CHAPTER 77 SENATE BILL No. 547 An  Act establishing the rural Kansas self-help gas act; amending K.S.A. 66-1,150 and repealing the existing section. Be it enacted by the Legislature of the State of Kansas:

      New Section  1. As used in sections 1 through 6, and amendments
thereto, the following words and phrases shall have the following mean-
ings:

      (a) ``Certificate'' means authority granted to a natural gas public util-
ity to transact business pursuant to chapter 66 of the Kansas Statutes
Annotated, and amendments thereto, to include any certificated area,
territory or exclusive service rights;

      (b) ``city limits'' means the area within the defined corporate limits
of an incorporated city;

      (c) ``existing gas service utility'' means a natural gas public utility that
presently owns, operates, maintains and is responsible for an existing gas
service line that the public utility, or its predecessor in interest, con-
structed from its distribution system to the point of service physically
located on the property being served and which is currently being used
to provide the property with firm gas service. In no event will it include
a natural gas public utility that merely owns, operates, maintains or is
responsible for a meter or meter station and incidental pipeline connec-
tions;

      (d) ``firm gas service'' means the level of gas service which obligates
the natural gas public utility, unless otherwise agreed between the natural
gas public utility and the customer, to provide their customer with an
unlimited supply of gas, available at all times and delivered to the cus-
tomer's property without interruption for any reason other than force
majeure;

      (e) ``gas'' means natural gas as the term is commonly understood in
the natural gas industry to include the meanings ascribed to the terms
``gas'' and ``natural gas'' in chapter 66 of the Kansas Statutes Annotated,
and amendments thereto;

      (f) ``gas provider'' means any person that provides gas, gas transpor-
tation, gas supply management or other gas services and any related fa-
cilities associated with delivering gas to a rural gas user;

      (g) ``gas supply system'' means any well, pipeline, plant tailgate, meter
or other facility which is a source of gas or which is associated with the
transportation, treatment, processing or delivery of gas;

      (h) ``person'' means an individual, association or other legal entity;

      (i) ``public utility'' means a natural gas public utility or common car-
rier as defined in chapter 66 of the Kansas Statutes Annotated, and
amendments thereto;

      (j) ``rural gas service'' means all activities necessary or convenient to
procure, manage, transport and deliver gas to a rural gas user; and

      (k) ``rural gas user'' means any person currently using natural gas from
a wellhead or gathering facility for agricultural purposes on property they
own, lease or operate that is located outside city limits and not presently
receiving gas service from an existing gas service utility.

      New Sec.  2. Any rural gas user who desires to constructs its own
pipeline connection to a gas supply system, and any gas provider assisting
the rural gas user, shall not be considered a public utility. If the rural gas
service is provided within an area where a public utility holds a certificate,
the rural gas user or the rural gas user's gas provider shall first notify the
existing gas service utility of their intent to provide rural gas service. If
the public utility holding the certificated area is not an existing gas service
utility, then the existence of such public utility and its certificate will not
in any way limit the rural gas user or the rural gas user's provider in
establishing and maintaining the rural gas service provided for by this act.

      New Sec.  3. (a) When notified pursuant to section 2, and amend-
ments thereto, an existing gas service utility shall have 30 days to develop
plans and propose an offer to the potential rural gas user for providing
rural gas service. The proposed plan shall include plans for installing fa-
cilities, price of natural gas and projected completion date.

      (b) Failure of the existing gas service utility to propose an offer or
complete the project by the projected completion date pursuant to sub-
section (a), unless otherwise agreed to by the rural gas user and the ex-
isting gas service utility, shall cause the existing gas service utility to waive
such utility's exclusive right to serve the rural user.

      (c) If the potential rural gas user does not accept the offer presented
by the existing gas service utility, the existing gas service utility shall re-
lease the rural gas user from the certificated area or may request from
the state corporation commission a determination to approve the utility's
plan or allow the rural gas user to use a different public utility or gas
provider to provide rural gas service.

      (d) Upon request for determination described in subsection (c) and
upon receipt of the proposed plans from the existing gas service utility
and from the rural gas user or their provider, the state corporation shall
have 30 days to complete such determination.

      New Sec.  4. When two or more rural gas users combine pursuant to
K.S.A. 66-104c, and amendments thereto, to operate as a nonprofit public
utility (NPU), if the rural gas service is provided within an area where a
public utility holds a certificate, the existence of such public utility and
its certificate will not in any way limit the rural gas users, the NPU, or
their gas provider, in establishing and maintaining the rural gas service
provided for by this act.

      New Sec.  5. All providers of rural gas service under the provisions
of sections 1 through 6, and amendments thereto, will comply with all
applicable pipeline safety laws including rules and regulations adopted by
the state corporation commission pursuant to K.S.A. 66-1,150, and
amendments thereto.

      New Sec.  6. The provisions of sections 1 through 6, and amendments
thereto, shall be known as the rural Kansas self-help gas act.

      Sec.  7. K.S.A. 66-1,150 is hereby amended to read as follows: 66-
1,150. (a) The state corporation commission is hereby authorized to adopt
such rules and regulations as may be necessary to be in conformance with
the natural gas pipeline safety act of 1968 (49 USCA 1671 et seq.), as
amended. Notwithstanding the exemption provisions of K.S.A. 66-104
and 66-131, and amendments thereto, and related statutes, for the pur-
pose of gas pipeline safety such rules and regulations shall be applicable
to: (1) All public utilities and all municipal corporations or quasi-munic-
ipal corporations transporting natural gas or rendering gas utility service;
(2) all operators of master meter systems, as defined by 49 C.F.R. 191.3;
and (3) all operators of privately or publicly owned pipelines providing
natural gas service or transportation directly to the ultimate consumer for
the purpose of manufacturing goods or generating power; and (4) pro-
viders of rural gas service under the provisions of sections 1 through 6,
and amendments thereto.

      (b) As used in subsection (a)(3), ``manufacturing goods'' does not in-
clude farming or activities associated with production of oil or gas.

      (c) Nothing in this section shall be construed as invalidating any pres-
ent rules or regulations of the state corporation commission, concerning
the regulation of pipelines and pipeline companies.

      Sec.  8. K.S.A. 66-1,150 is hereby repealed.

      Sec.  9. This act shall take effect and be in force from and after its
publication in the Kansas register.

Approved April 18, 2002.
 Published in the Kansas Register April 25, 2002.
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