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History of UTC predecessor agencies
Jeffrey Showman, March 11, 2004 Note: A paper copy of this un-dated, un-signed document was provided by Dixie Linnenbrink to Kygyz regulators. While its description of WUTC duties is no longer accurate, it's valuable for the record of historic changes in names and duties of our predecessor agencies.
HISTORY OF THEPrior to the adoption of Commission form of regulation, the Legislature undertook the task of prescribing maximum rates. With the growth of Washington State, problems of ratemaking and regulation increased in complexity. In 1905 the Legislature provided for a railroad commission with jurisdiction limited to railroad and express companies and expanded it in 1909 to include telephone and telegraph companies, sleeping cars, wharfingers, port districts, electric, gas, water and irrigation public service companies. In 1911, the name was changed to Public Service Commission. In 1915 pipelines were placed under Commission jurisdiction. In 1919 toll bridges were also placed under Commission jurisdiction.
WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION
Numerous changes in the physical makeup of the Commission and its responsibilities followed during the ensuing years. For instance, in 1921, the Public Service Commission of the State of Washington was abolished and in its place the Department of Public Works was created, under which there was a Division of Transportation and of Utilities and of Highways.
In 1923 the Division of Highways was abolished and a new Department created. At the same time certain responsibilities relating to safety and inspection of appliances and equipment were transferred to the Department of Labor and Industries, and jurisdiction over public terminal warehouses relating to shipping, grading, weighing and inspection of grain was transferred to the Department of Agriculture.
However, in 1921 the Commission was vested with jurisdiction over motor vehicle carriers of property and persons for hire. In 1933 storage warehouses were placed under Commission jurisdiction.
In 1935 the Department of Public Works was abolished and the Department of Public Service created. Jurisdictional responsibilities were not changed but by that time, perhaps the title “Department of Public Works” had an unhappy connotation which offended sensitive public officials because of its similarity in name to the Federal Public Works Administration. It is true, too, that this departmental description prompted many requests from a confused public for services and information entirely foreign to public service regulation.
In 1945 the Department of Public Service was abolished and instead two departments were created – that of Public Utilities and that of Transportation. Then, in 1949 the two departments were again consolidated into the Washington Public Service Commission, composed of three members. The latest change occurred in 1951 when the Legislature made the Commission bipartisan, requiring by law that no more than two members of the Commission shall belong to the same political party. It was further provided that Commissioner should be appointed by the Governor, with the consent of the Senate, for staggered six-year terms. One Commissioner is designated by the Governor to serve as Chairman of the Commission. No member maybe removed except for inefficiency, malfeasance or misfeasance in office upon specific written charges filed by the Governor and after a hearing before a special tribunal appointed by the Chief Justice of the Supreme Court. In 1961 the Legislature again changed the name, this time to the Washington Utilities and Transportation Commission (WUTC), but organization and functions of the Commission remained unchanged as did the appointment and terms for the office of the Commissioners.
The jurisdiction of the WUTC consists of the regulation, in the public interest, of the rates, services, facilities and practices in the broadest terms of those engaged in the transportation of household goods; and those engaged in supplying transportation of household goods; and those engaged in supplying any utilities service or commodity to the public for compensation, and related activities; and to prescribe such rules and regulations as may be necessary to carry out its duties.
The WUTC is also required to regulate certain activities of non-public service companies to the extent considered in the interest of public safety, such as the safety of interstate natural gas and hazardous liquid pipelines and logging and industrial railroads with respect to establishment, inspection and maintenance of grade crossing sand separations, and as to apportion the cost of signals, safety devices, and traffic separations when parties in interest are unable to agree on the division of costs.
PS, May 6, 2004, Jeffrey Showman:
Public utility commissions such as the WUTC became common during the Populist (1880's) and Progessive (1890-1912) eras as a way to control trusts and monopolies that had arisen during the second half of the 19th century, particularly abuses by railroads. Washington State's Constitution was written during that era (1889), so reflects these concerns in many areas. For instance, Article 12 authorizes regulation of common carriers (sec. 13), including telegraph and telephone companies (sec. 19), and establishment of a railroad commission to set rates (sec. 18).
What were the reasons for Populist and Progressive opposition to trusts and monopolies? One reason was because railroads would slash rates at competitive points, then make up lost revenues by charging high freight rates in non-competitive areas (e.g. to rural farmers seeking to ship their commodities to market. A famous novel of the period, The Octopus by Frank Norris, tells this story). Preventing such "rate discrimination" was, and is, a major task in setting public utility rates.
Other factors contributed to public dis-trust of corporations. Railroads had received huge land grants and subsidies from state and federal governments to help capitalize rail construction costs, and as an economic development incentive. (For instance, the original Mr. Weyerhauser was an officer of the Northern Pacific railroad, and built his timber company on railroad land grants). It was later determined that the value of land grants far exceeded the construction cost of the railroads. (Samuel Eliot Morison and Henry Steel Commager, The Growth of the American Republic, Volume Two (1942), 112-114). This is a major reason why Washington's Constitution prohibits lending public credit to private organizations (Art. 8, secs. 5 and 7). Finally, early environmentalism was also a factor: "Opposition to trusts and monopolies was not aroused so much by corruption and dishonest practices . . . as by the fear that the natural resources of the country were being ruthlessly exploited and rapidly exhausted by a group of men who used them for the aggrandizement of their own fortunes." (Morison and Commager, 142).
The first state constitution to authorize control of railroads was Illinois in 1870. Many western states followed Illinois' lead by establishing public utility commissions to oversee rates and practices of rail, express companies, electric and water utilities, and telephone and telegraph companies.
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