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2016 SESSION

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Senate Committee on Commerce and Labor

Chairman: Frank W. Wagner

Clerk: John Garrett
Staff: Frank Munyan
Date of Meeting: February 8, 2016
Time and Place: 15 minutes after Adjournment Senate Room B
Updated to add SB 442

H.B. 31 Automobile, commercial liability, and homeowners insurance policies; notices.

Patron: Miller

Automobile, commercial liability, and homeowners insurance policies; notices. Restores the ability of insurers, when sending certain types of notices, including notice of cancellation or nonrenewal of a motor vehicle, commercial liability, or homeowners insurance policy, to use mailing methods for which a certificate of mailing is obtained from the United States Postal Service, provided that certificates of bulk mail are not permissible. The measure also clarifies that Intelligent Mail barcode Tracing is a permitted first-class mail tracking method and clarifies that insurers are required to maintain records regarding the sending of such notices for one year, regardless of the method used to send the notice. The bill contains an emergency clause.

A BILL to amend and reenact §§ 38.2-231, 38.2-2113, and 38.2-2208 of the Code of Virginia, relating to notices relating to certain insurance policies.

16100926D

EMERGENCY

S.B. 85 Public utilities; regulation of rates and service, procedures of the State Corporation Commission.

Patron: Garrett

Public utility regulation. Requires the State Corporation Commission (SCC) to make information relating to (i) salaries and other remuneration paid by a public utility to its executive officers, (ii) payments or transfers by a public utility to its parent corporation, and (iii) the content of communications between the employees of the SCC and representatives of public utility companies open to inspection and copying by any citizen of the Commonwealth. If the SCC redacts any portion of any material or document on grounds that such redacted portion is confidential, it shall identify the general nature of the redacted portion. The measure makes water and sewer companies subject to the SCC's rules regarding meetings and communications between SCC commissioners and any party, or between commissioners and staff concerning any fact or issue arising out of a proceeding involving the regulation of rates, charges, services, or facilities of a utility. The measure requires the SCC, when setting rates relating to the use of water or sewer systems, to set the rates for use by a group of customers served by common facilities in a contiguous geographic area on the basis of the costs of serving that group alone and without reference to the costs of serving any other group of customers. The measure requires the SCC, when addressing approval of special rates, contracts, incentives, or other alternative regulatory plans, to consider its effect on reliability of all utility services rather than only electric service. The measure requires the SCC, before approving public utility rates under Chapter 10 of Title 56, to ensure that such action protects the public interest, will not unreasonably prejudice or disadvantage any customer or class of customers, and will not jeopardize the continuation of reliable public utility service. The SCC is required to fix rates that are just, reasonable, compensatory, and not unfairly discriminatory. In every such proceeding, the SCC will be required to consider the value and quality of the service and the cost of providing the service, and shall not allow the inclusion of contributions in aid of construction in the rate base of any public utility during a rate proceeding, impute prospective future contributions in aid of construction against the utility's investment in property used and useful in the public service, or impute accumulated depreciation on such contributions in aid of construction to reduce the rate base. The measure requires the SCC to include in its order and opinion in any public utility rate case involving water and wastewater treatment services a written explanation of certain specified conclusions. The measure eliminates the requirement that a public utility publish notice of a proposed rate increase in a newspaper and requires that the public utility provide each customer with notice of the proposed increase by mail or electronically, with such notice to be given in time to allow the customer to participate in the rate case proceedings. The measure provides that a public utility may bill its customers for service either by first class mail or electronically, as selected by the customer in accordance with a procedure to be approved by the SCC. The measure also establishes a procedure for the SCC, upon petition by customers, to revoke the certificate of public convenience and necessity of a public utility providing water service.

A BILL to amend and reenact §§ 12.1-19, 12.1-30.1, 56-234, 56-235.2, 56-235.3, 56-237.1, and 56-247.1 of the Code of Virginia and to amend the Code of Virginia by adding sections numbered 12.1-30.2, 56-235.2:1, and 56-265.6:1 relating to public utilities; regulation of rates and service; procedures of the State Corporation Commission.

16100553D

S.B. 136 Electrical transmission line siting; SCC to hold hearing when requested by locality.

Patron: Favola

Electrical transmission line siting; hearing requested by locality. Requires the State Corporation Commission (SCC) to hold at least one hearing in the area that would be affected by construction of an electrical transmission line of 138 kV or more, upon the request of the governing body of any county or municipality through which the line is proposed to be built. Currently the SCC is required to conduct a hearing in the affected area if requested by 20 or more interested parties. The measure also provides that the affected localities are given the same protections whenever a significantly different route is deemed desirable by the SCC.

A BILL to amend and reenact § 56-46.1 of the Code of Virginia, relating to State Corporation Commission; approval of electrical transmission lines; hearing.

16101617D

S.B. 139 Electric utility regulation; agricultural net energy metering.

Patron: Edwards

Electric utility regulation; agricultural net energy metering. Allows an otherwise-eligible agricultural customer-generator to participate in an electric utility's net energy metering program if it is to be served by multiple meters located on one parcel or on multiple adjacent parcels. Currently, such an agricultural customer-generator may be served by multiple meters that are located at separate but contiguous sites.

A BILL to amend and reenact § 56-594 of the Code of Virginia, relating to electric utility regulation; agricultural net energy metering.

16101876D

S.B. 140 Electric utilities; net energy metering, standby charges.

Patron: Edwards

Electric utilities; net energy metering; standby charges. Increases the size of electrical generating facilities operated by residential or agricultural net energy metering customers that are subject to a monthly standby charge from those with a capacity of 10 kilowatts to those with a capacity of 20 kilowatts.

A BILL to amend and reenact § 56-594 of the Code of Virginia, relating to electric utilities; net energy metering; standby charges.

16101877D

S.B. 148 Renewable energy; SCC to establish third-party power purchase agreements.

Patron: Edwards

Renewable energy; third-party power purchase agreements. Replaces the pilot program enacted in 2013 that authorized certain third-party power purchase agreements providing financing of certain renewable generation facilities. The measure requires the State Corporation Commission to establish third-party power purchase agreement programs for each electric utility. The existing pilot program applies only to Dominion Virginia Power and sets the maximum size of a renewable generation facility at one megawatt; the programs authorized by this measure apply to all electric utilities and do not set limits on the size of facilities. The measure also exempts sellers under third-party power purchase agreements from being defined as a public utility, public service corporation, public service company, or electric utility solely because of the sale of electricity or ownership or operation of a renewable generation facility.

A BILL to amend and reenact § 56-1.2 of the Code of Virginia; to amend the Code of Virginia by adding sections numbered 56-1.2:2, 56-232.2:2, and 56-594.2; and to repeal Chapters 358 and 382 of the Acts of Assembly of 2013, relating to the regulation of retail sales of electricity under third-party sales agreements.

16101875D

S.B. 383 Health insurance; parity of coverage for oral chemotherapy medications.

Patron: Vogel

Health insurance; parity of coverage for oral chemotherapy medications. Requires health insurers, health care subscription plans, and health maintenance organizations, whose policies provide coverage for cancer chemotherapy treatment, to provide coverage for a prescribed, orally administered anticancer medication on a basis no less favorable than that on which it provides coverage for intravenously administered or injected anticancer medications. Such a policy, contract, or plan shall not require a higher copayment, deductible, or coinsurance amount for a prescribed, orally administered anticancer medication than what it requires for an intravenously administered or injected anticancer medication that is provided, regardless of formulation or benefit category determination by the insurer, corporation, or health maintenance organization. The measure applies to the state employees' health insurance plan and to the local choice health program. The measure replaces a provision enacted in 2012 that requires health insurers, health care subscription plans, and health maintenance organizations whose policies, contracts, or plans include coverage for intravenously administered, injected, and orally administered anticancer drugs to consistently apply the criteria for establishing cost sharing applicable to orally administered cancer chemotherapy drugs and cancer chemotherapy drugs that are administered intravenously or by injection.

A BILL to amend and reenact § 38.2-3407.18 of the Code of Virginia, relating to insurance; parity of coverage for oral chemotherapy medications.

16102574D

S.B. 395 Investor-owned electric utilities; energy efficiency performance incentive.

Patron: Alexander

Investor-owned electric utilities; energy efficiency performance incentive. Authorizes investor-owned electric utilities to recover, as part of the cost recovery permitted for energy efficiency programs, a performance incentive. The amount of the performance incentive for a program varies based on the levelized cost of saved energy achieved by the utility. If the levelized cost of saved energy for the program is six cents per kilowatt hour or less, the performance incentive is an additional one percent of the actual costs for the utility to design, implement, and operate the program, excluding the margin that is recovered on operating expenses. The amount of the performance incentive increases as the levelized cost of saved energy for the program decreases, with the maximum incentive being an additional four percent of the actual costs for the program if the utility achieves a levelized cost of saved energy at or below three cents per kilowatt hour. The levelized cost of saved energy is calculated through a formula in which the product obtained by multiplying total program costs by a capital recovery factor is divided by the annual kilowatt hours saved in year three of the program. This performance incentive replaces a provision that authorized the State Corporation Commission (SCC) to allow an electric utility to recover revenue reductions related to energy efficiency programs to the extent that the SCC determines such revenue has not been recovered through margins from incremental off-system sales that are directly attributable to energy efficiency programs. The measure directs the Department of Mines, Minerals and Energy, in collaboration with the State Corporation Commission and utilizing a stakeholder process, to develop a standardized, independent protocol determined to measure, verify, and validate energy savings.

A BILL to amend and reenact §§ 56-576 and 56-585.1 of the Code of Virginia, relating to investor-owned electric utilities; performance incentive for energy efficiency programs; determination of protocol.

16103759D

S.B. 403 Virginia Energy Storage Consortium: created, terms of Board members, report.

Patron: Ebbin

Virginia Energy Storage Consortium. Establishes the Virginia Energy Storage Consortium as a political subdivision of the Commonwealth for the purpose of positioning the Commonwealth as a leader in research, development, commercialization, manufacturing, and deployment of energy storage technology. The powers of the Consortium include (i) promoting collaborative efforts among Virginia's public and private institutions of higher education in research, development, and commercialization efforts related to energy storage; (ii) monitoring relevant developments nationally and globally; and (iii) identifying and working with the Commonwealth's industries and nonprofit partners. The Consortium shall be governed by a board of directors of 15 nonlegislative citizen members appointed by the Governor, who shall initially serve staggered terms. Staff support shall be provided by the Department of Mines, Minerals and Energy. The measure expires on July 1, 2021.

A BILL to amend the Code of Virginia by adding in Title 67 a chapter numbered 16, consisting of sections numbered 67-1600 through 67-1608, relating to the Virginia Energy Storage Consortium.

16103876D

S.B. 442 Health benefit plans; prescription drugs; tiers.

Patron: Dance

Health benefit plans; prescription drugs; tiers. Prohibits a health carrier offering a health benefit plan that provides coverage for prescription drugs from implementing a formulary that places a prescription drug on the highest cost-sharing tier unless at least one prescription drug that is in the same therapeutic class and is a medically appropriate alternative treatment for a given disease or condition is available at a lower cost-sharing tier under the formulary.

A BILL to amend and reenact §§ 38.2-4319 and 38.2-4509 of the Code of Virginia and to amend the Code of Virginia by adding a section numbered 38.2-3407.14:1, relating to accident and sickness insurance; prescription drugs; highest cost tier.

16102529D

S.B. 562 Health benefit plans; amendments to federal law, changes in definition of large and small employers.

Patron: Norment

Health benefit plans; federal law changes; large and small employers. Deletes provisions that as of January 1, 2016, changed the definition of a "large employer," for purposes of a group health plan or health insurance coverage, from an employer who employed an average of more than 50 employees to an employer who employed more than 100 employees during the preceding calendar year. The definition of "small employer" is correspondingly revised to include employers who employ an average of 50 or fewer employees, which prior to January 1, 2016, was the threshold for delineating large employers from small employers. The measure also authorizes health carriers to sell, issue, or offer for sale any health benefit plan that would otherwise not be permitted to be sold, issued, or offered for sale due to conflict with the requirements of the federal Patient Protection and Affordable Care Act, to the extent the requirements of such Act are amended by any federal law. The measure has an emergency clause.

A BILL to amend and reenact §§ 38.2-3406.1, 38.2-3431, 38.2-3454.1, and 38.2-3551 of the Code of Virginia, relating to health benefits plans; amendments to federal law; large employers and small employers.

16102635D

EMERGENCY

S.B. 604 Student loan servicers; student loan ombudsman.

Patron: Howell


Student loan servicers; student loan ombudsman. Prohibits any person from acting as a student loan servicer without first obtaining a license from the State Corporation Commission (SCC) and establishes procedures pertaining to such licenses. Banks and credit unions are exempt from the licensing provisions. The servicing of a student loan encompasses (i) receiving any scheduled periodic payments from a student loan borrower pursuant to the terms of a student education loan; (ii) applying the payments of principal and interest and such other payments with respect to the amounts received from a student loan borrower, as may be required pursuant to the terms of a student education loan; and (iii) performing other administrative services with respect to a student education loan. Student loan servicers are prohibited from, among other things, (a) misrepresenting the amount, nature, or terms of any fee or payment due or claimed to be due on a student loan, the terms and conditions of the loan agreement, or the borrower's obligations under the loan; (b) knowingly misapplying or recklessly applying student loan payments to the outstanding balance of a student loan; and (c) failing to report both the favorable and unfavorable payment history of the borrower to a nationally recognized consumer credit bureau at least annually if the loan servicer regularly reports information to such a credit bureau. The measure also establishes the Office of the Student Loan Ombudsman within the SCC's Bureau of Financial Institutions. The Office of the Student Loan Ombudsman is required to provide timely assistance to any student loan borrower of any student education loan in the Commonwealth. The Office of the Student Loan Ombudsman is further required to establish and maintain a student loan borrower education course, which shall cover key loan terms, documentation requirements, monthly payment obligations, income-based repayment options, loan forgiveness, and disclosure requirements. The bill has a delayed effective date of October 1, 2016.

A BILL to amend the Code of Virginia by adding in Title 6.2 a chapter numbered 26, containing articles numbered 1 and 2, consisting of sections numbered 6.2-2600 through 6.2-2613, relating to student loans; licensing of student loan servicers; Office of the Student Loan Ombudsman.

16103330D

S.B. 614 Natural gas companies; right of entry upon property.

Patron: Edwards

Natural gas companies; right of entry upon property. Repeals a provision, enacted in 2004, that allows interstate natural gas companies to enter upon property to make examinations, tests, land auger borings, appraisals, and surveys without the written consent of the owner under certain circumstances.

A BILL to repeal § 56-49.01 of the Code of Virginia, relating to natural gas companies' right of entry upon property.

16103489D

S.B. 647 Renewable energy; efficient biomass.

Patron: Favola

Renewable energy; efficient biomass. Excludes inefficient biomass from the definition of renewable energy. The measure provides that renewable energy includes any biomass energy capacity, efficient or otherwise, in operation prior to January 1, 2016, and that on and after that date renewable energy may include the proportion of the thermal or electric energy from a facility that results from the co-firing of efficient biomass on or after January 1, 2016. "Efficient biomass" is defined as thermal or electric energy or combined heat and power from biomass generating units with an overall efficiency of 50 percent or greater on an annual basis. The measure directs how a unit's overall efficiency shall be determined on the basis of outputs of electrical generation and useful thermal energy output, which is defined in the bill as (i) including direct heat and other valid thermal end-use energy requirements for which fuel or electricity would otherwise be consumed and (ii) excluding thermal energy used for the purpose of drying or refining biomass fuel.

A BILL to amend and reenact § 56-576 of the Code of Virginia, relating to electric utility regulation; definition of renewable energy; efficient biomass.

16103410D

S.B. 684 Utility vegetation management activities; notices required to customers, civil penalties.

Patron: Black

Utility vegetation management activities; civil penalties. Requires utilities to give notice by first-class mail of planned vegetation management activities to customers, landowners, and local governments. The notice, which is required to be sent both not less than 60 days before the activities commence and again approximately two weeks before the activities commence, shall include a map of the site or parcels where activities are proposed and a description of the procedures by which the person to whom the notice is mailed may appeal the conduct of the planned vegetation management activities. The State Corporation Commission (SCC) shall require utilities to establish reasonable criteria for the conduct of vegetation management activities, which shall be consistent with guidelines to be adopted by the SCC that establish standards for the conduct of vegetation management activities. Vegetation management activities by any utility shall not alter, trespass upon, or limit the rights of any property owner. The measure requires the SCC, upon receipt of a written complaint, to investigate the situation. The measure also authorizes the SCC to impose a civil penalty against a utility that violates these requirements. One-half of the civil penalty collected by the SCC is to be paid to the owner of the property damaged by the violation that gave rise to the assessment of the civil penalty, and the other one-half is to be deposited in a special fund created by this bill and used for administration and enforcement activities.

A BILL to amend the Code of Virginia by adding in Article 5 of Chapter 10 of Title 56 a section numbered 56-260.2, relating to vegetation management by public service corporations; notices required; civil penalties; special fund established.

16104113D

S.B. 688 Limited liability companies; registered agent.

Patron: Petersen

Limited liability companies; registered agent. Authorizes a limited liability company (LLC) to designate an officer of the LLC as its registered agent. An officer of an LLC is defined in this measure as an employee of the LLC, other than a member or manager of the LLC, who has been designated by the LLC as a person upon whom any process, notice, or demand may be served. The measure requires such a registered agent or his designee to be available during regular business hours at the registered office to accept service of any process, notice, or demand.

A BILL to amend and reenact § 13.1-1015 of the Code of Virginia, relating to limited liability companies; registered agent.

16104188D

S.B. 725 Competitive telephone companies; alternative providers.

Patron: Edwards

Competitive telephone companies. Provides that an entity controlled by or related to a competitive telephone company shall not be considered an alternative provider of wireline or terrestrial wireless communications services. Currently, an incumbent competitive telephone company has a duty in its incumbent territory to extend or expand its facilities to furnish retail voice service and facilities if a customer does not have service available from an alternative provider of such services at prevailing market rates. The measure also provides that service provided by an entity that in any manner is controlled by or related to a local exchange telephone company is not be considered a reasonably adequate alternative to local exchange telephone service. Currently, the State Corporation Commission may determine whether the wireline or terrestrial wireless communications service available to a party requesting service is a reasonably adequate alternative to local exchange telephone service.

A BILL to amend and reenact § 56-54.6 of the Code of Virginia, relating to competitive telephone companies; alternative providers.

16103661D

S.B. 744 Electric utilities; recovery of cost of line extensions to serve megasites.

Patron: Wagner

Electric utilities; line extensions to serve megasites. Authorizes electric utilities to recover through their base rates the cost of extending lines to provide industrial-grade service to a megasite that is available for an economic development project. The fact that the current owner of the site will not be receiving the electric service will not bar the utility from recovering the costs of the service extension.

A BILL to amend the Code of Virginia by adding a section numbered 56-235.11, relating to electric utilities; recovery of costs of extending service to megasites.

16104139D

S.B. 745 Notice to customers of renewable electric power options.

Patron: Wagner

Notice to customers of renewable electric power options. Expands the requirement that investor-owned utilities provide customers with information on purchasing renewable energy by requiring the notice to provide information on electric energy provided by 100 percent renewable sources. The measure also requires the notice to include information on each type and approximate percentage of renewable resource used to fulfill each option's electricity generation and the location of each generating source.

A BILL to amend and reenact § 56-245.1:2 of the Code of Virginia, relating to electric utilities; notice of renewable power options.

16104249D

S.B. 761 Electric utilities; mandatory renewable portfolio standard.

Patron: McEachin

Electric utilities; mandatory renewable portfolio standard. Converts the existing voluntary renewable portfolio standard (RPS) program to a mandatory program. Under the new program, investor-owned electric utilities are required to make investments in solar energy generation, onshore wind generation, offshore wind generation, and cumulative energy efficiency savings that by calendar year 2030 meet RPS Standards. The standards incrementally increase until, in calendar year 2025 and thereafter, such sources account for 25 percent of the amount of total electric energy that the utility sold in 2007. At least one half of the electric energy counted toward the RPS Standards is required to be generated from sources located within the Commonwealth. An investor-owned electric utility that fails to comply with the RPS Standards established for the applicable year is required to pay a compliance fee of 10 cents for each kilowatt-hour of shortfall from required renewable sources.

A BILL to amend and reenact § 56-585.2 of the Code of Virginia, relating to electric utility regulation; renewable portfolio standard.

16104300D

S.B. 779 Electric utility regulation; net energy metering.

Patron: Stuart

Electric utility regulation; net energy metering. Authorizes any eligible customer-generator or eligible agricultural customer-generator to enter into a contract to sell any net metering eligible energy exceeding the eligible customer-generator's or eligible agricultural customer-generator's own energy demand for any monthly period to any other retail customer within the same service territory of the incumbent utility. The measure increases the maximum size of the aggregate generating facility that qualifies for (i) the agricultural net energy metering program from 500 kilowatts to two megawatts, (ii) the net metering program for residential eligible customer-generators from 20 kilowatts to 50 kilowatts, and (iii) the net metering program for nonresidential eligible customer-generators from one megawatt to two megawatts. The measure replaces the existing provision that allows an eligible agricultural customer-generator to be served by multiple meters that are located at separate but contiguous sites with a provision that allows such a customer-generator to be served by multiple meters that are located on one parcel or on multiple adjacent parcels. The measure repeals the provision that caps the size of a generation facility of an eligible customer-generator at his expected annual energy consumption. The measure also (a) replaces the existing provision that provides that an eligible customer-generator or eligible agricultural customer-generator will be paid for excess electricity at the rate that is provided for such purchases in a net metering standard contract or tariff approved by the State Corporation Commission with a requirement that they will be paid at a rate equal to the customer-generator's approved customer rate schedule plus all applicable riders and (b) repeals the provision that limits the net energy metering programs to one percent of each electric distribution company's adjusted Virginia peak-load forecast for the previous year.

A BILL to amend and reenact § 56-594 of the Code of Virginia, relating to electric utility regulation; net energy metering.

16104820D