In re Application of City of Neligh, Nebraska. City of Neligh, Nebraska, appellee,
Elkhorn Rural Public Power District, appellant.
Nebraska Power Review Board: Appeal and
Error. A decision of the Nebraska Power Review Board
will be affirmed if it is supported by the evidence and is
not arbitrary, capricious, unreasonable, or otherwise
Statutes: Appeal and Error. The meaning of a
statute is a question of law, and a reviewing court is
obligated to reach conclusions independent of the
determination made below.
from the Power Review Board. Reversed and remanded for
A. Jarecke and Ellen C. Kreifels, of Blankenau, Wilmoth &
Jarecke, L.L.R, for appellant.
C. Levy and Krista M. Eckhoff, of Baird Holm. L.L.R, and
Joseph McNally, of McNally Law Office, for appellee.
Heavican, C.J., Cassel, Stacy, and Funke, JJ., and Riedmann
and Arterburn, Judges.
City of Neligh, Nebraska (Neligh), filed an application with
the Nebraska Power Review Board (Board) seeking to [299 Neb.
518] transfer two newly annexed territories from the Elkhorn
Rural Public Power District (ERPPD) to Neligh's
electrical service area and to have the Board determine the
total economic impact of the transfer to the ERPPD. The Board
transferred the service and assessed the economic impact at
$490, 445.90. ERPPD appeals. We reverse the decision and
remand the cause for further proceedings.
Rev. Stat. § 70-1008(2) (Reissue 2009) provides:
A municipally owned electric system, serving such
municipality at retail, shall have the right, upon
application to and approval by the board, to serve newly
annexed areas of such municipality. Electric distribution
facilities and customers of another supplier in such newly
acquired certified service area may be acquired, in
accordance with the procedure and criteria set forth in
section 70-1010, within a period of one year and payment
shall be made in respect to the value of any such
facilities' customers or certified service area being
transferred. The rights of a municipality to acquire such
distribution facilities and customers within such newly
annexed area shall be waived unless such acquisition and
payment are made within one year of the date of annexation.
If an application is made to the board within one year of the
date of annexation for a determination of total economic
impact as provided in section 70-1010, such right shall not
be waived unless the municipality fails to make payment of
the price determined by the board within one year of a final
decision establishing such price. Notwithstanding other
provisions of this section, the parties may extend the time
for acquisition and payment by mutual written agreement.
Rev. Stat. § 70-1010 (Reissue 2009) further provides:
(1) The board shall have authority upon application by a
supplier at any time to modify service areas or [299 Neb.
519] customers to be served as previously established. The
same procedures as to notice, hearing, and decision shall be
followed as in the case of an original application. Suppliers
shall have authority by agreement to change service areas or
customers to be served with the approval of the board. This
section shall not apply to agreements referred to in
subsection (2) of section 70-1002.
(2) In the event of a proposed transfer of customers and
facilities from one supplier to another in accordance with
this section or section 70-1008 or 70-1009, the parties shall
attempt to agree upon the value of the certified service area
and distribution facilities and customers being transferred.
If the parties cannot agree upon the value, then the board
shall determine the total economic impact on the selling
supplier and establish the price accordingly based on, but
not limited to, the following guidelines: The supplier
acquiring the certified service area, distribution
facilities, and customers shall purchase the electric
distribution facilities of the supplier located within the
affected area, together with the supplier's rights to
serve within such area, for cash consideration which shall
consist of (a) the current reproduction cost if the
facilities being acquired were new, less depreciation
computed on a straight-line basis at three percent per year
not to exceed seventy percent, plus (b) an amount equal to
the nonbetterment cost of constructing any facilities
necessary to reintegrate the system of the supplier outside
the area being transferred after detaching the portion to be
sold, plus (c) an amount equal to two and one-half times the
annual revenue received from power sales to existing
customers of electric power within the area being
transferred, except that for large commercial or industrial
customers with peak demands of three hundred kilowatts or
greater during the twelve months immediately preceding the
date of filing with the board, the multiple shall be five
times the net revenue, defined as gross power sales, [299
Neb. 520] less costs of wholesale power including facilities
rental charges, received from ...