2015 ORS 221.420¹
Municipal regulation of public utilities

(1) As used in this section:

(a) "Public utility" has the meaning for that term provided in ORS 757.005 (Definitions).

(b) "Commission" means the Public Utility Commission of Oregon.

(c) "Council" means the common council, city council, commission or any other governing body of any municipality wherein the property of the public utility is located.

(d) "Municipality" means any town, city or other municipal government wherein property of the public utility is located.

(e) "Service" is used in its broadest and most inclusive sense and includes equipment and facilities.

(f) "Heating company" means any person furnishing heat but not electricity or natural gas to its customers.

(2) Subject to ORS 758.025 (Relocation of utilities in highway right of way), a city may:

(a) Determine by contract or prescribe by ordinance or otherwise, the terms and conditions, including payment of charges and fees, upon which any public utility, electric cooperative, people’s utility district or heating company, or Oregon Community Power, may be permitted to occupy the streets, highways or other public property within such city and exclude or eject any public utility or heating company therefrom.

(b) Require any public utility, by ordinance or otherwise, to make such modifications, additions and extensions to its physical equipment, facilities or plant or service within such city as shall be reasonable or necessary in the interest of the public, and designate the location and nature of all additions and extensions, the time within which they must be completed, and all conditions under which they must be constructed.

(c) Fix by contract, prescribe by ordinance, or in any other lawful manner, the rates, charges or tolls to be paid to, or that may be collected by, any public utility or the quality and character of each kind of product or service to be furnished or rendered by any public utility furnishing any product or service within such city. No schedule of rates, charges or tolls, fixed in the manner provided in this paragraph, shall be so fixed for a longer period than five years. Whenever it is proposed by any city to enter into any contract, or to enact any ordinance, or other municipal law or regulation concerning the matters specified in this paragraph, a copy of such proposed contract, ordinance or other municipal law or resolution shall be filed with the Public Utility Commission of Oregon before the same may be lawfully signed or enacted, as the case may be, and the commission shall thereafter have 90 days within which to examine into the terms thereof. If the commission is of the opinion that in any respect the provisions of the proposed contract, ordinance or other municipal law or resolution are not in the public interest, the commission shall file, in writing, with the clerk or other officer who has the custody of the files and records of the city, the commission’s reasons therefor. If the objections are filed within said period of 90 days, no proposed contract, ordinance or other municipal law or regulation shall be valid or go into effect until it has been submitted to or ratified by the vote of the electors of the city. Unless and until a city exercises its powers as provided in this paragraph, the commission is vested with all powers with respect to the matters specified in this paragraph. If the schedule of rates, charges and tolls or the quality and character of each kind of product or service is fixed by contract, ordinance or other municipal law or regulation and in the manner provided in this paragraph, the commission has no power or jurisdiction to interfere with, modify or change it during the period fixed thereby. Upon the expiration of said period such powers shall again be vested in the commission, to be exercised by the commission unless and until a new schedule of rates or the quality and character for such service or product is fixed or prescribed by contract, ordinance or other municipal law or regulation in the manner provided in this paragraph.

(d) Provide for a penalty for noncompliance with the provisions of any charter provision, ordinance or resolution adopted by the city in furtherance of the powers specified in this subsection. [Amended by 1971 c.655 §245; 1987 c.245 §2; 1987 c.628 §1; 1989 c.5 §1; 1989 c.999 §6; 1999 c.1093 §6; 2007 c.807 §40; 2009 c.444 §3]

Notes of Decisions

The scope of review in disputes between parties to a franchise is the same as for any contract, and is not limited to a determina­tion that the municipality acted reasonably and in good faith for the public interest. Rose City Transit Co. v. Portland, 18 Or App 369, 525 P2d 325 (1974), aff'd as modified 271 Or 588, 533 P2d 339 (1975)

A franchise is not a mere license, but a contract between a municipality and franchisee. Rose City Transit Co. v. Portland, 18 Or App 369, 525 P2d 325 (1974), aff'd as modified 271 Or 588, 533 P2d 339 (1975)

City may provide utility services in territory allocated to an­oth­er provider pursuant to ORS 758.400 (Definitions for ORS 758.015 and 758.400 to 758.475) to 758.475 (Fees) if it exercises authority under this sec­tion to exclude or eject provider from territory, however, city's mere place­ment of utility facilities and pro­vi­sion of services in territory is not exercise of that authority and is viola­tion of alloca­tion statutes in absence of formal ac­tion by city to eject or exclude provider. PacifiCorp v. City of Ashland, 89 Or App 366, 749 P2d 1189 (1988), Sup Ct review denied

City's statutory authority to exclude or eject public utility from public prop­erty applies only to privately owned public utilities. Springfield Utility Board v. Emerald People's Utility District, 191 Or App 536, 84 P3d 167 (2004), aff'd 339 Or 631, 125 P3d 740 (2005)

"Public utility" does not include utility owned by city, municipal corpora­tion or quasi-municipal corpora­tion. Springfield Utility Board v. Emerald People's Utility District, 191 Or App 536, 84 P3d 167 (2004), aff'd 339 Or 631, 125 P3d 740 (2005)

Read with ORS 221.450 (Privilege tax on public utilities operating without franchise), under home rule analysis, where city ordinance charging franchise fee is not specifically preempted by state law, city has authority to enact and enforce ordinance. Rogue Valley Sewer Services v. City of Phoenix, 262 Or App 183, 329 P3d 1 (2014), aff'd 357 Or 437, 353 P3d 581 (2015)


1 Legislative Counsel Committee, CHAPTER 221—Organization and Government of Cities, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ors221.­html (2015) (last ac­cessed Jul. 16, 2016).
 
2 Legislative Counsel Committee, Annotations to the Oregon Revised Stat­utes, Cumulative Supplement - 2015, Chapter 221, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ano221.­html (2015) (last ac­cessed Jul. 16, 2016).
 
3 OregonLaws.org assembles these lists by analyzing references between Sections. Each listed item refers back to the current Section in its own text. The result reveals relationships in the code that may not have otherwise been apparent.