Mass. Gen. Laws ch. 161 § 118
Any company desiring to accept said sections shall, at the time of its application to the department to determine the amount of its stock investment, apply to it to determine the status of its then unfunded debt. The department shall thereupon disallow any amount thereof which it deems was improperly incurred. Interest charges upon the debt so disallowed shall be borne by the company and charged to the amount which would otherwise be available as a return upon the stock investment. Interest charges upon the residue of the unfunded debt shall be included in the cost of service. Interest charges upon the unfunded debt incurred by the company after its acceptance of said sections shall be included in the cost of service unless the department determines any portion of such debt to be unreasonable or improper. Interest charges upon any portion disallowed shall thereafter be deducted from the return upon the stock investment.
Mass. Gen. Laws ch. 161, § 118