Section 23-18-902 - DefinitionsAs used in this subchapter:
(1) "Ancillary agreement" means any bond, insurance policy, letter of credit, reserve account, surety bond, swap arrangement, hedging arrangement, liquidity or credit support arrangement, or other financial arrangement entered into in connection with the issuance of storm recovery bonds;(2)(A) "Assignee" means any legal or commercial entity, including without limitation a corporation, statutory trust, limited liability company, partnership, limited partnership, or other legally recognized entity to which a utility sells, assigns, or transfers, other than as security, all or a portion of its interest in or right to storm recovery property.(B) "Assignee" includes any legal or commercial entity to which an assignee sells, assigns, or transfers, other than as security, all or a portion of its interest in or right to storm recovery property;(3) "Electric utility" means any person or any combination of persons, or lessees, trustees, and receivers of a person, owning or operating for compensation in this state equipment or facilities for producing, generating, transmitting, distributing, selling, or furnishing electricity to or for the public at retail in this state, and is regulated by the Arkansas Public Service Commission, including an electric cooperative corporation generating or transmitting electricity;(4) "Extraordinary natural gas, fuel, or purchased power costs" means, at the option and request of a utility, and as approved by the commission under § 23-18-903, some or all of the reasonable and prudent costs of maintaining service in immediate preparation for or in response to a storm;(5) "Financing costs" means: (A) Interest, discounts, and acquisition, defeasance, or redemption premiums that are payable on storm recovery bonds;(B) Any payment required under an ancillary agreement and any amount required to fund or replenish reserve or other accounts or subaccounts established under the terms of any indenture, ancillary agreement, or other financing documents pertaining to storm recovery bonds;(C) Any other cost related to issuing, supporting, repaying, and servicing storm recovery bonds, including without limitation servicing fees, billing or other information system programming costs, accounting and auditing fees, trustee fees and expenses, legal fees and expenses, consulting fees and expenses, administrative fees and expenses, placement and underwriting fees and expenses, independent director and manager fees and expenses, capitalized interest, rating agency fees and expenses, stock exchange listing and compliance fees and expenses, and filing fees, including costs related to obtaining the financing order;(D) Any income taxes and license or other fees imposed on the revenues generated from the collection of storm recovery charges or otherwise resulting from the collection of storm recovery charges, in any case whether paid, payable, or accrued;(E) Any gross receipts, franchise, use, and other taxes or similar charges including without limitation regulatory assessment fees, in any case whether paid, payable, or accrued, imposed upon the utility, any assignee, or any financing party with respect to the receipt of storm recovery charges or the issuance of storm recovery bonds; and(F) Any other costs, charges, and amounts approved by the commission in a financing order;(6) "Financing order" means an order of the commission adopted upon petition of a utility and under § 23-18-903 which, among other things, allows for: (A) The issuance of storm recovery bonds;(B) The imposition, collection, and periodic adjustments of storm recovery charges;(C) The creation of storm recovery property; or(D) The sale, assignment, or transfer of storm recovery property to an assignee;(7) "Financing party" means any holder of storm recovery bonds and any trustee, collateral agent, or other person acting for the benefit of holders of storm recovery bonds;(8) "Financing statement" has the same meaning as that provided in the Uniform Commercial Code - Secured Transactions, § 4-9-101 et seq.;(9) "Gas utility" means a person or any combination of persons, lessees, trustees, or receivers of a person, lessee, or trustee, owning or operating for compensation in this state equipment or facilities for storing, transmitting, distributing, selling, or furnishing natural gas to or for the public at retail in this state, and that is regulated by the commission;(10) "Secured party" means a financing party: (A) In favor of which a utility or its direct or indirect successors or assignees creates a security interest in all or any portion of its interest in or right to storm recovery property; and(B) That may be granted a security interest in storm recovery property under this subchapter and a security interest in other collateral subject to the Uniform Commercial Code - Secured Transactions, § 4-9-101 et seq., in one (1) security agreement;(11) "Security interest" means a pledge, hypothecation, or other encumbrance of or other right over any portion of storm recovery property created by contract to secure the payment or performance of an obligation;(12) "Storm" means, individually or collectively, a named tropical storm, a named hurricane, a tornado, an ice or snow storm, a flood, an earthquake or other significant weather event or a natural disaster that occurred during the calendar year 2009 or thereafter;(13) "Storm recovery activity" means any activity or activities by or on behalf of a utility in connection with the restoration or maintenance of service associated with utility service outages affecting customers of a utility as the result of a storm or storms, including without limitation: (A) All internal and external labor costs;(B) All costs related to mobilization, staging, and construction, reconstruction, replacement, or repair of:(i) Electric generation, transmission, or distribution facilities; and(ii) Natural gas storage, transmission, or distribution facilities; and(C) The reasonable and prudent purchase and receipt of extraordinary natural gas, fuel, or purchased power costs by a utility to maintain service in immediate preparation for or response to a storm;(14)(A) "Storm recovery bonds" means bonds, debentures, notes, certificates of beneficial interest, certificates of participation, certificates of ownership, or other evidences of indebtedness or ownership that are issued pursuant to or in connection with an indenture, contract, ancillary agreement, or other agreement of a utility or an assignee pursuant to a financing order, the proceeds of which are used directly or indirectly to provide, recover, finance, or refinance commission-approved storm recovery costs, financing costs, and costs to replenish or fund a storm recovery reserve to the level as the commission may authorize in a financing order, and which are secured by or payable from storm recovery property.(B) If certificates of beneficial interest or certificates of participation or ownership are issued, references in this subchapter to principal, interest, or premium shall be construed to refer to comparable amounts under those certificates;(15) "Storm recovery charges" means the amounts:(A) Authorized by the commission to recover, finance, or refinance storm recovery costs, financing costs, and the costs to create, fund, or replenish a storm recovery reserve, including without limitation through the issuance and repayment of storm recovery bonds; and(B) That shall be:(i) Imposed on all customer bills, subject to the limitations described in subdivision (15)(B)(iii)(a) of this section, and collected by a utility or its successors or assignees, or a collection agent;(ii) Nonbypassable charges that are separate and apart from the utility's base rates; and(iii)(a) Paid by all existing and future customers, subject to appropriate exclusions or adjustments to avoid the collection of natural gas costs from gas utility customers that do not purchase natural gas from the gas utility, receiving service from the utility or its successors or assignees under commission-approved rate schedules as provided in the financing order.(b) An individual customer's monthly storm recovery charges shall be based upon the customer's then-current monthly billing determinants;(16)(A) "Storm recovery costs" means, at the option and request of the utility and as approved by the commission pursuant to § 23-18-903, costs that are:(i) Reasonable and prudent costs, including without limitation the costs: (a) Expensed, charged to self-insurance reserves, capitalized, or otherwise financed, that are incurred or are expected to be incurred by a utility in undertaking a storm recovery activity; and(b) To purchase and receive extraordinary natural gas, fuel, or purchased power costs by utilities to maintain service in immediate preparation for or in response to a storm; and(ii) Net of applicable insurance proceeds and, when determined appropriate by the commission, including adjustments for normal capital replacement and operating costs, lost revenues, or other potential offsetting adjustments.(B) "Storm recovery costs" includes without limitation:(i) Carrying costs, at simple interest which shall accrue at a rate equal to the utility's last approved rate-base rate of return, from the date on which the storm recovery costs were incurred until the date that storm recovery bonds are issued or until storm recovery costs are otherwise recovered;(ii) The costs of retiring or purchasing any indebtedness or equity relating to or associated with storm recovery activities and extraordinary natural gas, fuel, or purchased power costs, including accrued interest, premium and other fees, costs, and charges related to the storm recovery activities; and(iii) The costs to create or fund any storm recovery reserves or to replenish any shortfall in any storm recovery reserves;(17) "Storm recovery property" means: (A) All rights and interests of a utility or the direct or indirect successors or assignees of the utility under a financing order, including the right to impose, bill, collect, and receive storm recovery charges authorized in the financing order and to obtain periodic adjustments to the charges as provided in the financing order; and(B) All revenues, collections, claims, rights to payments, payments, money, or proceeds arising from the rights and interests specified in subdivision (17)(A) of this section, regardless of whether the revenues, collections, claims, rights to payment, payments, money, or proceeds are imposed, billed, received, collected, or maintained together with or commingled with other revenues, collections, rights to payment, payments, money, or proceeds;(18) "Storm recovery reserve" means an electric utility's storm cost reserve account established pursuant to § 23-4-112; and(19) "Utility" means an electric utility or a gas utility, or both.Amended by Act 2021, No. 641,§ 1, eff. 4/12/2021.