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66-128. Valuation of property for rate-making purposes by commission; construction work in progress. (a) The state corporation commission shall determine the reasonable value of all or whatever fraction or percentage of the property of any common carrier or public utility governed by the provisions of this act which property is used and required to be used in its services to the public within the state of Kansas, whenever the commission deems the ascertainment of such value necessary in order to enable the commission to fix fair and reasonable rates, joint rates, tolls and charges. In making such valuations the commission may avail itself of any reports, records or other things available to the commission in the office of any national, state or municipal officer or board.

(b) (1) For the purposes of this act, except as provided by subsection (b)(2), property of any public utility which has not been completed and dedicated to commercial service shall not be deemed to be used and required to be used in the public utility's service to the public.

(2) Any public utility property described in subsection (b)(1) shall be deemed to be completed and dedicated to commercial service if: (A) Construction of the property will be commenced and completed in one year or less; (B) the property is an electric generation facility that converts wind, solar, biomass, landfill gas or any other renewable source of energy; (C) the property is an electric generation facility or addition to an electric generation facility; or (D) the property is an electric transmission line, including all towers, poles and other necessary appurtenances to such lines, which will be connected to an electric generation facility.

(3) Nothing in this subsection (b) shall be construed to preclude the state corporation commission, either on the commission's initiation of a docket or in a utility rate proceeding, from reviewing whether expenditures for public utility property were efficient and prudent.

(c) As used in this section, "electric transmission line" means any line or extension of a line with an operating voltage of 34.5 kilovolts or more which is at least five miles in length and which is used or to be used for the bulk transfer of electricity.

History: L. 1911, ch. 238, § 28; R.S. 1923, 66-128; L. 1978, ch. 266, § 1; L. 1984, ch. 247, § 1; L. 1995, ch. 264, § 1; L. 2001, ch. 207, § 1; L. 2004, ch. 120, § 6; L. 2007, ch. 117, § 1; L. 2008, ch. 174, § 3; July 1.

Law Review and Bar Journal References:

"Corporation Commission Practice," John E. Davis, 37 J.B.A.K. 87, 88 (1968).

"Allocating the Cost of Constructing Excess Capacity: Who Will Have to Pay for It All?" Robert L. Glicksman, 33 K.L.R. 429, 432, 433, 434 (1985).

"The Wolf Creek Excess Cost—Excess Capacity Bill," Robert Vancrum, 33 K.L.R. 475, 476, 478 (1985).

"Why Management Did it All Right: Overregulation and Other Acts of God," Gerald Charnoff, 33 K.L.R. 481, 485 (1985).

"Utility Regulation and the Political Process," Sid Shapiro, 33 K.L.R. 491, 496 (1985).

"Wolf Creek and The Rate-Making Process," Brian J. Moline, 33 K.L.R. 509, 511, 514 (1985).

Attorney General's Opinions:

Valuation of utility property by KCC. 84-24, 84-28.


1. Original cost not measure of reasonable rate. State, ex rel., v. Telephone Co., 115Kan. 236, 282, 223 P. 771.

2. "Reasonable value" has a connotation peculiar to rate proceedings. Southwestern Bell Tel. Co. v. State Corporation Commission, 192Kan. 39, 46, 50, 53, 54, 55, 59, 61, 65, 88, 89, 90, 386 P.2d 515.

3. Construed and applied; percentage allocation to rate base of property found to be used or required to be used, arbitrary. Kansas Gas & Electric Co. v. State Corporation Commission, 218Kan. 670, 673, 674, 675, 678, 544 P.2d 1396.

4. Referred to in determining that court did not have authority to substitute its judgment for commission which denied rate increase in part. Central Kansas Power Co. v. State Corporation Commission, 221Kan. 505, 513, 561 P.2d 779.

5. Construed; inclusion or exclusion of construction work in progress in rate base discretionary. Kansas City Power & Light Co. v. KCC, 224Kan. 86, 578 P.2d 254.

6. Within sound discretion of Commission to make adjustments outside test year for construction work in progress or other operating expenses. Gas Service Co. v. Kansas Corporation Commission, 4 Kan. App. 2d 623, 629, 630, 631, 609 P.2d 1157.

7. KCC order refusing to include construction work completed outside the test year in the utility's rate base affirmed. Kansas Power & Light Co. v. Kansas Corporation Commission, 5 Kan. App. 2d 514, 522, 620 P.2d 329.

8. Discussed in determination of rate base by prescribing property used or required to be used. Kansas-Nebraska Natural Gas Co. v. Kansas Corporation Commission, 4 Kan. App. 2d 674, 677, 678, 610 P.2d 121.

9. 66-128 et seq. not unconstitutional for vagueness nor as unlawful delegation of legislative authority. Kansas Gas & Electric Co. v. Kansas Corporation Comm'n, 239Kan. 483, 495, 720 P.2d 1063 (1986).

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