CHAPTER 696

An Act to prevent interruption or suspensions in the operation of certain
public utilities, and to that end to declare it to be the public policy
of the State that the functioning and operation of such utilities are
clothed with a public interest and are essential to the health, safety
and welfare of the citizens of Virginia; to authorize the Governor to
take possession of and. operate on behalf of the State public utilities
and to prescribe the terms and conditions of such taking possession of
and operation, and the power, authority and duty of the Governor
with respect thereto; to provide how any such utility may be returned
to private management and control; to declare certain acts unlawful;
and to impose penalties.

[H 704]
Approved April 7, 1952
Be it enacted by the General Assembly of Virginia:

1. § 1. The continuous, uninterrupted and proper functioning and
operation of public utilities engaged in the business of furnishing water,
light, heat, gas, electric power, transportation or communication, or any
one or more of them, to the people of Virginia are hereby declared to be
essential to their welfare, health and safety. It is contrary to the public
policy of the State to permit any substantial impairment or suspension of
the operation of any such utility and it is the duty of the Government of
the State to exercise all available means and every power at its command
to prevent the same so as to protect its citizens from any dangers, perils,
calamities or catastrophes which would result therefrom. It is therefore
further declared that such utilities are clothed with a vital public interest
and to protect the same it is necessary that impairment or suspension of
the operation of any such utility for any reason be prevented to the extent
and by the means hereinafier provided.
§ 2. Whenever in the judgment of the Governor there is an immi-
nent threat of substantial curtailment, interruption or suspension in the
operation of any public utility hereinabove mentioned he shall promptly
make an investigation to determine whether, in his opinion, an actual
curtailment, interruption or suspension of operation will constitute a
serious menace or threat to the public health, safety or welfare, and if he
concludes that it will, he shall forthwith issue an executive proclamation
so declaring and stating that at the time of such curtailment, interruption
or suspension of operation he will take immediate possession of the utility,
its plant and equipment, or so much thereof as may be necessary, for the
use of and operation by the Commonwealth. Where the Governor finds
it advisable for effectuation of the purposes hereof he may by proclamation
advance or defer such taking of possession.

§ 3. The Governor may possess and operate such properties in the
manner hereinafter provided and through such department or agency of
the State as he may designate.

§ 4. If the Governor shall issue a proclamation of intention to take
possession of and operate any such utility as provided herein, he shall
immediately ascertain what positions of employment are necessary to be
filled in order to operate the same to such extent as may be required to
protect the public safety and welfare, and the duties incident to each such
position, and shall ascertain from those persons then employed in such
positions whether they will accept employment by the State to perform
like duties for the State. Any such person who will accept employment
by the State shall be entitled to be employed and to continue in such
employment for such time as the Governor may determine. It shall be
the duty of the management of any such utility to provide promptly and
furnish to the Governor, upon his request, detailed information with
respect to the positions necessary to be filled and the duties incident to or
pertaining to each such position, and the name of the person presently
holding same.

§ 5. In the event that any person or persons then employed by the
utility in any such necessary positions shall fail to indicate an intention
to work for the State in operating the utility, when inquiry is made of
such person by the Governor or his agent, the Governor shall immediately
institute measures to employ another person or other persons to perform
the required duties of any one not indicating such intention. No person
who upon such inquiry fails to indicate intention to work for the State
may thereafter claim the right to employment by the State provided in
§ 4 of this act.

§ 6. The status of no person as an employee of the utility shall be
affected by either his acceptance of employment by the State or by his
refusal of such employment.

~§ 7. After any proclamation of intention to take possession, the
Governor may, by and through agents designated by him, enter upon the
property of the utility with prospective employees and familiarize them
with the nature of the work incident to the positions in which it is con-
templated they will be employed and train them to discharge the duties
thereof. The management of the utility and all State departments, insti-
tutions and agencies shall cooperate with the Governor in the operation
of the utility and in the securing and training of persons for employment
in such operation.

§ 8. Unless the management of the utility believes that the Governor
is mistaken in his conclusion as to the curtailment, interruption or suspen-
sion of operation, actual possession of the utility, its properties and
facilities, shall be delivered at the time stated in the executive proclama-
tion. In the event of refusal of possession, upon application of the Gov-
ernor any court of record of any county or city in which the utility’s main
executive offices in this State are located, or the judge thereof in vacation,
shall issue a rule requiring the authorized representatives of such utility
to show cause why possession should not be delivered at the time stated
in the executive proclamation. The rule shall be given preference over
all other matters pending before such court. After reasonable notice, the
court or judge shall hear the parties and determine as promptly as possible
the question of fact relating to the curtailment, interruption or suspension
of the operation of the utility and whether the facts require the delivery
of possession and render judgment requiring or denying delivery of pos-
session as the case may be.

§ 9. No person, organization or association or any bargaining repre-
sentative of the employees or any representative or agent of the manage-
ment of the utility shall interfere with or obstruct the Governor, or any
State representative or agent designated by him, in his efforts to secure
or contract for the services of the officers and employees of the utility or
of any person to engage in or continue the operation of the utility, or shall
encourage or solicit any such persons not to render such services or shall
interfere in or obstruct the training of prospective employees in the
operation of the utility by the Governor or by the designated State repre-
sentatives. Upon seizure of any utility as provided herein the establish-
ment or conduct of a picket line near or adjacent to any work engaged
in or proposed to be engaged in by any sugh persons employed or sought
to be employed by the State in its operation of such utility shall be deemed
an unlawful obstruction of the exercise of an essential function of the
State Government and a violation of this section; and all persons ordering,
directing, encouraging or participating in any such picketing shall be
guilty of violating this section.

§ 10. The expense of operating any utility pursuant to the provisions
of this act, and of training prospective employees or otherwise preparing
to operate the same shall be paid out of the appropriation for criminal
charges upon such authorizations as the Governor may prescribe, and all
funds, revenues or reimbursements derived from or received as a result
of such operations shall be paid into the State treasury and credited to
such appropriation, or, after full reimbursement of such appropriation for
expenditures therefrom, additional funds may be credited to such other
appropriations as the Governor may direct, and subsequent disbursements
in carrying out the purposes of this act may be made therefrom.

§ 11. During the period of the State’s operation of any utility,
pursuant to the provisions of this act, the Governor shall observe the
utility’s previously established salaries, wages, conditions of employment,
practices as to merit or length of service increases and as to promotions;
it being the intent of this act that any disputes as to such matters shall be
settled by collective bargaining between the parties to such disputes.

§ 12. The Governor may provide in such manner as he deems appro-
priate for the collection of the gross revenues accruing from the utility
during the time of its operation by the State. After payment of proper
operating expenses and reimbursement of the State for all expenses
incurred in preparing to operate same and making allowances of the
additional items as provided in § 15 of this act in defining net income,
eighty-five per centum of the net income shall be paid to the utility as
compensation for the temporary use of its business, facilities and proper-
ties. The amount of money so paid shall in no wise control the amount of
just compensation to be allowed the utility. In the event of disagreement
as to the amount of payments under this section, either party may, by
appropriate petition, submit the matter to the State Corporation Commis-
sion with the right of a ps from its decision to the,Supreme Court of
Appeals. SOQ e
§ 13. Whenever the authorized representatives of any such utility
shall notify the Governor, in writing, stating that the utility is in position
to and can and will resume operations and rendef normal public service,
and shall satisfy the Governor, or his designated agent, of the correctness
of such statement, the Governor, or such agent, upon the request of the
utility management, shall restore to the possession of the utility its proper-
ties and facilities. In the event that the Governor or such agent for
any reason refuses such restoration of possession, the utility shall have
the right to have a rule issued by any court of general chancery juris-
diction in the city of Richmond, or the judge thereof in vacation, to
show cause why such possession should not be restored. The rule shall
provide for ten days’ notice to the Governor or such agent before cause is
required to be shown. The decision of such court, or the judge thereof in
vacation, on such question shall be final as to conditions then existing, but
shall not be a bar to subsequent requests by the utility for restoration of
possession. Nothing in this section shall be construed as denying to the
Governor the right to restore possession at any time when, in his judg-
ment, the public interest so requires.

§ 14. The utility shall be entitled to receive reasonable, proper and
lawful compensation for the use of its business, facilities and properties
by the State. In the event the parties in interest are unable to agree upon
the amount of such compensation either party may file a petition in the
court rendering judgment reqyiring delivery of possession of the utility,
or in the event no such judgment was rendered, in any court mentioned
in § 8 of this act, for the purpose of having the same judicially determined.
The court shall, without a jury, hear such evidence and argument of
counsel as may ‘be deemed appropriate and render judgment thereon or
may refer to a commissioner such questions as are considered proper and
act upon the commissioner’s report as in ordinary chancery proceedings.
An appeal shall be to the Supreme Court of Appeals from any final judg:
ment of the court rendered under this section. If the amount of compensa-
tion so determined shall be less than the sum paid to the utility under the
provisions of § 12 of this act the utility shall return the excess by paying
the same to the State Treasurer to be credited as the Governor may direct
in accordance with the provisions of § 10 of this act. -

§ 15. The words “utilities” or “public utilities’ when used in this
act shall be construed to mean any person, partnership, association or
corporation, engaged in the business of furnishing electric power, water,
light, heat, gas, transportation or communication, or any one or more of
them, to the people of Virginia.

“Net income” with respect to operation of a utility by the State shall
be construed to mean the gross revenues derived from such operation after
deducting therefrom:

(1) The costs of operation and maintenance of the utility,

(2) The amount of depreciation during the time of such operation
based on the amount allowed in the utility’s federal income tax return,

(3) Federal, State, and local taxes which would be payable by the
utility, if the properties were operated by it,

(4) Interest on the indebtedness of the utility, and

(5) Payments for the cost of insurance.

All of such items shall be prorated on an annual basis in proportion
to the time the plant is operated by the State.

§ 16. Any person violating any of the provisions of §§ 4, 7 or 9 of
this act shall be guilty of a misdemeanor and upon conviction of same shall
be fined not less than ten nor more than one thousand dollars, and may be
imprisoned in jail for not more than twelve months.
§ 17. In addition to the remedies herein provided, the Governor is
hereby authorized to apply to the Circuit Court of the City of Richmond
or to any court mentioned in § 8 of this act for, and such court shall have
jurisdiction upon hearing and for cause shown to grant a temporary or
permanent injunction restraining any person, organization, association or
corporation from violating any provision of this act irrespective of
whether or not there exists an adequate remedy at law.

§ 18. It shall be the duty of every attorney for the Commonwealth
to whom the Governor shall report any violation of §§ 4, 7 or 9 of this
act to cause proceedings to be prosecuted without delay for the fines and
penalties in such cases. The Attorney General shall be charged with the
duty of enforcing all other provisions of this act and shall represent the
Governor in all matters arising thereunder. Whenever he shall deem it in
the best interest of the State the Attorney General may employ special
counsel to assist him in carrying out the duties imposed by this section and
the expense so incurred shall be considered as an expense of operation
of the utility and paid in accordance with the provisions of § 10 of this act.

§ 19. Nothing in this act shall apply to any express company,
sleeping car company, common carrier engaged in interstate commerce
by railroad or by air or to any company which is directly or indirectly
owned or controlled by any carrier by railroad.

20. Nothing in this act shall be considered or construed as in any
way questioning or impairing the constitutional or statutory powers of
Ee {Governor as commander in chief of the land and naval forces of the
2. If any provision of this act or the application thereof to any person or
circumstance is held invalid, such invalidity shall not affect other provi-
sions or applications of the act which can be given effect without the
invalid provisions or applications, and to this end the provisions of this
act are declared.to be severable.

An emergency exists and this act is in force from its passage.