restrictions from offering any prepaid services and from collecting customer deposits or advanced payments without prior approval of the Commission.
Chairman Sahr moved to grant the waiver of ARSD 20:10:24:02(8) and grant Yestel USA, Inc. Certificate of Authority subject to restrictions from offering any prepaid services and from collecting customer deposits or advanced payments without prior approval of the Commission. Commissioner Hanson seconded and Commissioner Johnson concurred. Motion passed 3-0.
Mr. Phil Lusk stated that on July 13, 2006, YMax Communications Inc. (YMax) filed a petition for exemptions or waivers from: developing company-specific cost-based switched access rates; use of the formula in ARSD 20:10:27:12, so that YMax may mirror the Qwest Corporation tariffed access rates; calculation of billing and collection costs as set forth in ARSD 20:10:27:13; and the requirement, as set forth in ARSD 20:10:27:07, that YMax file cost data in support of its switched access service tariff no less than once every three years. YMax also petitioned for approval of its access services tariff. Mr. Lusk recommended approving the exemption or waivers of ARSD 20:10:27:12; ARSD 20:10:27:13; and ARSD 20:10:27:07, and approval of its access services tariff.
Commissioner Hanson moved to grant the waivers of ARSD 20:10:27:12; ARSD 20:10:27:13; and ARSD 20:10:27:07 and approval of its access services tariff. Commissioner Johnson seconded and Chairman Sahr concurred. Motion passed 3-0.
Mr. Nathan Solem stated that on August 15, 2006, Zeus Telecommunications, LLC filed an application seeking a Certificate of Authority to resell interexchange services including 1+ outbound dialing, 800/888 Toll-Free inbound dialing, directory assistance, and postpaid calling card services throughout South Dakota. The applicant intends to provide wholesale interexchange telecommunications services via contracts and reserves the right to provide resale services via a tariff. The applicant has requested a waiver from filing a cash flow statement as required by ARSD 20:10:24:02(8) and has agreed to restrictions from offering any resale prepaid services and from collecting resale customer deposits or advanced payments. The applicant has met the requirements for the granting of a Certificate of Authority. Mr. Solem recommended the Commission grant the waiver request and issue Zeus Telecommunications LLC an Interexchange Certificate of Authority subject to restrictions from offering any prepaid services and collecting customer deposits or advanced payments without prior approval of the Commission.
Commissioner Johnson moved to grant the waiver of ARSD 20:10:24:02(8) and issue Zeus Telecommunications LLC an Interexchange Certificate of Authority subject to restrictions from offering any prepaid services and collecting customer deposits or advanced payments without prior approval of the Commission. Commissioner Hanson seconded and Chairman Sahr concurred. Motion passed 3-0
Mr. Phil Lusk stated that on August 18, 2006, First Communications, LLC (First Communications), applied to the Commission for a Certificate of Authority to provide a full array of resold interLATA and intraLATA interexchange telecommunications services to business and residential customers in the State of South Dakota. Specifically, First Communications seeks authority to provide basic "1+" long distance services, otherwise known as Message Telecommunications Service ("MTS"), travel card services, and Toll-Free services. First Communications will not provide operator assisted services and plans to provide its service on a resale basis. Mr. Lusk stated that First Communications, LLC had met the requirements. Mr. Lusk recommended the Commission grant First Communications, LLC a Certificate of Authority with restrictions from offering prepaid calling cards or accepting customer deposits or advance payments without prior approval of the Commission.
Commissioner Hanson moved to grant Interexchange Telecommunications Services in South Dakota a Certificate of Authority with restrictions from offering any prepaid services and collecting customer deposits or advanced payments without prior approval of the Commission. Commissioner Johnson seconded and Chairman Sahr concurred. Motion passed 3-0.
Ms. Kara Van Bockern stated that the Agreement has been properly filed, has been properly executed and does not appear to contain discriminatory provisions, no comments were filed, and recommended approval of the Agreement.
Chairman Sahr moved to approve the Agreement in TC06-157. Commissioner Johnson seconded and Commissioner Hanson concurred. Motion passed 3-0.
Ms. Kara Van Bockern stated that the company has an active Certificate of Authority. The Amendment to the Agreement has been properly filed, has been properly executed and does not appear to contain discriminatory provisions, no comments were filed, and recommended approval of the Amendment to the Agreement.
Chairman Sahr moved to approve the Amendment to the Agreement in TC06-158. Commissioner Johnson seconded and Commissioner Hanson concurred. Motion passed 3-0.
8. TC06-159 In the Matter of the Petition of Venture Communications Cooperative for Arbitration pursuant to the Telecommunications Act of 1996 to Resolve Issues Relating to an Interconnection Agreement with Alltel Communications, Inc. (Staff Analyst: Harlan Best, Staff Attorney: Kara Van Bockern)
Mr. Rich Coit stated that the South Dakota Telecommunications Association (SDTA) filed a Petition to Intervene. Ms. Kara Van Bockern stated staff has no objection to the intervention. Ms. Rolayne Wiest recommended granting intervention to SDTA subject to certain restrictions that were agreed to between Alltel Communications, Inc and SDTA.
Chairman Sahr moved to grant intervention to SDTA in Docket TC06-159. Commissioner Johnson seconded and Commissioner Hanson concurred. Motion passed 3-0.
Electricity
Kara Van Bockern stated that on September 22, 2006, Basin Electric Power Cooperative filed a letter of intent to construct an additional 100 MW gas turbine at an existing site five miles south of Groton. The construction phase of the proposed project will take 12 to 15 months.
Commissioner Johnson moved to designate the affected area for Basin Electric Power Cooperative's energy conversion facility to be in the area of Brown County located five miles south of the town of Groton, three miles north of the community of Ferney and 18 miles southeast of the city of Aberdeen, all of which is in Brown County.
Commissioner Johnson further moved that the Commission designate the persons holding the following offices to serve ex officio as the Local Review Committee for Basin Electric Power Cooperative's proposed project:
! The Chairman of the Brown County Commission;
! The President of the School Board of Groton School District 06-3;
! The Mayor of the city of Groton; and,
A person appointed by Basin Electric Power Cooperative, Inc
Commissioner Johnson further moved that any person on the Committee who ceases to hold such office or appointment shall be replaced on the Committee by his or her successor, who shall promptly notify the Commission of such succession. Commissioner Hanson seconded. Motion passed 2-0
Mr. Kyle White, Black Hills Power, Inc., had no objection of the extension of the suspension of the tariff for an additional 60 days. Mr. Dave Jacobson recommended that the Commission extend the deadline for the suspension of the imposition of the tariff for 60 days beyond October 28, 2006.
Commissioner Hanson moved to extend the suspension of the tariff 60 days beyond October 28, 2006. Commissioner Johnson seconded. Motion passed 2-0.
Gas and Electric
Mr. Bill Taylor stated, due to delays to result from a Confidentiality Agreement Dispute, Heartland Consumers Power District and South Dakota Power Company did not have sufficient time to take necessary depositions. Neither company he represents, therefore, could adequately respond to the jurisdiction question currently before the Commission. Mr. Dave Gerdes objected to Mr. Taylor's request for continuance and disputed whether sufficient time was available to conduct depositions. The parties agreed, however, if the Motion is granted, to discuss an alternate extended schedule.
Commissioner Johnson moved to grant the Motion for Continuance. Commissioner Hanson seconded. Motion passed 2-0
Natural Gas
Mr. Dave Jacobson stated that MidAmerican Energy Company filed an application to utilize its Purchased Gas Adjustment during the months of January through March of 2007 to share positive net margins earned on sales for resale made using natural gas stored at one of its Waterloo Iowa liquefied natural gas facility storage tanks. MidAmerican states that if the project does not result in a positive net margin from sales for resale, MidAmerican will not attempt to recover the negative net margin from retail customers. This approval for the Fuel Incentive and Proposal to Credit Margins through the Purchased Gas Adjustment would be a one time only approval. The sharing mechanism for the customers leaves little or no risk to the customer as matter a fact it will be benefit to the customer. In the past the Commission have allowed one time only exception to the Purchased Gas Adjustment. Mr. Jacobson recommended approval of the Fuel Incentive and Proposal to Credit Margins through the Purchased Gas Adjustment. Mr. Dave Badura stated that MidAmerican has hedged the summer to winter spread. MidAmerican is currently filling the tank now which is 76% full. This will be completed by December 1, 2006. Mr. Badura further stated that if the costs of repair is higher than what has been proposed MidAmerican will absorb any negative effect of the project. MidAmerican will make the final decision about the deposition of the tank by April 2007. Commissioner Hanson had numerous questions about the tank and approval in Iowa and asked for a deferral so MidAmerican has time to answer his questions.
Commissioner Hanson moved to defer Docket NG06-009. Commissioner Johnson seconded. Motion passed 2-0.
Jeff Decker, NorthWestern Energy stated that NorthWestern Energy is asking for approval of a contract with deviations to recover the cost of extending facilities to serve increased natural gas load at the Fordham Colony in Clark County, South Dakota. Mr. Dave Jacobson, recommended approval with the condition that NorthWestern report the final cost of the line extension to the Commission upon its completion and that approval does not pre-determine a Commission decision at the time of future rate case proceedings regarding line extension costs caused by this customer but not collected from this customer.
Commissioner Johnson moved approve the Contract with Deviations and the Tariff Revisions subject to NorthWestern reporting the final cost of the line extension to the Commission upon its completion and that approval does not pre-determine a Commission decision at the time of future rate case proceedings regarding line extension costs caused by this customer but not collected from this customer. Commissioner Hanson seconded. Motion passed 2-0.
Ms. Kara Van Bockern, stated that on October 5, 2006, Cornerstone Energy, Inc. filed a Petition for Intervention and has an interest in this docket, and staff has no objection to the intervention. Mr. Jeff Decker, NorthWestern Energy, stated that NorthWestern does not oppose the intervention.
Commissioner Hanson moved to grant Cornerstone Energy, Inc.'s intervention in Docket NG06-011. Commissioner Johnson seconded. Motion passed 2-0.
Meeting adjourned.
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Tina Douglas
Administrative Secretary
