§ 8-1-2-4.1 — Public water or wastewater utilities; changes in federal or state income tax rate; petition to commission for surcharge

Indiana § 8-1-2-4.1

• Jurisdiction: Indiana
• Art. 1: UTILITIES GENERALLY
• Ch. 2: Utility Regulation

Text

1. (a) As used in this section, "water or
wastewater utility" means a public utility (as defined in section 1(a) of
this chapter) that provides water or wastewater service to the public.
(b) Except as provided in subsection (h), not later than sixty (60)
days after the effective date of a change in the applicable federal or
state income tax rate as a result of new legislation, a water or
wastewater utility shall petition the commission for a water or
wastewater utility surcharge that adjusts the water or wastewater
utility's rates and charges to provide recovery for the change in the
federal or state income tax rate, independent of any other matters
related to the water or wastewater utility's revenue requirement. A
surcharge approved under this section shall operate on a prospective
basis.
(c) A surcharge under this section:
(1) applies to each rate or charge in effect at the time of the
petition;
(2) shall be calculated to reflect the difference between:
(A) the amount of federal or state income taxes that each
existing rate or charge was designed to recover based on the
income tax rate in effect at the time the rate or charge was
approved; and
(B) the amount of federal or state income taxes that would have
been embedded in the given rate or charge had the new income
tax rate resulting from the new legislation been in effect at the
time of approval; and
(3) shall not include normalization of a water or wastewater
utility's accumulated deferred income taxes. However, the
commission may address the issues described in this subdivision
in a sub-docket created by the commission.
(d) The commission shall approve a surcharge under this section if
the commission finds that:
(1) the surcharge has been calculated correctly under subsection
(c); and
(2) the water or wastewater utility's proposal is just and
reasonable.
(e) Beginning on the effective date of the new legislation, and
pending approval of a petition filed under this section, a water or
wastewater utility is authorized to use regulatory accounting for all
calculated differences described in subsection (c)(2).
(f) This section shall not be construed to limit the commission's
authority to:
(1) initiate proceedings; or
(2) take actions;
to ensure just and reasonable rates in connection with any new
legislation.
(g) A petition filed under this section is not considered a petition for
a general increase in rates and charges.
(h) A water or wastewater utility that serves fewer than eight
thousand (8,000) customers may, but is not required to, file a petition
under subsection (b).

Legislative History

As added by P.L.120-2021, SEC.2.