June 12, 2007, Introduced by Senators PATTERSON, KUIPERS, THOMAS and RICHARDVILLE and referred to the Committee on Energy Policy and Public Utilities.
A bill to amend 1939 PA 3, entitled
"An act to provide for the regulation and control of public and
certain private utilities and other services affected with a public
interest within this state; to provide for alternative energy
suppliers; to provide for licensing; to include municipally owned
utilities and other providers of energy under certain provisions of
this act; to create a public service commission and to prescribe
and define its powers and duties; to abolish the Michigan public
utilities commission and to confer the powers and duties vested by
law on the public service commission; to provide for the
continuance, transfer, and completion of certain matters and
proceedings; to abolish automatic adjustment clauses; to prohibit
certain rate increases without notice and hearing; to qualify
residential energy conservation programs permitted under state law
for certain federal exemption; to create a fund; to provide for a
restructuring of the manner in which energy is provided in this
state; to encourage the utilization of resource recovery
facilities; to prohibit certain acts and practices of providers of
energy; to allow for the securitization of stranded costs; to
reduce rates; to provide for appeals; to provide appropriations; to
declare the effect and purpose of this act; to prescribe remedies
and penalties; and to repeal acts and parts of acts,"
(MCL 460.1 to 460.10cc) by adding section 6r.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 6r. (1) A person shall comply with this section before
completing either of the following transactions:
(a) The purchase or sale, or other acquisition or disposition,
of 51% or more of the then outstanding shares of a regulated
utility's stock, or of a controlling interest in a regulated
utility, either directly or indirectly.
(b) The purchase or sale, or other acquisition or disposition,
of all or a substantial part of a regulated utility's existing and
operating assets used or useful at the time of the transaction in
providing regulated service in this state. This section does not
apply to the acquisition or transfer of assets acquired or sold in
the normal course of business.
(2) The commission shall promulgate rules for the
administration of this section.
(3) Within a reasonable period after entering into an
agreement for a transaction described in subsection (1), the
parties to the transaction shall file all of the following material
with the commission:
(a) A concise summary of the terms and conditions of the
proposed transaction.
(b) Copies of the material transaction documents if available.
(c) A summary of the projected impacts of the transaction on
rates and regulated utility services in Michigan.
(d) Pro forma financial statements that are relevant to the
transaction.
(e) Copies of the parties' public filings with other state or
federal regulatory agencies regarding the same transaction
including any regulatory orders issued by the agencies regarding
the transaction.
(4) Not later than 30 days from the date a person makes a
filing under this section, the commission shall notify the person
what, if any, materials required under subsection (3) or requested
under subsection (6) have not been provided. The commission shall
have 30 days from the date that the commission receives all of the
materials required under subsection (3) or requested under
subsection (6) to determine whether any investigations or hearings
are necessary to review the proposed transaction. At the end of the
30-day period, the commission shall issue 1 of the following:
(a) Advisory comments that may include any proposed
recommendations, modifications, or changes to the structure of the
proposed transaction based on the factors listed in subsection (8).
(b) A written statement that review is completed and no
further comment is necessary.
(5) The commission may extend the time required under
subsection (4) for the review and the issuing of its advisory
comments for a period not to exceed 120 days from the date that the
commission receives all of the material required or requested
within 30 days of the initial filing under subsection (3).
(6) The commission shall be entitled, upon written request, to
documents reasonably related to making the advisory comments under
subsection (4).
(7) Nonpublic information and materials submitted by a person
under this section clearly designated by the person as confidential
are exempt from the freedom of information act, 1976 PA 442, MCL
15.231 to 15.246. The commission shall issue protective orders as
necessary to protect information designated by a party as
confidential.
(8) The commission shall consider and may issue advisory
comments, including specific recommendations, modifications, or
changes to the structure of a proposed transaction subject to this
section, regarding 1 or more of the following:
(a) Whether the proposed transaction would have a material
adverse impact on the rates regulated by the commission under MCL
460.6a of the customers in this state affected by the transaction.
(b) Whether the proposed transaction would have a material
adverse impact on the provision of safe, reliable, and adequate
energy service.
(c) Whether the proposed transaction will result in the
subsidization of a nonregulated activity of a person through the
rates paid by the customers of a regulated utility, to the extent
prohibited by a code of conduct established by the commission under
section 10a(4).
(d) Whether the proposed transaction will significantly impair
a regulated utility's ability to raise necessary capital or to
maintain a reasonable capital structure.
(e) Whether the proposed transaction will have a material
adverse impact on competition in this state.
(9) As used in this section:
(a) "Commission" means the Michigan public service commission.
(b) "Person" means an individual, corporation, association,
partnership, or any other legal private or public entity.
(c) "Regulated utility" means an investor-owned electric
utility, an electric cooperative, or a natural gas distribution
utility, with rates subject to the jurisdiction of the commission.
(10) This section does not apply to a transaction subject to a
written agreement entered into before the effective date of the
amendatory act that added this section.