Seven months after an Oklahoma Supreme Court justice indicated ratepayers might be burdened with anywhere from $60 million to $100 million more costs on top of their 2021 winter storm rate hikes, legislators are being told it could in the range of $150 million. Yes, Winter Storm Uri remains a nightmare for ratepayers that just won’t go away.
The figure is involved in the legislature’s discussion of HB1220, an attempt to reinstate the extemption of ratepayers’ Winter Storm Uri securitized utility debt from the franchise fees collected across the state in various cities and towns. The bill was created after the State Supreme Court ruled last November that the Corporation Commission’s approval on a 2-1 vote to allow utilities to suspend collection of the fees was to be reversed. The ruling came in a challenge filed by Oklahoma City and the Oklahoma Municipal League.
Vice-Chief Justice Dustin Rowe issued a concurring opinion in the decision but warned it could mean possibly $100 million more on top of the $3.07 billion in winter storm charges.
“Will payment be made from the securitized revenue or from the utility companies’ balance sheets?” Rowe he wrote in his opinion. “I suppose the answer to these questions will be litigated in district court. From there, the district court can determine whether the burden of an additional $60-$100 million will fall onto the people of Oklahoma.”
“Today, nearly four years after the 14-day winter storm, it remains to be seen whether municipalities will receive their franchise fees and taxes. And, if municipalities are entitled to be paid-and if not from the securitized revenue-it remains to be seen whether the ratepayer will have to cough up more money to pay for this colossal financial event. Although beyond our purview, I cannot help but wonder how many of these catastrophic weather events Oklahoma ratepayers can afford-and what, if anything-has been done to prevent this from happening again,” added Justice Rowe.
A month later during a discussion of how to proceed, Corporation Commissioners were told by a Public Service Company lawyer, He “not prepared to address the issue at this time” but admitted it was an issue involving perhaps $60 million to $100 million “owed to Oklahoma towns and cities.”
Now comes a report from NonDoc that the state Senate was told the costs could reach $150 million. Below is the segment of the Monday morning NonDoc report about bills still in the legislature:
“One major bill that stalled without a hearing in the Senate last week was HB 1220, which passed the House 97-0 to reinstate an exemption of ratepayers’ Winter Storm Uri securitized utility debt from the franchise agreements collected for cities and towns. Corporation Commissioner Todd Hiett briefly visited the Senate lounge Thursday in an effort to make sure senators knew their inaction would equate to roughly $150 million in taxes on electricity and gas ratepayers around the state.
Senate President Pro Tempore Lonnie Paxton, however, admitted he was “not at all familiar” with the situation, mistakenly thinking the Oklahoma Municipal League was for the bill as opposed to against it.
“Oh. That shows you how much I know about it,” said Paxton (R-Tuttle). “It is a bill that the floor leader team has dealt with, but I could check on that for you for next week, but I have not been involved with it.”
But with HB 1220 failing to be heard in the Senate before the May 8 deadline, it would be up to Paxton and House Speaker Kyle Hilbert to strike an agreement over the next three weeks to block the additional taxation from taking effect.
“To me, it’s ridiculous that cities are trying to profit off of Winter Storm Uri in this fashion, and that was never the intent of that legislation we passed (authorizing ratepayer debt securitization),” said Hilbert (R-Bristow). “So I’m strongly supportive. I think it makes sense, so I’m going to continue to advocate for it.”
Adding to the turmoil is the legislature has three weeks remaining to decide whether it can reach a compromise on how to answer the franchise fee dilema.
