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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 27,
1999 (January 26, 1999)
KANSAS CITY POWER & LIGHT COMPANY
(Exact name of registrant as specified in its charter)
1-707
(Commission file number)
MISSOURI 44-0308720
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1201 Walnut
Kansas City, Missouri 64106
(Address of principal executive offices)
(816) 556-2200
(Registrant's telephone number, including area code)
NOT APPLICABLE
(Former name or former address, if changed since last report)
ITEM 5. OTHER EVENTS
Missouri Earnings Stipulation and Agreement
On January 26, 1999, Kansas City Power & Light Company
(Company), the Staff of the Missouri Public Service Commission
(Commission Staff), and the Office of Public Counsel, filed with
the Missouri Public Service Commission (Commission) a Stipulation
and Agreement to resolve the Commission Staff's recent earnings
audit. (A copy of the Stipulation and Agreement accompanies this
Report on Form 8-K as Exhibit 99.) The components of the
proposed settlement include:
- A reduction in annual Missouri revenues of 3.2%
(approximately $15 million) effective March 1, 1999.
- A moratorium on additional rate changes until the earlier of
September 1, 2001, or closing of the merger of the Company and
Western Resources, Inc. (KCPL/Western merger) with effective
dates of March 1, 2002, or one year following the close of the
KCPL/Western merger, whichever occurs first.
- In the KCPL/Western merger case filed before the Commission,
the Commission Staff and Office of Public Counsel reserve the
right to recommend (i) a rate reduction upon closing of the
KCPL/Western merger as a condition to the Commission's approval
of an alternative regulatory plan, and (ii) additional rate
reductions that would be effective no sooner than one year
following closing of the KCPL/Western merger.
The Commission must approve the Stipulation and Agreement.
The Company is hopeful that Commission approval will occur in
time for the rate reduction to be implemented by the March 1,
1999, effective date.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibit
Number
99 Stipulation and Agreement entered into January 26, 1999, by
and among Kansas City Power & Light Company, Staff of the
Missouri Public Service Commission, and Office of Public Counsel.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
KANSAS CITY POWER & LIGHT COMPANY
/s/Jeanie Sell Latz
Senior Vice President-Corporate Services
Date: January 27, 1999
BEFORE THE MISSOURI PUBLIC SERVICE COMMISSION
OF THE STATE OF MISSOURI
In the Matter of the ) Case No. ER-99-313
Stipulation And Agreement )
Reducing the Annual Missouri )
Retail Electric Revenues of )
Kansas City Power & Light )
Company )
)
In the Matter of the Joint ) Case No. EM-97-515
Application of Western )
Resources, Inc. and Kansas )
City Power & Light Company )
for Approval of the Merger )
of Kansas City Power & Light )
Company with Western )
Resources, Inc. and Other )
Related Relief )
STIPULATION AND AGREEMENT
Comes now the Staff of the Missouri Public Service
Commission ("Staff"), the Office of the Public Counsel ("Public
Counsel"), and Kansas City Power & Light Company ("KCPL") and
submit this Stipulation And Agreement for Missouri Public Service
Commission ("Commission") review, consideration and approval. As
a result of discussions among the signatories hereto, said
signatories have reached resolution respecting the results of an
earnings review of KCPL performed by the Staff. (This review
occurred in 1998, using a test year of the twelve (12) months
ending December 31, 1997, updated through June 30, 1998, and
included, among other things, review of KCPL's cost of capital,
examination of KCPL's financial books and records, study of
KCPL's fuel costs, and review of a depreciation study submitted
in 1998 pursuant to 4 CSR 240-20.030(6).) The Staff will file
with the Commission in the near future a memorandum providing the
Staff's rationale for entering into this Stipulation And
Agreement.
The Staff, Public Counsel and KCPL filed on October 7,
1998, in Case No. EM-97-515, a Joint Motion To Approve Procedural
Schedule wherein the intervenors in Case No. EM-97-515 were
advised of the Staff's earnings audit of KCPL because the
earnings audit
affects the procedural schedule in the KCPL -
Western Resources, Inc. merger case. Also, respecting any
concern about notice, the merger case provided the convenience
that all but two of the entities that in the past have intervened
in KCPL rate proceedings are parties to Case No. EM-97-515.
Trigen-Kansas City and the Missouri Retailers Association were
identified as entities that have intervened in prior KCPL rate
proceedings but have not intervened in the merger case. The
signatories are filing the instant Stipulation And Agreement in
both the merger case docket and a new docket, Case No. ER-99-313,
which will contain specimen tariff sheets that will be filed in
the next several days. The signatories request that the
intervenors in Case No. EM-97-515 and Trigen-Kansas City and
Missouri Retailers Association (counsel for which are shown on
the attached service list) [OMITTED FOR PURPOSES OF THIS FILING]
be made parties in Case No. ER-99-313 without the necessity of
their filing for intervention.
In support of this Stipulation and Agreement, the
Staff, Public Counsel, and KCPL state as follows:
1. Commencing with electric service provided on and after
March 1, 1999, KCPL shall reduce its annual Missouri electric
revenues by applying an equal percentage decrease of 3.2% to
every rate and charge on each electric rate schedule, excluding
Special Contract Service (SCS), Special Interruptible Contracts
(SIC), Incremental Energy Rider (IER); Additional Equipment
Rental Charge (AE); Residential Conservation Service Program
(RCS); program charges contained in both Two Part - Time of Use (TPP)
and Real Time Pricing (RTP,RTP - Plus); Service Facilities Charge
for Municipal Street Lighting Service (ML); Economic Development
Rider (EDR) percentages; Transformation Equipment Rental (TER);
Primary Equipment Service Agreement (PES); Urban Core
Development Rider (UCD) percentages; Commercial Street
Lighting (CL) percentages; Peak Load Curtailment Credit Rider (PLCC)
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credits and penalties; Parallel Generation Contract Service Schedule (PG)
payments; and charges contained in KCPL's General Rules And Regulations.
This 3.2% decrease amounts to an approximate $15.0 million decrease in
revenues exclusive of license, occupation, franchise, gross
receipts, or other similar fees or taxes. It is agreed by the
signatories that (i) this decrease has nothing to do with merger
savings alleged to result from the merger of KCPL and any other
entity, including Western Resources, Inc. ("Western Resources"),
and (ii) none of them will allege in the ongoing Western
Resources - KCPL merger case (Case No. EM-97-515), or in future
rate proceedings that alleged merger savings are reflected in
rates as a result of the instant Stipulation And Agreement.
2. Signatories to this Stipulation And Agreement will not
file any case with the Commission, or encourage or assist in
filing any case with the Commission requesting, (i) a general
increase or decrease in KCPL's Missouri retail electric rates, or
(ii) rate credits or rate refunds respecting KCPL's Missouri
retail electric rates, prior to the earlier of September 1, 2001,
or the closing of the Western Resources - KCPL merger, unless
there is the occurrence of a significant, unusual event,
such as an act of God; a significant change in federal or state
tax law; a significant change in federal or state utility law or
regulation; or an extended outage or shutdown of a major
generating unit(s) which has a major effect on KCPL or its
successors.
3. Signatories to this Stipulation And Agreement will not
request, or encourage or assist in any request for, (i) a general
increase or decrease in KCPL's Missouri retail electric rates, or
(ii) rate credits or rate refunds respecting KCPL's Missouri
retail electric rates that would become effective for service
rendered prior to March 1, 2002, or prior to one year after the
closing of the Western Resources - KCPL merger, whichever occurs
first.
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4. Acceptance of this Stipulation And Agreement by the
Commission shall not be deemed as constituting an agreement on
the part of the Commission to forego, during the above identified
periods, the use of any discovery, investigative or other power
which the Commission presently has. For example, non-signatories
to this Stipulation And Agreement may file or request, or
encourage or assist in any filing of or request for, an earnings
investigation of KCPL, and, in response or on its own motion, the
Commission may direct the Staff to conduct an earnings
investigation of KCPL. Thus, nothing in this Stipulation And
Agreement is intended to impinge or restrict in any manner the
exercise by the Commission of any statutory right, including the
right of access to information, or any statutory obligation.
Nothing in this Stipulation And Agreement is intended to impinge,
restrict or limit in any way Public Counsel's discovery powers,
including the right to access information and to audit and
investigate matters related to KCPL or its successors.
5. The specified period when the signatories to this
Stipulation And Agreement will not request, or encourage or
assist in any request for, a general increase or decrease in
KCPL's Missouri electric rates, rate credits or rate refunds
respecting KCPL's Missouri electric rates shall also apply to any
filing with the Commission for a change in KCPL's electric rates
pursuant to Section 393.292 RSMo 1994 to reflect a change in the
projected level or annual accrual of funding for decommissioning
the Wolf Creek nuclear plant. Signatories shall request that the
Commission include in KCPL's 1999 decommissioning Report And
Order, language substantially similar to that used in other such
nuclear decommissioning funding Report And Orders, that the Wolf
Creek decommissioning costs are included in KCPL's current cost
of service and are reflected in its current electric service
rates for ratemaking purposes.
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6. Respecting any proposal in the ongoing Western
Resources - KCPL merger case (Case No. EM-97-515) that the
Commission should adopt an alternative regulation plan, the
signatories reserve the right to take positions and argue that as
a condition of Commission approval of the proposed alternative
regulation plan, there should be additional rate reductions at
the time the alternative regulation plan goes into effect.
7. Signatories reserve the right to take positions and
argue in the ongoing Western Resources - KCPL merger case (Case
No. EM-97-515) that as a condition of the proposed merger, there
should be rate reductions commencing no sooner than one year
after the closing of the Western Resources - KCPL merger.
8. KCPL will continue to book an amortization totaling
$3.5 million annually upon approval of this Stipulation And
Agreement, which amortization shall continue until the Commission
approves a change either (i) upon agreement of the parties made
with due regard to KCPL's then existing situation, or (ii) in the
course of a general rate proceeding. This does not preclude
KCPL, the Staff, Public Counsel or any other party from
requesting that this amortization be directed toward specific
plant accounts or from requesting additional changes in
depreciation rates that may result from depreciation studies.
Any such accumulated amortization balance booked pursuant to this
Stipulation And Agreement, or the Stipulation And Agreement from
Case No. ER-94-199, will be used as an offset to rate base in
future rate proceedings of KCPL, or its successors. Furthermore,
a signatory may propose at any time that the Commission issue a
depreciation authority order adopting new depreciation rates for
KCPL or its successors.
9. Notwithstanding paragraphs 2 and 3 above, a signatory
at any time may file a request with the Commission for
consideration of changes in rate design and/or other tariff
provisions which would be appropriate for the Commission to
consider outside the context of a
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customer class cost of service and comprehensive rate design
docket or a rate or complaint case; provided, however that no
such change shall result in any shift of revenues between/among
classes, and provided further that if a request for consideration
of changes in rate design and/or other tariff provisions is
filed, a signatory may oppose such request and shall not be
deemed to have consented to the establishment of a new docket to
consider such request or to the proposals of the party making
such request.
10. Drafts of this Stipulation And Agreement have been
provided to all intervenors in Case No. EM-97-515 and to Trigen-
Kansas City and Missouri Retailers Association which are entities
identified by the signatories as usual intervenors in KCPL rate
proceedings. The signatories have endeavored to make themselves
available to answer questions and provide information. All but
two of the parties to Case No. EM-97-515 have advised the
signatories that they do not oppose the Stipulation And
Agreement. The Commission's rules identify the procedure to be
followed when a nonunanimous stipulation and agreement is filed
with the Commission. In particular, 4 CSR 240-2.115(3) provides
as follows:
When a nonunanimous stipulation and agreement is
executed by the parties, the attorney for the
applicant, company or other moving party shall file an
original and fourteen (14) copies with the secretary of
the commission and serve notice and a copy on all
nonsignatory parties. Each party shall then have five
(5) days from the receipt of the notice to file a
request for hearing with the commission. Failure to
file a timely request for hearing shall constitute a
full waiver of the party's right to a hearing.
11. None of the parties to this Stipulation And
Agreement shall be deemed to have approved or acquiesced in any
question of Commission authority, decommissioning methodology,
ratemaking principle, valuation methodology, cost of service
methodology or determination, depreciation principle or method,
rate design methodology, cost allocation, cost recovery, or
prudence that may underlie this Stipulation And Agreement, or for
which provision is made in this Stipulation And Agreement.
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12. If requested by the Commission, the Staff shall
have the right to submit to the Commission a memorandum
explaining its rationale for entering into this Stipulation And
Agreement. Each party of record shall be served with a copy of
any memorandum and shall be entitled to submit to the Commission,
within five (5) days of receipt of the Staff's memorandum, a
responsive memorandum which shall also be served on all parties.
All memoranda submitted by the parties shall be considered
privileged in the same manner as are settlement discussions under
the Commission's rules, shall be maintained on a confidential
basis by all parties, and shall not become a part of the record
of this proceeding, or bind or prejudice the party submitting
such memorandum in any future proceeding or in this proceeding
whether or not the Commission approves this Stipulation And
Agreement. The contents of any memorandum provided by any party
are its own and are not acquiesced in or otherwise adopted by the
other signatories to this Stipulation And Agreement, whether or
not the Commission approves and adopts this Stipulation And
Agreement.
The Staff also shall have the right to provide, at any
agenda meeting at which this Stipulation And Agreement is noticed
to be considered by the Commission, whatever oral explanation the
Commission requests, provided that the Staff shall, to the extent
reasonably practicable, provide the other parties with advance
notice of when the Staff shall respond to the Commission's
request for such explanation once such explanation is requested
from the Staff. The Staff's oral explanation shall be subject to
public disclosure, except to the extent it refers to matters that
are privileged or protected from disclosure pursuant to any
Protective Order issued in this case.
13. This Stipulation And Agreement represents a
negotiated settlement. Except as specified herein, the parties to
this Stipulation And Agreement shall not be prejudiced, bound by,
or in any way affected by the terms of this Stipulation And
Agreement (i) in any future
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proceeding; (ii) in any proceeding
currently pending under a separate docket; and/or (iii) in this
proceeding should the Commission decide not to approve the
Stipulation And Agreement in the instant proceeding, or in any
way condition its approval of same.
14. The provisions of this Stipulation And Agreement
have resulted from extensive negotiations among the signatories
signatory parties and are interdependent. In the event that the
Commission does not approve and adopt the terms of this
Stipulation And Agreement in total, it shall be void and no party
hereto shall be bound by, prejudiced, or in any way affected by
any of the agreements or provisions hereof unless otherwise
provided herein.
15. In the event the Commission accepts the specific
terms of this Stipulation And Agreement, the signatories waive
their respective rights to cross-examine witnesses; their
respective rights to present oral argument and written briefs
pursuant to Section 536.080.1 RSMo 1994; their respective rights
to the reading of the transcript by the Commission pursuant to
Section 536.080.2 RSMo 1994; and their respective rights to
judicial review pursuant to Section 386.510 RSMo 1994. This
waiver applies only to a Commission Report And Order respecting
this Stipulation And Agreement issued in these this proceedings,
and does not apply to any matters raised in any subsequent
Commission proceeding, or any matters not explicitly addressed by
this Stipulation And Agreement.
Wherefore the signatories request that the Commission grant
intervenor status in Case No. ER-99-313 to the parties of record
in Case No. EM-97-515 and to Trigen-Kansas City and the Missouri
Retailers Association without the necessity of their filing for
intervention and approve the instant Stipulation And Agreement.
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Respectfully submitted,
KANSAS CITY POWER & LIGHT COMPANY COMMISSION STAFF
DANA K. JOYCE
General Counsel
By: /s/James M. Fischer
William G. Riggins MBN 42501 BY: /s/Steven Dottheim MBN 29149
Assistant Chief Legal Officer Chief Deputy General Counsel
Kansas City Power & Light Company Missouri Public Service
P.O. Box 418679 Commission Staff
Kansas City, Missouri 64141-9679 P.O. Box 360
Jefferson City, Missouri 65102
Telephone: (816) 556-2785 Telephone: (573) 751-7489
Fax: (816) 556-2787 Fax: (573) 751-9285
and and
James M. Fischer OFFICE OF THE PUBLIC COUNSEL
James M. Fischer, P.C.
Attorney at Law
101 West McCarty Street, Suite 215
Jefferson City, Missouri 65101 By: /s/John B. Coffman MBN 36591
Deputy Public Counsel
Telephone: (573) 636-6758 Office of the Public Counsel
Fax: (573) 636-0383 P.O. Box 7800
Jefferson City, Missouri 65102
Telephone: (573) 751-4857
Fax: (573) 751-5562
[END OF EXHIBIT]