Montana Administrative Register Notice 38-2-247 No. 24   12/24/2020    
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In the matter of the amendment of ARM 38.2.601 and 38.2.3301 pertaining to investigation and discovery






TO: All Concerned Persons


            1. On January 26, 2021, at 1:30 p.m., the Department of Public Service Regulation, Public Service Commission (department) will hold a virtual public hearing to consider the proposed amendment of the above-stated rules. The hearing will be livestreamed at http://psc.mt.gov/livestream. Parties seeking to participate in the hearing must contact the department at 1-800-646-6150, by 5 p.m., January 21, 2021, to receive the necessary call-in information for the hearing.


2. The department will make reasonable accommodations for persons with disabilities who wish to participate in this rulemaking process or need an alternative accessible format of this notice. If you require an accommodation, contact the department no later than 5:00 p.m. on January 19, 2021. Please contact Katy Gordon, Department of Public Service Regulation, 1701 Prospect Avenue, Helena, Montana, 59620-2601; telephone (406) 444-6150; TDD/Montana Relay Service (406) 444-4212; or e-mail Katy.Gordon@mt.gov.


3. The rules as proposed to be amended provide as follows, new matter underlined, deleted matter interlined:


            38.2.601 DEFINITIONS  (1) through (1)(m) remain the same.

            (n)  "Party" means an individual, partnership, corporation, governmental body, or other identifiable group or organization, with the exception of the commission staff, who initiates a commission proceeding by filing a complaint, application, protest or a petition with the commission; or who is named as a defendant or respondent; or who is named or admitted by the commissioners or hearings examiner to a formal proceeding and whose legal rights, duties and privileges will be determined by the commissioners' final decision. The Commission staff shall have the full rights and responsibilities of parties under these rules, but shall not be bound by the rule governing contact between parties and the commission.

            (o) remains the same


AUTH: 69-1-110(3), 69-2-101, 69-2-103, 69-3-103, 69-12-201(2), MCA

IMP: 69-2-101, 69-2-103, MCA


            38.2.3301 INVESTIGATION AND DISCOVERY  (1) Techniques of prehearing discovery permitted in state civil actions may be employed in commission contested cases, and for this purpose the commission adopts rules 26, 28 through 37 (excepting rule 37(b) (1) and 37(b) (2) (d) of the Montana rules of civil procedure in effect on the date of the adoption of this rule, and any subsequent amendments thereto. In applying the rules of civil procedure to commission proceedings, all references to "court" shall be considered to refer to the commission; references to the subpoena power shall be considered references to ARM 38.2.3302 through 38.2.3305; references to "trial" shall be considered references to hearing; references to "plaintiff" shall be considered references to a party; and references to "clerk of court" shall be considered references to the staff member designated to keep the official record in commission contested cases.  Data requests and the additional issues process are the primary, though not exclusive, methods of pre-hearing investigation in commission proceedings. 

            (2) Nothing in (1) of this rule shall be construed to limit the free use of data requests among the parties. The exchange of information among parties pursuant to data requests is the primary method of discovery in proceedings before the commission. Data requests are a discovery tool, which may contain and combine elements of interrogatories, requests for production, request for admission, and deposition by written question, that provide an efficient means of gathering information where cases are presented primarily through pre-filed testimony with substantial supporting exhibits.  Requests—by the commission, hearings examiners, or parties—must be used in good faith, and should avoid repeating previously requested information. Requests must:

            (a) describe the topic and to what witness the request is directed;

            (b) be consecutively numbered (e.g., the commission may issue PSC-001 through 008 to EWM, PSC-009 through 016 to the MCC, and PSC-017 through 019 again to EWM);

            (c) be limited to five sub-parts, denoted with lower case letters (a–e);

            (d) have a separate page for each response; and  

            (e)  substantially adhere to this format:

            PSC-001   Regarding: Cost of Equity

                                Witness: Doe, JBD-4:10-25; As Appropriate


                                (a)  Please explain how the current market conditions impact the utility's cost of equity.

                                (b)  Please explain why these market conditions are expected to occur in the future, justifying an increased cost of equity.

            (3)  When appropriate, the commission or hearing examiner will establish an additional issues deadline to identify issues that the parties have not sufficiently addressed.  This deadline will typically occur after the submission of intervenor testimony and before submission of reply testimony.  If the commission or hearing examiner identifies any additional issues, it will notify the parties indicating what the issues are, provide direction for how the parties shall address them, and modify the existing procedural schedule as necessary.

            (4)  Additional methods of discovery available under Montana Rules of Civil Procedure 26(a) are permitted with commission approval.  The commission incorporates by reference Rule 26(b), excepting 26(b)(4)(C), which establishes the scope of discovery, and Rule 37, which governs discovery abuses, motions to compel, and sanctions.  Nothing in this rule limits the commission's additional broad statutory investigation powers otherwise found in Title 69, MCA.


AUTH: 2-4-602, 2-4-612, 69-1-110(3), 69-2-101, 69-2-102, 69-2-103, 69-3-103, 69-3-106, 69-3-203, 69-3-321, 69-12-201(2), MCA

IMP: 2-4-602, 69-2-101, 69-2-103, MCA


REASON: These proposed amendments to ARM 38.2.601(1)(n) and ARM 38.2.3301 are reasonably necessary to clarify the department's long-standing, pre-hearing investigation practices. The reasons for these amendments are detailed below.

            The final sentence of the definition of "party" in ARM 38.2.601(1)(n) was intended to extend to department staff the investigative tools described in ARM 38.2.3301, which discussed discovery tools available to parties.  Some parties appearing before the department have asserted that ARM 38.2.601(1)(n) allows the department's staff to participate as parties without observing rules against ex parte communication with the department.  To better reflect department staff's role in investigating facts and issues in contested cases not as a party, but as technical advisors to the department, the department proposes to remove the final sentence of ARM 38.2.601(1)(n) and provide a more detailed description of discovery and investigative procedures in ARM 38.2.3301.

            The department proposes to add to ARM 38.2.3301 new sections (2) and (3), regarding data requests and additional issues.  These sections are consistently included in the department's procedural orders.  To provide greater clarity on the processes involved, the department proposes to incorporate these processes in its rules.

            Historically, parties have preferred to use the department's data request procedures rather than the discovery tools available under the Montana Rules of Civil Procedure.  To simplify discovery in contested cases, the department proposes to limit its incorporation of the discovery tools available in the Montana Rules of Civil Procedure and allow parties to use those tools only upon department approval.


            4. Concerned persons may submit their data, views, or arguments either orally or in writing at the hearing. Written data, views, or arguments may also be submitted to: Katy Gordon, Department of Public Service Regulation, 1701 Prospect Avenue, Helena, Montana, 59620-2601; telephone (406) 444-6150; fax (406) 444-7618; or e-mail Katy.Gordon@mt.gov, and must be received no later than 5:00 p.m., February 2, 2021.


5. The Montana Consumer Counsel, 111 North Last Chance Gulch, Suite 1B, Helena, MT 59620-1703, telephone (406) 444-2771, is available and may be contacted to represent consumer interests in this matter.


6. The commission, a commissioner, or a duly appointed presiding officer may preside over and conduct the hearing.


7. The department maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency. Persons who wish to have their name added to the list shall make a written request that includes the name, e-mail, and mailing address of the person to receive notices and specifies for which program the person wishes to receive notices. Notices will be sent by e-mail unless a mailing preference is noted in the request. Such written request may be mailed or delivered to the contact person in 4 above or may be made by completing a request form at any rules hearing held by the department.


8. The bill sponsor contact requirements of 2-4-302, MCA, do not apply.


9. With regard to the requirements of 2-4-111, MCA, the department has determined that the amendment of the above-referenced rules will not significantly or directly impact small businesses. 



/s/ JUSTIN KRASKE                                  /s/ BOB LAKE                     

Justin Kraske                                              Bob Lake

Rule Reviewer                                            Chairman

                                                                    Department of Public Service Regulation


Certified to the Secretary of State on December 15, 2020.

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