A728

ASSEMBLY, No. 728

STATE OF NEW JERSEY

Introduced Pending Technical Review by Legislative Counsel

PRE-FILED FOR INTRODUCTION IN THE 1996 SESSION

By Assemblyman R. SMITH and Assemblywoman WEINBERG

An Act establishing the Office of Residential and Small Business Ratepayer Advocate, defining its functions, powers and duties^, and revising parts of the statutory law.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. (New section) Sections 1 through 9 of this act shall be known and may be cited as the "Residential and Small Business Ratepayer Advocate Act."

2. (New section) As used in sections 1 through 9 of this act:

"Board" means the Board of Public Utilities.

"Director" means the Director of the Office of Residential and Small Business Ratepayer Advocate.

"Office" means the Office of Residential and Small Business Ratepayer Advocate.

"Small business" means any business which is resident in this State, independently owned and operated and not dominant in its field, and which employs fewer than 100 full-time employees.

3. (New section) a. There is hereby established in the Executive Branch of the State Government the Office of Residential and Small Business Ratepayer Advocate. For the purpose of complying with the provisions of Article V, Section IV, paragraph 1 of the New Jersey Constitution, the Office of Residential and Small Business Ratepayer Advocate is hereby allocated within the Department of Commerce, Energy and Economic Development, but, notwithstanding said allocation, the Office shall be independent of any supervision or control by the department or by any board or officer thereof. The Office shall be under the supervision of the Director of the Office of Residential and Small Business Ratepayer Advocate.

b. The Office of Residential and Small Business Ratepayer Advocate shall represent and protect the interests of residential and small business utility ratepayers in proceedings before the Board of Public Utilities.

c. The Director of the Office of Residential and Small Business Ratepayer Advocate may initiate any such proceedings when the Director determines that a change in a rate or charge for any class of utility service is contrary to, or in conflict with, the interests of residential utility ratepayers or small business utility ratepayers. The Director shall have sole discretion to represent or refrain from representing the interests of residential utility ratepayers or small business utility ratepayers in any proceeding.

The Director is authorized to intervene in (1) any proceeding or public hearing on proposed revisions of the energy master plan required pursuant to section 12 of P.L.1977, c.146 (C.52:27F-14);

(2) any proceeding pertaining to the adoption of off-tariff rate standards by the board, for the approval by the board of off-tariff rates, or for the approval by the board of a public utility plan for an alternative form of regulation, as provided pursuant to P.L. , c. (C. )(pending in the Legislature as Senate Bill No. 1940 of 1995); or

(3) any other proceeding or particular matter as the Director may determine to be necessary to protect and represent the interests of residential utility ratepayers or small business utility ratepayers.

4. (New section) a. The Director of the Office of Residential and Small Business Ratepayer Advocate shall be appointed by the Governor, with the advice and consent of the Senate. The Director shall be an attorney-at-law of this State and a person who by reason of training, experience and attainment is qualified to represent the interests of residential and small business utility ratepayers. The Director shall serve a two year term; except that, the term of the Director of the Office of Residential and Small Business Ratepayer Advocate shall not extend beyond the term of the Governor.

5. (New section) a. The Director of the Office of Residential and Small Business Ratepayer Advocate shall:

(1) Appoint such investigators, stenographic and clerical assistants and other personnel as may be required for the conduct of the office, subject to the provisions of Title 11A, Civil Service, of the New Jersey Statutes, and other applicable statutes;

(2) Establish and maintain suitable headquarters for the Office and such regional quarters within the State as the Director shall deem necessary for the proper functioning of the office;

(3) Maintain one or more trial pools of lawyers who shall be available to serve as counsel on a case basis as needed;

(4) Engage counsel from said trial pools on a case basis as may be necessary for the proper performance of the duties of the Office and compensate them for their services. Cases shall be assigned by the Director to staff attorneys or attorneys hired by case on a basis calculated to provide competent representation in light of the nature of the case, the services to be performed, the experience of the particular attorney and other relevant factors;

(5) Accept the services of volunteer workers or consultants at no compensation or at nominal or token compensation and reimburse them for their proper and necessary expenses;

(6) Keep and maintain proper financial records and records in respect to particular cases handled and develop records for use in the calculation of direct and indirect costs of all or any aspect of the operation of the Office;

(7) On the basis of available data or estimates to prepare schedules of rates from time to time of amounts to be paid for services rendered other than by the staff, taking into account the nature of the services, the time involved, trouble and risk, the skill and experience required, and other pertinent factors;

(8) Have a general responsibility for the operation of the Office;

(9) Formulate and adopt rules and regulations as are necessary to effectuate the purposes of this act and for the efficient conduct of the work and general administration of the Office, its professional staff and other employees; and

(10) Have the authority to solicit, apply for and expend grants, donations, or other funds available from the federal government or private foundations as may be available to support the programs of the Office.

b. The Director may employ such assistants on a full-time basis as are necessary to perform the routine functions of the Office. When exceptional circumstances arise, the Director may on a temporary basis retain such other expert assistants as are necessary pursuant to a reasonable fee schedule established in advance by the Director.

6. (New section) a. The Office of Residential and Small Business Ratepayer Advocate shall annually make an assessment against each public utility consistent with but separate from the Board of Public Utilities' assessments under the provisions of P.L.1968, c.173 (C.48:2-59 et seq.).

b. The annual assessment shall be equal to a percentage of the gross operating revenue of the public utilities under the jurisdiction of the Board of Public Utilities derived from intrastate operations during the preceding calendar year at a rate to be determined annually by the Director of the Office of Residential and Small Business Ratepayer Advocate in the manner set forth in section 2 of P.L.1968, c.173 (C.48:2-60), except that the total amount assessed to any public utility shall not exceed 1/4 of 1% of the gross operating revenue subject to assessment hereunder. The minimum annual assessment under this section shall not be less than $500.00.

7. (New section) The annual assessment set forth in section 6 of P.L. , c. (C. )(pending in the Legislature as this bill) shall be levied by the Office of Residential and Small Business Ratepayer Advocate no later than July 1, and shall be paid within 30 days of mailing notice thereof and a statement of the amount by first class mail to any public utility.

8. (New section) The Director of the Office of Residential and Small Business Ratepayer Advocate is authorized to employ expert witnesses and such other professional expertise as the Director may from time to time deem necessary to assist the staff in its participation in proceedings before the Board of Public Utilities. The compensation of these experts shall be paid by the public utility participating in the proceeding which payment shall be separate and apart from the annual assessment set forth in section 6 of P.L. , c. (C. )(pending in the Legislature as this bill). In no event shall the sum total assessment paid by any utility pursuant to section 6 of P.L. , c. (C. )(pending in the Legislature as this bill) and this section exceed 1/4 of 1% of the gross operating revenue subject to assessment hereunder.

9. (New section) a. The Director of the Office of Residential and Small Business Ratepayer Advocate is authorized to represent the interests of residential and small business utility ratepayers as a party, or otherwise participate for the purpose of representing an interest of residential utility ratepayers or small businesses utility ratepayers, before the Board, and before any court or State or federal agency, initiating proceedings, if in the judgment of the Director, such action may be necessary, in connection with any matter involving regulation by the Board or the corresponding regulatory agency of the United States, whether on appeal or otherwise initiated.

b. The Director may exercise discretion in determining the interests of residential utility ratepayers or small business utility ratepayers that will be advocated in any particular proceeding and in determining whether or not to participate in or initiate any particular proceeding, and in so determining, shall consider the public interest, the resources available and the substantiality of the effect of the proceeding on the interest of residential or small business utility ratepayers.

c. The Director is authorized to represent any interest of residential or small business utility ratepayers which is presented to the Office for consideration, upon petition in writing, by a substantial number of persons who make direct use or are ultimate recipients of a product or service supplied by a person or public utility subject to regulation by the Board. The Director shall notify the principal sponsors of the petition, within a reasonable period of time after the receipt thereof, of the action taken or intended to be taken by the Office with respect to the interest presented in the petition. If the Director declines or is unable to represent the interest, the Director shall notify the sponsors and shall state the reasons therefor.

d. Any action brought by the Director before the Board or before any court or State or federal agency shall be brought in the name of the Office of Residential or Small Business Ratepayer Advocate. The Director may name a group of residential utility ratepayers, a small business, or any combination thereof, in whose name the action may be brought or may join with these parties in bringing the action.

e. Whenever the Director determines to initiate, intervene or otherwise participate in any particular proceeding on behalf of the interests of residential utility ratepayers or small business utility ratepayers, the Director shall issue publicly a written statement, a copy of which shall be filed in the proceeding, stating concisely the specific interest of residential or small business utility ratepayers to be protected.

10. Section 1 of P.L.1968, c.173 (C.48:2-59) is amended to read as follows:

1. To enable the Board of Public [Utility Commissioners in the Department of Public] Utilities to better perform its lawful duties relating to service, classifications to be used, rates and charges to be made and collected, rules and regulations to be prescribed, and supervision over all public utilities [and public movers] under its jurisdiction, the Board of Public [Utility Commissioners] Utilities shall annually make an assessment against each public utility [and public mover].

(cf: P.L.1972, c.36, s.1)

11. Section 2 of P.L.1968, c.173 (C.48:2-60) is amended to read as follows:

2. The assessment shall be equal to a percentage of the gross operating revenue of the public utilities under the jurisdiction of the [board] Board of Public Utilities derived from intrastate operations during the preceding calendar year at a rate to be determined annually by the board on or before June 30 in the following manner:

The total amount appropriated to the Board of Public Utilities by law for its general purposes for its next fiscal year shall be divided by the total amount of the gross operating revenues of all public utilities under the jurisdiction of the board derived from intrastate operations during the preceding calendar year. The quotient resulting shall constitute the percentage rate of the assessment for the calendar year in which such computation is made. The total amount so assessed to any particular public utility shall not exceed 1/4 of 1% of the gross operating revenue subject to assessment hereunder of that public utility derived from its intrastate operation during the preceding calendar year, except that the minimum assessment for any public utility shall be $500.00.

(cf: P.L.1989, c.281, s.1)

12. This act shall take effect immediately.

STATEMENT

This bill creates the Office of Residential and Small Business Ratepayer Advocate, an autonomous State agency in but not of the Department of Commerce, Energy and Economic Development. The Office, under the supervision of the Director of the Office of Residential and Small Business Ratepayer Advocate, would represent and protect the interests of residential and small business utility ratepayers in proceedings before the Board of Public Utilities (BPU).

The Director, who would be appointed by the Governor, with the advice and consent of the Senate, must be an attorney-at-law of this State and a person who by reason of training, experience and attainment is qualified to represent the interests of residential and small business utility ratepayers. The Director would serve a two year term, except that the term of the Director could not extend beyond the term of the Governor.

The Director would be empowered to initiate any rate proceeding when the Director determines that a change in a rate or charge for any class of utility service is contrary to, or in conflict with, the interests of residential utility ratepayers or small business utility ratepayers. The Director would have sole discretion to represent or refrain from representing the interests of residential utility ratepayers or small business utility ratepayers in any proceeding.

The Director would be authorized to intervene in any proceeding (1) on proposed revisions of the energy master plan; (2) pertaining to the adoption of off-tariff rate standards by the BPU, approval of off-tariff rates by the BPU, or approval by the BPU of a public utility plan for an alternative form of regulation, all as provided pursuant to P.L. , c. (C. )(pending in the Legislature as Senate Bill No. 1940 of 1995); or (3) any other proceeding or particular matter as the Director may determine to be necessary to protect and represent the interests of residential utility ratepayers or small business utility ratepayers.

The Office of Residential and Small Business Ratepayer Advocate would be authorized to make annual assessments against each public utility to provide funding for its operations.

The Director would be authorized to employ expert witnesses and such other professional expertise as the Director may from time to time deem necessary to assist the staff in its participation in proceedings before the BPU. The compensation of these experts would be paid by the public utility participating in the proceeding, which payment would be separate and apart from the aforementioned annual assessments.

Further, the Director would be authorized to represent the interests of residential and small businesses utility ratepayers as a party, or otherwise participate for the purpose of representing an interest of residential utility ratepayers or small business utility ratepayers, before the BPU, and before any court or State or federal agency, including initiating proceedings.

The Director may exercise discretion in determining the interests of residential or small business utility ratepayers that will be advocated in any particular proceeding and in determining whether or not to participate in or initiate any particular proceeding, and in so determining, must consider the public interest, the resources available and the substantiality of the effect of the proceeding on the interest of residential or small business utility ratepayers.

The Director may represent any interest of residential or small business utility ratepayers which is presented to the Office for consideration, upon petition in writing, by a substantial number of persons who make direct use or are ultimate recipients of a product or service supplied by a person or public utility subject to regulation by the BPU. The Director must notify the principal sponsors of the petition, within a reasonable period of time after the receipt thereof, of the action taken or intended to be taken by the Office with respect to the interest presented in the petition. If the Director declines or is unable to represent the interest, the Director must notify the sponsors and shall state the reasons therefor.

Any action brought by the Director before the BPU or before any court or State or federal agency would be brought in the name of the Office of Residential and Small Business Ratepayer Advocate. The Director may name a group of residential utility ratepayers, a small business, or any combination thereof, in whose name the action may be brought or may join with these parties in bringing the action.

Whenever the Director determines to initiate, intervene or otherwise participate in any particular proceeding on behalf of the interests of residential or small business utility ratepayers, the Director would be required to issue publicly a written statement, a copy of which must be filed in the proceeding, stating concisely the specific interest of residential or small business utility ratepayers to be protected.

The "Residential and Small Business Ratepayer Advocate Act."