Grindstone Butte Mut. Canal Co. v. Idaho Public Utilities Commission

• Decision Date: 29 April 1981
• Docket Number: No. 12990,12990
• Citation: 102 Idaho 175,627 P.2d 804
• Parties: GRINDSTONE BUTTE MUTUAL CANAL COMPANY, Farm Development Corporation, West End Project, Basin Land Irrigation Company and Blaine Mecham, Appellants, v. IDAHO PUBLIC UTILITIES COMMISSION, Idaho Power Company, FMC Corporation, Monsanto Company, Idaho Irrigation Pumpers Association, Inc., J. R. Simplot Co., Idaho Citizens Coalition, Idaho Consumer Affairs, Inc., and City of Boise, Respondents. In the Matter of the Application of IDAHO POWER COMPANY for Authority to Increase its Rates.
• Court: Idaho Supreme Court

Page 804

627 P.2d 804

102 Idaho 175

GRINDSTONE BUTTE MUTUAL CANAL COMPANY, Farm Development Corporation, West End Project, Basin Land Irrigation Company and Blaine Mecham, Appellants, v. IDAHO PUBLIC UTILITIES COMMISSION, Idaho Power Company, FMC Corporation, Monsanto Company, Idaho Irrigation Pumpers Association, Inc., J. R. Simplot Co., Idaho Citizens Coalition, Idaho Consumer Affairs, Inc., and City of Boise, Respondents In the Matter of the Application of IDAHO POWER COMPANY for Authority to Increase its Rates.

No. 12990.

Supreme Court of Idaho.

April 29, 1981.

William F. Ringert of Anderson, Kaufman, Anderson & Ringert, Boise, for appellants.

David Leroy, Atty. Gen., Michael S. Gilmore, Deputy Atty. Gen., Boise, for Idaho P. U. C.

Fred D. Decker, Twin Falls, for Idaho Power Co.

Roderick D. Gere of Idaho Legal Aid Services, Inc., Boise, for Idaho Citizen's Coalition.

DONALDSON, Justice.

Idaho Power Company filed an application with the Idaho Public Utilities Commission on February 28, 1977, requesting interim and permanent increases in rates and charges for electric service in the state of Idaho. The Commission issued a Notice of Application and Hearing in this matter and subsequently, hearings were held before the entire Commission beginning in April of 1977.

The Commission issued Order No. 13158, dated May 16, 1977, granting Idaho Power interim rate relief in the form of a 7.09% uniform increase to all rates and charges. However, this interim order expressly provided that as for the pending permanent rate increase application, all issues remained at controversy, including rate design, and the grant of interim relief was without prejudice or predetermination to the remaining issues. On November 28, 1977, the IPUC issued Order No. 13568, again an interim order, which generally increased the uniform increase in billing to 10.3%. Jurisdiction was retained over the issue of rate structure with the proviso that new permanent tariffs would be established.

On February 6, 1978, the IPUC issued Order No. 13714, which is the subject of this appeal. That order authorized Idaho Power to file revised electric rate schedules consistent with the terms of the order. The present controversy concerns the Commission's determination of the structure for Schedule 24 under which the appellants, irrigation and soil drainage customers, received service. Schedule 24, as specifically set out in subsequent Order No. 13738, which augmented Order No. 13714, was restructured so as to result in rate increases of up to 19.6% for high volume-high load factor Schedule 24 customers.

Appellants filed with the Commission a petition for rehearing, proposing a uniform rate increase, and a supplemental petition for rehearing, setting forth additional grounds for consideration. Both petitions were denied. Appellants subsequently perfected this appeal seeking review of the Commission's decision regarding the rate design as it pertains to them as certain Schedule 24 customers.

Appellants initially argue that the Commission failed to give them adequate notice that the Commission intended to consider a revision in the rate structure which would impact in particular upon them as high demand-high load factor Schedule 24 customers. Appellants cite the case of Grindstone Butte Mutual Canal Company v. Idaho Power Company, 98 Idaho 860, 574 P.2d 902 (1978) (hereinafter Grindstone I ), in support of their basic contention that parties must be given fair notice of exactly what the Commission proposes to do. See Intermountain Gas Co. v. Idaho Public Utilities Commission, 97 Idaho 113, 540 P.2d 775 (1975) (cited with approval in Grindstone I ).

In Grindstone I, the record of that case reflects that there had been notice given that a general rate increase was under consideration and that there had been present on the record the data compilation upon which a rate increase would be based. Specifically, the Commission pointed to Exhibit 75, which showed a low rate of return for Schedule 24 users in comparison with other classes of users, and it argued that the appellants in that case should have discerned the significance of the exhibit. The significance of the exhibit, in combination with the general proposition that rate allocation is inherent in any rate increase, should have given adequate notice that Schedule 24 users would be subject to a rate increase and should be on guard to defend. This Court did not agree with the Commission's foregoing argument but found instead that it was not until the Commission's issuance of Order No. 11694, issued almost a year after the application for an increase in rates by Idaho Power, that the appellant users "had an inkling that rate structures applicable to their business were due for special attention." Grindstone I at 864, 574 P.2d at 906.

Turning to the record before us here, we find that a Notice of Application and Hearing was sent out to appellants approximately four days after the rate increase application was received by the Commission, which provided:

"YOU ARE FURTHER NOTIFIED that Applicant proposes to increase electric service rates for irrigation and soil drainage pumping service, service to municipalities, the above designated Special Contracts, and all other customers, classes, and contracts, by approximately 22.8%.

....

"YOU ARE FURTHER NOTIFIED that the Commission may determine that an increase in revenues should be an amount other than that proposed by Applicant, and that the spread or allocation of any rate increase granted should be other than that proposed by Applicant. The rates of all Idaho jurisdictional customers of Applicant are at issue and subject to change in this proceeding." (emphasis added).

We hold that appellant Schedule 24 users, upon receipt of this notice, were put upon adequate notice that rate structures applicable to their business were due for special attention and that they would be subject to a possible rate increase in the amount of approximately 22.8%, dependent upon the outcome of the proceedings before the Commission. The Grindstone I requirement of adequate notice has been met.

Appellants contend further that nowhere in the notice or proceedings were they notified that one specific segment of the Schedule 24 users would be singled out to bear the burden of a rate increase. We find this contention based upon segmented treatment to be without merit as regards the issue of adequate notice. Regardless of whether they be high demand-high load factor users or low demand-low load factor users, appellants, as members of the class of Schedule 24 customers, were adequately notified that they were being considered for a rate increase. The related issue of whether this segmented rate allocation is just and reasonable as regards appellants is discussed below.

As is well established, this Court is confined in its review of decisions by the Public Utilities Commission. The Idaho Constitution provides us with the jurisdiction to review but it also provides for legislative definition of the scope of review. Id. Const. Art. 5, § 9. Accordingly, I.C. § 61-629 provides in part:

"Matters reviewable on appeal Judgment. No new or additional evidence may be introduced in the Supreme Court, but the appeal shall be heard on the record of the commission as certified by it. The review on appeal shall not be extended further than to determine whether the commission has regularly pursued its authority, including a determination of whether the order appealed from violates any right of the appellant under the Constitution of the United States or of the state of Idaho. Upon the hearing the Supreme Court shall enter judgment, either affirming or setting aside the order of the commission."

In light of this limited review, this Court has held:

"The Commission is a fact finding, quasi-legislative body authorized to investigate and determine issues presented by a utility's petition for increased rates. Where its findings are supported by competent and substantial evidence this Court is obliged to affirm its decision."

Boise Water Corp. v. Idaho Public Utilities Commission, 97 Idaho 832, 838, 555 P.2d 163, 169 (1976); Application of Pacific Telephone & Telegraph Co., 71 Idaho 476, 480, 233 P.2d 1024, 1026 (1951).

Recently, this Court has reemphasized the limited review we may make. "In reviewing findings of fact we will sustain a Commission's determination unless it appears that the clear weight of the evidence is against its conclusion or that the evidence is strong and persuasive that the Commission abused its discretion." Utah-Idaho Sugar v. Intermountain Gas Co., 100 Idaho 368, 376, 597 P.2d 1058, 1066 (1979).

Thus, our focus must be upon the evidence presented to the Commission. If the evidence is competent and substantial in support of the findings made and there has been no clear abuse of discretion, this Court is constrained to affirm those findings.

In the instant case, the Commission after an extended hearing made findings that previous rates were unjust and unreasonable and that based upon the Commission's evaluation of the evidence, significant changes had to be made in rate structure and design. Accordingly, a revision of Schedule 24 resulted.

The new schedule eliminated the past declining block demand charges in favor of a single flat demand charge and reduced the energy blocks to two blocks during the summer season with a single flat energy charge in the off peak season. The Commission found the new schedule to substantially reduce the price benefits of volume consumption while continuing to give some benefit to high load factor customers with the result being a reduction in cost for the majority of pump irrigators, while large volume customers received increases up to 19.6%. The Commission further found this result to be just and reasonable under the circumstances.

This Court is of the opinion that the relevant findings as made by the Commission adequately...