JOHNSON, J.
Multnomah County instituted this suit for a declaratory judgment declaring invalid a rule1 of the Public Utility Commissioner (Commissioner) directing how utilities shall allocate certain taxes levied by counties in computing rates charged to utility customers.2 The [524] effect of the rule is that utility expenses resulting from payment of the county’s net business income tax are passed on to county ratepayers only rather than being reflected as part of a utility’s general rate structure. The trial court held the rule invalid on the ground that it "* * * purports to establish public utility rates in a manner which does not comply with ratemaking and rate regulatory requirements prescribed by ORS 757.205 to ORS 757.220.” On appeal by the Commissioner, the county argues that the trial court was correct, and that in any event the rule should be declared invalid because it violates the Fourteenth Amendment to the United States Constitution and is against public policy. We disagree and reverse.
ORS 757.205 to 757.225 set forth a statutory procedure by which rates charged by public utilities are established. Utilities are required to file their rate schedules with the Commissioner, ORS 757.205. The Commissioner may, either upon complaint or upon his own motion, order a hearing on the rate schedule, suspend the imposition of the rates and by order establish what he deems to be a fair and reasonable rate. ORS 757.210, 757.215, 757.220 and 757.225. The [525] trial court concluded that the rule at issue here was in effect an "a priori determination of the reasonableness” of how certain charges would be allocated in fixing rates and that such determination could only be made after hearing in accordance with the procedures specified in ORS 757.210 to 757.220. The trial court’s premise apparently was that every ratemaking decision by the Commissioner must be ad hoc. However, the statutory powers of the Commissioner contemplate a more comprehensive and flexible regulatory scheme.
In the first place, the suspension procedure described in ORS 757.210 to 757.225 is not the exclusive ratemaking procedure available to the Commissioner. He can, for example, summarily alter, suspend or amend an existing rate under his emergency powers enumerated in ORS 757.235. Likewise, any person, or the Commissioner upon his own motion, can institute the hearing procedures provided for in ORS 756.500 to 756.610 and after such hearing, the Commissioner can enter an order rescinding, suspending or amending an existing rate. These latter statutes are significant in that in specific terms they establish the comprehensive nature of the Commissioner’s regulatory authority over rates. Furthermore, the general powers of the Commissioner are set forth in ORS 756.040 which in pertinent part provides:
"(1) In addition to the powers and duties now or hereafter transferred to or vested in the commissioner, he shall represent the customers of any public utility, railroad, air carrier or motor carrier, and the public generally in all controversies respecting rates, valuations, service and all matters of which he has jurisdiction. In respect thereof he shall make use of the jurisdiction and powers of his office to protect such customers, and the public generally, from unjust and unreasonable exactions and practices and to obtain for them adequate service at fair and reasonable rates.
"(2) The commissioner is vested with power and jurisdiction to supervise and regulate every public utility, railroad, air carrier and motor carrier in this state, [526] and to do all things necessary and convenient in the exercise of such power and jurisdiction.
* * * * ”
ORS 756.060 expressly grants the Commissioner broad rulemaking authority. That statute provides:
"The commissioner may adopt and amend reasonable and proper rules and regulations relative to all statutes administered by him and may adopt and publish reasonable and proper rules to govern his proceedings and to regulate the mode and manner of all investigations and hearings of public utilities, railroads, air carriers, motor carriers and other parties before him.”
A rule is defined by ORS 756.400 as:
"* * * any directive, regulation or statement of general applicability that implements, interprets or prescribes law or policy, or describes the organization, procedure or practice requirements of the commissioner. * *
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JOHNSON, J.
Multnomah County instituted this suit for a declaratory judgment declaring invalid a rule1 of the Public Utility Commissioner (Commissioner) directing how utilities shall allocate certain taxes levied by counties in computing rates charged to utility customers.2 The [524] effect of the rule is that utility expenses resulting from payment of the county’s net business income tax are passed on to county ratepayers only rather than being reflected as part of a utility’s general rate structure. The trial court held the rule invalid on the ground that it "* * * purports to establish public utility rates in a manner which does not comply with ratemaking and rate regulatory requirements prescribed by ORS 757.205 to ORS 757.220.” On appeal by the Commissioner, the county argues that the trial court was correct, and that in any event the rule should be declared invalid because it violates the Fourteenth Amendment to the United States Constitution and is against public policy. We disagree and reverse.
ORS 757.205 to 757.225 set forth a statutory procedure by which rates charged by public utilities are established. Utilities are required to file their rate schedules with the Commissioner, ORS 757.205. The Commissioner may, either upon complaint or upon his own motion, order a hearing on the rate schedule, suspend the imposition of the rates and by order establish what he deems to be a fair and reasonable rate. ORS 757.210, 757.215, 757.220 and 757.225. The [525] trial court concluded that the rule at issue here was in effect an "a priori determination of the reasonableness” of how certain charges would be allocated in fixing rates and that such determination could only be made after hearing in accordance with the procedures specified in ORS 757.210 to 757.220. The trial court’s premise apparently was that every ratemaking decision by the Commissioner must be ad hoc. However, the statutory powers of the Commissioner contemplate a more comprehensive and flexible regulatory scheme.
In the first place, the suspension procedure described in ORS 757.210 to 757.225 is not the exclusive ratemaking procedure available to the Commissioner. He can, for example, summarily alter, suspend or amend an existing rate under his emergency powers enumerated in ORS 757.235. Likewise, any person, or the Commissioner upon his own motion, can institute the hearing procedures provided for in ORS 756.500 to 756.610 and after such hearing, the Commissioner can enter an order rescinding, suspending or amending an existing rate. These latter statutes are significant in that in specific terms they establish the comprehensive nature of the Commissioner’s regulatory authority over rates. Furthermore, the general powers of the Commissioner are set forth in ORS 756.040 which in pertinent part provides:
"(1) In addition to the powers and duties now or hereafter transferred to or vested in the commissioner, he shall represent the customers of any public utility, railroad, air carrier or motor carrier, and the public generally in all controversies respecting rates, valuations, service and all matters of which he has jurisdiction. In respect thereof he shall make use of the jurisdiction and powers of his office to protect such customers, and the public generally, from unjust and unreasonable exactions and practices and to obtain for them adequate service at fair and reasonable rates.
"(2) The commissioner is vested with power and jurisdiction to supervise and regulate every public utility, railroad, air carrier and motor carrier in this state, [526] and to do all things necessary and convenient in the exercise of such power and jurisdiction.
* * * * ”
ORS 756.060 expressly grants the Commissioner broad rulemaking authority. That statute provides:
"The commissioner may adopt and amend reasonable and proper rules and regulations relative to all statutes administered by him and may adopt and publish reasonable and proper rules to govern his proceedings and to regulate the mode and manner of all investigations and hearings of public utilities, railroads, air carriers, motor carriers and other parties before him.”
A rule is defined by ORS 756.400 as:
"* * * any directive, regulation or statement of general applicability that implements, interprets or prescribes law or policy, or describes the organization, procedure or practice requirements of the commissioner. * *
The rule adopted here is a directive, regulation or statement of general applicability for the purpose of implementing the statutes administered by the Commissioner. Such rule is within his express statutory powers and consistent with sound administrative law principles. The Commissioner’s power over rates constitutes a broad delegation of legislative authority. The only legislative standards for exercising that authority are that rates be "fair and reasonable.” ORS 756.040. Confronted with such a broad delegation, courts either have encouraged or compelled administrative agencies to adopt rules of the kind at issue here establishing the standards for the exercise of such authority. See Sun Ray Drive-In Dairy v. OLCC, 20 Or App 91, 530 P2d 887 (1975); 1 Davis, Administrative Law §2.00, (1970 Supplement). Furthermore, in adopting policies of general application such as those at issue here, rulemaking procedures assure broader public input into the agency policy-making decisions than are afforded by the contested-case-type procedures where usually only those parties that are directly affected are given notice and participate in the [527] deliberative process. Compare ORS 756.410 with ORS 756.512 and 757.220; see also, Marbet v. Portland Gen. Elect., 277 Or 447, 458-464, 561 P2d 154 (1977). The rulemaking procedures followed by the Commissioner were wholly proper.
The county argues that the subject rule violates the equal protection clause of the Fourteenth Amendment to the United States Constitution because the Commissioner has treated taxes levied by counties in a different manner than his other rules treat similar types of taxes levied by cities. Of course, cities and counties have different jurisdictions and provide different services. The record indicates the Commissioner’s rationale for the different treatment of city and county taxes is that some services provided by the cities, such as city streets, are in the nature of a utility operating expense and thus are at least in part passed on to all ratepayers. In contrast he reasons that county taxes of the type at issue here are revenue measures generally benefiting county residents and thus should be passed on to county residents only. We are satisfied that the Commissioner’s reasons for the different classification satisfy the minimum rationality test of the Fourteenth Amendment, particularly as that test is applied in matters relating to the allocation of tax burdens. See San Antonio School District v. Rodriquez, 411 US 1, 93 S Ct 1278, 36 L Ed 2d 16 (1973); and Olsen v. State ex rel Johnson, 276 Or 9, 554 P2d 139 (1976).
The county’s argument that the Commissioner’s rule is not good public policy should be addressed to the Commissioner or the legislature.
Reversed.