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Public Information Collection and Request for Comments August 2, 2002.

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Federal Energy Regulatory Commission.


Request for Office of Management and Budget Emergency Processing of proposed information collection and request for comments.


The Federal Energy Regulatory Commission (Commission) has received Office of Management and Budget (OMB) approval for the following public information collection pursuant to the requirements of Section 3507(j)(1)of the Paperwork Reduction Act of 1995 (Pub. L. No.104-13), and 5 CFR 1320.13 of OMB's regulations. An agency may not conduct or sponsor and a person is not required to respond to a collection of information unless it displays a currently valid control number.


The Commission and OMB must receive comments on or before August 15, 2002.


Send comments to: (1) Michael Miller, Office of the Chief Information Officer, CI-1, Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426. Mr. Miller can be reached by telephone at (202) 502-8415 and by e-mail at; and

(2) Ms. Ruth Solomon, FERC Desk Officer, Office of Information and Regulatory Affairs, Office of Management and Budget, Room 10202 NEOB, 725 17th Street, NW., Washington, DC 20503. Ms. Solomon may be reached by telephone at (202) 395-7856 or by fax at (202) 395-7285. Ms. Solomon should be contacted by phone or fax.

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Mark Klose, Office of the Executive Director, Division of Regulatory Accounting Policy, (202) 219-2595; Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426.

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The Federal Energy Regulatory Commission (Commission) in Docket No. RM02-14-000, issued a proposed rule, to amend its Uniform System of Accounts for public utilities, natural gas companies and oil pipeline companies by establishing the documentation necessary to furnish readily full information concerning cash management agreements created by a Commission-regulated subsidiary and a non-regulated parent. Specifically, the Commission is requiring that all such cash management arrangements be in writing and specify the duties and responsibilities of participants in a cash management system (a system in which funds are transferred from multiple accounts to a single account in the parent company's name or a single account with interest earned or charged on the net cash balance position, or in which balances in affiliated companies' accounts are at the same bank as the parent company and transfers are made daily to the parent's account).

The Commission's staff has reviewed several cash management agreements between Commission-regulated companies and their non-regulated parent companies. With only one exception, there was no formal, written agreements at the gas pipelines, electric utilities and oil pipelines among the companies reviewed. There is potential for serious financial harm to Commission-regulated entities if non-regulated parent companies default on accounts payable owed to their regulated subsidiaries. Accordingly, the Commission is proposing to require written cash management agreements for the entities it regulates. Cash management agreements serve to define the rights and responsibilities of the Start Printed Page 51552parties to the agreements plus clarify how the funds will be advanced/transferred and whether interest will be paid and at what rate of interest to the companies providing the funds.

The Commission intends to clearly define the roles and responsibilities of all parties regarding transfers of cash, payment of bills, payment of interest, and the funds that can be taken from the regulated subsidiary. Cash management agreements should be reviewed and updated periodically to ensure that change in the corporate structure has not made the agreements obsolete. Additionally, cash management agreements must provide assurance for Commission-regulated entities and regulators that non-regulated parents aren't exposing their subsidiaries to severe financial harm for the benefit of non-regulated affiliated companies.

Under the statutes that it administers, the Commission has broad authority to act in the public interest and to ensure that adequate supplies of energy are available to the nation at a reasonable cost. Because of the Commission's concern that cash management accounts not be used improperly to impair the financial health of regulated entities, so as to cause harm to the rate paying public, it believes it is appropriate to put into place these requirements to protect the ratepayers.

The Commission has submitted this collection of information to OMB for approval. OMB's regulations describe the process that federal agencies must follow in order to obtain OMB approval for collections of information. See 5 CFR 1320. The standards for emergency processing of information collections appear at 5 CFR 1320.13. If OMB approves a reporting requirement, then it will assign an information control number to that requirement. OMB requires federal agencies seeking approval of information collections to allow the public an opportunity to comment on the proposed information collection. 5 CFR 1320.5(a)(1)(iv). Therefore, the Commission is soliciting comment on:

(1) Whether the collection of information is necessary for the proper performance of the Commission's functions, including whether the information will have practical utility:

(2) The accuracy of the Commission's estimate of the burden of the collection of this information, including the validity of methodology and assumptions used;

(3) The quality, utility, and clarity of the information to be collected; and

(4) How to minimize the burden of the collection of this information on respondents, including the use of appropriate automated electronic, mechanical, or other forms of information technology.

OMB Control No.: (to be assigned).

Expiration Date: 01/31/2002.

Title: Regulation of Cash Management Practices.

IC No.: FERC-907.

Respondents: Businesses or other for -profit.

Estimated annual burden: 896 hours.

Estimated Annual Reporting and/or Recordkeeping cost: $50,418.

Frequency of Response: On occasion.

Obligation to Respond: Mandatory.

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Linwood A. Watson, Jr.,

Deputy Secretary.

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[FR Doc. 02-20043 Filed 8-7-02; 8:45 am]