56-542 - Powers of the Commission.
§ 56-542. Powers of the Commission.
A. As used in this section:
"CPI" means the Consumer Price Index - U.S. City Averages for All UrbanConsumers, All Items (not seasonally adjusted) as reported by the U.S.Department of Labor, Bureau of Labor Statistics; however, if the CPI ismodified such that the base year of the CPI changes, the CPI shall beconverted in accordance with the conversion factor published by the U.S.Department of Labor, Bureau of Labor Statistics, and if the CPI isdiscontinued or revised, such other historical index or computation approvedby the Commission shall be used for purposes of this section that wouldobtain substantially the same result as would have been obtained if the CPIhad not been discontinued or revised.
"Real GDP" means the Annual Real Gross Domestic Product as reported by theU.S. Department of Commerce, Bureau of Economic Analysis.
B. The Commission shall have the power to regulate the operator under thistitle as a public service corporation. The Commission shall also have thepower, and be charged with the duties of reviewing and approving or denyingthe application, of supervising and controlling the operator in theperformance of its duties under this chapter and title, and of correcting anyabuse in the performance of the operator's public duties.
C. Pursuant to § 56-36, the Commission shall require annually from theoperator a verified report describing the nature of its contractual and otherrelationships with individuals or entities contracting with the operator forthe provision of significant financial, construction, or maintenanceservices. The Commission shall review the report and such other materials asit shall deem necessary for the purpose of determining improper or excessivecosts, and shall exclude from the operator's costs any amounts which it findsare improper or excessive. Included in such review shall be consideration ofcontractual relationships between the operator and individuals or entitiesthat are closely associated or affiliated with the operator to assure thatthe terms of such contractual relationships are no less favorable orunfavorable to the operator than what it could obtain in an arm's-lengthtransaction.
D. The Commission also shall have the duty and authority to approve or revisethe toll rates charged by the operator. Initial rates shall be approved ifthey appear reasonable to the user in relation to the benefit obtained, notlikely to materially discourage use of the roadway and provide the operatorno more than a reasonable rate of return as determined by the Commission.Thereafter, the Commission, upon application, complaint or its owninitiative, and after investigation, may order substituted for any toll beingcharged by the operator, a toll which is set at a level which is reasonableto the user in relation to the benefit obtained and which will not materiallydiscourage use of the roadway by the public and which will provide theoperator no more than a reasonable return as determined by the Commission.
E. If a change in the ownership of the facility or change in control of anoperator occurs, whether or not accompanied by the issuance of securities asdefined in subsection A of § 56-57 and § 56-65.1, the Commission, in anysubsequent proceeding to set the level of a toll charged by the operator,shall ensure that the price paid in connection with the change in ownershipor control, and any costs and other factors attributable to or resulting fromthe change in ownership or control, if they would contribute to an increasein the level of the toll, are excluded from the Commission's determination ofthe operator's reasonable return, in order to ensure that a change inownership or control does not increase the level of the toll above that levelthat would otherwise have been required under subsection D or subdivision I 3if the change in ownership or control had not occurred. As used in thissubsection, "control" has the same meaning as provided in § 56-88.1.
F. Pursuant to § 56-36, the Commission shall require an operator to providecopies of annual audited financial statements for the operator, together witha statement of the operator's ownership. The operator shall file suchstatement within four months from the end of the operator's fiscal year.
G. The proceeds and funding provided to the operator from any future bondindenture or similar credit agreement must be used for the purpose ofrefinancing existing debt, acquiring, designing, permitting, building,constructing, improving, equipping, modifying, maintaining, reconstructing,restoring, rehabilitating, or renewing the roadway property, and for thepurpose of paying reasonable arm's-length fees, development costs, andexpenses incurred by the operator or a related individual or entity inexecuting such financial transaction, unless otherwise authorized by theCommission.
H. The Commission may charge a reasonable annual fee to cover the costs ofsupervision and controlling the operator in the performance of its dutiesunder this chapter and pursuant to this section.
I. Effective January 1, 2013, through January 1, 2020, and notwithstandingany other provision of law:
1. Upon application of and public notification by the operator, filed notmore often than once within any 12-month period, the Commission shall approveto become effective within 45 days any request to increase tolls by apercentage that (i) is equal to the increase in the CPI, as defined insubsection A, from the date the Commission last approved a toll increase,plus one percent, (ii) is equal to the increase in the real GDP, as definedin subsection A, from the date the Commission last approved a toll increase,or (iii) 2.8 percent, whichever is greatest, which increase in the tollsapproved by the Commission is hereafter referred to as the "annualpercentage increase."
2. The operator additionally may request in an application made pursuant tosubdivision I 1, and the Commission shall further approve, an addition to thetoll increase to allow the operator to include, in its tolls, the amount bywhich its local property taxes paid in the immediately preceding calendaryear increased by more than the annual percentage increase above suchpayments for the previous calendar year.
3. Any request by the operator for an increase in the toll rates by a greaterpercentage than as provided in subdivision I 1 shall be considered forapproval by the Commission only upon presentation of an independent gradetraffic and revenue study and a finding by the Commission that (a) toll ratessubject to the preceding paragraph will not be sufficient to permit theoperator to maintain the minimum coverage ratio set forth in the ratecovenant provisions of its bond indenture or similar credit agreement, (b)such greater proposed tolls are reasonable to the user in relation to thebenefit obtained and will not materially discourage use of the roadway by thepublic, and (c) such greater proposed tolls provide the operator no more thana reasonable rate of return as determined by the Commission; however, theCommission shall not approve an increase in the toll rates pursuant to thissubdivision that exceeds the percentage increase necessary to permit theoperator to maintain the minimum coverage ratio described in clause (a). Suchrequest by an operator shall not be made as a result of a change in controlof the operator or the project roadway. As used herein, a "change in controlof the operator" means the sale or transfer of 25 percent or more of theassets of the operator or the acquisition or disposal of 25 percent or moreof the outstanding shares of stock of the operator, if it is a corporation,or analogous interest if the operator is another form of entity.
(1988, c. 649; 1991, c. 272; 2008, cc. 841, 844.)