Opinion
No. 22-0351
11-10-2022
MASON COUNTY PUBLIC SERVICE DISTRICT, Petitioner, v. The PUBLIC SERVICE COMMISSION OF WEST VIRGINIA and Ralph and Carla Huff, Respondents.
James V. Kelsh, Esq., William M. Lorensen, Esq., Bowles Rice LLP, Charleston, West Virginia, Counsel for the Petitioner Jeffrey A. Foster, Esq., Jessica M. Lane, Esq., Public Service Commission of West Virginia, Charleston, West Virginia, Counsel for Respondent Robert R. Rodecker, Esq., John R. McGhee, Esq., Cynthia L. Wilson, Esq., Kay Casto & Chaney PLLC, Charleston, West Virginia Counsel for the Amicus Curiae, West Virginia Rural Water Association
James V. Kelsh, Esq., William M. Lorensen, Esq., Bowles Rice LLP, Charleston, West Virginia, Counsel for the Petitioner
Jeffrey A. Foster, Esq., Jessica M. Lane, Esq., Public Service Commission of West Virginia, Charleston, West Virginia, Counsel for Respondent
Robert R. Rodecker, Esq., John R. McGhee, Esq., Cynthia L. Wilson, Esq., Kay Casto & Chaney PLLC, Charleston, West Virginia Counsel for the Amicus Curiae, West Virginia Rural Water Association
WALKER, Justice:
While investigating a complaint about residential water service that was disconnected for nonpayment, staff at the West Virginia Public Service Commission noticed that the Mason County Public Service District charged a $50 water disconnect fee in addition to a $50 reconnect fee when it computed arrearages. The Commission then invalidated the disconnect fee as an unreasonable practice even though the complaint made no mention of the fee.
The District appeals the Commission's order and argues that it exceeded its statutory jurisdiction by getting into fees because the Mason County Commission has the authority to establish the District's water rates, fees and charges. It also contends that the Commission erred by finding that the disconnect fee was unreasonable because it is used to cover a portion of the costs associated with disconnecting service. We find that the Commission acted within its authority to investigate and ultimately invalidate the disconnect fee, and the substantive result of its order is consistent with the Commission's precedent and rules. So, we affirm the order.
We wish to acknowledge and thank the amicus curiae West Virginia Rural Water Association for its brief in support of the District.
I. FACTUAL AND PROCEDURAL BACKGROUND
The Mason County Public Service District is a large public service district that meets the definition of a Locally Rate Regulated Utility (LRR). The District provides water and sewage services to customers throughout Mason County. In March of 2021, the District's Board and the Mason County Commission approved new water rates. The District's tariff includes a $50 disconnect fee and a $50 reconnect fee, and the District assesses both if it terminates and then reconnects water service for nonpayment.
See W. Va. Code § 16-13A-9(a)(2) (2021) ("The board of a public service district with at least 4,500 customers and annual combined gross revenue of $3 million providing water or sewer service separately or in combination may make, enact, and enforce all needful rules in connection with the enactment or amendment of rates, fees, and charges of the district....").
In March of 2021, the District disconnected Ralph and Carla Huff's water service for nonpayment. In October of 2021, the Huffs filed a formal complaint with the Commission against the District seeking to have their water service restored. The Huffs stated that the District shut off their water service for an entire summer during the COVID-19 pandemic. They complained that the District required them to pay their arrearages in full before it would restore their service. The Huffs’ involvement in this case was limited to the filing of the initial complaint. They did not appear at the administrative hearing and made no appearance before this Court.
The Commission referred the Huffs’ complaint to an Administrative Law Judge. Meanwhile, the Commission's staff filed an Interim Relief Memorandum on October 8, 2021, recommending that relief be granted. Although the Huffs did not raise the issue in their complaint, the Commission's staff expressed concern regarding the reasonableness of the District's practice of requiring the Huffs to pay both a disconnect and a reconnect fee before it restored service. That same day, the Commission granted interim relief.
In November of 2021, the District filed a motion to dismiss the complaint, claiming that it had complied with the Commission's memorandum by restoring service to the Huffs and entering into a deferred payment agreement with them. The District stated that it applied the disconnect fee, part of its tariff, in a nondiscriminatory manner. It also argued that the Huffs missed the thirty-day time period for a customer to challenge rates. In response, the Commission objected to the motion to dismiss, again noting its concerns with the practice of charging a disconnect fee and reconnect fee. The Commission argued that the thirty-day time period for a customer to challenge rates did not limit its investigation into that issue.
It is unnecessary to discuss the details of the deferred payment agreement offered to the Huffs. The only facts relevant to this appeal involve the District's disconnect fee.
See W. Va. Code § 24-2-1(b)(6) and (7) (2022).
In December of 2021, the Commission filed its Final Staff Memorandum. Among other things, it recommended that the District credit back to the Huffs’ account the $50 disconnect fee. The District filed an objection, stating that the disconnect fee should not be waived.
The matter was heard by an Administrative Law Judge on December 30, 2021. The Huffs did not appear, and the District moved to dismiss based on their failure to prosecute the claim. The Commission objected, arguing that it had the authority to proceed with the hearing on the issue of whether the disconnect fee was an unreasonable practice. The ALJ denied the motion to dismiss, and the hearing proceeded.
The District and the Commission offered evidence regarding the disconnect fee. Brent Clark, the District's General Manager, testified that the disconnect fee was approved by the District's Board and the Mason County Commission. He said that the fee was necessary to cover the travel costs; on average, the District incurred expenses of $116 for each disconnect or reconnect performed, and the fees diminish the extent to which the District's regular customers subsidize those who fail to make timely payments. On the other hand, Robert Cadle, a utility analyst with the Commission, testified that it was unreasonable for the district to charge both a disconnect and reconnect fee, because the practice could lead to double-recovery. He said that the Commission's water rules provide only for a reconnect fee and that utilities include the cost of disconnects for water service in their operation and management costs. In a recommended decision rendered on January 28, 2022, the ALJ found that the disconnect fee was an unreasonable practice under Commission precedent and rules. The District filed exceptions to the recommended decision.
See W. Va. Code R. § 150-7-6.8.3.a (2021) ("Whenever the supply of water is turned off for violation of rules, non-payment of bills, or fraudulent use of water, the utility may make a charge as set forth in its tariff for reestablishment of service.").
Following a review of the case, the Commission adopted the ALJ's recommended decision. The Commission found that it had jurisdiction to proceed over the matter under West Virginia Code §§ 24-2-1(b)(2) (2022) and 24-2-7(a) (2018), which provide authority for it to regulate the District's measurements, practices, acts or services. The Commission also found that the thirty-day time limit for customers to file a complaint did not serve as a basis to dismiss the matter because it had the authority to investigate an alleged or unreasonable act or practice under West Virginia Code § 24-2-7(a), which had no statutory time limitation. Likewise, the Commission found that the matter concerning the disconnect fee did not require dismissal for the Huffs’ failure to prosecute. The Commission noted that the issue of the reasonableness of the disconnect fee was not factually dependent on the Huffs’ testimony or evidence.
Regarding the reasonableness of the disconnect fee, the Commission noted that disconnect fees have historically been looked upon with disfavor and denied when requested by utilities. And while the Commission's water rules allow for a reconnect fee, they do not allow for a disconnect fee. Relying on its precedent, the Commission noted its historical stance that disconnect fees amount to a double-recovery because the expenses associated with disconnecting services are part of a public utility's operation and maintenance expenses. So, the Commission found that the disconnect fee was an unreasonable practice and it invalidated the disconnect fee. The District appealed the Commission's April 4, 2022, final order to this Court.
II. STANDARD OF REVIEW
We give deference to orders of the Commission, recognizing that most cases involve complex issues that fall within its special expertise of public utility regulation. To that end, we have applied a three-part standard of review:
W. Va. Action Grp. v. Pub. Serv. Comm'n of W. Va. , 233 W. Va. 327, 331-32, 758 S.E.2d 254, 258-59 (2014).
The detailed standard for our review of an order of the Public Service Commission contained in Syllabus Point 2 of Monongahela Power Co. v. Public Service Commission , 166 W. Va. 423, 276 S.E.2d 179 (1981), may be summarized as follows: (1) whether the Commission exceeded its statutory jurisdiction and powers; (2) whether there is adequate evidence to support the Commission's findings; and, (3) whether the substantive result of the Commission's order is proper.[ ]
Syl. Pt. 1, Cent. W. Va. Refuse, Inc. v. Pub. Serv. Comm'n of W. Va. , 190 W. Va. 416, 438 S.E.2d 596 (1993).
In this appeal, we are asked to consider whether the Commission exceeded its statutory jurisdiction. "Interpreting a statute or an administrative rule or regulation presents a purely legal question subject to de novo review."
Syl. Pt. 1, Pool v. Greater Harrison Cnty. Pub. Serv. Dist. , 241 W. Va. 233, 821 S.E.2d 14 (2018) (quoting Syl. Pt. 1, Appalachian Power Co. v. State Tax Dep't of W. Va. , 195 W. Va. 573, 466 S.E.2d 424 (1995) ).
III. ANALYSIS
West Virginia Code § 24-2-1(a) (2022) extends the jurisdiction of the Commission "to all public utilities in this state[.]" This jurisdiction includes "[a]ny public service district created under the provisions of § 16-13A-1 et seq. of this code[.]" But that jurisdiction is not without limits; the Commission's jurisdiction over LRR public service districts "is limited to those powers enumerated in § 24-2-1(b) [.]"
Id. at § 24-2-2(c) (2018).
In 2015, the Legislature stated that LRR public service districts "are most fairly and effectively regulated by the local governing body with respect to rates, borrowing and capital projects." It transferred the authority to set rates, fees and charges for those public service districts from the Commission to the county commission that created them.
Id. at § 24-1-1(j) (2015).
Id. at § 16-13A-9(a)(2) (2021).
In this appeal, the District claims that the Commission "hijacked" an ordinary customer complaint case to try to reclaim jurisdiction over fees that the Legislature had transferred to county commissions. The Commission denies that allegation and claims that it properly exercised jurisdiction over the District's practice of charging a disconnect fee. The parties also dispute whether the Commission erred in invalidating the disconnect fee as an unreasonable practice under West Virginia Code § 24-2-7(a). We address these issues below.
A. The Commission Acted Within its Statutory Jurisdiction
The District first argues that the Commission could not entertain a challenge to the disconnect fee that its county commission approved because the Huffs failed to file their complaint within the 30-day jurisdictional time limit of West Virginia Code § 24-2-1(b)(7), failed to appear at the administrative hearing, and failed to raise any issue related to the fee. The District maintains that the Commission's complaint resolution jurisdiction under West Virginia Code § 24-2-1(b)(7) has temporal limits in that "any formal complaint filed under this section that is based on the act or omission of the political subdivision shall be filed within 30 days of the act or omission complained of[.]" The District states that the Huffs failed to file their complaint either within 30 days of the Mason County Commission's approval of the District's tariff that set the $50 disconnect fee, or within 30 days of the District's termination of their water service.
The Commission responds that its jurisdiction over LLR public service districts includes "[r]egulation of measurements, practices, acts, or services, as granted and described in § 24-2-7 [,]" so it retains broad jurisdictional authority to investigate the District's practice of charging a disconnect fee—outside the parameters of the Huffs’ complaint—and this authority has no statutory time limits.
Id. at § 24-2-1(b)(2).
The District is concerned that the Commission believes its jurisdiction under West Virginia § 24-2-1(b)(2) includes the authority to reject rates, fees and charges that were duly adopted by a county commission, and that its ability to do so has no temporal limitation. The District maintains that the water service disconnect fee at issue is not an unreasonable practice, but a fee. It argues that the Commission overstepped its bounds and that its order invalidating the disconnect fee effectively overrides West Virginia § 16-13A-9(a)(2), which authorizes LRR public service districts and their county commissions to enact their own rates, fees and charges.
Our analysis of this issue is dispositively guided by the well-established principle that "[a] statutory provision which is clear and unambiguous and plainly expresses the legislative intent will not be interpreted by the courts but will be given full force and effect." West Virginia Code § 24-2-1(b)(2) provides that the jurisdiction of the Commission over the LRR public service districts includes the "[r]egulation of measurements, practices, acts, or services, as granted and described in § 24-2-7 of this code[.]" And West Virginia Code § 24-2-7(a) provides:
Syl. Pt. 2, State v. Epperly , 135 W. Va. 877, 65 S.E.2d 488 (1951).
Whenever, under the provisions of this chapter, the commission shall find any regulations, measurements, practices, acts or service to be unjust, unreasonable, insufficient or unjustly discriminatory, or otherwise in violation of any provisions of this
chapter, or shall find that any service is inadequate, or that any service which is demanded cannot be reasonably obtained, the commission shall determine and declare, and by order fix reasonable measurement, regulations, acts, practices or services, to be furnished, imposed, observed and followed in the state in lieu of those found to be unjust, unreasonable, insufficient, or unjustly discriminatory, inadequate or otherwise in violation of this chapter, and shall make such other order respecting the same as shall be just and reasonable.
This statute clearly and unambiguously gives the Commission the authority to examine the District's practice of charging a water disconnect fee, determine the reasonableness of that practice, and invalidate the practice when unreasonable. And we agree with the Commission that it scrutinized the practice of charging the disconnect fee (in addition to the reconnect fee), not the amount of the fee.
While the Commission lacked the statutory authority to enact rates, fees, and charges of the District in the first instance, it was authorized by West Virginia Code § 24-2-1(b)(2) to investigate and ultimately invalidate the District's practice of charging a disconnect fee under West Virginia Code § 24-2-7(a) "[w]henever" it found that practice to be unreasonable. So, the Commission had the statutory authority to conduct this investigation outside the parameters of the Huffs’ complaint, and it operated under no statutory time limitation.
For these reasons, we find no merit to the District's argument that the Commission erred by declining to dismiss the Huffs’ complaint as untimely under West Virginia Code § 24-2-1(b)(7), and for their failure to appear at the administrative hearing under the Commission's Procedural Rules.
B. The Commission's Order is Consistent with its Precedent and Rules
The District next argues that the Commission erred in determining that the disconnect fee was an unreasonable practice. It claims that the disconnect fee was entirely reasonable because it was applied in a nondiscriminatory fashion, was cost-based, and only recouped a fraction of the actual costs incurred by the District when disconnecting a delinquent customer's service. The District contends that the Commission's blanket policy of prohibiting a disconnect fee was unreasonable because the fee diminishes the extent to which the District's regular paying customers subsidize delinquent customers. The District states that the Commission's water rule —that does not specifically authorize the charging of a disconnect fee—is at odds with West Virginia § 16-13A-9(a)(2), where the Legislature gave the home county commission of the LRR public service district plenary authority to set rates, fees, and charges.
See note 5, above.
The Commission responds that the District's status as an LRR does not constitute a free pass for it to skirt the application of the Commission's precedent and rules and implement its own unreasonable practices. The Commission reiterates that its rules allow only for a reconnect fee. And the Commission historically has found that disconnect fees amount to a double-recovery because the expenses claimed here by the District should be part of its operation and maintenance expenses which are recoverable in base rates. So, the Commission contends that the application of a disconnect fee and a reconnect fee is an impermissible double-recovery by the District that rises to the level of an unreasonable practice.
We find that the Commission presents the better argument. West Virginia Code § 24-2-1(a) directs in the clearest terms that the Commission is the agency vested with power and jurisdiction to supervise the business of every public utility in this State. It is empowered to assure that public utility measurements, practices, acts, and services are just and reasonable and that service is adequate. As noted in Part II of this opinion, the decisions of this Court establish that we afford deference to policy determinations that fall within the Commission's jurisdiction and special expertise. The Commission clearly possesses the authority to determine whether the practice of charging a disconnect fee was reasonable and in the public interest. This determination is not made in a vacuum; rather, the Commission is guided by its precedent and rules as they establish uniformity for public utilities.
We have often said that the Legislature created the Commission to exercise its statutory powers over public utilities to safeguard the interests of the public:
The Public Service Commission was created by the Legislature for the purpose of exercising regulatory authority over public utilities. Its function is to require such entities to perform in a manner designed to safeguard the interests of the public and the utilities. Its primary purpose is to serve the interests of the public. Boggs v. Public Service Commission , 154 W.Va. 146, 174 S.E.2d 331 (1970).[ ]
Syl. Pt. 1, W. Va.-Citizen Action Grp. v. Pub. Serv. Comm'n , 175 W. Va. 39, 330 S.E.2d 849 (1985).
It is important to bear in mind the statutory scheme by which the Legislature delegated plenary regulatory authority over public utilities to the Commission, and the judiciary's limited role in reviewing the Commission's exercise of that authority. As explained above, the Commission is statutorily authorized to investigate and fix the unreasonable practices of a public utility, and the Legislature has recognized that the exercise of that power will sometimes "affect rates, fees, and charges fixed by the political subdivision[.]" So we reject the notion that LRR public service districts are not bound by the Commission's practice standards simply because they set their rates, fees and charges in the first instance. The jurisprudence in this State, "and around the nation, has recognized the wide discretion accorded public service commissions as quasi-legislative bodies[.]"
Entergy Gulf States, Inc. v. La. Pub. Serv. Comm'n , 730 So. 2d 890, 917 (La. 1999) ; see also Boise Water Corp. v. Idaho Pub. Utilities Comm'n , 97 Idaho 832, 555 P.2d 163, 169 (1976) (stating public service commission is a fact finding, quasi-legislative body authorized to investigate and determine issues pertaining to the regulation of public utilities).
In this case, the Commission did no more than apply its established precedent and rules when it invalidated the District's practice of assessing a water disconnect fee. We see no basis to second-guess the Commission's methods because "the rulings, interpretations and opinions" of the Commission "constitute a body of experience and informed judgment to which courts and litigants may properly resort for guidance." Based on the record before us, we do not find that the substantive result of its order is improper.
Sierra Club v. Pub. Serv. Comm'n of W. Va. , 241 W. Va. 600, 613, 827 S.E.2d 224, 237 (2019) (quoting Appalachian Power Co. v. State Tax Dep't of W. Va. , 195 W. Va. 573, 583, 466 S.E.2d 424, 434 (1995) (citations omitted)).
IV. CONCLUSION
For the reasons set out above, we affirm the Commission's order.
Affirmed.
CHIEF JUSTICE HUTCHISON dissents and may write separately.
JUSTICE WOOTON dissents and may write separately.
WOOTON, Justice, dissenting, joined by Chief Justice Hutchison :
The complainants, Ralph and Carla Huff, had their water service terminated due to nonpayment and later sought to have that service reconnected. The petitioner, Mason County Public Service District ("the District"), charged the Huffs separate fees for disconnection of water service ($50.00) and then for reconnection ($50.00). The Huffs complained to the respondent, The Public Service Commission ("PSC"), that they were required to pay the arrearage they owed before the District would restore their water service, raising no specific complaint as to either the disconnect fee or the reconnect fee. Nonetheless, the PSC exercised jurisdiction over the fee issue, determining that the disconnect fee was not really a fee, but "the practice " of charging a disconnect fee. The PSC determined that the District's "practice" of charging a disconnect fee was an "unreasonable practice" under the PSC's jurisdictional authority as set forth in West Virginia Code section 24-2-7(a) (2018). See also W. Va. Code § 24-2-1(b)(2) & (7) (Supp. 2022). The majority affirms the PSC's exercise of jurisdiction in this case and, in so doing, disregards the Legislature's 2015 transfer of the authority to set rates, fees and charges for a Locally Rate Regulated Public Service District ("LLR"), which includes the District, from the PSC to the county commission which created the PSD. See W. Va. Code § 16-13A-9(a)(2)(E) (2021). Therefore, I respectfully dissent. This Court recognized the transfer of the authority to set rates, fees and charges from the PSC to the District, an LLR, in Pool v. Greater Harrison County Public Service District , 241 W. Va. 233, 821 S.E.2d 14 (2018), as follows:
West Virginia Code § 24-2-7(a) provides:
(a) Whenever, under the provisions of this chapter, the commission shall find any regulations, measurements, practices, acts or service to be unjust, unreasonable, insufficient or unjustly discriminatory, or otherwise in violation of any provisions of this chapter, or shall find that any service is inadequate, or that any service which is demanded cannot be reasonably obtained, the commission shall determine and declare, and by order fix reasonable measurement, regulations, acts, practices or services, to be furnished, imposed, observed and followed in the state in lieu of those found to be unjust, unreasonable, insufficient, or unjustly discriminatory, inadequate or otherwise in violation of this chapter, and shall make such other order respecting the same as shall be just and reasonable.
West Virginia Code section 24-2-1(b)(2) & (7) provides:
(b) The jurisdiction of the commission over political subdivisions of this state providing separate or combined water and/or sewer services and having at least 4,500 customers and annual combined gross revenues of $3 million or more that are political subdivisions of the state is limited to:
....
(2) Regulation of measurements, practices, acts, or services, as granted and described in § 24-2-7 of this code ;
....
(7) Customers of water and sewer utilities operated by a political subdivision of the state may bring formal or informal complaints regarding the commission's exercise of the powers enumerated in this section and the commission shall resolve these complaints: Provided, That any formal complaint filed under this section that is based on the act or omission of the political subdivision shall be filed within 30 days of the act or omission complained of and the commission shall resolve the complaint within 180 days of filing. The 180-day period for resolution of the dispute may be tolled by the commission until the necessary information showing the basis of the matter complained of is filed by the political subdivision: Provided, however, That whenever the commission finds any regulations, measurements, practices, acts, or service to be unjust, unreasonable, insufficient, or unjustly discriminatory, or otherwise in violation of any provisions of this chapter, or finds that any service is inadequate, or that any service which is demanded cannot be reasonably obtained, the commission shall determine and declare, and by order fix reasonable measurement, regulations, acts, practices, or services, to be furnished, imposed, observed, and followed in lieu of those found to be unjust, unreasonable, insufficient, or unjustly discriminatory, inadequate, or otherwise in violation of this chapter, and shall make such other order respecting the same as shall be just and reasonable: Provided further, That if the matter complained of would affect rates, fees, and charges so fixed by the political subdivision providing separate or combined water and/or sewer services, the rates, fees, or charges shall remain in full force and effect until set aside, altered, or amended by the commission in an order to be followed in the future.
West Virginia Code section 16-13A-9(a)(2)(E) provides:
(2) The board of a public service district with at least 4,500 customers and annual combined gross revenue of $3 million providing water or sewer service separately or in combination may make, enact, and enforce all needful rules in connection with the enactment or amendment of rates, fees, and charges of the district. At a minimum, these rules shall provide for:
....
(E) Rates, fees, and charges approved by resolution of the board shall be forwarded in writing to the county commission with the authority to appoint the members of the board. The county commission shall publish notice of the proposed revised rates, fees, and charges by a Class I legal advertisement in compliance with the provisions of § 59-3-1 et seq. of this code. Within 45 days of receipt of the proposed rates, fees, and charges, the county commission shall take action to approve, modify, or reject the proposed rates, fees, and charges, in its sole discretion. If, after 45 days, the county commission has not taken final action to approve, modify, or reject the proposed rates, fees, and charges, as presented to the county commission, shall be effective with no further action by the board or county commission. In any event, this 45-day period shall be mandatory unless extended by the official action of both the board proposing the rates, fees, and charges, and the appointing county commission.
Prior to 2015, when any public service district wanted to change the rates it charged for water or sewer service, state law required the public service district to obtain approval from the PSC. In 2015, the Legislature adopted deregulation measures to limit the PSC's jurisdiction and to exempt larger public service districts from this requirement. After 2015, "larger" public service districts are statutorily defined as having at least 4,500 customers and are only required to obtain approval of a rate change from a local elected body, such as a county commission. The Legislature based the 2015 amendments on its finding that larger public service districts are "most fairly and effectively regulated by the local governing body with respect to rates, borrowing and capital projects." W.Va. Code § 24-1-1(j) [2015].
241 W. Va. at 236, 821 S.E.2d at 17 (emphasis added and footnotes omitted). We also stated in Pool that
[t]he Legislature plainly intended to limit the PSC's jurisdiction when it adopted West Virginia Code §§ 16-13A-9(a)(2) and 24-2-4a. When the Legislature modified those statutes in 2015, it perceived that the water and sewer rates charged by larger public service districts are best regulated by local elected officials and not the PSC. See W.Va. Code § 24-1-1(j). These statutes limited the PSC to regulating only the rates charged by smaller public service districts.
241 W. Va. at 240, 821 S.E.2d at 21 (emphasis added).
Notwithstanding this Court's acknowledgment of the District's jurisdiction to fix its rates and fees it charges and the Legislature's action in limiting the jurisdiction of the PSC in this regard, in the instant case the majority simply disregards the legislative grant of authority to the District. Critically, West Virginia Code section 16-13A-9 expressly allows the District to establish fees in accordance with the provisions of West Virginia Code sections 16-13A-1 to - 25 (2021), entitled "Public Service Districts," as follows:
(a)(1) The board may make, enact, and enforce all needful rules in connection with the acquisition, construction, improvement, extension, management, maintenance, operation, care, protection, and the use of any public service properties owned or controlled by the district. The board shall establish, in accordance with this article, rates, fees, and charges for the services and facilities it furnishes , which shall be sufficient at all times, notwithstanding the provisions of any other law or laws, to pay the cost of maintenance, operation, and depreciation of the public service properties and principal of and interest on all bonds issued, other obligations incurred under the provisions of this article , and all reserve or other payments provided for in the proceedings which authorized the issuance of any bonds under this article. The schedule of the rates, fees, and charges may be based upon:
....
(E) Any other basis or classification which the board may determine to be fair and reasonable, taking into consideration the location of the premises served and the nature and extent of the services and facilities furnished.
Id. § 16-13A-9(a)(1)(E) (emphasis added). Accordingly, the District did exactly that which the Legislature commanded: it adopted and approved charges for the services and facilities it furnishes to "pay for the cost of maintenance, operation, and depreciation" of its "properties and principal of and interest on all bonds issued, other obligations incurred under the provisions of this article, and all reserve or other payments provided for in the proceedings which authorized the issuance of any bonds under this article." Id. The District represented that it
is the largest physical public service district ("PSD") in the state – with 519 miles of main, serving all of the unincorporated areas of Mason County and reaching into three other counties. The average round trip from the District's home base to terminate water service is 60 miles and takes
two hours of personnel time. On average, the District incurs expenses of $116.10 per disconnection or reconnection performed. The disconnect and reconnect fees do not fully recover the District's expenses in performing these services; however, these fees diminish the extent to which the District's regular paying customers subsidize those who fail to make arrangements to continue service.
(Internal citations to appendix record omitted).
Despite the District's express grant of statutory authority to establish its rates and fees using a cost-based approach, the PSC undertook its own investigation into whether the disconnect and reconnect fees charged in this case were reasonable. The PSC based its exercise of its jurisdiction on its conclusion that the "disconnect fee" was not actually a fee but a "practice of charging the fee." W. Va. Code § 24-2-1(b)(2) & (7) and § 24-2-7(a) ; see supra notes 1 & 2.
In support of its position, the PSC first relied upon its Rules for the Government of Water Utilities, W. Va. Code R. §§ 150-7-1 to -11.7.6 (2021) ("Water Rules"). The PSC argued that under the Water Rules, customers can only be charged reconnect fees, not disconnect fees. See id. § 150-7-6.8.3.a (effective September 14, 2021). The PSC also argues that historically it has disfavored disconnect fees and denied requests by utilities to charge such fees because "disconnect fees amount to a double-recovery because expenses associated with disconnecting services are part of it operation and maintenance expenses for which the Commission or the county commission allows recovery when establishing service rates." See Jane Lew Pub. Serv. Dist. , Case No. 08-1867-PWD-T-PC-CN, at p.15 (Recommended Decision entered Mar. 13, 2009) ("It is reasonable to deny the inclusion of a disconnection fee in Jane Lew's tariff since it is current Commission policy to only allow a disconnection fee when a water utility is termination water service for a delinquent sewer bill under contract with a sewer utility.") and Fountain Pub. Serv. Dist. , Case No. 09-0443-PWD-T-PW, at 2 (Recommended Decision entered Sept. 8, 2009) ("Allowing a water utility to impose a disconnect fee may ostensibly result in double recovery by the utility, since normally this cost of service item is recouped in a utility's base rates.").
West Virginia Code of State Rules section 150-1-6.8.3.a allows for a charge for reconnection of water supply as follows: "Whenever the supply of water is turned off for violation of rules, non-payment of bills, or fraudulent use of water, the utility may make a charge as set forth in its tariff for reestablishment of service. " Id. (emphasis added). However, neither party mentioned nor argued the fact that the Water Rules also provide for a "disconnect fee" under the express subsection heading "Utility discontinuance of service" as follows:
6.8.2. Once a disconnected customer has paid his delinquency in full, or the utility has agreed to enter into a deferred payment agreement with the customer, and all disconnect and/or reconnect fees have been paid, the utility shall reconnect the customer's water service as soon as possible but no later than twenty-four (24) hours from the time the customer pays all disconnect and reconnect fees.
Id. (emphasis added). Moreover, a review of the Water Rules reveals no clearly expressed "disapproval" of disconnect fees.
Despite the PSC's claim that its Water Rules only allow fees for reconnecting service, not disconnecting it, and its pronouncement that disconnect fees are disfavored, neither of the relevant Water Rules nor the aforementioned recommended decisions support the PSC's overarching position in regard to the determinative jurisdictional issue: that a disconnect fee is not actually a fee but rather a "practice of charging the fee." Indeed, the recommended decisions and the Water Rules belie the PSC's argument, as there is no mention of a disconnect fee "practice" discussed in either. In short, what is readily gleaned from an examination of the foregoing is that the PSC created its "practice of charging the fee" rubric out of whole cloth in order to justify its exercise of jurisdiction under the auspices of West Virginia Code section 24-2-1(b)(2) & (7) and section 24-2-7(a). See supra notes 1 & 2.
Interestingly, neither party mentions the order entered in Mason County Public Service District and Point Pleasant Water Works , Case No. 08-1831-PSD-W-PC-T (Commission Order entered January 28, 2009), wherein the Commission, discussing certain fees including disconnect, reconnect, and administrative, explains that
[r]egarding approval of the fees, it is established Commission policy to permit utilities , with the exception of motor carrier utilities, to institute a charge for disconnecting and reconnecting customers who are disconnected due to failure to pay bills, provided the charge is reasonable and is reflected in the utility's tariff on file with the Commission. Arlington & Glen Falls Water Ass'n, Case No. 95-1234-W-T (Comm'n Order Aug. 7, 1996). The Commission policy is based on reasoning that a utility should be permitted to recover costs associated with disconnecting and reconnecting a delinquent customer directly from the customer incurring the cost in order to directly match the cost causer to the cost, rather than spreading the cost throughout the entire customer base.
No. 08-1831-PSD-W-PC-T, at p. 2 (emphasis added). However, the existence of any PSC policy disfavoring the assessment of a disconnect fee is of no moment to the determinative issue in this case, which is that the PSC lacks jurisdiction over LLR's in regard to the establishment of rates and fees. See W. Va. Code § 16-13A-9(a)(1)(E).
The PSC's assertion of jurisdiction – which is, essentially, an argument that its general grant of jurisdictional authority trumps the specific grant of jurisdictional authority given to LLRs and the District – is untenable under our well-established rules of statutory construction. Ordinarily, where two statutes apply to the same subject matter, the more specific statute prevails over the general statute. "When faced with a choice between two statutes, one of which is couched in general terms and the other of which specifically speaks to the matter at hand, preference generally is accorded to the specific statute. " Newark Ins. Co. v. Brown , 218 W. Va. 346, 351, 624 S.E.2d 783, 788 (2005) (emphasis added). We previously have held that "[t]he general rule of statutory construction requires that a specific statute be given precedence over a general statute relating to the same subject matter where the two cannot be reconciled." Syl. Pt. 1, UMWA by Trumka v. Kingdon , 174 W. Va. 330, 325 S.E.2d 120 (1984) (emphasis added). Accordingly, between the general authority of the Commission to investigate unreasonable acts or practices by a utility, § 24-2-7, and the specific delegation of authority to LLRs and locally elected county commissions to enact rates, fees and charges, § 24-1-1 (j) and § 16-13A-9(a), the specific grant of authority prevails.
To hold otherwise, as the majority has done in this case, invalidates the District's statutory jurisdiction to impose a disconnect fee based solely on the PSC's use of semantics. The majority's decision to uphold the PSC's exercise of jurisdiction over the disconnect fees herein effectively transfers jurisdiction over any "rates, fees, and charges" established by an LLR for the services and facilities it furnishes, see W. Va. Code § 16-13A-9(a)(1)(E), back to the PSC. Stated otherwise, anytime the PSC decides it wants to exercise jurisdiction in a case, all it has to do in order to circumvent the Legislature's transfer of jurisdiction to LLRs is to designate the fees as "measurements, practices, acts, or services." See id. § 24-2-1(b)(2) & (7). This clearly was not what the Legislature intended.
Based upon the foregoing, I respectfully dissent. I am authorized to state that Chief Justice Hutchison joins in this dissenting opinion.