Research Note: the PSC’s History and Jurisdiction

The Nebraska Public Service Commission (PSC) traces its roots to the Nebraska Board of Railroad Commissioners (which two years later became the Board of Transportation), an agency created by the legislature in 1885 to investigate claims of unfair practices by railroads in the state. The Nebraska State Railway Commission was established by constitutional amendment in 1906 as a more effective way to curtail railroads by regulating “rates, service, and the general control of common carriers.” Additional areas of regulation were added over the years, including jurisdiction over motor vehicles, telecommunications, and electric lines. In 1964, the commission was expanded to 5 commissioners from 3, and elections changed from statewide voting to today’s district format. The name of the Commission was changed to the Public Service Commission by a general election vote in 1972 to reflect its expanded responsibilities. Since then, the jurisdiction of the PSC has increased to include grain dealers, grain warehouses, housing, private water service, pipelines, natural gas, 911 service and infrastructure development, and broadband development.

To accommodate these varying regulatory responsibilities, the PSC is divided into 7 departments: General Administration, Communications, 911 Service System, Grain Warehouses and Dealers, Transportation, Housing & Recreational Vehicle, and Natural Gas & Pipeline. One interesting note is that consumer advocacy subdivisions can be found in each department, which is different from other states that create separate bodies for these duties. Each department is headed by a director, who reports to the 5 commissioners, and the executive director, who leads all executive management functions. In this research note, I will examine the PSC’s current authority in each of the regulated industries listed by the National Association of Regulatory Utility Commissioners.

Electricity and Energy

While most PSCs around the nation generally have a large focus on electricity and energy, the Nebraska PSC has a very limited jurisdiction. Because Nebraskans are served entirely by consumer-owned (public) power utilities (the only state in the nation where this is the case), the PSC has no authority over the rates or charges chosen by power districts, municipalities, and cooperatives. Instead, it has general supervision of wires crossing railroad track at public highway crossings and permitting authority over certain high voltage line construction outside of incorporated cities or villages. Most functions related to electricity are overseen by the Nebraska Power Review Board, which deals with retail and wholesale service area agreements between electric utilities that operate in Nebraska, the construction or acquisition of electric generation facilities or transmission lines, limited settling of disputes between utilities and customers, and other oversight duties.

Pipelines and Natural Gas

The PSC’s authority over pipelines and natural gas in Nebraska is much more similar to that of other commissions. If proposed routes are not approved by the governor, pipeline carriers must file applications for major oil pipelines through the commission, which investigates and holds at least one public hearing about each application. On natural gas, the PSC has full power, authority, and jurisdiction (including ratemaking powers) over natural gas public utilities, with the exception of small utilities, city and metropolitan district owned and operate utilities or those with agreements to provide services to cities, and services under contract to high-volume ratepayers. The PSC also certifies competitive natural gas providers and aggregators, which were deregulated in 1998, and may resolve any disputes involving them.

Water and Wastewater

The PSC’s jurisdictional authority over water and wastewater is limited to regulation of the rates and charge of private water companies furnishing water for domestic use or sewer services to most political subdivisions. The PSC has no jurisdiction over municipal water systems or rural water districts, while the Nebraska Department of Environment and Energy oversees water quality standards and compliance.

Transportation

The PSC has authority to classify and regulate groups of motor carriers, which are differentiated as “common carriers” (service available to anyone) and “contract carriers” (service to meet distinct needs of individual customers). The commission prescribes minimum rates and charges for contract carriers and issues special licenses for intrastate transportation of household goods and transportation of railroad employees. All motor carriers are subject to an annual fee per vehicle, required to have permits or certificates of public convenience, and required to apply to the PSC before doing major business transactions. Transportation network companies (for example, Uber or Lyft) are subject to different regulation and a separate but similar permitting process due to their unique nature. The commission also has authority over railroad carrier safety in the state, including operating requirements, railroad connections, and rail accident investigation.

Telecommunications

While telecommunications regulation is regulated on the federal level by the Federal Communications Commission, including one-way broadcast of television and radio signals, mobile radio services, interexchange services, internet services, and interstate communication, the PSC has a large role to play in regulating intrastate communication. The commission may regulate the rates and quality of most local telecommunications service, including changes to service by telecommunications carriers. The PSC oversees the Nebraska Telecommunications Universal Service Fund, which subsidizes services to high-cost areas of the state, as well as the Nebraska Telecommunications Relay System Fund, which provides vouchers for the purchase of communication equipment by deaf or speech-impaired individuals. The PSC is also the statewide implementing and coordinating authority for the 911 service system, and it uses the 911 Service System Fund to subsidize 911 service for governing bodies or public safety answering points. Lastly, the PSC regulates the market for dark fiber (laid but unused optical fiber) and administers the Nebraska Broadband Bridge Fund to facilitate and fund the development of broadband networks in unserved and underserved areas.

Housing

The PSC has regulatory authority over manufactured homes, recreational vehicles, and modular housing sold, offered for sale, or leased within the state of Nebraska, certifying compliance with regulations with its seal.

Grain Storage

The PSC licenses all grain dealers and warehouses in the state of Nebraska, and it can regulate terms of transactions. The PSC has additional jurisdiction over grain warehouse storage capacity expansion and grain storage rates and charges. Lastly, the PSC inspects grain moisture measuring devices in the state.

Sources

https://psc.nebraska.gov/administration/history-commission

https://nebnewspapers.unl.edu/lccn/sn84022835/1906-10-05/ed-1/seq-8/

https://nebraskalegislature.gov/laws/browse-statutes.php