|Legal Opinion: |
Text of Document: MemorandumFrom: Dennis Huffer
Re: Authority of Board of Public Utilities in Relation to the Authority of the Board of Mayor and Commissioners
Date: March 9, 2005
In July, 2001, the Board of Mayor and Commissioners passed an ordinance giving the Board of Public Utilities supervisory authority over the city’s water, sewer, and gas systems. This was done under authority of T.C.A. § 7-52-111. Now apparently questions have arisen about how the authority granted the Board of Public Utilities meshes with the authority of the Board of Mayor and Commissioners.
As you know, municipalities own and operate utilities in their proprietary or business capacity, rather than in their governmental capacity. This distinction between proprietary and governmental capacities is a good way to look at and attempt to understand how the authority of these two (2) bodies fits together. The proprietary or business operation of these utilities has been delegated to the Board of Public Utilities. But for utility matters that affect the health, safety, and welfare of the city’s residents, the Board of Mayor and Commissioners still has jurisdiction to act.
The Board of Mayor and Commissioners has authority under the City’s Charter to:
Prescribe reasonable regulations regarding the construction, maintenance, operation and service of public utilities and telecommunications systems, compel reasonable extensions of facilities for these services, and assess fees for the use of or impact upon these services. Article II, Section A(14), Private Acts 2001, Ch. 17.
The City’s governing body has delegated its authority granted by this charter provision relative to the administration and operation of the utility systems to the utilities board but retains its governmental authority to act for the general welfare of the municipality relative to utilities as well as other matters. The City governing body can go so far as to abolish the utility board and return control of the utilities to the City governing body. State ex rel. Patton v. Mayor of Lexington, 626 S.W.2d 5 (Tenn. 1981). Or, if bonds have been issued under T.C.A. 7-52-101 and the following sections, the City governing body, subject to referendum approval, may dispose of the utilities. T.C.A. 7-52-132.
The Board of Public Utilities and its members have the following responsibilities:
• Each member must give a bond that may be required by resolution by the City’s governing body. T.C.A. 7-52-109.
• The utilities board must hold a meeting within 10 days after appointment and qualification of members to elect a chair. T.C.A. 7-52-110.
• The utilities board must designate, fix the amount of bond of, and set the compensation for a secretary and treasurer or secretary-treasurer. T.C.A. 7-52-110.
• The utilities board must hold public meetings at least once a month and establish its rules of procedure. T.C.A. 7-52-110.
• The utilities board must keep separate accounts for the electric plant and for each works and make due allocation of joint expenses, revenues, and property valuations. T.C.A. 7-52-111.
• The utilities board must keep a complete and accurate record of all meetings and actions taken and receipts and disbursements. T.C.A. 7-52-113.
• The utilities board must make written reports of the above items to the City’s governing body at least yearly. Copies of this report must be filed with the city clerk or recorder. T.C.A. 7-52-113.
• The utilities board has general supervision and control of the acquisition, improvement, operation, and maintenance of the electric plant and other utilities. T.C.A. 7-52-114.
• The utilities board must appoint and fix the salary of an electric plant superintendent. T.C.A. 7-52-114.
• The utilities board must determine programs and make all plans for the acquisition of the electric plant. T.C.A. 7-52-115.
• The utilities board must make all determinations as to improvements, rates, and financial practices, and may establish rules and regulations to govern the furnishing of electric service. T.C.A. 7-52-115. Presumably the city delegated all this authority relative to the water and gas systems to the utilities board as well.
• The utilities board may disburse all monies in the electric plant fund for the furnishing of electric service. A copy of the rates and charges and of all rules and regulations must be kept in the main and branch offices and in the office of the city recorder or clerk. T.C.A. 7-52-115.
• The utilities board must charge the city for services as it does for other entities in similar circumstances. T.C.A. 5-52-116.
• The superintendent has charge of the construction and immediate management of the plant and the enforcement of all rules and decisions of the utilities board. T.C.A. 7-52-117.
• The superintendent appoints all employees and fixes their duties and pay except for technical consultants and lawyers, who must be approved by the utilities board. T.C.A. 7-52-117.
• The superintendent with the approval of the utilities board acquires and disposes of all property, which must be taken in the name of the city. T.C.A. 7-52-117.
• The superintendent acts as purchasing agent for the utilities. T.C.A. 7-52-117.
All of these listed powers of the utilities board are business-type powers. The utilities board has no power to pass ordinances or to act for the general health, safety, and welfare of the citizens. The utilities board cannot compel people to act by levying fines for ordinance violations. The power to act for the general health, safety, and welfare of the citizens is reserved to the Board of Mayor and Commissioners. Thus the Board of Mayor and Commissioners may adopt and enforce ordinances that protect the safety of the water supply and prohibit practices that could lead to the spread of disease. For example, the Board may prohibit cross connections and require persons to connect to an available sewer.
With the unlikely exception that in some peculiar situation it might be impossible or impracticable to provide electric service without requiring the undergrounding of the wires, etc., a requirement that utility facilities be put underground should be treated as a safety, welfare, and aesthetic issue. Good arguments can be made that underground wires are safer and create a better appearance than overhead wires. These issues are in the purview of the Board of Mayor and Commissioners rather than the utilities board. Therefore, with the possible exception noted above, any requirement that utility facilities be placed underground should be done by ordinance of the Board of Mayor and Commissioners rather than by rule of the utilities board.