{"operation":"document","citation":"4 CCR 723-4 Rule 4351","title":"Costs Prohibited from Rates","source_type":"regulation","agency":"Colorado Public Utilities Commission","status":"current","official":true,"published_on":null,"effective_on":null,"summary":"(a) Base rates and rate adjustment mechanisms shall not recover the following costs: (I) expenses related to marketing and administration or customer service for unregulated products or services provided or sold by the utility or the utility's affiliates in accordance with the rules addressing unreg","machine_formats":{"json":"https://regulus.evalyn.ai/document/co-ccr-4-723-4-4351.json","markdown":"https://regulus.evalyn.ai/document/co-ccr-4-723-4-4351.md"},"app_url":"https://regulus.evalyn.ai/document/co-ccr-4-723-4-4351","source_url":"https://www.sos.state.co.us/CCR/DisplayRule.do?action=ruleinfo&ruleId=2260&deptID=18&agencyID=96&deptName=Department%20of%20Regulatory%20Agencies&agencyName=Public%20Utilities%20Commission&seriesNum=4%20CCR%20723-4","body":"(a) Base rates and rate adjustment mechanisms shall not recover the following\ncosts:\n(I) expenses related to marketing and administration or customer service for\nunregulated products or services provided or sold by the utility or the\nutility’s affiliates in accordance with the rules addressing unregulated\ngoods and services 4 CCR 723-3-3500, et seq.;\n(II) entertainment or gift expenses;\n(III) penalties or fines related to taxes;\n(IV) investor-relation expenses;\n(V) expenses associated with lobbying or other activities meant to influence\nthe outcome of any local, state, or federal legislation, ordinance,\nresolution, or ballot measure. For the purpose of a base rate proceeding\nand related reporting, lobbying means directly, or through the solicitation\nof others, communicating with a person that is in a position to make a\npolicy decision in order to influence the outcome of local, state, or federal\nlegislation;\n(VI) organizational dues, membership dues, or other contributions to any\norganization, association, institution, corporation, or other entity that\nengages in lobbying or other similar activities meant to influence the\noutcome of any local, state, or federal legislation, ordinance, resolution, or\nballot measure;\n(VII) advertising and public relations expenses incurred to promote or improve\nthe utility’s brand, to influence public opinion about the utility, to create\n\ngood will toward the utility from the general public. Advertising regarding\nservice interruptions, safety measures, emergency conditions, or\nemployment opportunities with the utility may be included in a revenue\nrequirement for any test year as determined by the Commission;\n(VIII) advertising and public relations expenses not directly related to a purpose\nor program that is required or authorized under statute, rule, or order.\nAdvertising or other consumer education expenses directly related to\nincome-based rates and services, including special rates, pilot programs,\nenergy efficiency, beneficial electrification, renewable energy, and\ntransportation electrification, may be included in a revenue requirement for\nany test year as determined by the Commission;\n(IX) charitable giving expenses, including contributions to organizations\nqualified under Section 501(c)(3) or 501(c)(4) of the federal “Internal\nRevenue Code of 1986”, 26 U.S.C. Sec. 501, as amended;\n(X) contributions to political candidates, campaign committees, issue\ncommittees, or independent expenditure committees or similar political\nexpenses;\n(XI) travel, lodging, food, and beverage expenses of the utility’s officers;\n(XII) travel, lodging, food, and beverage expenses and no more than 50\npercent of all other reimbursed expenses of the utility’s board of directors;\n(XIII) expenses related to any owned, leased, or chartered aircraft for the\nutility’s board of directors and officers, where aircraft has the meaning set\nforth in § 41-23-101(1), C.R.S.; and\n(XIV) more than 50 percent of compensation to the utility’s board of directors.\n(b) Required data in base rate case.\n(I) A utility shall provide in any base rate case where the Commission has\nsuspended the proposed tariff and ordered a hearing, at minimum, the\nfollowing information to enable a determination by the Commission that\nthe utility is not seeking to recover from its customers any of the prohibited\ncosts identified in subparagraphs (a)(I) through (a)(XIV) of this rule:\n\n(A) disaggregated data that identifies the portion of total annual\ncompensation excluded from cost recovery for each individual\nemployee (identified at least by position and title) who conducted\nactivities during the applicable test year period that are prohibited\nfor recovery; and\n(B) disaggregated data that identifies all amounts paid by the investor-\nowned utility to outside vendors (including but not limited to\nconsultants and legal counsel) to conduct activities during the\napplicable test year period that are prohibited for recovery.\n(II) This information shall be filed by the utility into the administrative record\nfor the proceeding no later than 30 days after the issued date of the\nCommission decision setting the matter for hearing and shall be updated,\nas applicable, at the time of filing rebuttal testimony.\n(c) Reporting. For the purpose of demonstrating compliance with § 40-3-114, C.R.S.,\non or before April 30th of each year, each utility shall file with the Commission a\nreport that identifies any costs prohibited by paragraph 4351(a) that the utility\nsought to include in base rates or in a rate adjustment mechanism but the\nCommission found, in a written decision, are not permitted to be recovered from\ncustomers. The report must include, for each prohibited cost required to be\nreported, the purpose of the expenses corresponding to subparagraphs\n4351(a)(I) through (XIV), and the payee and amount of the expenses the\nCommission found are not permitted to be recovered from customers. The report\nshall be filed concurrently with and in the same proceeding as the investor-\nowned utility’s annual report filed in accordance with rule 4006.\n(d) Penalties. If the Commission determines that an investor-owned utility improperly\nrecovered through rates any of the prohibited costs or expenditures listed in\nparagraph 4353(a), the Commission may assess a civil penalty against the utility\npursuant to rules 4009 and 4010.\n(e) Refunds. If the Commission assesses a civil penalty against the utility in\naccordance with paragraph 4351(d), the Commission shall also order the utility to\nsubmit for approval a refund plan pursuant to rule 4410. The utility shall refund\nthe amount of prohibited costs or expenditures improperly recovered through\nrates, plus interest, to customers.","truncated":false,"body_characters":5714}