Taxation Without Documentation:Are Licensees Paying Too Much in Annual Charges?

摘要

Over the past several years, hydroelectric licensees have challenged the portion of theirannual charges bills from the Federal Energy Regulatory Commission (“FERC”)attributable to the administrative costs reported by federal agencies other than FERC.In appealing these charges, licensees discovered a total lack of accountability inFERC’s annual charges program. Because the federal agencies reporting these costsfail to adhere to minimal record-keeping and documentation standards, their costreports are replete with errors, making it impossible to decipher whether the costs theyreport were actually incurred in administering the Federal Power Act (“FPA”). FERC’snewly announced policies compound the problem by making clear that it will notconduct any sort of review of these sloppy cost reports prior to passing the coststhrough to hydroelectric licensees. As discussed herein, FERC’s new policiesincorrectly attempt to avoid its responsibilities under the FPA to: (1) ensure that costsare supported by substantial evidence; (2) bill licensees only those costs that are withinthe purview of its cost-recovery authority; and (3) seek to avoid increasing the price ofelectricity to consumers by such annual charges. To fulfill its responsibilities under theFPA, FERC should implement a process to review these cost submittals from theagencies, ensure that costs meet minimal federal requirements, and adopt standards toavoid the continued escalation in resource agency costs.