In re Application of City of Minden

I n re A pplIcAtIon of cIty of MInden, nebrAskA.
cIty of MInden, nebrAskA, AppellAnt, v.
southern publIc power dIstrIct, Appellee ,
And brIAn petersen And bArb petersen,
Intervenors-Appellees.
811 N.W.2d 659
Filed December 23, 2011. 	No. S-10-1055.
1. Nebraska Power Review Board: Appeal and Error. An appellate court will
affirm a decision of the Nebraska Power Review Board if the evidence supports
the decision and it is not arbitrary, capricious, unreasonable, or otherwise illegal.
2. Statutes: Appeal and Error. Statutory interpretation is a question of law that an
appellate court resolves independently of the trial court.
3. Nebraska Power Review Board: Judgments: Appeal and Error. When it
appears that the Nebraska Power Review Board has complied with the controlling
statutes and the evidence is sufficient to support its findings of fact, an appellate
court may not substitute its judgment for that of the board, and the action of the
board will be sustained.
4. ____: ____: ____. An appellate court cannot interfere with a decision of the
Nebraska Power Review Board unless there is no evidence to sustain the action
of the board, or, for some other reason, the record shows the action of the board
is arbitrary and unreasonable.
5. Public Utilities: Rates. The filed rate doctrine specifies that a filed tariff has the
effect of law governing the relationship between the utility and its customers,
operates across the spectrum of regulated utilities, and applies where state law
creates a state agency and a statutory scheme pursuant to which the state agency
determines reasonable rates.
6. Public Utilities: Rates: Presumptions. The filed rate doctrine conclusively
presumes that both the utility and its customers know the contents and effect of
published tariffs.
7. Actions: Public Utilities: Rates. The filed rate doctrine acts to bar suits against
regulated utilities involving allegations concerning the reasonableness of the
filed rates.
Appeal from the Power Review Board. Affirmed.
Andrew 	S. 	Pollock, 	David 	J.A. 	Bargen, 	and 	Mark 	R.
Richardson, Senior Certified Law Student, of Rembolt Ludtke,
L.L.P., for appellant.
David A. Jarecke, of Blankenau Wilmoth, L.L.P., and Mathew
T. Watson, of Crosby Guenzel, L.L.P., for appellee.
No appearance for intervenors-appellees.
926 	282 NeBRASkA RePoRTS
Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
11/01/2026 04:44 AM CST

heAvIcAn, 	c.J., 	wrIght, 	connolly, 	gerrArd, 	stephAn,
MccorMAck , and MIller-lerMAn, JJ.
connolly, J.
The City of Minden, Nebraska (Minden), filed an applica-
tion to construct a subtransmission line with the Nebraska
Power Review Board (the Board). Southern Public Power
District (Southern) objected to the application. The Board
denied the application, finding that Minden’s proposal was not
the most economical and feasible means of supplying electrical
services and also that its proposal would unnecessarily dupli-
cate Southern’s existing line. Minden appeals. Because the
evidence supports the Board’s decision and it is not arbitrary
or unreasonable, we affirm.
BACkGRoUND
In April 2010, Minden filed an application to construct an
electric subtransmission line. The line consisted of about 2.12
miles of overhead line and about .04 miles of underground line.
The overhead line was to have insulation that would support a
voltage of 69 kilovolts, but Minden would operate it at only
34.5 kilovolts. The underground portion’s insulation would
support a voltage of only 34.5 kilovolts.
The proposed line would begin at a Nebraska public power
district (NPPD) substation, which is outside of Minden, to the
northeast. From that point, the proposed line was to proceed
south before turning to the west and entering Minden. The pro-
posed line would then connect with a substation on the north
side of Minden.
Minden planned to construct this line as a replacement to
an aging underground line. The underground line was about 30
years old and was reaching the end of its useful life. The exist-
ing underground line went along the same route as Minden’s
proposed line.
Minden initially estimated the project’s cost at $750,000.
Minden, however, later revised and lowered its estimate to
$500,000. Minden admitted that this was just an estimate and
that it could not know what the line would actually cost until
it received bids. The cost could potentially vary by 20 percent.
IN Re APPLICATIoN oF CITy oF MINDeN 	927
Cite as 282 Neb. 926

Minden claimed that the ratepayers would not pay this cost
because it had been setting aside money for several years in
preparation to build the line.
Southern protested Minden’s application. Southern argued
that it had an existing 34.5-kilovolt line, built about 20 years
after Minden had constructed its original underground line.
Southern stated its line could accommodate the load that
Minden hoped to carry on its proposed line. Southern’s line
was originally built to provide power to a nearby ethanol plant;
it apparently was not initially designed with the aim of serv-
ing Minden. This line would be directly adjacent to Minden’s
proposed line. Southern argued that because the proposed line
would duplicate and also compete with its existing line, it was
contrary to Nebraska public policy regarding powerlines.
The record shows that Minden receives backup service from
Southern. Minden pays Southern $4,000 a month for this serv-
ice. The parties disputed whether Minden received backup
power on a Southern line coming from the west side of town
or on a Southern line on the east. But if Southern were to pro-
vide Minden’s primary source of power, it would be through
the eastern line, the one that would be adjacent to Minden’s
proposed line.
Southern had offered to transmit Minden’s power. The price
that Southern offered was one-half of Southern’s usual sub-
transmission rate, or about $48,000 a year. Southern guaranteed
this price for 5 years. After 5 years, the price would be one-half
of whatever the subtransmission rate was at that time. Minden
rejected this offer, apparently because it was concerned about
the rate after 5 years and did not want to rely on Southern for
its transmission.
The cost of transmitting the power was not the only cost to
consider, there was also the cost of maintenance. Minden had
a contract with NPPD under which NPPD provided Minden’s
maintenance on its system. Minden usually allocates between
$250,000 and $300,000 a year for maintenance of its system.
Representatives of Minden said that if Minden did not wish to
have maintenance done, it simply did not allocate funds for it.
The funds for maintenance are in addition to the cost of the
power that Minden purchases from NPPD.
928 	282 NeBRASkA RePoRTS

The record shows that if Minden built the proposed line,
it planned to deenergize its underground line and cancel its
backup agreement with Southern. This action would result
in Minden’s lacking a backup source of power. Conversely,
if Minden were to leave the underground line energized, its
exposure to maintenance costs would increase because it would
have to maintain both the proposed aboveground and existing
underground lines.
The Board issued its findings of fact and conclusions of law.
The Board’s factual findings are consistent with the facts we
have already laid out. The underlying facts of this case do not
appear to be in serious dispute. Instead, the parties have drawn
their battlelines around the conclusions the Board drew from
those facts.
Regarding those conclusions, the Board concluded that both
Minden’s proposal and the use of Southern’s line would serve
the public convenience and necessity. The Board based this
conclusion on the age of Minden’s underground line and the
likelihood that failures would soon occur if Minden could not
find a replacement.
But the Board concluded that Minden’s proposal was not
the most economical and feasible means of supplying the
service. While the Board accepted Minden’s $500,000 esti-
mate to construct the line, it also noted that $750,000 was
Minden’s initial estimate. According to the Board, this devia-
tion reflected the fluctuations of the prices of the materi-
als needed and the difficulty of price estimates. The Board
concluded there was no guarantee that the costs would not
increase, requiring Minden’s ratepayers to pay the overages
for the cost of the project.
The Board was also concerned with Minden’s failure to
account for maintenance. Although the Board acknowledged
it was possible that maintenance would not be needed, it was
equally possible that a storm could cause significant damage
resulting in Minden’s paying the cost. The Board noted that
Minden’s exposure to maintenance costs would be greater if it
built its own line than it would be if it used Southern’s.
The Board concluded that at the current rate, Minden could
use the $500,000 it had saved to receive power over Southern’s
IN Re APPLICATIoN oF CITy oF MINDeN 	929
Cite as 282 Neb. 926

line for the next 10 years. The Board noted that Minden could
pay for services even longer if it invested this money until it
was needed to pay Southern. Summed up, the Board found that
using Southern’s line was the more economical and feasible
choice for Minden.
In addition, the Board found that Minden’s proposed line
would be unnecessarily duplicative of Southern’s. The Board
noted that both lines would begin at the same place and both
would be connected to the substation on the north side of
Minden. Moreover, both lines would have the same voltage.
And Southern’s line had the capacity to carry both its load and
the load that Minden wished to carry on its proposed line. In
sum, the Board found that the new line would be unnecessarily
duplicative of Southern’s existing line.
ASSIGNMeNTS oF eRRoR
Minden assigns that the district court erred in
(1) determining that Minden’s proposed subtransmission line
was not the most economical and feasible means of providing
electric service; and
(2) determining that Minden’s proposed subtransmission line
would constitute an unnecessary duplication of facilities.
STANDARD oF ReVIeW
[1] An appellate court will affirm a decision of the Board if
the evidence supports the decision and it is not arbitrary, capri-
cious, unreasonable, or otherwise illegal.1
[2] Statutory interpretation is a question of law that we
resolve independently of the trial court.2
ANALySIS
Neb. Rev. Stat. § 70-1001 (Cum. Supp. 2010) sets out the
Board’s policy in part as follows:
In order to provide the citizens of the state with ade-
quate electrical service at as low overall cost as possible,
1 In re Application of Neb. Pub. Power Dist., 281 Neb. 350, 798 N.W.2d 572
(2011).
2 See id.
930 	282 NeBRASkA RePoRTS

consistent with sound business practices, it is the policy of
this state to avoid and eliminate conflict and competition
between public power districts, public power and irriga-
tion districts, individual municipalities, registered groups
of municipalities, electric membership associations, and
cooperatives in furnishing electric energy to retail and
wholesale customers, to avoid and eliminate the duplica-
tion of facilities and resources which result therefrom,
and to facilitate the settlement of rate disputes between
suppliers of electricity.
Neb. Rev. Stat. § 70-1014 (Cum. Supp. 2010) guides our
analysis. This statute provides that “before approval of an
application, the board shall find that the application will serve
the public convenience and necessity, and that the applicant
can most economically and feasibly supply the electric service
resulting from the proposed construction or acquisition, with-
out unnecessary duplication of facilities or operations.”
The Board found that Minden’s application would serve the
public convenience and necessity. The Board, however, found
that Minden could not supply the electricity most economically
and feasibly. The Board also found that Minden’s line would be
unnecessarily duplicative of Southern’s. Minden argues that the
Board erred in these two findings.
[3,4] But Minden’s arguments buck a strong headwind:
When it appears that the Board has complied with the control-
ling statutes and the evidence is sufficient to support its find-
ings of fact, this court may not substitute its judgment for that
of the Board, and the action of the Board will be sustained.3 In
other words, this court cannot interfere with a decision of the
Board unless there is no evidence to sustain the action of the
Board, or, for some other reason, the record shows the action
of the Board is arbitrary and unreasonable.4
3 See Cornhusker P. P. Dist. v. Loup River P. P. Dist., 184 Neb. 789, 172
N.W.2d 235 (1969).
4 Omaha P. P. Dist. v. Nebraska P. P. Project, 196 Neb. 477, 243 N.W.2d
770 (1976).
IN Re APPLICATIoN oF CITy oF MINDeN 	931
Cite as 282 Neb. 926

I s MInden’s A pplIcAtIon the Most econoMIcAl
And feAsIble M eAns of provIdIng
electrIc servIce?
Minden first argues that the Board erred in concluding that
Minden could not supply the electricity most economically and
feasibly. Minden argues that this is a “matter of simple arith-
metic.”5 It contends that a one-time payment to construct the
line is more economical for Minden over the long term than
paying $48,000 a year for the use of Southern’s line because
the proposed line will, over time, pay for itself.
As part of this argument, Minden raises the filed tariff, or
filed rate, doctrine. According to Minden, this doctrine, which
it concedes we have never applied to an entity like Southern,
prohibits Southern from offering it a lower rate than it offers
to other customers. Minden argues that Southern must charge
twice what Southern has offered, which would be the rate
that Southern charges other customers. once Southern charges
Minden the full price, Southern’s proposal will no longer be
the best option for Minden.
[5-7] The filed rate doctrine specifies that a filed tariff
has the effect of law governing the relationship between
the utility and its customers, operates across the spectrum
of regulated utilities, and applies where state law creates
a state agency and a statutory scheme pursuant to which
the state agency determines reasonable rates.6
The doctrine conclusively presumes that both the utility and its
customers know the contents and effect of published tariffs.7
Accordingly, the doctrine acts to bar suits against regulated
utilities involving allegations concerning the reasonableness of
the filed rates.8
We decline to apply the filed rate doctrine in this case
for two reasons. First, the touchstone of the filed rate doc-
trine—that rates be filed with a regulatory body with authority
5 Brief for appellant at 10.
6 64 Am. Jur. 2d Public Utilities § 62 at 469 (2011) (emphasis supplied).
7 Id.
8 Id.
932 	282 NeBRASkA RePoRTS

to determine reasonable rates—is not present. Minden admits
that “[t]he Board has no authority to determine retail rates.
Suppliers need not file their tariff, ordinance or rate schedule
with the Board. The Board does not have authority to review
rates.”9 And Minden has not pointed us to any other regulatory
body that has such authority.
Second, Minden overlooks Neb. Rev. Stat. § 70-655(2)
(Reissue 2009). This section provides in part that “[t]he board
of directors may negotiate, fix, establish, and collect rates,
tolls, rents, and other charges for users and consumers of elec-
trical energy and associated services or facilities different from
those of other users and consumers.” (emphasis supplied.) In
other words, the Legislature has explicitly allowed Southern to
do what Minden asks us to forbid. We decline Minden’s invita-
tion. The filed rate doctrine has no application to the facts of
this case.
Under § 70-1014, the Board must decide whether Minden
can “most economically and feasibly supply the electric serv-
ice.”10 That means Minden’s proposal must be more economi-
cal and feasible than what Southern proposed. The Board found
that it was not. We conclude that evidence supports that deci-
sion and that it is not arbitrary or unreasonable.
Although Minden estimated that the line would cost $500,000
to construct, it had not yet solicited bids and acknowledged
that the actual cost could be as much as 20 percent higher.
The Board noted that “[t]here is no guarantee that [Minden’s]
ratepayers will not have to provide additional funding for the
proposed line.” If the costs turned out to be more than Minden
had set aside, then this project or other projects may have to
be put on hold, Minden’s ratepayers may see an increase, or
Minden may have to issue bonds.
In contrast, Southern had offered to transport Minden’s elec-
tricity to Minden for one-half of its normal subtransmission
rate. For the first 5 years, it would be locked in at one-half
of Southern’s current rate. After that, it would be one-half of
9 Brief for appellant at 10.
10 See In re Application of Neb. Pub. Power Dist., supra note 1.
IN Re APPLICATIoN oF CITy oF MINDeN 	933
Cite as 282 Neb. 926

whatever Southern’s rate was. With the money that Minden had
already set aside, it could pay for 10 years of transmission or
perhaps even more.
Finally, the Board found that Minden’s exposure to poten-
tial maintenance costs would likely be lower if it accepted
Southern’s offer. If Minden accepted Southern’s offer, Minden
could potentially have little or no exposure to maintenance
costs. If, however, Minden did not accept the offer, it ran the
risk of having to pay for any damage to the line.
In sum, the Board concluded that a locked-in rate of about
$48,000 a year for 5 years followed by 5 years at one-half
of Southern’s then-existing subtransmission rate was more
economical and feasible than constructing a line whose exact
cost was unknown. Further, the Board concluded that reducing
Minden’s potential maintenance cost exposure also weighed in
favor of Southern’s proposal. As noted, when the Board has
complied with the controlling statutes and the evidence is suf-
ficient to support its findings of fact, this court may not substi-
tute its judgment for that of the Board, and we will sustain the
Board’s action.11 We conclude that there is evidence to support
the Board’s decision that Southern can more economically and
feasibly transmit Minden’s necessary power.
would MInden’s proposed lIne result
In unnecessAry duplIcAtIon?
Section 70-1014 also requires the Board to consider “unnec-
essary duplication of facilities or operations.” The Board found
that Minden’s proposal would be unnecessarily duplicative of
Southern’s line. Minden argues that the Board erred in deter-
mining that Minden’s proposed line would result in unneces-
sary duplication. Minden concedes that its proposed line would
be duplicative of Southern’s. But Minden argues that there is
no unnecessary duplication.
The Board found that Southern’s line and Minden’s pro-
posed line both began at the NPPD substation located outside
of Minden and were connected to Minden’s substation inside of
town. The two lines would operate at the same voltage. Further,
11 See Cornhusker P. P. Dist., supra note 3.
934 	282 NeBRASkA RePoRTS

the Board noted that it was uncontested that Southern’s line
had the capacity to service Minden’s needs and that Southern
would provide this service for a fee to Minden. To summarize,
the two lines were to begin at the same place and both con-
nected to Minden’s substation. And only one line was needed
to carry the load. The record shows sufficient evidence to sup-
port the Board’s decision that Minden’s line would be unneces-
sarily duplicative of Southern’s line, and that decision is not
arbitrary or unreasonable.
CoNCLUSIoN
We conclude the Board did not err when it concluded that
Minden’s line was not the most economical and feasible line.
Further, the Board did not err when it concluded that Minden’s
line would be unnecessarily duplicative of Southern’s existing
line. Accordingly, we affirm.
A ffIrMed.
wrIght, J., not participating in the decision.
STATe v. heSSLeR 	935
Cite as 282 Neb. 935
stAte of nebrAskA, Appellee , v.
Jeffrey A. hessler , AppellAnt.
807 N.W.2d 504
Filed December 23, 2011. 	No. S-11-379.
1. Effectiveness of Counsel. A claim that defense counsel provided ineffective
assistance presents a mixed question of law and fact.
2. Postconviction: Appeal and Error. on appeal from a proceeding for postconvic-
tion relief, the trial court’s findings of fact will be upheld unless such findings are
clearly erroneous.
3. Effectiveness of Counsel: Appeal and Error. Determinations regarding whether
counsel was deficient and whether the defendant was prejudiced are questions of
law that an appellate court reviews independently of the lower court’s decision.
4. Postconviction: Appeal and Error. A motion for postconviction relief cannot be
used to secure review of issues that were known to the defendant and could have
been litigated on direct review.
5. Postconviction: Effectiveness of Counsel: Appeal and Error. When a defendant
was represented both at trial and on direct appeal by lawyers employed by the
same office, the defendant’s first opportunity to assert ineffective assistance of
trial counsel is in a motion for postconviction relief.
6. Postconviction: Constitutional Law. Postconviction relief is a very narrow cat-
egory of relief available only to remedy prejudicial constitutional violations.