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031 Order re PUC Motion to IntervenePage1 of1 COURT,DISTRICT COUNTY, COLORADOBOULDER Court Address: 1777 Sixth Street P.O. Box 4249, Boulder, CO, 80306-4249 Petitioner(s)THE CITY OF BOULDER v. Respondent(s)PUBLIC SERVICE COMPANY OF COLORADO et al. COURT USE ONLY Case Number:2019CV30637 Division:5 Courtroom: Order: Motion to Intervene The motion/proposed order attached hereto: MOOT. Issue Date:9/4/2019 THOMAS FRANCIS MULVAHILL District Court Judge DATE FILED: September 4, 2019 2:42 PM CASE NUMBER: 2019CV30637 DISTRICT COURT, BOULDER COUNTY, COLORADO Boulder County Justice Center 1777 6th Street Boulder, Colorado 80302 Petitioner: THE CITY OF BOULDER, a Colorado Home Rule City, v. Respondents: PUBLIC SERVICE COMPANY OF COLORADO, a Colorado Corporation, d/b/a XCEL ENERGY, MORGAN GUARANTY TRUST COMPANY OF NEW YORK; and PAUL WEISSMANN, in his official capacity as Treasurer of Boulder County. COURT USE ONLY Attorneys for Proposed Intervenor: PHILIP J. WEISER, Attorney General PAUL C. GOMEZ, 22759* First Assistant Attorney General RUTH M. HARPER, 52143* Assistant Attorney General 1300 Broadway, 6th Floor Denver, CO 80203 Telephone: 720-508-6166 FAX: 720-508-6041 E-Mail: paul.gomez@coag.gov ruth.harper@coag.gov *Counsel of Record Case No. 2019CV30637 Division: 5 MOTION TO INTERVENE Attachment to Order - 2019CV30637 2 The Colorado Public Utilities Commission (“PUC”); Jeffrey P. Ackermann, in his official capacity as Chairman of the Public Utilities Commission; and Frances A. Koncilja and John C. Gavan, in their official capacities as Commissioners of the Public Utilities Commission; through undersigned counsel, hereby submits the following Motion to Intervene (“Motion to Intervene”). The PUC seeks intervention pursuant to C.R.C.P. 24(a) and, in the alternative, C.R.C.P. 24(b). CERTIFICATION PURSUANT TO C.R.C.P. 121 § 1-15(8) Undersigned counsel for the PUC has conferred with counsel for Petitioner, the City of Boulder (“Boulder or “City”) and Respondents: (1) Public Service Company of Colorado (“Public Service”); and (2) Paul Weissmann, in his official capacity as Treasurer of Boulder County, regarding this Motion to Intervene. Counsel for Plaintiff stated that Plaintiff opposes the Motion to Intervene. Counsel for the PUC is authorized to represent that neither Respondent opposes the Motion to Intervene. GROUNDS AND AUTHORITY The PUC respectfully submits that it has a right to intervene in this matter pursuant to C.R.C.P. 24(a)(2). In the alternative, the PUC requests the Court permit it to intervene under C.R.C.P. 24(b)(2). As required by C.R.C.P. 24(c), this Motion to Intervene states the grounds for intervention and is accompanied by the PUC’s “Motion to Dismiss Pursuant to C.R.C.P. 12(b)(1), Or In the Alternative Stay Proceeding Pending Final PUC Decision,” which pleads that the Court dismiss the First Amended Petition in Condemnation for lack of subject matter jurisdiction, or in the alternative stay the proceeding pending a final PUC decision approving the designation of assets for transfer. The PUC reserves its right to other claims or defenses. Attachment to Order - 2019CV30637 3 The PUC seeks to intervene in order to apprise the Court of the ongoing PUC proceeding and to preserve the PUC’s jurisdiction to approve the designation of assets for transfer, a duty required of the PUC under C.R.S. § 40-5-105(1) (2018) and confirmed through prior decision of the Boulder District Court. See Attachment A to this Motion to Intervene, Order Re: Judicial Review of the Colorado Public Utilities Commission Decisions, City of Boulder v. Pub. Utils. Comm’n, Case No. 14CV30047 (Boulder Dist. Ct., January 14, 2015) (“Boulder District Court Decision”). The PUC files this motion to intervene, rather than a cross petition pursuant to C.R.S. § 38-1-109 (2018), because of the PUC’s narrow and unique interest in the subject matter of this condemnation action—specifically, that this action should not proceed until the PUC has issued a final decision approving the designation of assets for transfer. Case law denying parties intervention for lack of interest in the property at issue is not applicable here. See, e.g., Denver Power & Irrigation Co. v. Denver & R.G.R. Co., 69 P. 568 (1902); Bd. of Cty. Comm’rs of Weld Cty. v. Anderson, 525 P.2d 478, 479 (1974). The instant case is distinguishable. By prior decision, the Boulder District Court found the PUC must approve the designation of assets for transfer to Boulder as a condition precedent to condemnation. See Attachment A to this Motion to Intervene, Boulder District Court Decision. Boulder just recently provided final versions of outstanding filings in ongoing PUC Proceeding No. 15A-0589E on June 28, 2019, and August 2, 2019, and the PUC has not yet had opportunity to provide the necessary approvals for transfer. Given these circumstances, the PUC respectfully asks this Court to grant this Motion to Intervene so that the Court may review and consider the PUC’s concurrently filed motion to Attachment to Order - 2019CV30637 4 dismiss, or in the alternative stay the proceeding, and be fully apprised of the ongoing PUC proceeding and applicable case law before determining how to proceed with Plaintiff’s petition. ARGUMENT 1. The PUC May Intervene As a Matter of Right Pursuant to C.R.C.P. 24(a)(2), upon timely application, a party may intervene as a matter of right where it claims an interest in the subject matter of the litigation, the disposition of the litigation may impede or impair the ability to protect that interest, and the interest is not adequately represented by existing parties. “Rule 24 should be liberally interpreted to allow, whenever possible and compatible with efficiency and due process, issues related to the same transaction to be resolved in the same lawsuit and at the trial court level.” Cherokee Metro. Dist. v. Meridian Serv. Metro. Dist., 266 P.3d 401, 404 (Colo. 2011). In determining whether intervention is appropriate, a court should consider: (1) whether an intervenor has an interest; (2) whether it has an impairment; and (3) whether it is inadequately represented. Id. at 404-07. a. The PUC has an interest in completing its proceeding prior to any condemnation action in Boulder District Court. The PUC’s narrow and unique interest in this litigation is to preserve its jurisdiction to approve the designation of assets for transfer from Public Service to Boulder to form Boulder’s new municipal electric utility, as required under C.R.S. § 40-5-105(1) (2018). This designation by the PUC of assets for transfer is a necessary and logical condition precedent to any action to condemn and price the assets. In 2015, Judge LaBuda of the Boulder District Court considered this very issue and ruled “it is necessary and appropriate for the PUC to determine how facilities Attachment to Order - 2019CV30637 5 should be assigned, divided, or jointly used to protect the system’s effectiveness, reliability, and safety.” See Attachment A to this Motion to Intervene, Boulder District Court Decision at p. 12. Judge LaBuda found this PUC determination “must be made prior to the City’s condemnation of property for utility municipalization.” Id. Thus the PUC retains jurisdiction over the subject matter of this dispute until it issues a final decision designating assets for transfer including a finding that the division will protect the remaining system’s effectiveness, reliability, and safety. The PUC has not yet issued this final decision. To date, the PUC has conditionally approved designation of certain assets outside substations. See Attachment B to this Motion to Intervene, PUC Decision No. C17-0750, issued September 14, 2017, in PUC Proceeding No. 15A-0589E (“PUC Decision No. C17-0750”). Several issues remain pending for resolution. The following list is not exhaustive. Now that the proper filings have been made, the PUC can move forward to expeditiously establish appropriate procedures and a schedule for resolving the outstanding issues and complete its proceeding. First, the PUC must approve the “Corrected List of Facilities Outside Substations,” referred to as “Exhibit 5A.” In PUC Decision No. C17-0750, the PUC required Boulder to “correct the errors and omissions from the list of assets for transfer outside of the substations and resubmit the revised list of assets for final approval.” Boulder has now filed, concurrent with this condemnation case and after extensions,1 a final version of Exhibit 5A. Now the PUC can make 1 See PUC Decision Nos. C17-1065-I, issued December 22, 2017 (extension to March 13, 2018); C18-0181-I, issued March 14, 2018 (extension to June 11, 2018); C18-0557-I, issued July 16, 2018 (extension to August 24, 2018); C18-0742-I, issued August 31, 2018 (extension to October 26, 2018). Attachment to Order - 2019CV30637 6 a final determination whether to approve the corrected asset list. This may require additional process to develop a record demonstrating the proposed division will “protect the system’s effectiveness, reliability, and safety,” consistent with the standard in the Boulder District Court Decision. Public Service, the regulated utility whose assets are the subject of this dispute, has expressly asked that it and other parties be afforded due process before the PUC as the PUC makes its final “critical” determination whether the resulting system is effective, reliable, and safe. See Attachment C to this Motion to Intervene, Public Service Response to Boulder’s Proposed Procedures and to the Combined Response in Opposition, filed June 19, 2019, in PUC Proceeding No. 15A-0589E. Second, the PUC must approve the “Corrected List of Property Interests Outside Substations,” referred to as “Exhibit 5B.” In PUC Decision No. C17-0750, the PUC required Boulder to file an agreement(s) between Boulder and Public Service “that provides Public Service permanent non-exclusive easements and other necessary real property rights for the location of Public Service’s electric facilities within Boulder’s city limits that are necessary for Public Service to provide service to its customers after separation.” Boulder has just now filed a final version of Exhibit 5B, on August 2, 2019. Review and approval of this final version will require additional process like Exhibit 5A. Third, the PUC must resolve whether any decisions are ripe for review regarding transfer of assets inside substations. In PUC Decision No. C17-0750, the PUC found it premature to designate facilities inside substations for transfer. On January 25, 2019, Public Service filed a petition for declaratory order requesting the PUC declare that Boulder may not commence Attachment to Order - 2019CV30637 7 condemnation proceedings to acquire assets inside substations until Boulder and Public Service agree on the transfer and an application for designation of assets for transfer is filed with, and granted by, the PUC. See Attachment D to this Motion to Intervene, Public Service Petition for Declaratory Order, filed January 25, 2019, in PUC Proceeding No. 15A-0589E. Intervenor IBM, Corp. (“IBM”) supports this petition. See Attachment E to this Motion to Intervene, IBM Notice of Support and Joinder of Relief Sought in Petition for Declaratory Order, filed January 29, 2019, in PUC Proceeding No. 15A-0589E. The PUC has not yet ruled on the petition because the proceeding was stayed to allow parties time to develop a proposal to resolve the many outstanding issues. See Attachment F to this Motion to Intervene, PUC Decision No. C19-0151- I, issued February 8, 2019, in PUC Proceeding No. 15A-0589E. Boulder has now filed a proposed process. See Attachment G to this Motion to Intervene, Boulder Notice Regarding Proposed Process to Address and Resolve Outstanding Issues, filed June 12, 2019, in PUC Proceeding No. 15A-0589E. However, Public Service and IBM object. In its response, Public Service specifically reiterates its request that substation-related filings be filed with the PUC and parties be given opportunity to request a hearing, conduct discovery, and present evidence. See Attachment C to this Motion to Intervene, Public Service Response to Boulder’s Proposed Procedures and to the Combined Response in Opposition. Likewise, IBM responds that Boulder cannot proceed to condemnation without final PUC action and that Boulder’s proposed process is inadequate. See Attachment H to this Motion to Intervene, IBM Response to Boulder’s Combined Response in Opposition, filed June 19, 2019, in PUC Proceeding No. 15A-0589E. Now that final versions of Exhibits 5A and 5B have been filed, a status conference is expected to Attachment to Order - 2019CV30637 8 soon be set in the PUC proceeding to determine next steps in resolving this and other outstanding issues and pleadings. Fourth, the PUC must resolve remaining issues raised by intervenor IBM. In PUC Decision No. C17-0750 at ¶¶ 236-239, the PUC found the record insufficient “at this time” to conclude Boulder was unwilling or unable to provide substantially adequate service to IBM. The PUC found IBM’s operational and financial concerns can be addressed as Boulder and Public Service develop plans for substation configurations and as Boulder continues to make operation plans for its new utility. The PUC clarified that IBM is not precluded from bringing additional evidence to the PUC that demonstrates Boulder is unable to provide it adequate service. IBM continues to assert to the PUC that its concerns have not been addressed. Because of these outstanding issues, the PUC has a direct interest in this condemnation action. The PUC’s interest is to ensure that, before any condemnation action proceeds, the PUC is afforded opportunity to complete its administrative proceeding and issue a final decision approving the designation of assets for transfer. b. The PUC’s interest in completing its proceeding would be impaired if the condemnation case moves forward. The PUC’s interest in completing its proceeding would be impaired if the condemnation case proceeds prematurely. The Boulder District Court Decision established that the PUC’s approval must be granted prior to Boulder going to court to condemn assets. If the Court were to allow the condemnation action to move forward while the PUC proceeding is ongoing, the result would be confusing and inconsistent agency and court rulings. This conflict could further delay and complicate this already prolonged and complicated dispute. Attachment to Order - 2019CV30637 9 In PUC Decision No. C17-0750 at ¶ 5 and Ord. ¶ 2, the PUC required Boulder to resubmit the asset list in Exhibit 5A “for final approval.” The PUC stated the proceeding may conclude with a final decision designating the assets for transfer upon the PUC’s satisfaction that Boulder has complied with the conditions in Decision No. C17-0750. Id. at ¶ 10. Likewise, Judge LaBuda in the Boulder District Court Decision recognized that the facilities Public Service requires to provide service to its customers and the facilities needed by Boulder to create its municipal electric utility are “intimately intertwined.” See Attachment A to this Motion to Intervene, Boulder District Court Decision at p. 12. She concluded it was therefore “necessary and appropriate for the PUC to determine how facilities should be assigned, divided, or jointly used to protect the system’s effectiveness, reliability, and safety.” Id. Accordingly, the PUC must have opportunity to complete its proceeding and issue a final decision approving the designation of assets for transfer. This includes opportunity to review the June 28, 2019, and August 2, 2019, filings recently made by Boulder, allow parties to respond, and determine finally that this assignment, division, or joint use will meet the standard in the Boulder District Court Decision. And, as Judge LaBuda recognized, timing is key—the PUC’s determinations must be made prior to Boulder beginning condemnation. Were the Court to allow this condemnation action to proceed, it would undermine the ongoing PUC proceeding and create confusing results. c. The PUC’s interests are not adequately represented by the parties. No other party adequately represents the PUC’s interest in this condemnation case. The PUC’s narrow and unique interest is to apprise the Court of the ongoing PUC proceeding and Attachment to Order - 2019CV30637 10 preserve the PUC’s jurisdiction to approve the designation of assets for transfer. The PUC is the only entity interested in protecting its jurisdictional decision-making authority. Although Public Service has also filed a motion to dismiss Plaintiff’s petition, the PUC’s interest in preserving its jurisdiction and completing its ongoing proceeding is distinct from that of a party litigating before the PUC, particularly where, as is the case here, the PUC has not yet issued a final decision concluding its proceeding. The PUC’s interest in intervening is to ensure the Court is fully apprised of the ongoing PUC proceeding and that the PUC’s critical prerequisite determinations are made prior to any condemnation action. Because all three parts of C.R.C.P. 24(a)(2) are satisfied, the PUC is entitled to intervene as of right in this condemnation case. 2. In the Alternative, the Court Should Permit the PUC to Intervene Alternatively, C.R.C.P. 24(b)(2) permits that, upon timely application, anyone may be permitted to intervene in an action when an applicant’s claim or defense and the main action have a question of law or fact in common. In exercising its discretion to grant permissive intervention, a court “shall consider whether the intervention will unduly delay or prejudice the adjudication of the rights of the original parties.” C.R.C.P. 24(b)(2). The PUC’s claim that it retains jurisdiction over this dispute and must be afforded opportunity to complete its administrative proceeding concerns the same questions of law and fact as this condemnation action. Permitting the PUC to intervene at this time will not unduly delay or prejudice the adjudication of the rights of the original parties. Rather, it will avoid confusing and inconsistent results that may only further complicate and delay resolution of this Attachment to Order - 2019CV30637 11 dispute. Respondent Public Service has just filed its answer to Plaintiff’s petition along with a motion to dismiss for lack of subject matter jurisdiction. This Court has not yet made any substantive rulings or established a procedural schedule and trial date. Now is the appropriate and best time for the PUC to be admitted as an intervenor. 3. PUC Intervention is Timely and Does Not Prejudice Petitioner or Respondents The PUC’s intervention before this Court is timely. Respondent Public Service has just filed its answer along with a motion to dismiss. This Court has not yet made any substantive rulings or established a procedural schedule and trial date. The parties are therefore in no way prejudiced by PUC intervention in this condemnation case at this time. However, the PUC would be unduly prejudiced if it is denied intervention, particularly as it actively moves forward to resolve the outstanding issues before it in its ongoing administrative proceeding that are a necessary prerequisite to any condemnation action. CLAIM OR DEFENSE TO BE ASSERTED In compliance with C.R.C.P. 24(c), concurrent with this Motion to Intervene, the PUC files a concurrent “Motion to Dismiss Pursuant to C.R.C.P. 12(b)(1), Or In the Alternative Stay Proceeding Pending Final PUC Decision.” The PUC’s interest in this matter not only warrants intervention in this litigation, but also requires dismissal of the First Amended Petition in Condemnation. In the alternative, the PUC urges that the Court stay the condemnation action pending a final PUC decision approving the designation of assets for transfer. In the event the Court does not dismiss this action and moves forward with the merits of Plaintiff’s petition, the PUC reserves its right to assert future claims and defenses. Attachment to Order - 2019CV30637 12 CONCLUSION WHEREFORE, the PUC respectfully requests that the Court grant the PUC’s Motion to Intervene, allowing the PUC the opportunity to intervene in this litigation, and accept the concurrently filed PUC Motion to Dismiss Pursuant to C.R.C.P. 12(b)(1), Or In the Alternative Stay Proceeding Pending Final PUC Decision, such that the Court may consider the PUC pleading that requests the Court dismiss the First Amended Petition in Condemnation for lack of subject matter jurisdiction, or in the alternative stay the proceeding pending a final PUC decision approving the designation of assets for transfer. Respectfully submitted August 8, 2019. PHILIP J. WEISER, Attorney General /s/ Paul C. Gomez PAUL C. GOMEZ, 22759* First Assistant Attorney General RUTH M. HARPER, 52143* Assistant Attorney General State Services Section Attorneys for the Colorado Public Utilities Commission *Counsel of Record In accordance with C.R.C.P. 121 § 1-26(7), a printed copy of this document with original signature is maintained by the Office of the Attorney General and will be made available for inspection by other parties or the Court upon request. Attachment to Order - 2019CV30637 13 CERTIFICATE OF SERVICE This is to certify that a true and correct copy of the above captioned MOTION TO INTERVENE was served upon all parties herein by e-filing and service through the Colorado Courts E-Filing System (CCEF) or by depositing copies of the same in the United States mail, first- class postage prepaid, at Denver, Colorado, this 8th day of August, 2019, addressed as follows: Attorneys for Petitioner, City of Boulder Office of the Boulder City Attorney Thomas A. Carr Kathleen E. Haddock P.O. Box 791 Boulder, CO 80306 Hamre, Rodriguez, Ostrander & Dingess, PC Donald M. Ostrander Richard F. Rodriguez 3600 S. Yosemite Street, Suite 500 Denver, CO 80237 Attorney for Respondent, Paul Weissmann, in his official capacity as Treasurer of Boulder County Oliva D. Lucas Boulder County Attorney P.O. Box 471 Boulder, CO 80306 Attorneys for Respondent, Public Service Company of Colorado John R. Sperber Sarah M. Kellner Brandee L. Caswell Matthew Dumont Clark Katharine M. Gray Sean J. Metherell FAEGRE BAKER DANIELS LLP 1144 Fifteenth Street, Suite 3400 Denver, CO 80202 /s/ Xan Serocki XAN SEROCKI In accordance with C.R.C.P. 121 § 1-26(7), a printed copy of this document with original signature is maintained by the Office of the Attorney General and will be made available for inspection by other parties or the Court upon request. Attachment to Order - 2019CV30637