Rates – Proceeding Participation – Advance Funding
In this decision, the AUC considered an application for advance funding by the Consumers’ Coalition of Alberta (“CCA)” (the “Advance Funding Application”) in connection with its participation in Proceeding 243751 (the “Original Proceeding”). The AUC approved advance funding for the CCA in the amount of $418,213.53.
The Advance Funding Application
The CCA submitted the Advance Funding Application on June 27, 2019, pursuant to Section 7 of Rule 022: Rules on Intervener Costs in Utility Rate Proceedings.
In support of its request for advance funding, the CCA submitted proposed cost budgets in the pre-GST amounts of $475,723.00 for the consulting services provided by Bema Enterprises Ltd. (“Bema”), and $93,275.00 for legal services provided by Mr. James Wachowich, Q.C. of Wachowich & Company. The CCA estimated its total consulting and legal costs, including GST, at $597,448 and requested advance funding in the amount of 70 percent of this estimate.
AUC’s Authority to Award Advance Funding
The AUC noted that its authority to award costs for participation in a utility rates proceeding is found in Section 21 of the Alberta Utilities Commission Act. In assessing an advance funding request, the AUC applies sections 3 and 7 of Rule 022, which state:
3. Costs Eligibility
3.1 The Commission may award costs to an intervener who has, or represents a group of utility customers that have, a substantial interest in the subject matter of a hearing or other proceeding and who does not have the means to raise sufficient financial resources to enable the intervener to present its interest adequately in the hearing or other proceeding.
7. Advance of fund request
7.1 An eligible intervener in a hearing or other proceeding may, at any time before or during the hearing or other proceeding, make a request to the Commission for an advance of funds.
7.2 An application for advance funding must include a budget in accordance with Section 6 and include information substantiating the need for advance of funds.
7.3 If the Commission awards an advance of funds to an eligible intervener under this section, the Commission may issue an order directing the applicant to advance funds to the eligible intervener and set out the terms for repayment of the advance to the applicant by the eligible intervener if the Commission varies or denies costs on the claim for costs filed by the eligible intervener at the close of the hearing or other proceeding.
The AUC determined that some advance funding was warranted in this case for the CCA to present its interests adequately in the Original Proceeding.
The AUC accepted the CCA’s assertion that it did not have the means to raise sufficient financial resources to enable it to adequately present its interests in the Original Proceeding without advance funding.
The AUC observed that, based on the current schedule for the Original Proceeding, the CCA does not expect the Original Proceeding to conclude for some time. Consequently, the time period between the incurrence of costs and the approval of final costs could be significant. Further, the AUC noted that the record of the Original Proceeding is voluminous, including 463 exhibits at the time that the advance funding application was filed, and includes confidential materials, which could lead to a significant use of consulting and legal resources.
The AUC noted that, historically, it has awarded between 30 and 60 percent of an intervener’s projected costs as advance funding where evidence supports an advance funding award. The AUC approved advance funding of 70 percent in Proceeding 22393. The AUC noted that similarly to Proceeding 22393, the dollar amounts involved in the original proceeding are significant, the record is large, and the length of time until the final cost award is made may be over one year from the date that costs are incurred.
The AUC found that an advance funding award of 70 percent of the budgeted costs, including GST, had been demonstrated and that such an award was consistent with the objectives of sections 3 and 7 of Rule 022. Accordingly, the AUC granted an advance funding award of 70 percent of the CCA’s budgeted costs, including GST consisting of $398,298.60 for the sum of the legal and consultant budgets before GST ($568,998.00 × 70 percent) and GST on this amount of $19,914.93 ($28,449.90 × 70 percent) for a total of $418,213.53.
The AUC noted that the advance funding approved in this decision would be subject to adjustment when a final costs decision is rendered following completion of the original proceeding.