such action results in a retroactive rate increase and a price in excess of the NGPA ceiling price. Discussion Northern urges that the Commission reinstate the crediting mechanism that was eliminated by Opinion No. 307-A. However, Northern's arguments have no merit because the elimination of that mechanism did not affect the remedy for the federal violation and in no way diminished either Northern's or its interstate customers' federal rights. The Commission found that respondents had sold certain noncasinghead gas in intrastate commerce which was unlawfully diverted from Northern or sold without certificate authority at excessive prices in violation of the NGA or the NGPA. The subject gas was dedicated to Northern by the certificate holder Dorchester "the company owning the leasehold rights to natural gas produced from beneath the surface acreage at issue in these proceedings. The gas would have been taken from those reserves if it had been produced from a Dorchester gas proration unit."6 In order to cure the violation, the Commission, in Opinion No. 307, ordered respondents to pay Northern the amounts they had received from the sales of the gas that had been diverted. Northern in turn was required to flowthrough the amounts it received to its interstate customers after it paid Dorchester for that gas at the applicable section 104 prices that it had paid Dorchester during the period when the diversion occurred. Clearly Dorchester was entitled to payment for the gas if the diverted gas was produced from its property. In its order, the Commission recognized that certain respondents might not refund the amount attributable to them. Thus to ensure that Dorchester did not obtain preferential treatment, the Commission order provides that Dorchester and Northern's interstate customers would share on a proportional basis. To the extent that any respondent does not pay its full share, the amount Dorchester receives from that respondent will be reduced proportionally so that both Dorchester and the interstate customers would recover from that respondent. The Commission's order, however, required Dorchester to credit any amount that it would receive from certain state court proceedings involving respondents against the amount that it is entitled to receive under Opinion No. 307, and to remit to Northern any proceeds in excess of the Opinion No. 307 amount. Northern was required to distribute these funds to interstate customers. We fail to see how elimination of this crediting provision affects Northern's federal rights or those of its interstate customers. Northern has not challenged the provision that requires Dorchester, an innocent party to the violation, to be paid for the subject gas. Northern objects to the elimination of the crediting on the grounds that it might lead to a greater recovery by Dorchester than the amount of the price of the gas, or that Dorchester might receive a double recovery from the state court proceeding. In eliminating the crediting mechanism the Commission stated that it was doing so because there was no need for it since the state court could take into account the remedy Dorchester realized in our proceeding: By requiring Dorchester to remit to Northern any proceeds from pending lawsuits that exceed an amount to recompense the loss of dedicated reserves, the Commission might limit Dorchester's rights to damages under state law. We are persuaded 6874 F.2d at 1341. by Dorchester's arguments that the courts are in a position to prevent double recovery by Dorchester by taking into account any remedy it realizes in this proceeding while fashioning and enforcing remedies for any violations of state law.7 If Dorchester recovered more than the sales price of the gas in the state court proceeding, under state law, that would be solely between Dorchester and the respondents. It could not affect the federal remedy and the rights of Northern or its interstate customers that we vindicated in these proceedings. Thus, if the state court imposed additional damages upon respondents under state law, neither Northern nor its customers could assert any federally based claim to such award. In this proceeding we have remedied only the violation of federal law and we intend no preemptive effect by this remedy. We have purposefully acted to ensure that the state court remains free to adjudicate the matters before it. If there is any other violation, the state court is the forum where that will be determined, together with the appropriate relief. Northern also argues that the Commission's refusal to assert jurisdiction over funds withheld by Cabot and Texaco in Northern leads to a result which is patently unfair to interstate customers. However, the Commission's decision in Northern is final and not subject to collateral attack in this proceeding. With respect to this proceeding, respondents were not permitted to deduct the amount of funds held by Cabot and Texaco to reduce the amount of the subject refund. Those amounts represent revenues from the sale of dedicated gas illegally diverted from Northern and its interstate customers. Moreover, Northern is a party in the state court proceedings, and has alleged that it is entitled to share in any recovery ordered by that court. Contrary to Northern's assertions, the Commission's remedy fully considers and properly recognizes the jurisdictional status of Dorchester and federal law applicable to the subject gas and does not merely seek to avoid limiting Dorchester's recovery. The Commission's remedy is appropriate because it provides a remedy which restores the interstate customers to status quo ante without restrictions to Dorchester's state recoveries. Under the Commission's remedy, Dorchester's recovery of the section 104 price for the gas does not, as Northern contends, allow Dorchester recovery in excess of its certificate authorization, rate schedule, and the NGPA ceiling price or fail to adequately protect the rights of interstate customers. The Commission's equitable remedy concerned sales by respondents not Dorchester. The violations of the subject certificates which required sales by Dorchester to Northern were adequately addressed in the Commission's orders. Dorchester's rate schedules are applicable to its sales to Northern not the subject sales by respondents. Further, Dorchester made no first sale to which an NGPA ceiling price is applicable. Therefore, the removal of the requirement to credit Dorchester's state recoveries cannot and does not produce a recovery which exceeds any certificate, rate schedule, or NGPA price ceiling restriction to Dorchester's sales. Northern's reliance on Southern Union is also misplaced. In Southern Union, the court held that a producer could not recover from interstate purchasers state court damages described as "sounding in tort," because that award was determined by the price of gas established in the producer's contract. This would have allowed the producer to collect a price for the sale of regulated gas in excess of the federal price ceiling. The court held that this fell under the rule of Arkansas Louisiana Gas Co. v. Hall, 453 U.S. 571 (1981) (Arkla), which precludes a producer from collecting more than the ceiling price through a breach of contract action. Northern mistakenly argues that the Commission has disregarded Arkla and Southern Union and provided Dorchester what amounts to a retroactive rate increase and a remedy in excess of the NGPA price ceiling. As discussed above, the subject unlawful sales were by the respondents, and they must refund the revenues from such sales. All amounts in excess of the section 104 price that respondent received from the sales are to be refunded to Northern and its interstate customers. Dorchester will receive the section 104 price. Whatever the state court orders will not relate to any sales to interstate customers but merely will involve Dorchester and respondents. To the extent there is any double recovery, it would come from the respondents, but such a recovery could not affect Northern's rights nor the rights of its interstate customers. The Commission orders: (A) The requests for rehearing of Opinion No. 307-A of Northern and NDG are denied. (B) The respondents must refund monies in accordance with the orders in these proceedings within 30 days following the date of this order. Within sixty days from the date of this order the respondents must file a refund report. The refund report must show (1) the amount of principle and interest paid, (2) the dates the refunds were paid, and (3) a statement of concurrence by Northern. [¶ 61,180] Southwestern Electric Power Company, Docket No. ER89-571-001 Order Denying Request for Rehearing (Issued February 22, 1991) Before Commissioners: Martin L. Allday, Chairman; Charles A. Trabandt, On August 17, 1990, Southwestern Electric Power Company (Southwestern) filed a request for rehearing.1 Background On July 27, 1989, Southwestern submitted for filing a third amendment to its agreement for the sale of electric power and energy to the City of Hope, Arkansas (Hope). The amendment implements the parties' original intent by providing for the construction and operation of a delivery point directly interconnecting Southwestern and Hope.2 By letter dated July 19, 1990, the Secretary required a filing fee of $6,630.00 from Southwestern in connection with its filing of the amendment.3 Southwestern urges the Commission to reverse the Secretary's assessment of the fee for two reasons. First, Southwestern contends that the amendment proposed no change in its filed rates and therefore is exempt from a fee under the Commission's regulations No. 530, 55 Fed. Reg. 50,677 (1990), FERC Statutes and Regulations ¶ 30,906 (1990), reh'g denied, Order No. 530-A, [FERC Statutes and Regulations] 8 In its request for rehearing (at 17-18), Northern notes that Texas courts have stayed related proceedings. However, there is no inconsistency between such actions and the Commission's decision. The Commis-¶30,914 (1991). Order No. 530 eliminated appeals of sion's action recognizes that state courts may consider the Commission's remedy for violations of federal law in making their determinations regarding matters of state law. 1 Southwestern originally filed an appeal of staff action. However, on December 3, 1990, the Commission issued a final rule in Docket No. RM90-11-000 amending Rule 1902 of the Commission's Rules of Practice and Procedure, 18 C.F.R. § 385.1902. Order staff action as an intermediate step prior to rehearing. Order No. 530 became effective on its date of issuance. 2 The amendment was accepted for filing by a letter order dated July 13, 1990. 3 Southwestern did not submit the $6,630 requested by the Secretary. because it has "no effect on the rate the utility charges." Second, Southwestern maintains that even if the filing of the amendment is properly deemed to affect its rates, the assessed fee is illegal because it is not justified by the Commission's costs as required by the Independent Offices Appropriations Act (IOAA).5 Discussion The narrow issue presented here is whether the Secretary erred in assessing a fee of $6,630.00 for the filing of the amendment. However, a necessary threshold determination is whether the Commission's filing fees for rate schedule filings under sections 205 and 206 of the Federal Power Act, as effective pursuant to Commission Order Nos. 494 and 494-A, are fair and based on the Commission's costs as required by the IOAA.6 In recent proceedings, Southwestern and other utilities have challenged the Commission's filing fees for electric rate filings on the grounds that the fees violated the IOAA.? Those cases were remanded at the request of the Commission so that the Commission might reconsider its orders and potentially dispose of the grounds for appeal.8 Under the IOAA, the Commission is authorized to establish fees for the services and benefits the Commission provides. Under the generic order establishing the particular filing fees that existed at the time this dispute arose, the Commission set its filing fees based on the work associated with review of filings and pursuant to that order was entitled to assess a filing fee of $6,630. However, in recognition of the fact that the specific filing fee at issue here was challenged by Southwestern in the instant rehearing, that the generic order establishing * 18 C.F.R. § 381.502(b) as it existed at that time provided: "There is no fee charged for rate schedule filings under sections 205 and 206 of the Federal Power Act which have no effect on the rate the utility charges or which involve only rate decreases." 5 31 U.S.C. § 9701(b) (1988). 6 Filing fees under the Independent Offices Appropriations Act of 1952, Order No. 494, FERC Statutes and Regulations 30,809, at pp. 31,087, 31,096, reh'g denied, Order No. 494-A, 43 FERC 161,464 (1988) (codified at 18 C.F.R. § 381.502 (1989)); see also 54 Fed. Reg. 12,901 (1989). These orders made effective the $6,630 fee at issue here. 7 Southwestern Electric Power Company v. FERC, Nos. 88-1507, 1518 and 1546 (D.C. Cir. remanded August 11, 1989) (Challenge of fees imposed under Commission's Order No. 435, effective November 4, 1985 through May 30, 1988); Central Illinois Public Service Company v. FERC, No. 88-1545 (D.C. Cir. remanded August 11, 1989) (Challenge of fees imposed under Commission's Order Nos. 494 and 494-A, effective May 31, 1988). that particular filing fee was challenged and subsequently remanded to the Commission at our request, that the Commission subsequently changed its filing fees, in part, for the reasons Southwestern asserts, on rehearing, and that the Commission could have applied the new filing fees (which are lower than the preexisting fees) retroactively on a generic basis, we believe it appropriate to exercise our discretion in this proceeding and to impose a lesser filing fee. We believe that our latest generic order establishing filing fees provides a reasonable and justifiable filing fee to impose in these circumstances. Accordingly, as explained more fully below, rather than assess a filing fee of $6,630, we will instead assess a filing fee of $4,360. 12 As just noted, the Commission has adopted a new fee schedule. 10 The adoption of the new fee schedule addresses the issues identified by the court in Raton Gas Transmission Company v. FERC 11 and resolves the matters set forth in the Commission's motion for remand in Southwestern Electric Power Company v. FERC and Central Illinois Public Service Company v. FERC.13 Under the new fee schedule, filings will be assigned to one of five fee classes based on the type of filing, ranging from the simplest rate schedule filings to the most complex. The fee is based on the actual cost to the Commission of processing an average filing within each class. The new fee schedule also implements categorical reductions proposed in order to ameliorate potential unfairness or hardship. The Commission will apply the new fee schedule to Southwestern's filing. 14 Under the new fee schedule, Class III rate filings are rate increase filings under sections 205 and 206 of the Federal Power Act that 8 See, e.g., Commission's Motion for Remand at 2, Central Illinois Public Service Company v. FERC, No. 88-1545 (D.C. Cir. remanded August 11, 1989). 9 See, e.g., FERC Statutes and Regulations at pp., 31,088-89. As discussed infra, our latest generic order establishing filing fees also sets filing fees based on the work associated with review of filings. 10 Revision of Rate Schedule Filings Under Sections 205 and 206 of the Federal Power Act, Order No. 527, 55 Fed. Reg. 41,996, [FERC Statutes and Regulations ¶ 30,900] (1990), clarified, Order No. 527-A, [FERC Statutes and Regulations ¶ 30,912] (1991). 11 852 F.2d 612, 619 (D.C. Cir. 1988). 12 Nos. 88-1507, et al. (D.C. Cir. remanded August 11, 1989). 13 No. 88-1545 (D.C. Cir. remanded August 11, 1989). 14 Cf. Revision of Filing Fees for Natural Gas Rate and Tariff Filings, Order No. 506, 53 Fed. Reg. 44,182, FERC Statutes and Regulations ¶ 30,836, at p. 31,258 (1988). qualify for the abbreviated cost-of-service information filing requirements as defined in section 35.13(a)(2) of the Commission's regulations.15 After reexamining Southwestern's July 27, 1989 filing, the Commission finds that Southwestern's filing is a Class III filing under the new fee schedule since the proposed amendment results in additional charges under the existing agreement and such charges are less than $1 million. 16 Accordingly, the appropriate filing fee is a Class III filing fee, or $4,360. This fee is $2,270 less than the fee that was originally assessed under the old fee schedule. Southwestern argues that even if the filing of the amendment is properly deemed to affect its rates, the assessed fee is illegal because it is not justified by the Commission's costs as required by the Independent Offices Appropriations Act (IOAA). However, we are now applying the new filing fee rule, which explicitly takes into consideration the IOAA in determining the fair and appropriate fee and thus explicitly responds to the Company's concern. 17 We conclude, for the foregoing reasons, that Southwestern's rehearing request should be denied and a payment be ordered. The Commission orders: (A) Southwestern's request for rehearing is hereby denied. (B) Southwestern is hereby directed to pay a filing fee of $4,360. [¶ 61,181] Paiute Pipeline Company, Docket Nos. RM91-2-000, RP89-245-000, and Order Granting Motion (Issued February 22, 1991) Before Commissioners: Martin L. Allday, Chairman; Charles A. Trabandt, In Order No. 5281 the Commission identified the filings of certain pipelines that are not subject to the order's stay of collection of fixed take-or-pay charges allocated based on purchase deficiencies, including the filings of those pipelines with recovery mechanisms that have become final and nonappealable. Appendix A to Order No. 528 listed the filings of those pipelines the Commission was able to identify as unaffected by the remand in Associated Gas Distributors v. FERC, 893 F.2d 349 (D.C. Cir. 1989) (AGD II) and not subject to the stay, but invited other pipelines to inform the Commission if they believed that they also should be listed in the category of pipelines that are not subject to the stay. Consistent with this invitation, Paiute Pipeline Company (Paiute) filed a motion requesting that the Commission identify its take-or-pay filings in the category of filings not subject to that order's stay with respect to certain fixed takeor-pay charges billed to it by Northwest Pipeline Corporation (Northwest) which it passes through to its customers. For the reasons discussed below, Paiute's motion will be granted. 15 18 C.F.R. § 35.13(a)(2) (1990). 16 See FERC Statutes and Regulations at p. 31,830. 17 55 Fed. Reg. at p. 41,997. Background On October 27, 1989, the Commission issued an order in Docket No. RP89-245-000 accepting and suspending the tariff sheets filed by Paiute to recover approximately $2.6 million in fixed take-or-pay charges billed to Paiute by its upstream pipeline supplier, Northwest. The costs in question had been included in Northwest's first and second Order No. 500 [FERC Statutes and Regulations 30,761] filings in Docket Nos. RP89-137-000 and RP89-219-000. Paiute proposed to recover the fixed take-or-pay charges from its customers on an as-billed basis, employing the same purchase deficiency method used by North west. On August 15, 1990, the Commission issued a letter order accepting the tariff sheet filed by Paiute to recover additional costs billed to it by Northwest. These costs were billed to Paiute pursuant to Northwest's third, fourth, and fifth Order No. 500 filings in Docket Nos. RP90-50-000, RP90-90-000, and RP90-118-000. No party protested either of Paiute's filings, or sought rehearing of the Commission orders 153 FERC 61,163 (1990). 2 49 FERC 61,092 (1989). 3 52 FERC 61,194 (1990). |