Regular Session 2023-2024 House Bill 2047 P.N. 2614

PRINTER'S NO. 2614

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

2047

Session of

2024

INTRODUCED BY RABB, McANDREW, HILL-EVANS AND DALEY,

FEBRUARY 20, 2024

REFERRED TO COMMITTEE ON CONSUMER PROTECTION, TECHNOLOGY AND

UTILITIES, FEBRUARY 20, 2024

AN ACT

Amending Title 66 (Public Utilities) of the Pennsylvania

Consolidated Statutes, in rates and distribution systems,

further providing for recovery of advertising expenses; and,

in restructuring of electric utility industry, providing for

membership in regional transmission organization.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. Section 1316 of Title 66 of the Pennsylvania

Consolidated Statutes is amended to read:

§ 1316. Recovery of [advertising] lobbying and political

activity expenses.

(a) General rule.--For purposes of rate determinations, no

public utility may charge to its consumers as a permissible

operating expense for ratemaking purposes any direct or indirect

expenditure by the utility for [political advertising] lobbying

or political activities or prohibited costs. The commission

shall also disallow as operating expense for ratemaking purposes

expenditures for other advertising, unless and only to the

extent that the commission finds that such advertising is

reasonable and meets one or more of the following criteria:

(1) Is required by law or regulation.

(2) Is in support of the issuance, marketing or

acquisition of securities or other forms of financing.

(3) Encourages energy independence by promoting the wise

development and use of domestic sources of coal, oil or

natural gas and does not promote one method of generating

electricity as preferable to other methods of generating

electricity.

(4) Provides important information to the public

regarding safety, rate changes, means of reducing usage or

bills, load management or energy conservation.

(5) Provides a direct benefit to ratepayers.

(6) Is for the promotion of community service or

economic development.

(b) Charging expenses to stockholders.--Any direct or

indirect expenditure by a public utility for political

advertising, or any other advertising not meeting the criteria

set forth in subsection (a), shall be charged to its

stockholders and shall not be included as an operating expense

for ratemaking purposes.

(1) Whenever a public utility proposes a change in rates

under section 1308 (relating to voluntary changes in rates),

the public utility shall file with the commission a listing

of each type of advertising prepared, distributed or

presented by the public utility or to be prepared,

distributed or presented by the public utility during the

test year utilized by the public utility in discharging its

burden of proof, and a listing of each type of advertising

20240HB2047PN2614 - 2 -

prepared, distributed or presented by the public utility

during the year immediately preceding the test year, as well

as an accounting of the expenditures by the public utility

for such advertising, to the extent such advertising is

proposed to be included as operating expense for ratemaking

purposes.

(2) Not later than December 31 of each year, a public

utility with more than 75,000 customers in this Commonwealth

shall file with the commission a report itemizing the costs

of lobbying or political activities. The report shall

include:

(i) costs spent by the parent company or an

affiliate of the public utility that are directly billed

or allocated to the public utility;

(ii) a list of the title, job description and salary

of any employee of the public utility who performed work

associated with the lobbying or political activity,

including the hours attributed to the work;

(iii) a list of the title, job description and

salary of any employee of the parent company or affiliate

of the public utility who performed work associated with

the lobbying or political activity, including the hours

attributed to the work that were directly billed or

allocated to the public utility;

(iv) a list of payments that the public utility made

to all third-party vendors for expenses associated with

the lobbying or political activity, including unredacted

billing amounts, billing dates, payees and an explanation

of each expenditure in detail sufficient to describe the

purpose of the cost; and

20240HB2047PN2614 - 3 -

(v) any other information the commission considers

relevant.

(3) The filing requirements imposed by this subsection

shall not be construed to limit the right of any party to

discovery under this or any other provision of law.

(d) [Definition.--As used in this section the term

"political advertising" means any advertising] Definitions.--As

used in this section, the following words and phrases shall have

the meanings given to them in this subsection unless the context

clearly indicates otherwise:

"Lobbying or political activity." Action taken at the State

or municipal government level in connection with:

(1) influencing legislation;

(2) participating or intervening in any political

campaign on behalf of or in opposition to a candidate for

public office;

(3) an attempt to influence a segment of the general

public with respect to an election, a legislative matter, an

executive decision or referendum;

(4) political advertising; or

(5) supporting public policy research, analysis,

preparation or planning.

"Political advertising." Advertising for the purpose of

influencing public opinion with respect to any legislative,

administrative action or candidate election or with respect to

any controversial issue to be decided by public voting. The term

includes money spent for lobbying but not money spent for

appearances before regulatory or other governmental bodies in

connection with a public utility's existing or proposed

operations.

20240HB2047PN2614 - 4 -

"Prohibited costs." An expense for any of the following:

(1) membership, dues, sponsorships or contributions to a

business or industry trade association, group or related

entity exempt from taxation under section 501 of the Internal

Revenue Code (Public Law 99-514, 26 U.S.C. § 501);

(2) unless approved or ordered by the commission,

advertising, marketing, communication or other related

expense identified by the commission that seeks to influence

public opinion or create goodwill toward a public utility;

(3) travel, lodging or food and beverage expense for the

board of directors and officers of a public utility or the

board of directors and officers of a parent company of a

public utility;

(4) entertainment or gifts;

(5) any owned, leased or chartered aircraft for the

board of directors and officers of a public utility or the

parent company of a public utility; or

(6) investor relations.

Section 2. Title 66 is amended by adding a section to read:

§ 2816. Membership in regional transmission organization.

(a) General rule.--An electric distribution company shall be

a member of a regional transmission organization.

(b) Filing of report.--On or before February 1 each year, an

electric distribution company shall submit to the commission a

report on any recorded vote cast by the electric distribution

company or, subject to subsection (c), an affiliate of the

electric distribution company at a meeting of a regional

transmission organization during the immediately preceding

calendar year.

20240HB2047PN2614 - 5 -

shall include:

(1) all recorded votes cast by the electric distribution

company, regardless of whether the vote is otherwise

disclosed;

(2) all votes cast by an affiliate of the electric

distribution company, if the electric distribution company

itself did not vote on the matter; and

(3) a brief description explaining how each vote cast by

the electric distribution company or its affiliate is in the

interest of the public.

(d) Definitions.--As used in this section, the following

words and phrases shall have the meanings given to them in this

subsection unless the context clearly indicates otherwise:

"Affiliate." A corporation or person with an affiliated

interest as defined in section 2101 (relating to definition of

affiliated interest).

"Meeting." A committee, user group, task force or other part

of a regional transmission organization in which votes are

taken.

"Recorded vote." A vote that is tabulated, either

individually or as part of a sector, for any purpose at a

meeting, regardless of:

(1) whether the vote represents a final position of any

person casting the vote; or

(2) the decision-making authority of those voting.

"Regional transmission organization." An entity that

qualifies as a regional transmission organization under 18 CFR

35.34 (relating to regional transmission organizations).

Section 3. This act shall take effect in 60 days.

20240HB2047PN2614 - 6 -