Regulation of Rates and Charges by Municipal Utilities

C.R.S. tit. 40, art. 3.5
in effect

C.R.S. § 40-3.5-101 Application - reasonable charges - adequate service

40-3.5-101. Application - reasonable charges - adequate service. (1) This article shall be applicable within the authorized electric and natural gas service areas of each municipal utility that lie outside the jurisdictional limits of such municipality. Insofar as municipal utilities establish rates, charges, and tariffs and any regulations pertaining thereto in accordance with the provisions of this article, the provisions of section 40-1-104 and articles 4, 6, and 7 of this title shall not apply; except that section 40-4-105 shall apply with respect to the crossing of railroad rights-of-way. Nothing in this article shall be construed as limiting the applicability of article 5 of this title. (2) All charges made, demanded, or received by any municipal utility for any rate, product, or commodity furnished or to be furnished or any service rendered or to be rendered shall be just, reasonable, and sufficient. (3) Every municipal utility shall furnish, provide, and maintain such service, instrumentalities, equipment, and facilities as shall promote the safety, health, comfort, and convenience of its patrons, its employees, and the public, and as shall in all respects be adequate, efficient, just, and reasonable. (4) For the purposes of this article, "municipal utility" means a municipal natural gas or electric utility.

C.R.S. § 40-3.5-102 Regulation of rates

40-3.5-102. Regulation of rates. The power and authority is hereby vested in the governing body of each municipal utility and it is hereby made the duty of each such governing body to adopt all necessary rates, charges, and regulations to govern and regulate all rates, charges, and tariffs of its municipal utility within its authorized electric and natural gas service areas which lie outside the jurisdictional limits of the municipality. No rate, charge, tariff, or voluntary plan approved pursuant to section 40-2-122 shall unjustly discriminate between or among those customers or recipients of any commodity, service, or product of the municipal utility within the authorized service area. In the event that any rate, charge, tariff, or voluntary plan established within the authorized service area which lies outside the jurisdictional limits of the municipality varies from the rate, charge, tariff, or voluntary plan established for the same class of customers or recipients of any such service within the authorized service area which lies inside the jurisdictional limits of the municipality, such rate, charge, tariff, or voluntary plan shall not become effective until reviewed and approved by the commission. Such review and approval shall be in accordance with the provisions of article 3 of this title; except that in no event shall the commission modify or establish such rate, charge, or tariff to an amount lower than that established by the municipality, or approve a voluntary plan that differs from the voluntary plan, for the same class of customers or recipients of any utility service within the authorized service area which lies inside the jurisdictional limits of the municipality.

C.R.S. § 40-3.5-103 Rate schedules

40-3.5-103. Rate schedules. Municipal utilities shall print and keep open for public inspection schedules showing all rates and charges collected or enforced, or to be collected or enforced, together with all rules, regulations, contracts, privileges, and facilities which in any manner affect or relate to rates and service within the authorized electric and natural gas service areas of the municipal utility which lie outside the jurisdictional limits of the municipality.

C.R.S. § 40-3.5-104 Changes in rates - notice and public hearing

40-3.5-104. Changes in rates - notice and public hearing. (1) (a) No change shall be made by any municipal utility in any rate or charge or in any rule, regulation, or contract relating to or affecting any base rate, charge, or service, or in any privilege or facility, except after thirty days' notice to the public. Such notice shall be given by keeping open for public inspection new schedules stating plainly the changes to be made in the schedules then in force and the time when the changes will go into effect. In addition, such notice shall be given by publishing the proposed new schedule, or if that is impractical due to the size or bulk of the proposed new schedule, by publishing a notice of the availability of the proposed new schedule for public inspection, at least once in at least one newspaper of general circulation in the authorized service area at least thirty days and no more than sixty days prior to the date set for public hearing on and adoption of the new schedule. (b) In addition to the notice provided for in paragraph (a) of this subsection (1), if a municipal utility serves customers who live outside the municipal corporate boundaries, notice of any change in any rate or charge or in any rule, regulation, or contract relating to or affecting any base rate, charge, or service or any change in any privilege or facility shall be given by mailing to such customer notification of any such change. (2) The notice required by subsection (1) of this section shall also specify the date, time, and place at which the public hearing shall be held by the governing body of the municipal utility to consider the proposed new schedule. The notice shall specify that each municipal utility customer shall have the right to appear, personally or through counsel, at such hearing for the purpose of providing testimony regarding the proposed new schedule. Said public hearing shall be held on the date and time and at the place set forth in the notice; except that the governing body of the municipal utility may adjourn and reconvene said hearing as it deems necessary. (3) The governing body of the municipal utility, for good cause shown, may allow changes without requiring the thirty days' notice and public hearing by an order specifying the changes to be made, the circumstances necessitating the change without requiring the thirty days' notice and public hearing, the time when the changes shall take effect, and the manner in which the changes shall be published. (4) Insofar as municipal utilities establish rates, charges, and tariffs and any regulations pertaining thereto in accordance with the provisions of this article, any conflict shall be resolved by the commission in accordance with the procedures contained in article 6 of this title upon the filing of a complaint by no less than five percent of the affected electric or natural gas customers outside the corporate limits of the municipality or by five such customers, whichever number is greater. Any such complaint shall be filed with the commission within thirty days after the final decision by the governing body of the municipality to change a rate, charge, or tariff or any regulation pertaining thereto. If such complaint is heard by the commission and is deemed not frivolous, all reasonable costs as determined by the commission, including reasonable attorney fees, shall be paid by the utility. In any hearing conducted pursuant to the provisions of this section, the burden of proof shall be sustained by the municipal utility.

C.R.S. § 40-3.5-105 Free and reduced service prohibited - exceptions

40-3.5-105. Free and reduced service prohibited - exceptions. Except as otherwise provided in this section, no municipal utility shall charge, demand, collect, or receive a greater or lesser or different compensation for any product or commodity furnished or to be furnished, or for any service rendered or to be rendered, than the rates and charges applicable to such product, commodity, or service as specified in its schedules on file and in effect at the time, nor shall any such municipal utility refund or remit, directly or indirectly or in any manner or by any device, any portion of the rates and charges so specified nor extend to any corporation or person any form of contract or agreement or rule or regulation or any facility or privilege except one which is regularly and uniformly extended to all corporations and persons. The governing body of the municipal utility may by rule or order establish such exceptions from the operation of this prohibition as it may consider just and reasonable.

C.R.S. § 40-3.5-106 Advantages prohibited - graduated schedules

40-3.5-106. Advantages prohibited - graduated schedules. (1) No municipal utility, as to rates, charges, service, facilities, or in any other respect, shall make or grant any preference or advantage to any corporation or person or subject any corporation or person to any prejudice or disadvantage. No municipal utility shall establish or maintain any unreasonable difference as to rates, charges, service, facilities, or in any other respect, either between localities or between any class of service. The governing body of each municipal utility shall determine the reasonableness of any such difference. (2) Nothing in this article shall prohibit a municipal utility engaged in the production, generation, transmission, distribution, or furnishing of heat, light, gas, or power from establishing a graduated scale of charges subject to the provisions of this article. (3) Nothing contained in this article shall exempt from the public utilities commission of the state of Colorado the power and authority to regulate the rates, charges, tariffs and any regulations pertaining thereto of the sale of natural gas by a municipal utility to another public utility.

C.R.S. § 40-3.5-107 Fees

40-3.5-107. Fees. Municipal utilities authorized to serve areas which lie outside their municipal corporate limits shall be subject to providing annual reports of gross operating revenues, computation of fees, and payment of such fees relating to those areas.
Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://leg.colorado.gov/sites/default/files/images/olls/crs2024-title-40.docxFetched: 10/6/2026