§ 8-1-30.3-6.5 — Water and wastewater utility allocation of wastewater improvement costs to water customers

Indiana § 8-1-30.3-6.5

• Jurisdiction: Indiana
• Art. 1: UTILITIES GENERALLY
• Ch. 30.3: Acquisition of Distressed Water or Wastewater

Text

5. (a) This section applies to a utility
company that is an eligible utility under IC 8-1-31.7-3 and that
provides both water and wastewater service in one (1) or more areas in
which the utility company has acquired wastewater utility property in
an acquisition that was eligible for approval, or was approved, under:
(1) this chapter; or
(2) IC 8-1.5-2-6.1.
(b) A utility company described in subsection (a) may, in a petition
to the commission for approval of a plan for service enhancement
improvements to the utility company's wastewater utility property
under IC 8-1-31.7, propose to allocate a portion of eligible costs of the
utility company's wastewater utility property to the utility company's
water customers.
(c) If a utility company makes a proposal under subsection (b), the
utility company shall submit the following as part of the utility
company's case in chief:
(1) The estimated adjustment rider that would result if there were
no allocation of eligible costs to the utility company's water
customers.
(2) A calculation of two percent (2%) of the utility company's
authorized total revenues for purposes of subsection (f)(1).
(3) Information regarding the availability of grants or low interest
loans and whether the utility company considered using available
grants or low interest loans to help the utility company finance or
reduce the cost of the service enhancement improvements for the
utility company and the utility company's customers.
(4) Documentation demonstrating that the utility company has
developed an asset management program, as defined in guidelines
adopted by the Indiana finance authority under IC 5-1.2.
(5) An estimate of the life cycle management costs, as defined in
guidelines adopted by the Indiana finance authority under IC 5-1.2, that will be incurred over the useful life of the assets to be
financed by the service enhancement improvements for which
approval is sought under IC 8-1-31.7.
(6) Information as to whether the wastewater utility property
acquired by the utility company was subject, before the
acquisition, to an enforcement order (as defined in IC 8-1-1.9-5).
(d) The commission may approve a utility company's proposal under
subsection (b) to the extent the commission finds that:
(1) subject to subsection (e), because of reasonable and necessary
improvements that are proposed for the wastewater utility
property, the resulting rates charged to wastewater customers
would reach levels necessitating the provision of financial
assistance to the customers in accordance with IC 8-1-2-0.5 and
in a manner consistent with IC 8-1-2-4;
(2) the total rates charged by the utility company for water service
will not increase unreasonably as a result of the allocation;
(3) the utility company included in its proposal information
regarding the availability of grants or low interest loans and
whether the utility company considered using available grants or
low interest loans to help the utility company finance or reduce
the cost of the service enhancement improvements for the utility
company and the utility company's customers, as described in
subsection (c)(3); and
(4) the utility company has developed an asset management
program, as defined in guidelines adopted by the Indiana finance
authority under IC 5-1.2, as described in subsection (c)(4).
(e) The commission may consider available reasonable measures
that could be taken to reduce the cost of the service enhancement
improvements described in subsection (d)(1).
(f) For purposes of subsection (d)(2):
(1) an increase in the total rates charged for water service is not
unreasonable to the extent the allocation under subsection (b)
results in an increase in authorized total revenues of two percent
(2%) or less; and
(2) the commission shall use the utility company's most recently
authorized total revenue, inclusive of adjustments in accordance
with adjustable rate mechanisms approved by the commission, for
purposes of making the determination under subdivision (1).
(g) If the commission approves a utility company's proposal under
subsection (d):
(1) the utility company shall include a notice on or with water
customer monthly bills specifying the amount of the adjustment
rider under IC 8-1-31.7 approved by the commission that recovers
necessary wastewater utility improvements;
(2) the utility company shall, in subsequent general rate cases,
submit a cost of service study as part of the utility company's case
in chief; and
(3) the commission shall:
(A) evaluate the allocation of eligible costs of the utility's
wastewater utility property to the utility company's water
customers in those subsequent general rate cases described in
subdivision (2); and
(B) order, to the extent the commission finds necessary, any
changes to the utility's rates to ensure just and reasonable rates.
(h) In the commission's annual report under IC 8-1-1-14 the
commission shall include a description of any activity under this
section in the fiscal year ending June 30 of the year in which the report
is due.

Legislative History

As added by P.L.100-2023, SEC.1.