Colorado § 40-9.5-204 - Just compensation for service rights and facilities by municipality.

§ 40-9.5-204. Just compensation for service rights and facilities by municipality.

(1) The just compensation for electric distribution facilities and service rights shall be:

(a) The present-day reproduction cost, new, of the electric distribution facilities being acquired, less depreciation computed on a straight-line basis over thirty-five years with such depreciation being limited to one-half of such cost; and

(b) An amount equal to the cost of constructing any necessary facilities to reintegrate the system of the cooperative electric association located outside the municipality or the area annexed by the municipality after detaching the electric distribution facilities to be sold; and

(c) An annual amount, payable each year for a period of ten years following the date of purchase, equal to twenty-five percent of the revenues received by the municipality from the sale of electric power to the services within such municipality which were previously served by the cooperative electric association; and

(d) An annual amount equal to five percent of the revenues received by the municipality from the sale of electric power to the additional services that come into existence in the affected area, for each year for a period of ten years following the date of acquisition.

(2) If the cooperative electric association and the municipality cannot agree on the amount to be paid pursuant to subsection (1) of this section, either party may bring an action for condemnation or inverse condemnation in the district court for the county in which the property is located to determine the amount to be paid pursuant to the factors stated in subsection (1) of this section. During the pendency of any such action, the municipality shall deposit with the court the amount the municipality has offered to be paid the cooperative electric association, and, upon said payment, the municipality shall have the right to serve all electric customers within the annexed area.

Source: L. 86: Entire part added, p. 1160, § 1, effective May 27.

ANNOTATION

Statutory scheme set forth in §§ 40-9.5-201 to 40-9.5-207 is not unconstitutional since such sections do not mandate that a public utility transfer all its customers and facilities to a municipality upon a notice of annexation by the municipality. Thus, there may not be a taking under the statutory scheme which would otherwise preclude regulation by the P.U.C. in such areas. This section, which provides for situations where the municipality can compete with the public utility, does not conflict with section 35 of article V of the state constitution. Nor does the statutory scheme violate section 25 of article V prohibiting special legislation or section 15 of article II governing just compensation for takings of property for public use. Poudre Valley Rural Elec. v. Loveland, 807 P.2d 547 (Colo. 1991).

"Revenues" under paragraph (c) of subsection (1) means both the base charge and usage charge received by the municipality. Poudre Valley Rural Elec. v. Loveland, 807 P.2d 547 (Colo. 1991).