Report Title:

Utilities; Undergrounding Conversion Fund

 

Description:

Adopts a state policy of favoring underground utilities.  Establishes an underground conversion fund for sustained incremental conversion of overhead utilities.  Allows income tax refund as a voluntary contribution to the fund.

 


HOUSE OF REPRESENTATIVES

H.B. NO.

1647

TWENTY-FOURTH LEGISLATURE, 2007

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT


 

 

RELATING TO UNDERGROUNDING OF OVERHEAD UTILITIES.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


     SECTION 1.  The legislature finds that the undergrounding of overhead utilities can help to protect our electricity and communications infrastructure by developing systems that have endurance and hardening resistance to overcome vulnerabilities to potential acts of terrorism and natural disasters, such as hurricanes and tsunamis.  Further, the legislature also finds that there is a general public preference for underground utilities since undergrounding improves the visual quality of Hawaii's natural environment, improves road safety, increases property values, and enhances the visitor experience for tourism, Hawaii's major industry.

     The legislature also finds that the high cost of converting to underground utilities has prevented many communities from receiving these benefits.  Therefore, overhead utilities have been continually maintained and even reconstructed while adjacent public improvements are built.  Underground conversion will take significant financial resources, the participation of many entities, and many years of coordinated effort to achieve.  However, it is a necessary goal to enhance the public's safety and welfare.

     Accordingly, the purpose of this Act is to:

     (1)  Establish and affirm a clearly stated policy that the conversion of overhead electric and communication facilities to underground facilities and the initial underground installation of these facilities is substantially beneficial to the public safety and welfare, is in the public interest, and is a public purpose; and

     (2)  Establish an underground conversion fund for a sustained, coordinated conversion of overhead utilities.

     SECTION 2.  Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§235-    Voluntary contributions to the underground conversion fund.  The director shall establish procedures to allow a taxpayer to designate and pay a voluntary contribution to the underground conversion fund on the taxpayer's annual state income tax return.  The amount of the voluntary contribution shall be added to the final income tax due from the taxpayer or subtracted from any refund due to the taxpayer and deposited in the underground conversion fund.  The director may use the check-the-box concept on the state tax form for the voluntary contributions."

     SECTION 3.  Chapter 269, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows:

"PART   .  UNDERGROUND CONVERSION

     §269-A  Underground conversion fund.  There is established in the state treasury an underground conversion fund to be administered by the underground conversion board.  The revenues to be deposited into the fund shall include:

     (1)  Five per cent of the state public utility fee or the excess remaining after funding of public utilities commission operations, whichever is the greater;

     (2)  Federal and state appropriations and contributions by other public bodies;

     (3)  Voluntary conversion funds; and

     (4)  Round-up program funds.

     §269-B  Underground conversion board.  There is established within the department of commerce and consumer affairs for administrative purposes an underground conversion board for the purpose of implementing this part.  The board shall consist of nine voting members; provided that:

     (1)  Three members shall be appointed by the governor, including:

         (A)  One representative from the electric utility industry;

         (B)  One representative from the telecommunications utility industry; and

         (C)  One representative from the cable service industry;

     (2)  One member shall be the state director of transportation or the director's representative;

     (3)  One member shall be the consumer advocate or the consumer advocate's representative;

     (4)  Two members shall be representative of the general public appointed by the speaker of the house of representatives; and

     (5)  Two members shall be representative of the general public appointed by the president of the senate.

The members shall serve without compensation but each shall be reimbursed for necessary travel expenses incurred in the performance of their duties.

     §269-C  Powers and duties of underground conversion board.  (a)  In addition to any other powers and duties authorized by law, the underground conversion board may:

     (1)  Establish and administer the underground conversion fund to plan, design, and construct the conversion of overhead lines to underground lines;

     (2)  Accept revenues, compensations, proceeds, charges, penalties, grants, or any other payments in any form, from any public agency or from any other source for deposit into the underground conversion fund;

     (3)  Adopt guidelines and criteria for the expenditure of funds from the underground conversion fund;

     (4)  Expend funds from the underground conversion fund to plan, design, and construct the conversion of overhead distribution lines to underground lines;

     (5)  Authorize the issuance of loans pursuant to section 269-D;

     (6)  Establish a systematic prioritization of improvement areas for the conversion of overhead distribution lines to underground lines;

     (7)  Publish and distribute information and conduct educational programs in furtherance of this part;

     (8)  Issue binding interpretations or declaratory rulings and conduct contested case proceedings pursuant to chapter 91;

     (9)  Subpoena witnesses and documents, administer oaths, and receive affidavits and oral testimony, including telephonic and electronic communications;

    (10)  Recommend to the legislature additional statutory amendments to effectuate the purposes of this part;

    (11)  Adopt, amend, or repeal rules pursuant to chapter 91 as it may deem necessary to effectuate this part;

    (12)  Establish a policy to maximize the use of federal highways funds for undergrounding of utility facilities during the construction or reconstruction of any new or existing federal aid highway project;

    (13)  Maximize coordination and the establishment of funding sources with other federal, state, and county agencies to ensure the development of a hardened infrastructure designed with the endurance to withstand potential acts of terrorism and natural disasters, such as hurricanes and tsunamis;

    (14)  Establish a task force to assist with the development of a comprehensive statewide plan for the long-term incremental undergrounding of utility lines; and

    (15)  Enforce this part and its rules.

     (b)  Additionally, the board shall:

     (1)  Review the policies and laws of other jurisdictions that address the incremental undergrounding of utilities, as studied by the legislative reference bureau in 1999;

     (2)  Review community priorities and financing options studied in "Oahu Utilities Under-grounding and Visual Mitigation Studies" by the American Institute of Architects Honolulu Chapter in 2003;

     (3)  Review the current work-share program of the Hawaiian Electric Company, Incorporated for undergrounding distribution utilities based on cost sharing with participating communities;

     (4)  Clarify the relationship between the public utilities commission and above ground infrastructure wiring regulated by other governmental bodies;

     (5)  Balance undergrounding conversion cost with the environmental and aesthetic concerns of consumers;

     (6)  Envision a plan that is driven by the availability of financing from the underground conversion fund rather than a fixed firm date for converting all utilities;

     (7)  Present a process to the public utilities commission for final approval to determine priorities for specific incremental undergrounding projects or grants; and

     (8)  Make provisions to facilitate private funding of underground utilities in locations that will have a lower priority for conversion funds.

     §269-D  Long-term loans.  The board shall have the authority to make long-term loans to private property owners in communities that are low on the priority list for underground conversion grants.

     §269-E  Round-up program.  The commission shall allow the utilities to administer a round-up program, under which the utilities may collect voluntary contributions for the underground conversion fund from ratepayers who choose to contribute the difference between their actual utility bill and their bill payment, which is rounded up to the nearest dollar.  The utilities shall deposit into the utilities underground conversion fund, on a monthly basis, the difference between the actual bill and the rounded amount.  Any moneys collected by a utility from the round-up program shall be excluded in determining the utility's annual gross revenue."

     SECTION 4.  Section 226-14, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

     "(b)  To achieve the general facility systems objective, it shall be the policy of this State to:

     (1)  Accommodate the needs of Hawaii's people through coordination of facility systems and capital improvement priorities in consonance with state and county plans[.];

     (2)  Encourage flexibility in the design and development of facility systems to promote prudent use of resources and accommodate changing public demands and priorities[.];

     (3)  Ensure that required facility systems can be supported within resource capacities and at reasonable cost to the user[.];

     (4)  Pursue alternative methods of financing programs and projects and cost-saving techniques in the planning, construction, and maintenance of facility systems[.]; and

     (5)  Convert existing overhead distribution utilities in the public domain to underground utilities and encourage counties to do the same."

     SECTION 5.  The underground conversion board shall submit an interim report of its findings and recommendations on the development of a comprehensive statewide plan for the long-term incremental undergrounding of utility lines, including proposed legislation, if any, to the legislature and the governor no later than twenty days before the convening of the regular session of 2008.  The underground conversion board shall submit a final report on its findings and recommendations on the development of a comprehensive statewide plan for the long-term incremental undergrounding of utility lines, including proposed legislation, if any, to the legislature and governor no later than twenty days before the convening of the regular session of 2009.

     SECTION 6.  In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

     SECTION 7.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 8.  This Act shall take effect upon its approval.

 

INTRODUCED BY:

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