2009 ANNUAL REPORT - New Mexico Public Regulation … · 2011-07-19 · 2009 ANNUAL REPORT Sandy Jones, Chairman David W ... •Continued implementation of the Qwest AFOR-I Second

P U B L I C R E G U L A T I O N C O M M I S S I O N

2009 ANNUAL REPORT

Sandy Jones, ChairmanDavid W. King, Vice Chairman

Jason Marks, CommissionerJerome D. Block, CommissionerCarol K. Sloan, Commissioner

Daniel Mayfield, Chief of Staff

P U B L I C R E G U L A T I O N C O M M I S S I O NTable of Contents

Commissioners Contact Information..............................................................................3

PRC District Map...............................................................................................................4

Commission Letter.............................................................................................................5

PRC Regulatory Matrix....................................................................................................6

Organizational Chart........................................................................................................7

Commissioner Accomplishments...................................................................................8

Chief of Staff .....................................................................................................................10

Consumer Relations Division.........................................................................................12

Utility Division.................................................................................................................13

Transportation Division...................................................................................................15

Pipeline Safety Bureau.....................................................................................................16

State Fire Marshal Division.............................................................................................17

Insurance Division...........................................................................................................21

General Counsel...............................................................................................................29

Hearing Examiners..........................................................................................................31

Legal Division..................................................................................................................32

Administrative Services Division.................................................................................35

Public Information Officer..............................................................................................37

Native American Liaison................................................................................................37

PRC Directory...................................................................................................................38

P U B L I C R E G U L A T I O N C O M M I S S I O NCommissioners

JASON A. MARKS, COMMISSIONERPRC, District 11120 Paseo de PeraltaP.O. Box 1269Santa Fe, NM 87504-1269

Executive Assistant: Leroy Aragon

SANDY JONES, CHAIRMANPRC Commissioner, District 51120 Paseo de PeraltaP.O. Box 1269Santa Fe, NM 87504-1269

Executive Assistant: Elizabeth Martin

E-mail: [email protected] Free: 1 888 427-5772Direct: 505-827-8020

DAVID W. KING, VICE CHAIRMANPRC Commissioner, District 21120 Paseo de PeraltaP.O. Box 1269Santa Fe, NM 87504-1269

Executive Assistant: Stacy Starr-Garcia



JEROME D. BLOCK, COMMISSIONERPRC, District 31120 Paseo de PeraltaP.O. Box 1269Santa Fe, NM 87504-1269

Executive Assistant: Charlotte Duran



CAROL K. SLOAN, COMMISSIONERPRC, District 41120 Paseo de PeraltaP.O. Box 1269Santa Fe, NM 87504-1269

Executive Assistant: Luis Ledezma

3

mailto:[email protected]











COMMISSION DISTRICTS

4


COMMISSION LETTER

5


PRC REGULATED ENTITY MATRIXThe Public Regulation Commission (PRC) regulates public utilities, telecommunications companies, motor carriers, and insurance companies operating in New Mexico. Other functions of the RC include administering the State Fire Marshal, State Firefighters Training Academy, Pipeline Safety and the Registration of Corporations doing business in New Mexico.

Regulated Entity Type

CCN(Market Entry)

Rates Service Quality Safety Consumer

Complaints

Electric Utilities X X X X X

Natural Gas Utilities X X X X X

Water Utilities & Sewer X X X X X

Telephone ILECs X X X X

Telephone CLECs X X

Long Distance Carriers X

Wireless Telephone Cos. X

Motor Carriers, including; taxis, buses, limousines, shuttle services, wreckers, ambulances, household movers.

X X X X X

Pipelines X

Excavators X

Underground Facility Owners X

Insurance Carriers X X X X

Insurance Agents X X X

State Fire Marshal (Inspection of Public Bldgs)

X

Excludes utilities owned by a local government or mutual domestic water associations.

The PRC sets rates for gas transmission and distribution; the price of the gas itself is based on market prices.

The PRC Insurance Division has very limited rate review authority over most lines; the Division sets rates for Title Insurance.

1

1

1

2

3

1

2

3

6


ORGANIZATIONAL OVERVIEW

COMMISSIONERS CommissionerAssistants

Chief of Staff Management Analyst

GeneralCounsel

HearingExaminers

PublicInformation

Officer

NativeAmerican

Liaison

ConsumerRelationsDivision

InsuranceDivision

LegalDivision

State FireMarshalDivision

TransportationDivision

UtilityDivision

Administrative Services Division

InsuranceComplaints

Utility &Trans.

Complaints

InsuranceSuperintendent

Dep. Supt.Finance/Bdgt.

RevenueAudit

Section

RevenueProcessing

Section

Chief DeputySuperintendent

Chief ActuaryLife & Health

Rate and FormLife & Health

Bureau

Chief ActuaryProperty & Casualty

Rate and Form Prop. & Casualty

Bureau

DeputySuperintendentof Operations

Company Licensing

Bureau

AgentsLicensing

Bureau

Managed Healthcare

Bureau

Title InsuranceBureau

Worker’sCompensation

Bureau

ExaminationsBureau

InvestigationsBureau

Insurance Fraud

Bureau

Compliance Director

Finance andBudget Bureau

Information Systems & Technology

Bureau

Human Resources

Bureau

Corporations Bureau

RecordsManagement

Bureau

State FirefighterTraining Academy

Bureau

FireInspection

Bureau

Fire ServiceSupportBureau

WIPP GrantProgram

Fire CodeEnforcement

Bureau

ApplicationsBureau

ComplianceBureau

PipelineSafetyBureau

AccountingBureau

EconomicsBureau

Electrical Engineering

Bureau

Gas, Water &Wastewater

Bureau

Telecom-munications

Bureau

7


COMMISSION ACCOMPLISHMENTSThe New Mexico Public Regulation Commission is comprised of five elected Commissioners, each representing a district of the State of New Mexico. Commissioners are elected to a four year term and are limited to no more than two consecutive terms. Commissioners are elected on a staggered election cycle. The Commission is the overall regulatory authority for a wide variety of industries.

Past Year Commission Accomplishments

The Commission holds Regular Open Meetings every Tuesday and Thursday in its office in Santa Fe. Commission accomplishments during FY2009 include:

Telecommunications

• Continued implementation of the Qwest AFOR-I Second Amended Settlement Agreement, including Cyber Center, Broadband Expansion and Service Quality.

• Qwest AFOR II: third year of three-year rate freeze on basic local exchange service.• Proceeding initiated to develop and implement Qwest AFOR III Plan.• Qwest’s promotional offerings scrutinized to determine whether in compliance with PRC

Order that allowed more flexibility to respond to competition.• Proceeding ongoing to investigate prison inmate calling rates.• Continued careful management of the State Rural Universal Service fund.• Sky-Wi problems successfully resolved.• Initiated proceeding to implement a Lifeline-Linkup Rule for low income telephone

services.

Utilities

Major Cases Completed

• PNM electric base rates-substantially reduced from original filing.• PNM generation resource stipulation, enhancing reliable low cost reserve capacity.• PNM emergency fuel clause, providing additional assurance to investors.• SPS electric base rates - substantially reduced from original filing.• SPS fuel clause (settled), resolving issues going back several years.• EPE electric base rates - Unanimous, uncontested, comprehensive settlement filed, which

substantially reduced rates requested by EPE in its original filing.• Picacho HIlls Water and Wastewater (enforcement ongoing).• Renewable Energy: Approved Renewable Portfolio Standards procurement plans for 2008

for all three investor owned electric utilities, assuring compliance with law.• Hired consultant to assist with RFP process to perform audit and/or prudence review of

PNM fuel clause.• Adopted technical standards for electric utility interconnection.• Energy efficiency measurement and verification committee reviewed and selected work of

contractor.• NOPR issued on revised residential utility customer service and disconnection rules.

8


COMMISSION ACCOMPLISHMENTSRulemaking

• Complete revision and integration of procedural rules for utility and transportation cases.

• Technical standards for electric utility interconnection.• Reasonable cost thresholds for renewable technologies.• Energy efficiency incentives/disincentives (ongoing).• NOPR issued on revised residential utility customer service and disconnection rules.• Formed working group with TRD and led meeting to address issues of taxation of

utility and telecommunication service on Indian Nations pursuant to legislative mandate.

• Initiated proceeding to implement a Lifeline-Linkup Rule for low income telephone services.

Public Safety

Transportation and Pipeline Safety

• Continue implementation of UCR filing and fee collection for Mexican Trucking Companies, (funds go to road fund).

State Fire Marshal

• Fire Code Enforcement Bureau will have ensured completion of inspections of every public and private school in New Mexico and implemented program of mandatory inspections every two years at minimum.

• Distributed $34,880,810 from Fire Protection Fund to 390 fire departments.• Distributed $3,228,310 from the Fire Protection Grant Fund to 41 fire departments to

purchase new apparatus and equipment.

Consumer Outreach

• Conducted Regular Open Meetings and Workshops throughout the State.• Maintained PRC presence at EXPO New Mexico highlighting the function of agency.• Conducted extensive state-wide consumer education.

Year to Come

The Commission plans to hold Regular Open Meetings (ROM’s) in all districts in New Mexico in the coming year. The Commission will continue to expand enhanced consumer outreach through public service announcements, educational and promotional events, as well as provide assistance to victims of disaster.

9


The Chief of Staff provides agency-wide leadership and support to the Public Regulation Commission and oversees the budget and preparation of significant reports such as the agency’s Annual Report and Strategic Plan to the Legislative Finance Committee. The Chief of Staff also works to ensure that the daily operations of the agency run efficiently and effectively, in order to provide exceptional customer service to the public, and maintain balance between the industries that the PRC regulates and it’s customers.

The Chief of Staff manages division directors and meets regularly with them to assure that Commission policies and directives are implemented. He also reports the activities and progress of all divisions to the Commissioners.

The Chief of Staff’s office serves as the central facilitator for public information and community relations on behalf of the Commission. During legislative sessions, the Chief of Staff serves as the agency’s central clearinghouse for all requests for analysis of legislation assigned to the PRC by the Legislative Finance Committee and Department of Finance and Administration. The Chief of Staff ensures that legislative inquiries and deadlines are met and provides information to State Lawmakers concerning legislative issues.

The Chief of Staff works closely with outside and internal resources in order to implement the Mission and meet the goals of the Public Regulation Commission.

The Past Year

During the past fiscal year the NMPRC moved all of its Santa Fe employees into the PERA Building at 1120 Paseo de Peralta, after the Public Employees Retirement Association moved to a new building. The Chief of Staff and Commission was instrumental making this consolidation possible by successfully negotiating with the General Services Department and other key agencies to secure the vacated office space. The locating all employees into one building resulted in a substantial savings of general fund money for the State of New Mexico. Before 2009’s move the NMPRC housed employees in three separate buildings throughout Santa Fe. This move is part of the Commission and Chief of Staff’s ongoing commitment to always ensure that the NMPRC be a fiscally responsible State Agency.

The Commission and Chief of Staff have been strong supporters and proactive proponents of agency employees. Through diligence and dedication the Commission and Chief of Staff have effected employee salary parity throughout the agency. This effort has been an ongoing undertaking and continues to ensure equitable compensation for all agency employees - both tenured and recent.

Through the Chief of Staff’s fiscally responsible management and discerning foresight the status of the NMPRC’s general fund revenues has not been adversely affected, hence, averting furloughs for PRC employees. Preventing employee furloughs was due in part to fiscal discipline and sound administrative financial management practices that curbed unnecessary spending, yet took into account the many needs and requirements of the agency as a whole. The current FY 2010 PRC budget is consistent with FY 2007 funding levels. In addition, agency dollar reversions have decreased significantly, demonstrating that the PRC is operating within its approved budget.

CHIEF OF STAFF

10


CHIEF OF STAFF

The Commission and Chief of Staff recognize that every employee plays an invaluable role in providing excellent customer service to the public. This customer services extends to consumers of the industries the PRC regulates, as well as the regulated entities and internal customers.

The Chief of Staff will continue to strive to set the highest of standards for fiscal responsibility and will work diligently on behalf of the Commission, our employees and the people of the State of New Mexico.

The Year to ComeThe Chief of Staff’s Office will continue to strive to create and maintain a synergy between consumers and the industries the PRC regulates and will continue to assist the Commissioners and Division Directors in reviewing existing programs to continue providing quality services to the public. The Chief of Staff will continue to maintain positive working relationships with New Mexico Lawmakers, elected agencies and regulated industries.

The Chief of Staff will continue to engage a proactive, fiscally responsible management approach to address the tough challenges posed by today’s economy by identifying areas in which fiscal responsibility can be further effected, while maintaining the highest quality of service to the citizens of New Mexico and the entities the PRC regulates.

The New Mexico Public Regulation Commission will continue to serve the citizens of New Mexico with courtesy, respect, and to meet their needs by providing quality customer service.

11

!

!"#$""#"""!

!"#%""#"""!

!"#&""#"""!

!!#"""#"""!

!!#'""#"""!

!!#$""#"""!

!!#%""#"""!

!!#&""#"""!

!'#"""#"""!

!'#'""#"""!

'""( '""& '"") '"!"

*+,+-./!01,2!3124+5

This graph illustrates the PRC’s general fund budget levels for the past four fiscal years (2007-2010).

From FY 07-09 the agency experienced increased levels of funding, however, as the graph demonstrates the PRC’s funding has significantly decreased in the past fiscal year.

!

"

!"#"""!

$""#"""!

$!"#"""!

%""#"""!

%!"#"""!

&""#"""!

&!"#"""!

'""#"""!

'!"#"""!

%""( %"") %""*

+,-,./0!12-3!4,5,.678-6

This graph illustrates the PRC’s general fund revenue reversions for the past three fiscal years (2007-2009).

PRC reversion amounts have decreased significantly, demonstrating that the PRC is operating within its approved budget.


The Consumer Relations Division (CRD) serves as the PRC’s primary consumer protection facilitator to assist consumers with inquiries and complaints against companies that are regulated by the New Mexico Public Regulation Commission. The division consists of two bureaus: Utility & Transportation Complaints and Insurance Complaints. The division’s compliance officers assist consumers with their disputes in an effort to resolve consumer troubles in a fair and timely manner. Our compliance officers utilize mediation and alternative dispute resolution methods to solve consumer complaints.

Performance Measures

The CRD compiles consumer information and develops data to advise the Commission about consumer related issues and trends. The division also assists the Commission to develop and implement consumer policies and consumer education and outreach programs. The CRD works closely with the consumer protection divisions of the New Mexico Attorney General and Governor’s Constituent Services Office to ensure fair and timely resolution of consumer inquiries and complaints.

The Past Year

This past year the CRD handled 16,747 total consumer inquiries and complaints, which were reported to the CRD by New Mexico consumers. Additionally, the CRD developed informational collateral materials, which contain consumer information to impact general consumer protection advice concerning industries regulated by the PRC.

During 2009 the CRD organized and facilitated multiple town hall and open business meetings for the Commission, which took place statewide, throughout Commission districts. CRD Staff instituted a “hotline” for consumers who needed information regarding the impending disconnection of SkyWi by several telecommunications carriers CRD staff is also a participant in three cases in regard to electric and gas residential customer service rules; developing a proposed rule for propane; and establishing quality if service benchmarks for electric IOU’s. The CRD also participated in various community events such as EXPO New Mexico, and Solar Fiesta as part of an ongoing effort to engage PRC community outreach and education.

The Year to Come

2010 should be as, or more, productive as 2009. The CRD will continue to meet its objective of processing consumer inquiries and complaints in a timely, knowledgeable and professional manner. The CRD investigates all PRC related consumers complaints to ensure that New Mexico laws, rules, regulations and tariffs are legally adhered to by the PRC regulated industries, and to do so within an average processing time of 24-hours or less on Utility and Transportation complaints and consumer insurance complaints within statutory requirements. The Division will continue to develop and participate in community outreach programs, education and public information events such as EXPO New Mexico and PRC town hall meetings. CRD staff may be contacted by calling toll-free 1-888-4-ASK PRC (1-888-427-5772) or online at www.nmprc.state.nm.us/crd

CONSUMER RELATIONS DIVISION

12

http://www.nmprc.state.nm.us/crd

http://www.nmprc.state.nm.us/crd


UTILITY DIVISIONPURPOSE

The Utility Division serves as advocacy staff to the Commission in the regulation of electric, natural gas, renewable energy sources, telecommunications and water and wastewater systems as provided by law. Division Staff advocates public interest positions in docketed cases; ensures and enforces compliance with statutes, rules and Commission Orders; provides technical support on legislation and rulemaking; and assists in relations with other state, regional and federal entities.

MAJOR RECENT ACCOMPLISHMENTS

Electric

• Staff continues to assist and encourage the Commission to be proactive in the promotion of energy efficiency and the development of renewable energy resources, while balancing concern for ratepayer impacts, especially for low income customers.

• Participated in proceedings on Third-Party contracts for distributed generation.• Successfully settled rate increase filings by all three investor-owned utilities.• Energy Efficiency Incentives rulemaking workshops continue.• Energy Efficiency Measurement and Verification Committee contractor selected by

Evaluation Committee and Commission; review process underway.• IRP process ongoing. Renewable Portfolio Standard (RPS) program proposals and

reports reviewed and analyzed.• Reasonable Cost Threshold for Renewable Energy and incentives for Solar and

Distributed Generation under consideration.• Net metering rule complete; Interconnection rulemaking process complete.• Continuous monitoring of issues and developments regarding transmission, including

RETA, SPPP, FERC corridors, etc.• Settlement negotiations successful with PNM regarding global agreement on three

cases involving purchased power and potential certification of power plants.• Staff participated in fuel clause proceedings for PNM and Rural Electric Cooperatives.• Facilitated workshop process for low-income and other protections from

disconnection.• Supported legislation for permanent funding source for Low Income Home energy

Assistance Program (LIHEAP).• Investigated complaints of service quality, interruptions, and line extension policies.• Worked with CRD developing process to assist propane service customers.• Participated in discussion with agencies and stakeholders on development of “smart

grid” systems and technologies.

13


UTILITY DIVISIONGas

• PNM sale of gas nit to New Mexico Gas Company stipulation approved. Energy Efficiency offerings review ongoing.

• Zia Natural Gas. Rate case hearing concluded.

Telecommunications

• Ongoing proceeding on truth in billing; inmate operator service providers; rural universal service fund; Sacred Wind Communications; eligible telecommunications carriers (ETC); New Mexico Low Income Telephone Service.

• Facilitated working group progress on exemption from taxation of utility and telecommunication service on tribal lands, pursuant to legislative mandate.

• Monitored Qwest compliance with Second Amended Settlement Agreement (SASA) and Alternative Form of Regulation (AFOR II).

• Followed national discussions regarding VOIP providers, universal service reform, broadband deployment, net neutrality, mergers and acquisitions and industry trends.

• Actively participated in Qwest AFOR III and promotions proceedings.

Water

• Investigated complaints regarding water utilities and worked with customers, owners and other entities to achieve satisfactory solutions.

• Three rate case filings reviewed and testimony submitted.• Staff attending meeting of working group on water planning per House Memorial 42.• Met with NMED staff on compliance issues.

Administrative

• Assisted in development of electronic filing of documents (ongoing).• Assisted in archiving of records.• Assisted other PRC divisions as requested.• Developed and strengthened relationships with other entities and agencies.• Developed and strengthened relationships with other states’ counterpart agencies and

regional entities such as WREGIS.

14


TRANSPORTATION DIVISIONThe State of New Mexico implements a public policy which fosters the development, coordination and preservation of a safe, sound, and adequate transportation system, requiring financial responsibility and accountability on the part of the motor carriers, providing for economic regulation of carriers of persons and household goods and towing services performing non-consensual tows, and by streamlining and promoting uniformity of state regulation of motor carriers. The Transportation Division serves as both advocacy and advisory staff to the PRC depending on the type of case.

The Past Year

The Transportation Division accomplished the following:

• Processed more than 2,899 insurance filings.• Issued 282 certificates for Warrants, Public Convenience and Necessity, Tariff

Changes, Name Changes, Transfers, Leases and Contracts.• Conducted 50 inspections for Railroad crossings.• Conducted 25 Railroad safety inspections• Will mail out more than 17,000 UCR Applications for 2010 for New Mexico,

Arizona and United States of Mexico Carriers.• Sent 684 Notice of Expiration, Suspension and Intent to Seek Revocation and

Notice of Hearing to 684 Transportation Carriers for failure to maintain Proof of Insurance.

• Revoked 489 operating authorities for failure to respond and/or attend hearings.

The Year to Come

The Division will complete a safety review of all ambulances. The Division will work on procedures for inspecting and assuring that all other transportation companies are in compliance with all Transportation Rules. The division will also continue to strive and improve relations with the Motor Transportation Division (MTD) of the Department of Public Safety and continue to work on regulation to comply with Federal Motor Carrier Safety requirements. The Pipeline Safety Bureau will continue to work and educate contractors about the One-Call program; PSB will continue Master Meter and Large Operator inspections.

Type of Service No. of Regulated Companies

• Ambulance 100• Household Goods Carriers 54• Passenger Carriers 180• Towing Services 379• Property Warranty Carriers 1,749• Railroads 12

★The Investigations Bureau conducted 178 inspections and performed 64 investigations.

★Initiated the Incidental Carrier Program.

★The PRC intends to file a Notice of Proposed Rulemaking regarding Railroad Rules.

15


PIPELINE SAFETY BUREAU OF THE TRANSPORTATION DIV.The Pipeline Safety Bureau (“PSB”) enforces Federal and State Pipeline Safety Regulations and Excavation Damage Prevention rules in order to provide for the safety of the citizens of New Mexico. Through a partnership arrangement with the US Department of Transportation, the PSB is responsible for safety compliance inspections and enforcing state and federal pipeline safety regulations on intrastate gas and hazardous liquid pipeline facilities, which includes private and municipal gas distribution systems, master meter gas systems, Liquid Propane Gas systems, transmission systems and jurisdictional gathering lines.

The Past Year

The PSB continues to vigorously promote the national “Call before You Dig” program that is the “811” telephone number for the program.

• PSB received 99% rating from federal reviewers• The PSB Chief has been appointed to the Distribution Integrity Management Program

and currently serves on the Board of Directors of the American Public Gas Association’s Security & Integrity Foundation.

The Year to Come

The PSB will continue the development of an Excavation Damage Prevention Law Violation tracking system in order to facilitate reporting of third party damages and to track compliance with enforcement actions. The PSB will actively implement new Distribution Integrity Management Program rules applicable to distribution systems and that are anticipated to be promulgated at the federal level by late 2008 or early 2009.

The PSB is funded by federal grants and fees, which are assessed on operator that fall under the safety jurisdiction of the PSB.

The PSB increased educational training hours for inspectors, which is a professional requirement in order to be certified to conduct safety inspections.

16


STATE FIRE MARSHAL DIVISIONThe Division provides numerous services related to the life safety of our state’s residents and guests through a separation of work assignments. There are four Bureaus within the Division that focus on the legal requirements and goals of the Division. The Division’s services are provided by 43 permanent staff and approximately 150 adjunct and contractual staff.

FIRE SERVICE SUPPORT BUREAU

The Fire Service Support Bureau is tasked with numerous responsibilities that assist the local fire departments. The Bureau applies the funding formulas for distribution of the State Fire Protection Fund and the State Fire Protection Grant Fund. The Bureau’s staff specialists also audit the local governments’ expenditures of the funds. Other assistance programs include inspection of fire stations, review of training records and firefighter qualification documentation, review of equipment purchases, approval of fire apparatus specifications, assistance with the preparation for ISO rating upgrade surveys and assistance in obtaining loans through the New Mexico Finance Authority. A special position exists within the Bureau, which coordinates training and preparation for fire departments along the WIPP transportation routes.

Performance Measures:

Number of inspection and audit hours: 2,725

Percent of fire departments with an ISO rating of nine or ten that have been reviewed by survey or audit: 100% (Exceeding target)

Number of statewide fire districts with ISO ratings of eight or better: 63%

Number of fire districts statewide: 390

The Past Year:

The Bureau calculated and distributed $34,880,810.00 from the Fire Protection Fund to 390 municipal and county fire departments. Also, $3,228,310.00 was distributed from the Fire Protection Grant Fund to 41 fire departments to purchase new apparatus and equipment.

The Bureau has implemented an aggressive fire department audit and review program for every fire department and is conducting the program on a county-by-county basis.

17


STATE FIRE MARSHAL DIVISIONThe Year to Come:

The Bureau will distribute $43,170,899.00 from the Fire Protection Fund to 394 municipal and county fire departments. Also, the Bureau will assist the Fire Protection Grant Council set the guidelines, review applications and distribute $4,767,279.93 to qualifying fire departments.

Continued assistance will be available to bring New Mexico fire departments on line with emergency response reporting to the National Fire Incident Reporting System

FIRE CODE ENFORCEMENT BUREAU

The Fire Code Enforcement Bureau provides for the life safety of the public and the reduction of property losses by inspecting public occupancies for compliance with fire and life safety codes. The efforts to assure that public buildings are safe range from initial plans reviews to final inspection before occupancy is allowed and continues with periodic inspections. Priorities are given to buildings where large numbers of people gather and special conditions exist, such as schools, theaters and hospitals. Special activities, including inspection of above ground flammable liquid storage tanks and the regulation of fireworks sales, are also the responsibility of the Fire Code Enforcement Bureau.

A special priority has been given to the inspection of schools throughout the state. In cooperation with local fire departments and the Public School Finance Authority a commitment has been made to inspect every public school at least every two years. Currently the program is on target to conduct each school inspection every 12 to 18 months.

Partnership agreements have been presented to every fire department in New Mexico to outline responsibilities and coordinate efforts for more thorough code inspections. Approximately 80% of the departments have responded and approximately 51% have committed to assist with code inspections.

Performance Measures: Number of inspection hours - 15,288

The Past Year: The Bureau conducted 3,129 code inspections and 467 plan reviews.

The Year To Come: The Bureau is preparing to review and adopt the upgraded 2009 version of the International Fire Code.

18


STATE FIRE MARSHAL DIVISIONFIRE INVESTIGATION BUREAU

The Fire Investigation Bureau has certified investigators on call 24 hours a day. They are tasked to respond to all fires involving state property and are available to local fire authorities when the fire origin and cause are undetermined or arson is suspected. In cases with indication of arson the investigators will assist local and state law enforcement agencies with the collection of evidence and the possible prosecution of suspects.


Percent of counties and municipalities participating in the Arson Task Force or partnerships with the State Fire Marshal: 62% ( Exceeding target)

This Past Year:

The Bureau conducted 178 investigations.

The Bureau fostered strong working relationships with the Insurance Fraud Bureau of the Insurance Division of the PRC, the New Mexico State Police, the Federal Bureau of Alcohol, Tobacco and Firearms and insurance company investigators.

The Bureau began the design and planning process for an evidence processing facility to be constructed on the campus of the Firefighters Training Academy in Socorro. Contracts have been signed to begin construction.

The Year to Come:

Partnership agreements are being put in place with all the state’s fire departments to outline responsibilities and coordinate efforts for thorough fire investigations.

19


STATE FIRE MARSHAL DIVISIONFIREFIGHTERS TRAINING ACADEMY BUREAU

The Firefighters Training Academy Bureau operates the state fire academy in Socorro. The Bureau offers over 80 courses ranging from entry level to advanced management for chief officers. In addition to fire suppression classes, there are course in technical rescue, hazardous materials, terrorist response, instructor qualifications and business management. The Bureau also provides courses in specialized training through partnerships with the Federal Emergency Management Agency and the National Fire Academy. The Academy’s certification programs are accredited by the International Fire Service Accreditation Congress.

Classes are conducted throughout the state, as well as on the Socorro campus. Some larger fire departments, with their own local academies, also send their students to the state’s facility to use the specialized burn props for the most realistic training experience possible. Although the majority of students are members of New Mexico municipal and county fire departments, many come from other states, Tribal entities, the Federal Government, Mexico and the private sector.

With the use of monies received from the State Legislature and HUD, the Academy has upgraded fire equipment, repaired roofs, replaced fire station bay doors, repaired concrete training pads, repaired parking lot surfaces and tied the on-site sewer system into the City of Socorro waste treatment system.


Number of training contact hours: 106,590

Number of personnel completing training: 3,003

Pass rate for state certification exams: 91%

This Past Year:

The Academy delivered 267 courses statewide.

The Year to Come:

The Academy will be expanding the outreach training programs so that local fire departments may receive more basic training and certification opportunities than ever before.

The New Mexico State Fire Marshal’s Office is the state’s focal point for the fire service. The office strives to assist our state’s fire departments with increased funding, realistic training and professional certifications, reduction of the crime of arson and safer public occupancies. All of these efforts lead to a more fire safe New Mexico.

20


INSURANCE DIVISIONOVERVIEW

The Insurance Division is committed to assuring easy access to reliable insurance products that meet consumers’ needs, are underwritten by dependable, reputable, financially sound companies that charge fair and reasonable rates and are represented by trustworthy, qualified agents, while promoting a positive business climate through a caring and qualified staff. The Insurance Division is organized into the following:

• Agent Licensing Bureau• Company Licensing Bureau• Examinations Bureau• Financial Audit Bureau• Insurance Fraud Bureau• Investigations Bureau• Life / Health Rate & Form Filing Bureau• Managed Health Care Bureau• Property / Casualty Rate & Form Filing Bureau • Title Insurance Bureau• Workman’s Compensation Bureau

The New Mexico Insurance Department was originally established in 1905 by the New Mexico Legislature and charged with the regulation of the business of insurance within the Territory of New Mexico. Since its creation, the mission of the Insurance Division has remained the same. The mission of the Insurance Division:

• The protection of the interests of insurance consumers• The promotion and protection of the public good by ensuring the existence of

a safe and competitive insurance markets through the development and enforcement of the insurance laws.

• The promotion of access to affordable insurance that allows for adequate consumer choice

The promotion and development of more streamlined, uniform, and efficient regulatory processes

21


INSURANCE DIVISIONThe New Mexico Insurance Division is a member of the National Association of Insurance Commissioners (NAIC), which is an organization of the insurance regulators from the 50 states, the District of Columbia, and the five U.S. territories. The NAIC provides a forum for the development of uniform policy when uniformity is appropriate. State insurance regulators created the NAIC in 1871 to address the need to coordinate regulation of multistate insurers. With offices in Kansas City, Missouri, New York and Washington, D.C., the NAIC provides invaluable support to insurance commissioners.

Everyone in New Mexico is affected by risk or the uncertainty of an unforeseen occurrence or loss, in one way or another. Individuals, businesses and other organizations face various risks in their different activities. Insurance protects them from these risks that affect their property, lives and health.

Recently the Division of Insurance (DOI) revamped the divisions website to be more user friendly and added the new “Ask Mo” feature for consumers to direct insurance related questions directly to the Superintendent of Insurance.

AGENT LICENSING BUREAU

The Agents Licensing Bureau processes the licensing, renewal, and continuing education monitoring and associated fee collections for over 90,000 agents, brokers, adjustors, bail Bondsmen, and 4,500 insurance agencies transacting the business of insurance in New Mexico. Non-resident producers and business entities can now apply electronically for licenses, appointments, renewals, and cancellations. After review and approval by Agent Licensing staff, the license is mailed directly to the applicant at the address proved on the application. Applying electronically is faster and less costly to the producer. The option to apply by paper is still available. In response to the passage of the Gramm-Leach-Bliley Act (GLBA) and the potential creation of the National Association of Registered Agents and Brokers (NARAB), the NAIC modified the Declaration of Uniform Treatment and developed the Declaration of Reciprocity. The Declaration of Reciprocity was circulated to the state insurance commissioners, directors, and superintendents in July 2000. In June 2008 New Mexico was certified as a reciprocal jurisdiction under GLBA

MEASURE GOAL ACTUAL FY09

Percentage of producer applications,

appointments and renewals processed

within ten business days.

90% 95%

22


INSURANCE DIVISIONCOMPANY LICENSING BUREAU

The Company Licensing Bureau’s function is to review applications for domestic, foreign, and alien insurance companies. The Bureau also reviews applications for Insurance Premium Finance Companies, Motor Clubs, Purchasing Groups, Advisory Organizations, Risk Retention Groups, Service Contract Providers, Surplus Line Insurers, and Viatical Settlement Providers. The Company Licensing Bureau measures it’s success by having 90% of company certificates of authority applications and registrations processed within 180 days. The Bureau is also responsible for the surplus lines premium taxes and filings. The Unit’s objectives are to monitor and improve the company licensure process to exceed the applicable performance measure targets; improve information systems and reporting to the NAIC; develop on-line filing capabilities; automate manual procedures; and, develop and implement an automated telephone system.

EXAMINATIONS BUREAU

The Examinations Bureau completed annual financial analysis review of domestic insurers’ financial statements as of December 2008, and the 1st and 2nd quarter of domestic insurers’ financial statements of the current year. The staff analysts accomplished the 1st and 2nd quarter financial analysis within an average of two and half days per company. The Examinations Bureau completed market conduct analysis timely. Quarterly financial analysis has been performed on the foreign insurers, surplus line insurers and unauthorized reinsurers, those of whom have been placed on the Watch list have been constantly monitored for solvency. The Chief Examiner supervised and reviewed all the analytical reviews to ensure regulatory quality and efficiency. The Examinations Bureau conducted and completed three entrance examinations; and additional six scheduled financial condition examinations have been progressing as expected. The Chief Examiner has been fully and actively engaged throughout the process of examinations.

The Examinations Bureau exercised its regulatory responsibilities with due diligence and rigorous oversight. The three entrance examinations were completed within one week per company with an actual incurred examination cost being managed to be fifty percent less of initial estimated budget, a big savings for the consumers without comprising quality and effectiveness. The six financial condition examinations are also being managed with expected completion time within four months or less and expected actual cost to be fifteen to twenty percent less than initial estimated budget, again a significant improvement in project time and resource management from previous years.

23


INSURANCE DIVISIONThe Examinations Bureau presides over the Solvency Team meetings regularly, with active participation by the Chief Examiner, the General Counsel, Chief Deputy Superintendent and actuaries. The Solvency Team, with the firm support of the Superintendent, reviewed and updated the New Mexico statues and insurance regulations and regulatory practices and procedures, and worked collectively and restlessly to, in addition to preparation and readiness for the NAIC accreditation recertification which is scheduled for 2010, ensure responsive solvency surveillance and effective consumer protection.

FINANCIAL AUDIT BUREAUInsurance Finance and Budget

It is the duty of the budget team to prepare the Division of Insurance’s budget. The team coordinates with the NMPRC Administrative Services Division, the Department of Finance and Administration and the Legislative Finance Committee to establish the Insurance Operations Fund. This fund was designed to financially support insurance operations to accomplish operational restructuring, information technology, and policy goals.

Insurance Revenue Audit and Processing

The Revenue Processing Section collects premium taxes and assessments as well as audits insurance companies’ financial statements to ensure that the premium taxes collected are accurate. The Section reconciles 100% of the DOI’s revenues and ensures that the insurance revenues are distributed to the appropriate funds. The Section also processes Patients’ Compensation Fund (PCF) settlements and expenditures. These sections collect over $215,000,000 in revenues annually.

The Unit’s objectives are to improve our auditing and enforcement of revenue collection; successfully implement a new dedicated funding system; work in the areas of fee collection to ensure the proper auditing safeguards, processing and communication with the Administrative Services Division and Department of Finance Authority; assist the Superintendent in the restructuring of the Insurance Division to support the budget, revenue collection and performance measure monitoring; coordinate with the independent outside computer programmer to make enhancements to our information system to support the Unit’s revenue collection abilities and enhance performance and reporting; and, promulgate a rule to govern how premium tax refunds and credits will be processed.

24


INSURANCE DIVISIONINSURANCE FRAUD BUREAU

The Insurance Fraud Bureau assists the Superintendent in investigating and prosecuting insurance fraud under the New Mexico Insurance Code and the State Criminal Code by working with state, local and federal law enforcement agencies such as, Attorney General’s Office, U.S. Attorney’s Office, and the FBI.

The Bureau assists the Superintendent in educational outreach to industry and general public to raise awareness of insurance fraud and its cost to consumers. The Bureau works with other bureaus in the Division to advise on criminal versus administrative issues, to get background information on licensed individuals and refers non-criminal matters to the appropriate areas for resolution.

The Fraud Bureau strives to ensure that 80% of complaints are processed and recommended for either further administrative action or closure within 60 days.

INVESTIGATIONS BUREAU

The Investigations Bureau provides investigative services in determining violations within the New Mexico Insurance Code, and ensuring compliance with the Code. This Bureau focuses on complaints within the industry which might indicate a potential violation for an administrative fine.

The objectives of the bureau are to design and implement an administrative investigations manual to define investigation’s role within the market analysis approach of the Consumer Protection & Enforcement Program; obtain administrative investigator training and certification; assist the Superintendent in designing an information tracking system to support the consumer enforcement program and coordinate activities of the Consumer Relations Division, Legal Division and the Managed Health Care, Fraud, Title, Workers Compensation and Examinations Units.

The Investigations Bureau staff will continue to develop systems and processes during the current fiscal year that will enhance and streamline the operating processes

Investigations UnitPerformance Measure


Percentage of complaints processed and recommended for either further administrative action or closure within 60-days.

85% 88%

25


INSURANCE DIVISIONLIFE AND HEALTH RATE AND FORM FILING BUREAU

The Life & Health Rate and Form Filing Bureau, on behalf of the Superintendent, reviews all life, accident and health, Medicare supplement, long term care and credit life and disability policy forms and their respective rates to ensure compliance with the New Mexico Insurance Code and the New Mexico Administrative Code. The Bureau’s objectives are to improve the performance measure standards to achieve an outcome of 98.5% review of policy forms and rates within statutory guidelines; work with NAIC staff to implement and streamline the statutory mandate of electronic submission of policy forms and rates; work with NAIC to implement and streamline the Interstate Insurance Product Regulation Compact by developing uniform standards for insurance products, to establish a central clearinghouse to receive and provide prompt review of insurance products covered under the compact, give appropriate regulatory approval to those product filings and advertisements satisfying the applicable uniform standard, improve coordination or regulatory resources and expertise between state insurance departments regarding the setting of uniform standards and review of insurance products, and perform related functions as may be consistent with the state regulation of the business of insurance; implement the electronic funds transactions (EFT) process to allow assessment of statutorily mandated filing fees; assist the Superintendent in responding to consumer and complaint activity relative to the Bureau’s statutory and regulatory jurisdiction; and implement and assist with the implementation of imaging and BIZFLOW systems to support the Insurance Division’s archiving initiatives; and educate and train staff.

MANAGED HEALTH CARE BUREAU

The Managed Health Care Bureau assists the Superintendent in administering and enforcing the Patient Protection Act, which is part of the New Mexico Insurance Code. The Bureau provides support to New Mexico managed health care consumers with their inquiries and complaints. The Bureau conducts formal and informal presentations to medical groups, employers, and health care insurance consumers throughout New Mexico to educate the public about their rights under the Patient Protection Act rights. The Bureau also participates in community events and partners with other state agencies to provide training to others in an effort to effectively reach citizens and inform them of the services provided to resolve consumer and provider complaints. The Bureau is responsible for administrating the external grievance reviews and hearings, administrative enforcement and rulemaking actions as directed by the Superintendent. The current guidelines for performance require the Bureau processes complaints within 180 days of filing with a target of 80 percent to be considered, timely.

26


INSURANCE DIVISION

The Managed Health Care Bureau current objectives are:

• Revise and update health care insurance regulations as need by federal reform changes to support consumers and industry needs.

• Assist the Superintendent in the development of a consumer resource tool to provide education and guidance related to access to care and procedure pricing.

• Assist the Compliance Director to enhance processes related to health care insurance in the enforcement program and coordinate activities of the Consumer Relations Division, Legal Division and the Investigations, Fraud, Title, Worker’s Compensation and Examinations Units.

Strengthen the External Review Hearing process by streamlining practices and support effective measures to ensure accuracy, timeliness, and, fair results.

PROPERTY / CASUALTY RATE & FORM FILING BUREAU

The Property & Casualty Insurance Rate and Form Filing Unit assists the Superintendent in the review and approval of all Rate, Rule and Form Filings to insure compliance with all Rules and Regulations of the New Mexico Insurance Code. Regulatory oversight assures insurance carriers are authorized to transact insurance business in the state and the consumers of these products with an equitable playing field. The Property & Casualty Insurance bureau has implemented steps in the process of reviewing all Rate & Form Filings in a timely manner in an effort to enhance our Speed to Market initiatives to provide everyone with a long term and a common interest in a fair marketplace where consumers and insurance carriers are protected. The Property & Casualty Rate, Rule and Form filing section strives to provide as many and the best possible insurance products at the most competitive premiums. The bureau also works very closely with the Superintendent in responding to consumer outreach and complaint activity related to property & casualty products and rates. Consumers are educated and informed about their rights and understand how the violation of those rights can be addressed and resolved.

GOAL ACTUAL FYO9 GOAL ACTUAL FYO9

Close 90% of internal & external grievances

received within 180 days of filing.

98.80%Conduct 100 Managed

Healthcare outreach presentations annually.

93

MANAGED HEALTH CARE BUREAU

27


INSURANCE DIVISIONTITLE INSURANCE BUREAU

The Title Insurance Bureau assists the Superintendent in regulating the title insurance industry of New Mexico through ratemaking, rule making, title plant inspection and administrative enforcement.

The objectives of the Title Bureau are to exceed 20 title plant inspections throughout New Mexico for the next calendar year; assist the Superintendent with the bi-annual title hearings dealing with rates and rules; assist the Superintendent with any enforcement action resulting from examinations of title insurers and agents; assist the Superintendent in designing an information tracking system to support the consumer enforcement program; assist the Superintendent in designing and maintaining an consumer information system.

WORKMAN’S COMPENSATION BUREAU

The Workers’ Compensation Unit assists the Superintendent in regulating workers compensation insurance companies, carriers, and agents, in conjunction with other state and federal agencies such as the Workers Compensation Administration and OSHA. The Unit’s objectives are to improve coordination with other agencies such as the Workers Compensation Administration, Construction Industries Division and New Mexico OSHA; expand Appeals Board authority to expedite the resolution of worker grievances; and, assist the Superintendent in designing an information tracking system to support the consumer enforcement program.


Title Plant Inspections performed. 21 28


Percentage of employers whose worker’s compensation accident

frequency is reduced through counseling, advice and training.

80% 80%

Processed 97% of Rate and Form filings within 90-days.

Financial Audit collected over

$215,000,000 in revenue in FY09

Investigations Bureau handled 343 consumer investigations in FY09.

Material Facts...

28


OFFICE OF GENERAL COUNSELOVERVIEW

The Office of General Counsel (“OGC”) serves as legal counsel to the Commission, and provides legal advice and assistance to the Commission on matters such as rulemakings and adjudicatory proceedings pending before the Commission, the drafting and review of contracts between the Commission and third-party vendors, and litigation involving the Commission pending in federal and state courts and agencies.

Performance Measures

OGC ensures that the Commission meets any statutory deadline applicable to cases pending before the Commission. In fiscal year 2009, the Commission issued final orders within the applicable statutory deadlines in 100% of the cases, which included the issuance of final orders in PNM Electric’s rate case.

Overall, OGC assisted the Commission in completing a total of 402 docketed cases, which included 11 rulemakings.

The Past Year

The following are some of the more significant cases in which the OGC played a crucial role:

• Case No. 08-00273-UT - The Commission approved an uncontested settlement among the parties in this case that established the rates charged by Public Service Company of New Mexico retail customers.

• Case No. 08-00330-UT - The Commission issued a Request for Proposals, and selected an outside firm to conduct an audit and prudence review of PNM’s fuel and purchased power costs. To the PRC’s knowledge, this is the first comprehensive audit and prudence review that has ever been conducted by the Commission or PNM’s predecessors.

• Case No. 08-00399-UT - The Commission, in an emergency meeting, instituted an investigation into Qwest Corporation’s interruption of service to SkiWi, an internet service provider, which resulted in hundreds of New Mexico customers, including police and other emergency services, losing their telephone and other communications systems.

29


OFFICE OF GENERAL COUNSELQwest had interrupted service to SkyWi for non-payment. The Commission required Qwest to immediately recommence service to SkyWi to give SkyWi’s customers a reasonable period of time to obtain service from another provider.

• Case No. 09-00100-TR-EN - This proceeding is part of the Commission’s ongoing effort to ensure that all motor carriers subject to its jurisdiction have the required amount of insurance. As a result of this proceeding, the Commission has revoked the authority of over 100 motor carriers to conduct business in New Mexico.

• Case No. 08-00221-UT - Large investor owned utilities in New Mexico are required to phase-in increasing amount of renewable energy resources over a period in 2022, when the utilities’ portfolio must include 20% renewable resources. PNM’s plan was vigorously examined and the plan approved by the Commission included the continuation of its very successful residential photovoltaic (PV) program, and introduced a “large PV” program designed for commercial and industrial customers.

The Next Year

The OGC expects that the Commission will commence or complete its prudence review of SPS’s and EPE’s fuel clause.

30

Ensuring a full and adequate record is established.


HEARING EXAMINERSHearing Examiners serve as administrative law judges or adjudicators in the cases assigned to them by the Commission. The Chief Hearing Examiner is appointed by and reports to the Commissioners. Hearing Examiners set hearings and conferences, establish procedures and details for the conduct of proceedings; ensure that a full and adequate record is established, make rulings on procedural and evidentiary matters; conduct hearings, admit evidence into the record; analyze evidence, briefs and applicable laws, rules and orders; issue recommended decisions, including findings of fact, conclusions of law and ordering paragraphs; and utility stipulations negotiated by parties to the Commission.

The Past Year

In the past year, Hearing Examiners have presided over a number of noteworthy cases on behalf of the Commission. There were numerous rate cases, including Public Service Company of New Mexico (“PNM”), Southwestern Public Service Co. (“SPS”), Natural Gas Processing Co.’s division Zia Natural Gas, New Mexico American Water Company both the Clovis and Edgewood districts and El Paso Electric Company (“EPE”). Other cases were the development of Renewable Energy Plans for PNM, SPS and EPE. Numerous fuel clause cases were completed. More underground line extension projects for PNM were concluded. The development of a third Alternative Form of Regulation plan (“AFOR”) for Qwest Corporation, to succeed Qwest’s second AFOR plan, was heard and a recommendation made. The proposed settlement of an investigation into the prudence and reasonableness of SPS’s participation in the Southwest Power Pool Regional Transmission Organization was heard. Gas energy efficiency programs for New Mexico Gas Company were heard and approved upon recommendation. Workshops were held on whether there should be a policy linking utility earnings to quality of customer service for major investor-owned utilities, and on an inquiry into rules protecting consumer rights for propane gas service customers. A recommendation of a service territory CCN for Moongate Water Company was completed. A recommendation was made for a rulemaking to amend the electric fuel clause rule. Numerous transportation tariff proceedings occurred. The Hearing Examiners also concluded numerous workshops to develop new rules for energy efficiency. Three PNM cases involving the addition of 415 MW of new generation capacity into jurisdictional rate base, and a PNM ownership interest that replaced an existing lease of 29.8 NW of Palo Verde Nuclear Generating Station capacity were consolidated and heard together. There was also an expedited review proceeding of 2009 Annual Reports filed by Eligible Telecommunications Carriers (“ETCs”) for compliance, and certification of the Federal Communications Commission for continued Universal Service Funding. Establishment of an initial list of Qwest Corp “non-impaired” wire centers pursuant to FCC’s TRRO.

31


HEARING EXAMINERSA recommendation was made regarding whether third party providers of renewable energy were public utilities. Finally, the Hearing Examiners made a recommendation as to the jurisdiction of IOSP’s tariffs and the reasonableness of those rates.

The Year to Come

The Hearing Examiners will diligently preside over all cases assigned to them by the Commission. Major cases will include more rate cases including one for PNM electric. A water rate case for New Mexico American Water Co. is pending. The Hearing Examiners expect that other cases will include development of Integrated Resource Plans for the electric utilities, and energy efficiency programs for electric and gas utilities including PNM, SPS and Gas Company. In addition, the annual approval of renewable energy plans for PNM, SPS and EPE must be completed under renewable energy rules. The investigation of the prudence of SPS’s participation in the Southwest Power Pool Regional Transmission Organization will be completed. Telecommunications cases will include eligible telecommunications designations relating to universal service funding. Potentially there will be a series of cases involving Qwest’s compliance with, and other matters related to Qwest’s third AFOR Plan.

The PRC Hearing Examiners are located at:

PERA Building

1120 Paseo de Peralta

Santa Fe, New Mexico 87501

32


LEGAL DIVISIONThe Legal Division represents the public interest positions and recommendations of the Staff of all PRC divisions in matters before the Commission and before the Superintendent of Insurance, and also provides them with professional, competent legal advice.

As attorneys, it is also Legal Division’s ethical responsibility to assist in safeguarding the integrity of Commission proceedings. One of the most important aspects of Legal Division’s role is to ensure that the rights of the parties to Commission proceedings, including their due process rights, are protected. In addition, Legal Division attorneys assure that the positions taken by members of the Staff comply with legal requirements, and carefully consider Commission policy.

The Legal Division employs eleven lawyers (including the Director) and four support personnel. The Division is under the day-to-day supervision of three managing attorneys: (1) Utilities and Telecommunications; (2) Energy; and (3) Corporations, Insurance and Transportation. In addition, an attorney who reports directly to the Division Director is responsible for the enforcement of Commission orders in the state courts as necessary to assure compliance by regulated entities. Although each lawyer has developed special expertise in one or more areas of practice, the Division actively employs training and case assignment across more than one area of expertise, so that each lawyer has the opportunity to develop competence and experience in various areas. Since its attorneys must litigate against in-house counsel from multi-state corporations, nationally-recognized expert witnesses, and experienced lawyers from private law firms both inside and outside New Mexico, experienced and knowledgeable Staff counsel is vital.

The attorneys in Legal Division average 21 years in the practice of law, with an average of 14 years devoted to government and/or regulatory experience.

The Past Year

Legal Division attorneys have assisted Commission Staff in proposing important rules governing transportation insurance requirements, railroad safety and other railroad issues, and the use of independent contractors as drivers for cab companies . The Legal Division has also represented Staff in the multitude of cases before the Commission including: rules concerning customer service standards for utilities, net metering of electric service, consumer rights regarding propane service; interconnection of utilities with third party generators; the investigation of the reasonableness of inmate phone rates and billing practices; Qwest’s midpoint compliance with its required $225 Million investment under the SASA [Second Amended Settlement Agreement];

33


LEGAL DIVISIONmodifications to Qwest’s SASA to apply to services on a going-forward basis; PNM’s, EPE’s and SPS’s applications for rate increases; PNM’s application for an emergency electric fuel and purchased power adjustment clause; SPS’s application for approval to join the Southwest Power Pool RTO; PNM’s application to sell its gas division; PNM’s application to acquire additional generation plant; PNM’s, EPE’s and SPS’s renewable energy portfolio standard cases; the title insurance annual rate case; and utility applications for certificates of convenience and necessity, among many others.

In state district court, the Legal Division brought suit to enforce Commission fines against a household goods moving company and its owner operating without valid state authority and engaging in inappropriate business practices and against a limousine operator operating illegally.

The Coming Year

The Legal Division has two vacant attorney positions, and a vacant legal support worker position. Attorneys and support staff will take advantage of cost-effective continuing education opportunities to maintain and improve their expertise, and to keep abreast of national, as well as regional and local issues. As feasible, continuing legal education requirements are being met through in-house programs. Familiarity with alternative regulatory schemes, renewable energy issues and economic and technological developments is critical for the effective representation of Staff experts. Legal Division will be participating in the transportation insurance, railroad and independent contractor driver rulemakings, as well as those concerning customer service standards for utilities, net metering of electric service, and consumer rights regarding propane service. Legal Division also anticipates representation of Staff in cases including consideration of fuel clause issues, water company rate cases, possible electric rate cases and various enforcement matters, as well as annual Renewable Portfolio Standard filings.

34


ADMINISTRATIVE SERVICES DIVISIONThe Administrative Services Division (ASD) provides support and customer services to the divisions and programs of the agency. Those services include general, financial and human capital management, capital assets oversight, records management, corporations and information technology systems. ASD is composed of five bureaus: Finance and Budget, Information Technology, Human Resources, Records Management and Corporations.

Budget and Finance Bureau

The Budget and Finance Bureau facilitates the agency’s fiduciary responsibility and is accountable for maintaining the financial business practices of the PRC. In FY08 the bureau earned an unqualified audit opinion on its external financial and compliance audit.

• During FY09 the Finance and Budget Bureau managed a 2.5% reduction in general fund appropriations and maintained fiscal responsibility and obligations without cutting essential operations within the PRC.

• The Finance and Budget Bureau was able to reduce the overall agency general fund reversion regardless of revenue source from $713,000 to $192,00.

• The general fund appropriation reversion was reduced from $422,00 to $45,000 in FY09.

• The agency’s financial closing and financial statement preparation was completed by Finance and Budget staff in FY09, reducing this contract service cost by $30,000.

• In FY09 the Finance and Budget bureau reduced prior year request for payments from $34,000 in FY08 to $2,300 in FY09.

Information Systems Bureau

The Information Systems Bureau facilitates technical infrastructure management and end-user support to assist the agency in accomplishing the mission of the PRC. The ISB

MISSIONTo provide and deliver guidance, assistance, information and

expertise in the areas of administrative support to the Commission, all our divisions and corporate consumers, in an efficient, positive

and professional manner to ensure the PRC meets statutory, regulatory and internal administrative requirements.

35


ADMINISTRATIVE SERVICES DIVISIONsupports information technology network infrastructure including application support, endusers support and training, and maintains a high-level of security assuring PRC data integrity.

The ISB continues to expand the agency’s website by implementing more customer friendly applications, and was successful in receiving funding to enhance several application systems, which will benefit both the consumer and the agency.

Human Resources Bureau

The Human Resources Bureau processes Human Resources personnel transactions and maintains payroll integrity for the agency.

Records Management Bureau

The Records Management Bureau is responsible for retaining, managing and safeguarding all original case files produced by the various component units of the Commission. The bureau also is responsible for document reproduction and archival management of documents.

Corporations Bureau

The Corporations Bureau remained fully staffed during the past fiscal year and continues to make significant progress towards meeting its performance targets and most importantly to provide customer service for consumers. The bureau is responsible for processing incorporations in accordance with state law.

Performance Measure

The Public Regulation Commission obtained an unqualified opinion on its audit report for the Fiscal Year ended June 30, 2008.

The Year to Come

Corporations Bureau Electronic Payment Acceptance

With the advent of electronic banking and the increasing number of state agencies accepting electronic payments, either by direct online banking or credit card, the Corporations Bureau continues to work to increase its accessibility and enhance its business processes to be more customer friendly. Payments would be guaranteed thus eliminating the chance for lost or insufficient funds checks coming into the Bureau. The Commission received an appropriation to address enhancement.

36


PUBLIC INFORMATION OFFICERThe Office of Public Information strives to fulfill the goals and mission of promoting a positive awareness of the Public Regulation Commission and its division and provides a liaison between the Commission, the divisions and staff, and the various media.

With the Public Information Officer (“PIO”), the commissioners are informed of media inquires beyond those of a very general nature. The PIO serves to answer media questions and provide the media with information about the Commission and the agency’s functions.

The PRC PIO focuses on a proactive process for providing information to the public and media about the PRC. The PIO accomplishes this by:

• Distributing press releases about Commission actions, district constituency meetings, rule making and public hearings to all New Mexico print, TV and radio media, and media located in Texas serving New Mexico.

• Posting press releases on the PRC’s website to keep the general public informed

• Scheduling radio interviews and television appearances for Commissioners

• Assisting with media marketing for public comment hearing on important issues such as the Mid Size Telecom Carrier Rules; Transportation Rules; Area Code relief planning; and, Fire Code Revisions

• Assisting media to obtain requested information

NATIVE AMERICAN LIAISONThe Public Regulation Commission’s Native American Liaison (“NAL”) works to foster a government-to-government relationship between the Commission and New Mexico Indian Tribes. The Native American Liaison visits regularly with tribal governments to assess tribal concerns and identify tribal interests as they relate to PRC public policy initiatives. The NAL advises the Commission and Division Directors about issues and challenges affecting Pueblos, the Navajo Nation and Jicarilla and Mescalero Apache Tribes and makes recommendations to the Commission concern those matters. The NAL actively organizes collaborative efforts between the PRC, Pueblos, Tribes and Native American Nations through meetings and other cooperative collaboration. Note: The above describes the duties and responsibilities of the NAL. Currently this position is vacant.

37


PRC DIRECTORYStaff Member Division/Bureau Phone Number

Daniel W. Mayfield Chief of Staff 505.827.4433

Juan Rios Administrative Services Director/Chief Clerk 505.827.4084

Mona Varela Consumer Relations Director

505.827.4661

Larry Lujan Transportation Director 505.827.4290

Roy Stephenson Utility Director 505.827.6960

John Standefer State Fire Marshal 505.827.3761

Reyes Romero Fire Academy Director 575.835.7521

Morris Chavez Insurance Superintendent 505.827.4299

Thomas Rushton Chief Deputy Superintendent

505.827.4309

Darlene Gomez Deputy Superintendent 505.827.4645

Ronny Lujan Deputy Superintendent 505.827.4596

Johnny Montoya Insurance Examinations Director

505.827.4465

Ben Montoya Insurance Fraud Bureau Chief

505.476.0569

Bureau Chief Title Insurance Bureau 505.827.4528

Robert Hirasuna General Counsel 505.827.4477

William Herrmann Chief Hearing Examiner 505 827.6926

Carol Rising Legal Director 505.827.6908

Gerald Gardner Public Information Officer 505.827.4446

Vacant Native American Liaison 505.827.4001

38


NOTES__________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Documents

2009 ANNUAL REPORT - New Mexico Public Regulation … · 2011-07-19 · 2009 ANNUAL REPORT Sandy Jones, Chairman David W ... •Continued implementation of the Qwest AFOR-I Second