AUTHORITY: Implementing Sections 9-101, 9-201, 9-229 and 16-108.5 of, and authorized by Section 10-101 of, the Public Utilities Act [220 ILCS 5].

SOURCE: Adopted at 39 Ill. Reg. 8378, effective June 5, 2015; amended at 47 Ill. Reg. 5619, effective April 7, 2023.

SUBPART A: GENERAL PROVISIONS

 

Section 288.10  Scope

 

a)         This Part applies to the following rate case expenses for which recovery is sought by the public utility through rates:

 

1)         expenses incurred by a public utility to compensate outside counsel/support staff and outside technical experts/support staff for preparing and litigating a rate case filing; and

 

2)         expenses incurred by a public utility to compensate affiliate counsel/support staff and affiliate technical experts/support staff for preparing and litigating a rate case filing.

 

b)         This Part also applies to the disbursement of compensation pursuant to Section 9-229 of the Public Utilities Act [220 ILCS 5] from the Consumer Intervenor Compensation Fund for any docketed proceedings in which public utilities seek to recover rate case expenses or in any other docketed proceedings concerning matters affecting programs, plans, tariffs, policies, pricing, rates, costs, charges, or other offerings associated with utility service.

 

(Source:  Amended at 47 Ill. Reg. 5619, effective April 7, 2023)

 

Section 288.20  Definitions

 

"Act" means the Illinois Public Utilities Act [220 ILCS 5].

 

"Administrator" means the person or entity independent of the Commission and chosen by the Commission through a competitive bid process who is responsible for the prudent management of the Consumer Intervenor Compensation Fund and for recommendations for the award of consumer intervenor compensation from the Fund. [220 ILCS 5/9-229(b)(7)(A)]

 

"Commission" means the Illinois Commerce Commission.

 

"Consumer interest representative" or "CIR" means:

 

a residential utility customer or group of residential utility customers represented by a not-for-profit group or organization registered with the Illinois Attorney General under the Solicitation of Charity Act;

 

representatives of not-for-profit groups or organizations whose membership is limited to residential utility customers; or

 

representatives of not-for-profit groups or organizations whose membership includes Illinois residents and that address the community, economic, environmental, or social welfare of Illinois residents, except government agencies or intervenors specifically authorized by Illinois law to participate in Commission proceedings on behalf of Illinois consumers. [220 ILCS 5/9-229(b)(2)]

 

"Eligible costs" means costs incurred by a consumer interest representative to represent residential consumer interests in a proceeding before the Commission, including reasonable attorney's or advocate's fees, reasonable expert witness fees, and other reasonable costs of preparation for and participation in a hearing or proceeding, including reasonable compensation for each advocate's, attorney's, or lay or expert witness's hours expended, and other eligible costs for reimbursement, but specifically excluding expenses related to travel or meals.

 

"Flat fee contract" means a contract between a public utility and outside counsel or an outside technical expert by which the public utility pays an agreed-upon amount, regardless of hours worked or billed.

 

"Fund" means the Consumer Intervenor Compensation Fund created pursuant to Section 9-229(b) of the Act.

 

"Hourly rate contract" means a contract under which a public utility agrees to compensate outside counsel or an outside technical expert based on hourly rates multiplied by hours billed.

 

"Material recommendation" means any recommendation advanced by a consumer interest representative for Commission action in testimony, briefing, the presentation of facts in the evidentiary record, and evidence and recommendations concerning expenses, investments, rate design, rate impact, or other matters affecting the programs, plans, tariffs, policies, pricing, rates, costs, charges, or other offerings associated with utility service, relating to a significant issue in the docket as defined in this Section.

 

"Miscellaneous expenses" means expenses billed by an outside counsel, outside technical expert, public utility affiliate counsel, or public utility affiliate technical expert for costs including, but not limited to, photocopying, travel, travel-related meals, and lodging, if the evidence establishes that those costs were excluded from the agreement with the public utility as compensation for the rate case at issue.

 

"Not-to-exceed contract" means a contract between a public utility and outside counsel or an outside technical expert by which the public utility agrees to compensate the outside counsel or outside technical expert at an hourly rate for work billed, if there is a cap on the maximum amount that may be paid out under the contract.

 

"Outside counsel" means an attorney that is not employed by the public utility or any of its affiliates who is retained to prepare and litigate a rate case filing subject to this Part on behalf of the public utility.

 

"Outside counsel and outside technical expert compensation" means costs subject to the Commission's specific assessment as to justness and reasonableness, which include the following costs for which the public utility seeks recovery as part of rate case expense in a rate case filing:

 

Outside counsel (attorney) fees, whether billed under an hourly rate contract, a flat fee contract, a not-to-exceed contract, or some other arrangement for compensation, including non-attorney support staff fees and reimbursement of miscellaneous incidental expenses.

 

Outside technical expert fees, whether billed under an hourly rate contract, a flat fee contract, a not-to-exceed provision, or some other arrangement for compensation, support staff fees, and reimbursement of miscellaneous expenses.

 

"Outside technical expert" means a consultant or other professional who is not employed by the public utility or any of its affiliates that is retained to testify as an expert witness on behalf of the public utility or otherwise assist the public utility with the preparation or litigation of a rate case filing.

 

"Significant financial hardship" means that a consumer intervenor has incurred or will incur eligible costs as defined in this Section and will be either unable or not reasonably able, without an award of intervenor compensation, to participate in a Commission proceeding by offering lay or expert testimony or legal briefing and argument concerning the expenses, investments, rate design, rate impact, or other matters affecting the pricing, rates, costs, or other charges associated with utility service.

 

"Significant issue in the docket" means an issue raised in a docket which affects the expenses, investments, rate design, rate impact, or other matters affecting the programs, plans, tariffs, policies, pricing, rates, costs, charges, or other offerings associated with utility service.

 

"Support staff" means personnel performing functions under the direction and supervision of outside counsel, outside technical experts, public utility affiliate counsel, or public utility affiliate technical experts in connection with a rate case filing subject to this Part, such as paralegals, legal assistants or other non-attorney/non-technical expert staff whose time is billed to the public utility in connection with a rate case filing.

 

"Time entry" means a contemporaneously generated document that states the hours performed on a particular task, specifying the task performed and:

 

the applicable hourly rate, in the case of hourly rate billing or a contract with a not-to-exceed clause; or

 

the applicable estimated hourly rate, in the case of a flat fee contract.

 

"Utility affiliate counsel" means an attorney employed by a public utility affiliate who prepares and litigates a rate case filing subject to this Part on behalf of the public utility.

 

"Utility affiliate counsel and support staff and utility affiliate technical experts and support staff compensation" means costs subject to the Commission's specific assessment as to justness and reasonableness, which include the following costs for which the public utility seeks recovery as part of rate case expense in a rate filing:

 

Expenses for utility affiliate counsel and related support staff for services provided on a rate case pursuant to an affiliate agreement, if the recovery of incentive compensation costs is excluded from rate case expense;

 

Expenses for utility affiliate technical experts and related support staff for services provided on the rate case pursuant to an affiliate agreement, if the recovery of incentive compensation costs is excluded from rate case expense.

 

"Utility affiliate technical expert" means a professional employed by a public utility affiliate that is:

 

retained to testify as an expert witness on behalf of the public utility or otherwise assist the public utility with the preparation or litigation of a rate case filing; and

 

who is not a utility affiliate counsel as that term is defined.

 

(Source:  Amended at 47 Ill. Reg. 5619, effective April 7, 2023)

 

Section 288.30  Required Support for Compensation Costs (Renumbered)

 

(Section 288.30 renumbered to Section 288.100 at 47 Ill. Reg. 5619, effective April 7, 2023)

 

Section 288.40  Determination of Reasonable Compensation Costs (Renumbered)

 

(Section 288.40 renumbered to Section 288.110 at 47 Ill. Reg. 5619, effective April 7, 2023)

 

Section 288.50  Compensation Costs Support Disclosure (Renumbered)

 

(Section 288.50 renumbered to Section 288.120 at 47 Ill. Reg. 5619, effective April 7, 2023)

SUBPART B: RATE CASE EXPENSE

 

Section 288.100  Required Support for Compensation Costs

 

a)         A public utility subject to this Part shall, upon request during discovery, make information available to parties of record to assist them in developing a recommended amount of rate case expense and to assist the Commission in assessing the justness and reasonableness of amounts paid to compensate all persons covered by Section 288.10. This information shall include, but not be limited to, the following:

 

1)         Facts and documentation describing the terms of the engagement between the public utility and outside counsel/support staff and the public utility and outside technical experts/support staff that include the nature of the services to be provided, by whom the services would be provided, and the hourly rates to be charged.  In a flat fee contract, this documentation shall include the estimated hourly rate charged for work of similar nature or some other unit of time measurement.

 

2)         For services provided, including, but not limited to, under an hourly rate contract, a flat fee contract, or a contract with a not-to-exceed provision, invoices disclosing time entries for each outside counsel/support staff that clearly indicate:

 

A)        a description of the services provided;

 

B)        by whom the services were provided;

 

C)        the time spent providing the services on a daily basis;

 

D)        the applicable hourly rate, or some other unit of time measurement, charged by the persons providing the services; and

 

E)        For outside counsel and their support staff, the applicable codes from the American Bar Association's Uniform Task-Based Management System Litigation Code Set or a similar standardized billing system, if and to the extent that the outside counsel/support staff use that coding system in their billing invoices.

 

3)         For services provided under an hourly rate contract, including, but not limited to, a contract with a not-to-exceed provision, invoices or other documents disclosing time entries for each outside technical expert/support staff that clearly indicates:

 

A)        a description of the services provided;

 

B)        by whom the services were provided;

 

C)        the time spent providing the services on a daily basis;

 

D)        the hourly rate charged, or some other unit of time measurement.

 

4)         For services provided under a flat fee contract, all invoices provided by the outside counsel/support staff or outside technical expert/support staff to the public utility that are performed under the contract, as well as any existing invoices or documentation disclosing time entries and summaries of any proposals reviewed before the selection for service.

 

5)         For a flat fee contract, documents created or reviewed by the public utility in considering the reasonableness of the contracted fee, including any fee-related calculations that the public utility performed or reviewed before executing the contract. This includes the estimated hourly rate that would be charged in an hourly rate contract and the presumed or estimated number of hours to be worked.

 

6)         For services provided by utility affiliate counsel/support staff and utility affiliate technical experts/support staff, documentation that clearly indicates:

 

A)        a description of the services provided;

 

B)        the name and title of the persons providing the services;

 

C)        the time spent providing the services on a daily basis; and

 

D)        the amounts and rates charged, excluding incentive compensation costs.

 

b)         In addition to the information required in subsection (a), the public utility shall provide the following information at the time of filing its direct case:

 

1)         All information required by 83 Ill. Adm. Code 285.3085 (Schedule C-10) and 285.3090 (Schedule C-10.1).

 

2)         Invoices or documentation from the counsel and expert witnesses that specify the work performed, by whom the work was performed, and the charges for the services.

 

3)         An explanation of the processes, procedures, and controls the public utility has in place to ensure that the work performed by all persons covered by Section 288.10 does not duplicate work performed by a public utility employee.

 

4)         An explanation of the process, procedures, and controls the public utility has in place to ensure that the bills from all persons covered by Section 288.10 are accurate, reasonable, and not redundant before payment is made to those vendors.

 

5)         An explanation of the reasonableness of the fees to be paid to all persons covered by Section 288.10 with consideration of the factors enumerated in Section 288.110.

 

6)         An explanation of the public utility's rationale for the proposed amortization period of total rate case expense that approximates the time between rate cases.

 

c)         At the time of filing its direct or rebuttal case and, if applicable, its surrebuttal case, and as otherwise directed by the Administrative Law Judge, the public utility shall file a summary schedule of the compensation costs for which rate recovery is sought that includes, for all persons covered by Section 288.10, the following:

 

1)         Identification of the outside counsel/support staff, outside technical experts/support staff, utility affiliate counsel/support staff, and utility affiliate technical experts/support staff;

 

2)         Total projected expense update, if the projection is the basis for the total requested rate case expense;

 

3)         Actual expense incurred to date, with supporting invoices made available upon request;

 

4)         Remaining costs projected to be incurred, if any; and

 

5)         Total rate case expense that was approved by the Commission in the utility's previous rate case for the work performed by all persons covered by Section 288.10.

 

d)         Inclusion of overhead expenses for all persons covered by Section 288.10 (e.g., photocopying, binding) shall be accompanied by evidence that the rates charged to the public utility by the attorney or expert specifically exclude those overhead expenses from the rates charged to the public utility.

 

e)         Not later than five business days before the start of evidentiary hearings in the rate case, the public utility shall file an affidavit signed by a public utility representative with authority to make affirmations on behalf of the public utility that, to the best of the public utility representative's knowledge, information, and belief:

 

1)         The compensation paid or to be paid to all persons covered by Section 288.10 that the public utility is seeking to recover as rate case expense in the instant rate case is supported by billings or other documentation that:

 

A)        Are true and accurate;

 

B)        Support costs that were reasonable to prepare and litigate the rate case;

 

C)        Were reviewed and approved by public utility management before payment; and

 

D)        Are not duplicative;

 

2)         The public utility paid or will pay the billed amounts requested to be recovered as rate case expense;

 

3)         Additional compensation, if any, to be paid to all persons covered by Section 288.10 that are not yet billed to the public utility, or not yet performed, will be made in accordance with the affirmations required in this subsection (e); and

 

4)         The filing of the public utility representative affidavit is informational in nature and shall not be binding on the Commission in its assessment of the justness and reasonableness of the amount of rate case expense requested by the public utility.

 

f)         All updates and supporting documentation of the rate case expense amounts requested by the utility for recovery in rates shall be submitted for inclusion in the evidentiary record of the rate case.

 

(Source:  Former Section 288.30 renumbered to 288.100 and amended at 47 Ill. Reg. 5619, effective April 7, 2023)

 

Section 288.110  Determination of Reasonable Compensation Costs

 

a)         Rate case expenses shall be addressed in the attorney review that occurs in post-trial briefs.

 

b)         The factors to be considered by the Commission in determining the justness and reasonableness of compensation costs for all persons covered by Section 288.10 may include, without limitation, the following:

 

1)         The fulfillment of the required support for compensation costs as required in Section 288.110;

 

2)         Identification of the type of service involved as either professional or support staff;

 

3)         Novelty, complexity, or difficulty of the issues;

 

4)         Nature, extent, and reasonableness of work performed that was considered at the time the work was performed, including, without limitation, the amount of support required for pleadings, discovery, briefing, and hearings, and the relevance of the work products to the justness and reasonableness of the proposed utility rates;

 

5)         Requisite skill required to perform services efficiently and accurately;

 

6)         Professional credentials, including, without limitation, education, training, experience, achievements, and reputation, in the applicable professional discipline;

 

7)         The reasons why multiple outside counsel, outside technical experts, utility affiliate counsel, or utility affiliate technical experts addressed the same issues;

 

8)         Relevant evidence regarding the market rates concerning fees charged for comparable services, including, as applicable, fees charged in other rate cases in Illinois or fees charged in other jurisdictions for rate cases;

 

9)         Hourly rates applicable to outside counsel and outside technical experts representing or retained by utilities and outside counsel or outside technical experts representing or retained by other entities that regularly appear in Commission proceedings; and

 

10)        The reasonableness of the amount of time taken to perform a task.

 

(Source:  Former Section 288.40 renumbered to 288.110 and amended at 47 Ill. Reg. 5619, effective April 7, 2023)

 

Section 288.120  Compensation Costs Support Disclosure

 

a)         Information disclosed by the utility in support of compensation costs for all persons covered by Section 288.10 shall be given the same protections for privileged, confidential and proprietary information that exist under the Commission's Rules of Practice (83 Ill. Adm. Code 200), the Illinois Code of Civil Procedure [735 ILCS 5], the Illinois Rules of Evidence, and other applicable Illinois law.

 

b)         When information or a document is withheld from disclosure or discovery on a claim that it is privileged pursuant to a common law or statutory privilege, any claim shall be made expressly and shall be supported by a description of the nature of the documents, communications or things not produced or disclosed and the exact privilege that is being claimed.

 

c)         When there is a dispute regarding a claim of privilege, any party may file a motion seeking an in camera inspection of the documents in question by the Administrative Law Judge to resolve that dispute.

 

d)         Nothing in this Section is intended to prevent or otherwise change any protections or rights existing under the Illinois Code of Civil Procedure, the Illinois Supreme Court Rules, the Illinois Rules of Evidence, the Commission's Rules of Practice, or any other applicable law concerning privileged information or documents.

 

(Source:  Former Section 288.50 renumbered to 288.120 at 47 Ill. Reg. 5619, effective April 7, 2023)

SUBPART C: CONSUMER INTERVENOR COMPENSATION