County Com'Rs of San Miguel v. Colo. P.U.C.

• Decision Date: 30 April 2007
• Docket Number: No. 06SA213.,06SA213.
• Citation: 157 P.3d 1083
• Parties: In Re The BOARD OF COUNTY COMMISSIONERS OF the COUNTY OF SAN MIGUEL, The Coalition of Concerned San Miguel County Homeowners, Hans (Henson) Jones, The Wilson Mesa Homeowners Association, and Ptarmigan Ranch Owners Association, Plaintiffs and Petitioners v. The COLORADO PUBLIC UTILITIES COMMISSION; Commissioner Gregory E. Sopkin; Commissioner Polly Page; Commissioner Carl Miller; Former Commissioner Jim Dyer; Tri-State Generation and Transmission Association, Inc.; and The Board Of County Commissioners of the County of Montrose, Defendants and Respondents.
• Court: Colorado Supreme Court

157 P.3d 1083

In Re The BOARD OF COUNTY COMMISSIONERS OF the COUNTY OF SAN MIGUEL, The Coalition of Concerned San Miguel County Homeowners, Hans (Henson) Jones, The Wilson Mesa Homeowners Association, and Ptarmigan Ranch Owners Association, Plaintiffs and Petitioners v. The COLORADO PUBLIC UTILITIES COMMISSION; Commissioner Gregory E. Sopkin; Commissioner Polly Page; Commissioner Carl Miller; Former Commissioner Jim Dyer; Tri-State Generation and Transmission Association, Inc.; and The Board Of County Commissioners of the County of Montrose, Defendants and Respondents.

No. 06SA213.

Supreme Court of Colorado, En Banc.

April 30, 2007.

As Modified on Denial of Rehearing May 21, 2007.^*

John W. Suthers, Attorney General, David A. Beckett, Assistant Attorney General, Business and Licensing Section, Denver, Colorado, Attorneys for Defendants and Respondents Colorado Public Utilities Commission, Commissioner Gregory E. Sopkin, Commissioner Polly Page, Commissioner Carl Miller, and Former Commissioner Jim Dyer.

Steven J. Zwick, San Miguel County Attorney, Rebekah S. King, San Miguel Assistant County Attorney, Telluride, Colorado, Attorneys for Plaintiff and Petitioner The Board of County Commissioners of the County of San Miguel.

Arnold & Porter LLP, David S. Neslin, Harris D. Sherman, Denver, Colorado, Attorneys for Plaintiffs and Petitioners Coalition of Concerned San Miguel County Homeowners, Hans (Henson) Jones, The Wilson Mesa Homeowners Association, and Ptarmigan Ranch Owners Association.

No appearance by or on behalf of Defendants and Respondents Tri-State Generation and Transmission Association, Inc. and The Board of County Commissioners of the County of Montrose.

Justice HOBBS delivered the Opinion of the Court.

In this original proceeding under C.A.R. 21, we determine whether the Colorado Public Utilities Commission ("PUC" or "Commission"), pursuant to sections 40-6-113(6) and 40-6-115, C.R.S. (2006), must include in the record of its proceedings advisory memoranda received from its staff and considered by the Commissioners in the deliberative phase of their proceedings.¹

PUC employees include among their numbers two groups of agency experts—a testimonial staff and an advisory staff. Performing different functions in PUC proceedings, these two groups operate independently and in isolation of each other. The testimonial staff is active in making presentations to the Commission during the evidentiary phase of proceedings, in which parties present evidence. In the deliberative phase, the advisory staff assists the PUC Commissioners in analyzing the record made during the evidentiary phase, and arraying the various choices the Commissioners have before them in making their decision.

Advisory memoranda contain an analysis of the record made prior to the Commissioners' deliberation; these memoranda also contain staff recommendations to the Commissioners. Members of the advisory staff are not decision-makers. The PUC Commissioners are the decision-makers, and they may accept or reject all or any portion of the advisory staff's analysis and/or recommendations.

After they complete their deliberations in a public proceeding, the PUC Commissioners enter a final written decision or order under section 40-6-109(3), C.R.S. (2006). A party may appeal the final written decision or order to the district court pursuant to section 40-6-115.

In the case before us, the district court held that the advisory staff's memoranda must always be included in the records of PUC's proceedings, under section 40-6-113(6). But, the PUC's long-standing practice is not to include advisory memoranda in the record it certifies to district courts upon judicial review.

The parties who filed this judicial review proceeding in the District Court for San Miguel County contend, and the district court agreed, that the PUC violates section 40-6-113(6) when it fails to include advisory memoranda in the records of PUC proceedings. These parties contended in the district court, as well as here, that the advisory memoranda in this case must be made part of the record because:

they were obtained at the PUC's initiative and considered by the PUC in rendering the decision under review; . . . the memoranda are not privileged because their contents were publicly disclosed; and . . . the memoranda are relevant because they contain factual findings and recommendations contrary to the PUC's positions on the merits.

Pls. and Petrs.'s Resp. 8.

We hold that section 40-6-113(6) does not generally require the PUC to include advisory memoranda in the records of PUC decisions and orders. However, when the staff injects new factual information into the proceedings through an advisory memorandum read at the open meeting deliberation of the Commissioners, and this factual information has not otherwise been made part of the record, the PUC must include such factual information in the agency record for purposes of judicial review under section 40-6-115.

Accordingly, we discharge the rule in part and make it absolute in part. We return this case to the district court, with directions that it (1) conduct an in camera review of the advisory memoranda in this case, (2) determine whether the staff injected new factual information during the open meeting deliberative phase of this proceeding and whether such factual information has not been made part of the record, and (3) include in the section 40-6-113(6) record any such new factual information for purposes of section 40-6-115 judicial review of the PUC's decision. So that the district court may conduct this in camera review, we order the PUC to transmit the advisory memoranda in this proceeding to the district court under seal.

I.

Tri-State Generation and Transmission Association, Inc. ("Tri-State") operates the Nucla-Telluride transmission line, which transports power from a station in Montrose County to a substation in San Miguel County. Tri-State has proposed replacing the existing 69 kV transmission line with a more powerful 115kV transmission line in order to better serve a growing regional population.

The San Miguel County Commissioners ("the County") and the Coalition of Concerned San Miguel County Homeowners ("the Homeowners' Coalition") do not dispute that this upgraded service is needed. At issue is how the new transmission line will be installed.

When Tri-State proposed upgrading the line, the County imposed conditions on the upgrade. The County required Tri-State to construct designated portions underground because of aesthetic and environmental concerns. Tri-State appealed these conditions to the PUC pursuant to section 29-20-108(5), C.R.S. (2006). The Homeowners' Coalition joined as a party to the PUC proceeding in opposition to Tri-State's appeal.² The PUC appointed its testimonial staff to intervene in the proceeding as a party. See 4 Colo.Code Regs. § 723-1-1007(a) & (b) (2006).

The PUC followed its usual procedures. In September and October of 2003, it took public comment and held evidentiary hearings. The parties filed direct, answer, and rebuttal testimony in accordance with procedural orders the PUC issued. After the evidentiary hearings, the parties filed statements of position. This concluded the "formal hearing" phase during which evidence is gathered and the record is compiled, including pleadings, testimony, and exhibits presented during the hearing phase.

In January 2004, the Commission conducted a meeting to deliberate Tri-State's appeal. Pursuant to Colorado's Open Meetings Law, the deliberative meeting was open to the public. See §§ 24-6-401 to -402, C.R.S. (2006). The Commission also broadcast this meeting over the Internet.

During this deliberative meeting, one or more members of the advisory staff read from portions of advisory memoranda prepared for the Commissioners. The advisory memoranda were not otherwise made available to the public.

The PUC Commissioners conducted their deliberations and voted in public at the meeting. The PUC later issued its decision in writing, pursuant to section 40-6-109(3).³ In its decision, the PUC directed Tri-State to construct the transmission line underground, as the County wished, if the cost estimates for underground construction were less than or equal to the amount required for overhead construction. The PUC also directed Tri-State to (1) obtain cost estimates for underground and overhead construction and (2) install the transmission lines underground if San Miguel County, homeowners, and/or others were willing to pay the cost difference.

The PUC's decision provided that the County and Homeowners' Coalition could return for resolution of disagreement over cost estimates after Tri-State gathered and reported its estimated costs to the PUC. Subsequently, the County and Homeowners' Coalition asserted that Tri-State's cost estimates were generally incomplete and that the cost estimates for an underground transmission line ought to be based on a method known as "direct burial." Tri-State had based its underground cost estimates on a more expensive technique known as "duct bank," which it claimed to be superior for maintenance reasons.

The PUC held a two-day evidentiary hearing on the cost issue and conducted its public deliberative meeting to decide this issue. The advisory staff made a presentation that included reading from parts of an advisory memorandum submitted to the PUC Commissioners, but the memorandum was not otherwise made public. The PUC broadcasted the public meeting over the Internet.

During the public meeting, advisory staff discussed with the PUC Commissioners whether Tri-State should be allowed to use the cost of duct bank construction, as opposed to direct burial, for its estimate of the cost of an underground transmission line. In the course of the discussion, an advisory staff member stated that she had independently investigated a direct burial project that had taken place in New Zealand and which Tri-State...