HSB 249 (LSB 2646YC (3) 86)

HOUSE FILE _____

BY  (PROPOSED COMMITTEE ON GOVERNMENT OVERSIGHT BILL BY CHAIRPERSON KAUFMANN)

A BILL FOR

An Act relating to the construction, erection, maintenance, or operation of electric transmission lines and hazardous liquid pipelines, and including effective date and applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 478.3, subsection 3, Code 2015, is amended to read as follows:
   3.  a.  For the purpose of this section chapter, the term “public” when used in relation to public interest, public use, or needs of the public shall not be interpreted to refer to and be limited to consumers located in this state.
   b.  Paragraph “a” shall not apply to a transmission line, wire, or cable that is capable of operating at an electric voltage of thirty-four and one-half kilovolts or greater and that primarily provides electricity through alternating current and is used by rate-regulated electric utilities, municipal electric utilities, rural electric cooperatives, or electric transmission owners to provide electric service to the aforementioned utilities or to the public for compensation.
    Sec. 2.  Section 478.4, Code 2015, is amended to read as follows:
   478.4  Franchise —— hearing.
   1.  The utilities board shall consider the petition and any objections filed to it in the manner provided. It shall examine the proposed route or cause any engineer selected by it to do so. If a hearing is held on the petition it may hear testimony as may aid it in determining the propriety of granting the franchise. It may grant the franchise in whole or in part upon the terms, conditions, and restrictions, and with the modifications as to location and route as may seem to it just and proper. Before granting the franchise, the utilities board shall make a finding that the proposed line or lines are necessary to serve a public use and represents a reasonable relationship to an overall plan of transmitting electricity in the public interest. A franchise shall not become effective until the petitioners shall pay, or file an agreement to pay, all costs and expenses of the franchise proceeding, whether or not objections are filed, including costs of inspections or examinations of the route, hearing, salaries, publishing of notice, and any other expenses reasonably attributable to it. The funds received for the costs and the expenses of the franchise proceeding shall be remitted to the treasurer of state for deposit in the department of commerce revolving fund created in section 546.12 as provided in section 476.10.
   2.  a.  A finding of public use and public interest shall not be made in regard to a petition for a franchise if the petition sets forth that the exercise of the right of eminent domain will be used and if the petition primarily involves construction of a high-voltage direct current line and the petition does not provide for the erection of electric substations at intervals of less than fifty miles, which is necessary to accommodate both the purchase and sale to persons located in this state of electricity generated or transmitted by the franchisee.
   b.  Paragraph “a” shall not apply to a transmission line, wire, or cable that is capable of operating at an electric voltage of thirty-four and one-half kilovolts or greater and that primarily provides electricity through alternating current and is used by rate-regulated electric utilities, municipal electric utilities, rural electric cooperatives, or electric transmission owners to provide electric service to the aforementioned utilities or to the public for compensation.
    Sec. 3.  NEW SECTION.  478.34  Severability.

   If any provision of this chapter or its application to any person or circumstance is held invalid or otherwise rendered ineffective by any entity, the invalidity or ineffectiveness shall not affect other provisions or applications of this chapter that can be given effect without the invalid or ineffective provision or application, and to this end the provisions of this chapter are severable.
    Sec. 4.  Section 479B.1, Code 2015, is amended to read as follows:
   479B.1  Purpose —— authority.

   It is the purpose of the general assembly in enacting this law to grant the utilities board the authority to implement certain controls over hazardous liquid pipelines to protect landowners and tenants from environmental or economic damages which may result from the construction, operation, or maintenance of a hazardous liquid pipeline or underground storage facility within the state, to approve the location and route of hazardous liquid pipelines, and to grant rights of eminent domain where necessary unless the grant of such rights is specifically prohibited.
    Sec. 5.  Section 479B.2, Code 2015, is amended by adding the following new subsections:
   NEW SUBSECTION.  2A.  “Major oil pipeline” means a pipeline that is larger than twelve inches in inside diameter.
   NEW SUBSECTION.  2B.  “Major oil pipeline company” means a person engaged in or organized for the purpose of owning, operating, or controlling major oil pipelines for the transportation or transmission of any hazardous liquid.
    Sec. 6.  Section 479B.16, Code 2015, is amended to read as follows:
   479B.16  Eminent domain.
   1.  A pipeline company granted a pipeline permit shall be vested with the right of eminent domain, to the extent necessary and as prescribed and approved by the board, not exceeding seventy-five feet in width for right-of-way and not exceeding one acre in any one location in addition to right-of-way for the location of pumps, pressure apparatus, or other stations or equipment necessary to the proper operation of its pipeline. The board may grant additional eminent domain rights where the pipeline company has presented sufficient evidence to adequately demonstrate that a greater area is required for the proper construction, operation, and maintenance of the pipeline or for the location of pumps, pressure apparatus, or other stations or equipment necessary to the proper operation of its pipeline.
   2.  A pipeline company granted a permit for underground storage of hazardous liquid shall be vested with the right of eminent domain to the extent necessary and as prescribed and approved by the board in order to appropriate for its use for the underground storage of hazardous liquid any subsurface stratum or formation in any land which the board shall have found to be suitable and in the public interest for the underground storage of hazardous liquid, and may appropriate other interests in property, as may be required adequately to examine, prepare, maintain, and operate the underground storage facilities.
   3.  This chapter does not authorize the construction of a pipeline longitudinally on, over, or under any railroad right-of-way or public highway, or at other than an approximate right angle to a railroad track or public highway without the consent of the railroad company, the state department of transportation, or the county board of supervisors, and this chapter does not authorize or give the right of condemnation or eminent domain for such purposes.
   4.  A major oil pipeline company as defined in section 479B.2 that has not received a permit under this chapter on or before January 12, 2015, shall not be granted, or otherwise vested with, the right of eminent domain.
    Sec. 7.  EFFECTIVE UPON ENACTMENT.  This Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 8.  APPLICABILITY.  The sections of this Act amending sections 478.3 and 478.4 are applicable to petitions for franchise filed on or after November 1, 2014, that have not been acted upon by the board on the effective date of this Act and to petitions for franchise filed on or after the effective date of this Act.
EXPLANATION
The inclusion of this explanation does not constitute agreement with

the explanation’s substance by the members of the general assembly.
   This bill relates to the construction, erection, maintenance, or operation of electric transmission lines and hazardous liquid pipelines.
   In determining whether to grant a petition for a franchise to construct, erect, maintain, or operate an electric transmission line, the Iowa utilities board is required to find that, among other requirements, the proposed line or lines are necessary to serve a public use and represent a reasonable relationship to an overall plan of transmitting electricity in the public interest. The bill provides that a finding of public use and public interest shall not be made in the event a petition for a franchise primarily involves construction of a high-voltage direct current line and the petition does not provide for the erection of electric substations at intervals of less than 50 miles, which is necessary to accommodate both the purchase and sale to persons located in Iowa of electricity generated or transmitted by the franchisee.
   Additionally, current Code section 478.3, specifying franchise petition requirements, provides that for the purposes of that Code section, the term “public” shall not be interpreted to be limited to consumers located in Iowa. The bill modifies this provision to instead specify that the term “public” as used in Code chapter 478 in reference to public use, interest, and needs shall refer to and be limited to consumers located in this state.
   With reference to both the restriction against a finding of public use and public interest for the high-voltage direct current line and the limitation of the term “public” to consumers located in Iowa, the bill provides that these provisions shall not apply to a transmission line, wire, or cable that is capable of operating at an electric voltage of 34 and one-half kilovolts or greater that primarily provides electricity through alternating current and is used by rate-regulated electric utilities, municipal electric utilities, rural electric cooperatives, or electric transmission owners to provide electric service to the aforementioned utilities or to the public for compensation.
   Further, the bill provides that if any provision of Code chapter 478 or its application to any person or circumstance is held invalid or otherwise rendered ineffective by any entity, the invalidity or ineffectiveness shall not affect other provisions or applications of the Code chapter that can be given effect without the invalid or ineffective provision or application, and to this end the provisions of the Code chapter are severable.
   With relation to hazardous liquid pipelines, the bill adds two new definitions to Code section 479B.2. The bill defines a “major oil pipeline” to mean a pipeline that is larger than 12 inches in inside diameter. The bill defines a “major oil pipeline company” to mean a person engaged in or organized for the purpose of owning, operating, or controlling major oil pipelines for the transportation or transmission of any hazardous liquid. The bill provides that a major oil pipeline company that has not received a permit under Code chapter 479B to construct, maintain, or operate a major oil pipeline on or before January 12, 2015, shall not be granted, or otherwise vested with, the right of eminent domain.
   The bill takes effect upon enactment. The provisions of the bill relating to petitions for a franchise to construct, erect, maintain, or operate an electric transmission line apply to petitions for franchise filed on or after November 1, 2014, that have not been acted upon by the board on the bill’s effective date and to petitions for franchise filed on or after that date.