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CCP 02-11-2002
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CCP 02-11-2002
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<br />.1 <br /> <br />~ <br /> <br />tit <br /> <br />. <br /> <br />-. <br /> <br />February 6, 2002 <br />Page 2 <br /> <br />requested by NSP but did indicate that NSP could address any concerns which it had in regard <br />to the allocation of construction costs for an underground project to the Public Utilities <br />Commission. <br /> <br />In January of 1999, NSP requested the Public Utilities Commission to approve a City <br />Requested Facilities Surcharge Rider (CRFS Rider) as part of the NSP rate structure. The <br />CRFS Rider would be used to recover the extra cost of constructing electrical distribution lines <br />underground. The extra cost would be collected by increasing use charges to customers in <br />those cases where the underground construction was requested by a city and the city chose <br />not to pay for the incremental cost from general funds. After an extensive review period <br />(January 7, 1999 to September 21,2001) and upon receipt of comments from various parties <br />including the Suburban Rate Authority and the League of Minnesota Cities, the Public Utilities <br />Commission concluded that, although a city may require a public utility to underground <br />electrical distribution lines, the public utility could recover the extra cost from the city with its <br />consent or by imposing surcharges on customers without the city's consent. <br /> <br />On December 17, 2001 the City of Arden Hills approved the recodification of its City Code. <br />The new code includes a Section 1010.13 which is entitled "Underground Installation of <br />Distribution Lines" (2001 Regulations). The 2001 Regulations obviously supercede the 1971 <br />Regulations. The 2001 Regulations continue to require, as a general rule, that electrical <br />distribution lines be constructed underground. It does not specifically address cost allocation. <br />However, there are provisions in the City's platting regulations which would require developers <br />to absorb these costs in connection with the construction of new residential or commercial <br />projects. <br /> <br />The 2001 Regulations contain a process that can be followed by the City in order to determine <br />if it will require existing overhead distribution lines to be constructed underground. The <br />process involves a public hearing which is designed to consider a number of factors including <br />the manner in which the costs of this type of project wouid be allocated. The 2001 <br />Regulations recognize that theCity must take into consideration the rate structures that have <br />been approved by the Public Utilities Commission. <br /> <br />Since the League of Minnesota Cities participated in the Public Utilities Commission review <br />process which preceded the approval of the CRFS Rider, and since the League of Minnesota <br />Cities also prepared the 2001 Regulations, I have concluded that the City's current regulations <br />are designed to balance the authority of the City to require the undergrounding of electrical <br />
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