Public Utility Commission of Texas

Guidelines for Calculating and Processing Administrative Penalties for Violations of PUC Substantive Rule 26.125, Relating to Registration of ADADs


This document describes the methodology used by the Staff of the Public Utility Commission of Texas (PUC) to compute recommended administrative penalties to be assessed by the Commission. The objective is to establish a general, yet systematic approach to calculating and processing administrative penalty proceedings for companies violating PUC Substantive Rule § 26.125, Relating to Registration of ADADs. This document does not address when an enforcement action is initiated, but rather how the PUC Staff evaluates violations for the purpose of recommending administrative penalties to the Commission.

I. Statutory Authorizations

Tex. Util. Code Ann. §§ 15.023-15.025 provide the Commission with the authority to assess administrative penalties and sets forth factors that the Commission must consider in determining the amount of penalty to assess. P.U.C. Procedural Rule § 22.246(c)(3) states as follows:

(3) The amount of the penalty shall be based on:

(A) the seriousness of the violation, including the nature, circumstances, extent, and gravity of any prohibited acts, and the hazard or potential hazard created to the health, safety, or economic welfare of the public:

(B) the economic harm to property or the environment caused by the violation;

(C) the history of previous violations;

(D) the amount necessary to deter future violations;

(E) efforts to correct the violation; and

(F) any other matter that justice may require, including, but not limited to, the respondent's timely compliance with requests for information, completeness of responses, and the manner in which the respondent has cooperated with the commission during the investigation of the alleged violation.

In order to fairly and consistently apply the factors established in P.U.C. Procedural Rule § 22.246, prior to issuing a Notice of Violation and Intent (NOV) to Assess an Administrative Penalty to companies for violations of PUC Substantive Rule § 26.125 (relating to Registration of ADADs), Commission Staff follows the three (3) step process outlined below.

Step 1

A proposed base penalty amount of up to $100.00 (generally) is assessed per violation per day. Staff selects a penalty amount sufficient to encourage ADAD operators to register their ADADs. This base penalty amount also takes into consideration the amount necessary to deter future violations.

Step 2

Once a base penalty amount is calculated, the Executive Director (ED) may issue a proposed NOV. In the event the ED issues an NOV, the case proceeds in accordance with the PUC Procedural Rules.

Step 3

If the company requests a settlement conference pursuant to PUC Procedural Rules, Staff gathers information relevant to: (1) prior violations, if any; (2) efforts to correct the violation; and (3) any other matter that justice may require. Staff then revises the base penalty amount to reflect mitigation factors identified in the settlement conference, if any; provided, however, that the negotiated penalty amount is never less than forty percent (40%) of the base penalty amount.