                                 CODE OF VIRGINIA

POWERS OF THE COMMISSION (§ 56-542)

A. As used in this section:
			&#8220;CPI&#8221; means the Consumer Price Index &#x2014; U.S. City Averages
for All Urban Consumers, All Items (not seasonally adjusted) as reported by the
U.S. Department of Labor, Bureau of Labor Statistics; however, if the CPI is
modified such that the base year of the CPI changes, the CPI shall be converted
in accordance with the conversion factor published by the U.S. Department of
Labor, Bureau of Labor Statistics, and if the CPI is discontinued or revised,
such other historical index or computation approved by the Commission shall be
used for purposes of this section that would obtain substantially the same
result as would have been obtained if the CPI had not been discontinued or
revised.
			&#8220;Materially discourage use&#8221; means to cause a decrease in traffic
of three or more percentage points based on either a change in potential toll
road users or a change in traffic attributable to the toll rate charged as
validated by (i) an investment-grade travel demand model that takes population
growth into consideration or (ii) in the case of an investigation into current
toll rates, an actual traffic study that takes population growth into
consideration.
			&#8220;Real GDP&#8221; means the Annual Real Gross Domestic Product as
reported by the U.S. Department of Commerce, Bureau of Economic Analysis.

B. The Commission shall have the power to regulate the operator under this title
as a public service corporation. The Commission shall also have the power, and
be charged with the duties of reviewing and approving or denying the
application, of supervising and controlling the operator in the performance of
its duties under this chapter and title, and of correcting any abuse in the
performance of the operator&#8217;s public duties.

C. Pursuant to &#xA7; 56-36, the Commission shall require annually from the
operator a verified report describing the nature of its contractual and other
relationships with individuals or entities contracting with the operator for the
provision of significant financial, construction, or maintenance services. The
Commission shall review the report and such other materials as it shall deem
necessary for the purpose of determining improper or excessive costs, and shall
exclude from the operator&#8217;s costs any amounts which it finds are improper
or excessive. Included in such review shall be consideration of contractual
relationships between the operator and individuals or entities that are closely
associated or affiliated with the operator to assure that the terms of such
contractual relationships are no less favorable or unfavorable to the operator
than what it could obtain in an arm&#8217;s-length transaction.

D. The Commission also shall have the duty and authority to approve or revise
the toll rates charged by the operator. Initial rates shall be approved if they
appear reasonable to the user in relation to the benefit obtained, not likely to
materially discourage use of the roadway, and provide the operator no more than
a reasonable return as determined by the Commission. Thereafter, the Commission,
upon application, complaint or its own initiative, and after investigation, may
order substituted for any toll being charged by the operator, a toll which is
set at a level which is reasonable to the user in relation to the benefit
obtained and which will not materially discourage use of the roadway by the
public and which will provide the operator no more than a reasonable return as
determined by the Commission. Any proposed toll rates that fail to meet these
criteria as determined by the Commission are contrary to the public interest,
and the Commission shall not approve such toll rates.
			Any application to increase toll rates shall include a forward-looking
analysis that demonstrates that the proposed toll rates will be reasonable to
the user in relation to the benefit obtained, not likely to materially
discourage use of the roadway, and provide the operator no more than a
reasonable return. Such forward-looking analysis shall include reasonable
projections of anticipated traffic levels, including the impact of social and
economic conditions anticipated during the time period that the proposed toll
rates would be in effect. The Department shall review and provide comments upon
the analysis to the Commission. Notwithstanding any other provision of law, the
Commission shall not approve more than one year of toll rate increases proposed
by the operator.

E. If a change in the ownership of the facility or change in control of an
operator occurs, whether or not accompanied by the issuance of securities as
defined in subsection A of &#xA7; 56-57 and &#xA7; 56-65.1, the Commission, in
any subsequent proceeding to set the level of a toll charged by the operator,
shall ensure that the price paid in connection with the change in ownership or
control, and any costs and other factors attributable to or resulting from the
change in ownership or control, if they would contribute to an increase in the
level of the toll, are excluded from the Commission&#8217;s determination of the
operator&#8217;s reasonable return, in order to ensure that a change in
ownership or control does not increase the level of the toll above that level
that would otherwise have been required under subsection D if the change in
ownership or control had not occurred. As used in this subsection,
&#8220;control&#8221; has the same meaning as provided in &#xA7; 56-88.1.

F. Pursuant to &#xA7; 56-36, the Commission shall require an operator to provide
copies of annual audited financial statements for the operator, together with a
statement of the operator&#8217;s ownership. The operator shall file such
statement within four months from the end of the operator&#8217;s fiscal year.

G. The proceeds and funding provided to the operator from any future bond
indenture or similar credit agreement must be used for the purpose of
refinancing existing debt, acquiring, designing, permitting, building,
constructing, improving, equipping, modifying, maintaining, reconstructing,
restoring, rehabilitating, or renewing the roadway property, and for the purpose
of paying reasonable arm&#8217;s-length fees, development costs, and expenses
incurred by the operator or a related individual or entity in executing such
financial transaction, unless otherwise authorized by the Commission.

H. The Commission may charge a reasonable annual fee to cover the costs of
supervision and controlling the operator in the performance of its duties under
this chapter and pursuant to this section.

I. Any agreement between the operator and the Department made pursuant to this
chapter shall not be construed to alter the duties, obligations, or powers of
the Commission set forth in this chapter.

J. Prior to refinancing existing debt, an operator shall petition the Commission
for approval to refinance such debt. The Commission may approve such petition
only if the operator demonstrates (i) that it has the financial capability to
pay off the debt incurred in the refinancing over the term of the bond, loan, or
similar instrument; (ii) that the term of the bond, loan, or similar instrument
does not extend beyond the expiration of the operator&#8217;s current
certificate of authority; (iii) that such refinancing will not increase toll
rates; and (iv) that such refinancing is in the public interest.

HISTORY: 1988, c. 649; 1991, c. 272; 2008, cc. 841, 844; 2021, Sp. Sess. I, cc.
349, 350.