[Congressional Record (Bound Edition), Volume 162 (2016), Part 3]
[House]
[Pages 3118-3119]
[From the U.S. Government Publishing Office, www.gpo.gov]




                      FEDERAL POWER ACT AMENDMENT

  Mr. WHITFIELD. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 4427) to amend section 203 of the Federal Power Act, as 
amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 4427

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. CLARIFICATION OF FACILITY MERGER AUTHORIZATION.

       Section 203(a)(1)(B) of the Federal Power Act (16 U.S.C. 
     824b(a)(1)(B)) is amended by striking ``such facilities or 
     any part thereof'' and inserting ``such facilities, or any 
     part thereof, of a value in excess of $10,000,000''.

     SEC. 2. NOTIFICATION FOR CERTAIN TRANSACTIONS.

       Section 203(a) of the Federal Power Act (16 U.S.C. 824b(a)) 
     is amended by adding at the end the following new paragraph:
       ``(7)(A) Not later than 180 days after the date of 
     enactment of this paragraph, the Commission shall promulgate 
     a rule requiring any public utility that is seeking to merge 
     or consolidate, directly or indirectly, its facilities 
     subject to the jurisdiction of the Commission, or any part 
     thereof, with those of any other person, to notify the 
     Commission of such transaction not later than 30 days after 
     the date on which the transaction is consummated if--
       ``(i) such facilities, or any part thereof, are of a value 
     in excess of $1,000,000; and
       ``(ii) such public utility is not required to secure an 
     order of the Commission under paragraph (1)(B).
       ``(B) In establishing any notification requirement under 
     subparagraph (A), the Commission shall, to the maximum extent 
     practicable, minimize the paperwork burden resulting from the 
     collection of information.''.

     SEC. 3. EFFECTIVE DATE.

       The amendment made by section 1 shall take effect 180 days 
     after the date of enactment of this Act.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Kentucky (Mr. Whitfield) and the gentleman from Massachusetts (Mr. 
Kennedy) each will control 20 minutes.
  The Chair recognizes the gentleman from Kentucky.


                             General Leave

  Mr. WHITFIELD. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days to revise and extend their remarks and to 
insert extraneous materials in the Record on the bill.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Kentucky?
  There was no objection.
  Mr. WHITFIELD. Mr. Speaker, I yield myself such time as I may 
consume.
  Section 203 of the Federal Power Act establishes requirements for the 
sale, disposition, merger, purchase, and acquisition of certain utility 
assets and facilities. In the Energy Policy Act of 2005, Congress 
amended section 203 by dividing the section into separate statutory 
subsections, adding a new subsection granting FERC jurisdiction to 
review sales of certain generating facilities and increasing the 
minimum monetary threshold from $50,000 to $10 million for three of the 
four statutory subsections. This monetary threshold serves as a floor 
to ensure that public utilities would only be required to file and FERC 
to review proposed transactions of a minimal material significance.
  As amended by Congress in 2005, the subsection in section 203 of the 
Federal Power Act that pertains to mergers and consolidations of FERC 
jurisdictional facilities did not include an express minimum monetary 
threshold of $10 million or any other amount. FERC has since 
interpreted this statutory change as eliminating the de minimis 
exceptions for mergers and consolidations. As a result, mergers and 
consolidations of any amount, no matter how small, require FERC 
approval.
  This legislation, H.R. 4427, which was introduced by Mr. Pompeo of 
Kansas, remedies this discrepancy by amending section 203 to expressly 
include a minimum monetary threshold of $10 million for mergers and 
consolidations of FERC jurisdictional facilities, thereby mirroring the 
existing $10 million monetary threshold set forth in the other three 
subsections of section 203.
  As explained by the general counsel of FERC, ``adding a $10 million 
de minimus threshold to the `merge and consolidate clause' . . . could 
ease the administrative burden on the Commission staff and the 
regulatory burden on industry without a significant negative effect on 
the Commission's regulatory responsibilities.''
  Therefore, Mr. Speaker, I urge all Members to pass this legislation 
introduced by the gentleman from Kansas (Mr. Pompeo).
  I reserve the balance of my time.
  Mr. KENNEDY. Mr. Speaker, I yield myself such time as I may consume.
  I rise in support of H.R. 4427, legislation by the gentleman from 
Kansas (Mr. Pompeo), which would add a $10 million threshold to trigger 
FERC review of a merger or consolidation under section 203 of the 
Federal Power Act.
  This is a significant change to current law as established by the 
Energy Policy Act of 2005 that essentially did away with the Public 
Utilities Holding Company Act, PUHCA, as it had existed for 70 years, 
in order to reduce the burden on industry.
  But it also fundamentally altered and strengthened section 203 of the 
Federal Power Act to protect against potential market abuses that might 
arise without the protections of PUHCA. With that reasonable compromise 
authored by then-Chairmen Barton and Domenici, it earned the bipartisan 
support of Ranking Members Dingell and Bingaman.
  Testimony we heard at a recent Energy and Power Subcommittee hearing 
highlighted that, last year, roughly 20 percent of section 203 
applications fell beneath the $10 million threshold. That is a 
significant number of applications.
  Furthermore, in multiple conversations with FERC general counsel and 
others, it became clear that, if the bill were to be enacted in its 
original form, FERC would have no way to know if attempts were being 
made to evade the review threshold by structuring major merger 
consolidation activity as a series of below-threshold consolidations. 
FERC has already told us that it has the tools to deal with efforts to 
evade review through such schemes if it finds out that they are 
occurring.
  However, the clear problem was, which FERC acknowledged, that the 
bill, as introduced, would leave the Commission with no standardized 
way to acquire information to even know that these below-threshold 
transactions were actually occurring. I think we can all agree that 
FERC

[[Page 3119]]

should not have to rely on trade publications or word of mouth to know 
that merger consolidation activity is occurring involving regulated 
entities.
  The easiest way to address this problem is by requiring regulated 
entities engaging in merger or consolidation activity to simply have to 
notify FERC that a transaction is occurring, and that is exactly what 
the committee did when it adopted by voice vote an amendment by 
Subcommittee Ranking Member Bobby Rush.
  The bill, as reported by the Energy and Commerce Committee, requires 
FERC to begin a rulemaking process to develop a short, simple 
notification process for transactions between $1 million and $10 
million. The bill also includes statutory direction to FERC to minimize 
the notification burden on industry to the maximum extent possible.
  What we envisioned is a standard form of a page or less, able to be 
completed online, that simply informs FERC that a transaction is 
occurring or has recently occurred, who is involved, what the 
appropriate amount of that transaction is, and a brief description of 
the transaction. The bill we are considering now also adds language 
requested by industry, supported by both the chairman and ranking 
member of the committee, which provides further certainty by setting a 
reporting deadline of not later than 30 days from the consummation of a 
reportable transaction.
  I commend the gentleman from Illinois and the gentleman from Kansas, 
along with Chairman Upton, Chairman Whitfield, and Ranking Member 
Pallone, for coming together and addressing this issue. It is a 
sensible piece of legislation that reduces the burden not only on 
industry, Mr. Speaker, but also on the government, while ensuring the 
public good is protected.
  I urge passage of the legislation.
  I yield back the balance of my time.
  Mr. WHITFIELD. Mr. Speaker, as the gentleman from Massachusetts made 
reference, this bill will reduce regulatory burdens, bring important 
parity to the statute, while also protecting ratepayers by providing 
important notice requirements. I would urge its passage.
  I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Kentucky (Mr. Whitfield) that the House suspend the 
rules and pass the bill, H.R. 4427, as amended.
  The question was taken; and (two-thirds being in the affirmative) the 
rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

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