Senate panel hears refuse utility rate reform bill

The Senate Community and Regional Affairs Committee heard introductory testimony Tuesday on legislation that would allow trash haulers to use a faster process for setting rates.

Senate Bill 16 would let refuse utilities use an existing simplified rate filing procedure, a change supporters said would reduce delays that now stretch rate cases to nearly three years. The bill also requires the Regulatory Commission of Alaska to create rules specific to refuse utilities that ensure public notice and time for customer comment. Under the bill, public notice and comment periods would become a legal requirement, not just a suggestion. The bill includes an immediate effective date.

Dawson Mann, chief of staff to bill sponsor Senator Myers, told the committee the current system forces utilities to seek large rate increases instead of smaller, more frequent adjustments. Under existing law, the RCA has 450 days to decide a rate case, with an option to extend another 450 days.

"From what we hear, the extension is used most of the time," Mann said. "That means a rate case can take almost three years. Because of that delay, utilities are not asking for small increases. Instead, they are asking for big jumps, sometimes 20 percent or more."

The bill is based on language that passed one chamber unanimously four years ago and passed the other chamber two years ago, though not in the same bill at the same time, Mann said.

Curt Froning, division vice president for Waste Connections of Alaska, testified that the current process requires extensive legal and consulting support costing hundreds of thousands of dollars. Those costs are recoverable in rates, meaning Alaska customers ultimately pay for them.

"This process is especially challenging for small and rural solid waste providers, many of whom simply do not have the same resources that larger companies do and have the capacity to navigate a prolonged, highly technical rate case," Froning said.

He pointed to Washington State's Utilities and Transportation Commission as a model, saying that agency handles solid waste rate filings far more efficiently through simplified mechanisms and early staff engagement. Many filings are completed quickly and with minimal expense, he said.

Senate Bill 16 would expand use of simplified rate filings under existing statute, require pre-filing education for RCA audit staff on solid waste operations, and allow more direct informal communication during the review process.

RCA Commissioner John Springsteen attended the hearing to answer questions but said the commission cannot take a position on legislation until it is discussed at a public meeting under Open Meetings Act requirements. He said the RCA has not taken a position on similar bills in the past.