SB 205-1_ Filed 04/04/2013, 07:41 Wesco


Text Box


    PREVAILED      Roll Call No. _______
    FAILED        Ayes _______
    WITHDRAWN        Noes _______
    RULED OUT OF ORDER


[

HOUSE MOTION ____

]

MR. SPEAKER:

    I move that Engrossed Senate Bill 205 be amended to read as follows:

    Delete the title and insert the following:
    A BILL FOR AN ACT to amend the Indiana Code concerning utilities.

SOURCE: Page 1, line 1; (13)MO020501.1. -->     Page 1, between the enacting clause and line 1, begin a new paragraph and insert:
SOURCE: IC 8-1.5-3-8; (13)MO020501.1. -->     "SECTION 1. IC 8-1.5-3-8, AS AMENDED BY P.L.172-2009, SECTION 5, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 8. (a) A municipality owning a utility under this chapter shall furnish reasonably adequate services and facilities.
    (b) The rates and charges made by a municipality for a service rendered or to be rendered, either directly or in connection therewith, must be nondiscriminatory, reasonable, and just.
    (c) "Reasonable and just rates and charges for services" means rates and charges that produce sufficient revenue to:
        (1) pay all the legal and other necessary expenses incident to the operation of the utility, including:
            (A) maintenance costs;
            (B) operating charges;
            (C) upkeep;
            (D) repairs;
            (E) depreciation;
            (F) interest charges on bonds or other obligations, including leases; and
            (G) costs associated with the acquisition of utility property

under IC 8-1.5-2;
        (2) provide a sinking fund for the liquidation of bonds or other obligations, including leases;
        (3) provide a debt service reserve for bonds or other obligations, including leases, in an amount established by the municipality, not to exceed the maximum annual debt service on the bonds or obligations or the maximum annual lease rentals;
        (4) provide adequate money for working capital;
        (5) provide adequate money for making extensions and replacements to the extent not provided for through depreciation in subdivision (1); and
        (6) provide money for the payment of any taxes that may be assessed against the utility.
    (d) It is the intent of this section that the rates and charges produce an income sufficient to maintain the utility property in a sound physical and financial condition to render adequate and efficient service. Rates and charges too low to meet these requirements are unlawful.
    (e) The board may recommend to the municipal legislative body rates and charges sufficient to include a reasonable return on the utility plant of the municipality.
    (f) Rates and charges established under this section are subject to the approval of:
        (1) the municipal legislative body by ordinance; and
        (2) the commission, in accordance with the procedures set forth in IC 8-1-2.
The commission shall approve rates and charges that are sufficient, in addition to the cash revenue requirements set forth in subsection (c), to include a reasonable return on the utility plant of the municipality if the legislative body so elects.
    (g) Except for a municipally owned utility taxed under IC 6-1.1-8-3, and subject to section 8.3(n) of this chapter, the commission shall approve rates and charges sufficient to compensate the municipality for taxes that would be due the municipality on the utility property were it privately owned. These rates and charges in lieu of taxes may be transferred to the municipal general fund, if the legislative body so elects.
    (h) The commission shall grant a request that an increase in rates and charges not be effective until after the occurrence of a future event if the legislative body so requests.
    (i) A municipality that acquires and operates a utility under IC 8-1.5-2 by exercising the power of eminent domain may not impose a special rate, charge, surcharge, or other fee, other than rates and charges approved under this section or otherwise authorized by law, on the customers of the utility in order to pay for the costs associated with acquiring the utility through the exercise of the power of eminent domain.


SOURCE: IC 8-1.5-3-8.3; (13)MO020501.2. -->     SECTION 2. IC 8-1.5-3-8.3, AS ADDED BY P.L.139-2012, SECTION 3, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 8.3. (a) This section applies to a utility that provides service to property located outside the corporate boundaries of the municipality.
    (b) As used in this section:
        (1) "utility"; and
        (2) "works";
have the meaning set forth for those terms in section 8.1 of this chapter.
    (c) This subsection applies if a municipal legislative body adopts an ordinance under section 8.1 of this chapter or under IC 36-9-23-26 that is in effect on March 31, 2012, and that imposes rates and charges on users of the works for service to property located outside the corporate boundaries of the municipality that exceed by more than fifteen percent (15%), but not more than fifty percent (50%), the rates and charges imposed on users of the works for service to property located within the corporate boundaries of the municipality. Not later than September 30, 2012, the municipality may petition the commission to approve the percentage difference between rates and charges established in the ordinance for property within and property outside the corporate boundaries. In the petition, the municipality shall set forth the following:
        (1) The date on which the ordinance took effect.
        (2) The percentage difference between rates and charges imposed on users of the works for service to property located outside the corporate boundaries of the municipality and to property located within the corporate boundaries of the municipality.
        (3) Whether the works that is the subject of the ordinance is a water utility works, a wastewater utility works, or both a water and wastewater utility works.
If the commission determines that a petition filed under this subsection satisfies the requirements of this subsection, the commission shall approve the petition, including the percentage difference between rates and charges described in subdivision (2). If the commission determines that a petition filed under this subsection does not satisfy the requirements of this subsection, the commission shall disapprove the petition. However, if the percentage difference imposed in the ordinance was the subject of an objecting petition that was filed under section 8.2 of this chapter or under IC 36-9-23-26.1 and sustained on final judgment or appeal, as applicable, by a court, the percentage difference is considered approved without the filing of a petition under this subsection.
    (d) If a municipality that files, or that is exempt from filing, a petition under subsection (c) adopts an ordinance under section 8.1 of this chapter after March 31, 2012, that imposes rates and charges on users of the works for service to property located outside the corporate

boundaries of the municipality that exceed the rates and charges imposed on users of the works for service to property located within the corporate boundaries of the municipality by more than the sum of the percentage difference approved or considered approved by the commission under subsection (c) plus fifteen percent (15%), either or both of the following may petition the commission to review and adjust, if necessary, the rates and charges imposed on users of the works for service to property located outside the corporate boundaries of the municipality:
        (1) The municipality.
        (2) The lesser of:
            (A) ten percent (10%) of all; or
            (B) twenty-five (25);
        users of the works whose property is located outside the corporate boundaries of the municipality.
A petition filed under this subsection must be filed not more than fourteen (14) days after the date on which the ordinance referred to in this subsection is adopted. A petition may not be filed under this subsection if a petition has already been filed under section 8.2 of this chapter appealing the same rates and charges.
    (e) If a municipal legislative body, other than a municipal legislative body described in subsection (c), adopts an ordinance under section 8.1 of this chapter after March 31, 2012, that imposes rates and charges on users of the works for service to property located outside the corporate boundaries of the municipality that exceed the rates and charges imposed on users of the works for service to property located within the corporate boundaries of the municipality by more than fifteen percent (15%), either or both of the following may petition the commission to review and adjust, if necessary, the rates and charges imposed on users of the works for service to property located outside the corporate boundaries of the municipality:
        (1) The municipality.
        (2) The lesser of:
            (A) ten percent (10%) of all; or
            (B) twenty-five (25);
        users of the works whose property is located outside the corporate boundaries of the municipality.
A petition must be filed not more than fourteen (14) forty-five (45) days after the date on which the ordinance is adopted. A petition may not be filed under this subsection if a petition has already been filed under section 8.2 of this chapter or under IC 36-9-23-26.1 appealing the same rates and charges.
    (f) The filing of a petition with the commission under subsection (d) or (e) stays the ordinance adopted under section 8.1 of this chapter or under IC 36-9-23-26. The rates and charges in effect before the adoption of the ordinance remain in effect until:


        (1) the commission approves or disapproves the petition, or the petition is dismissed under subsection (g); and
        (2) if applicable, the commission adjusts the rates and charges imposed by the ordinance on users of the works whose property is located outside the corporate boundaries of the municipality.
    (g) The commission shall prescribe the form and manner in which a petition must be filed under subsection (d) or (e). The burden of proof to demonstrate that the proposed rates and charges are nondiscriminatory, reasonable, and just is on the municipality, regardless of who petitions the commission. If the commission fails to approve or disapprove a petition within one hundred twenty (120) days after the petition is filed in the form and manner prescribed by the commission, the petition is dismissed, and the ordinance adopted under section 8.1 of this chapter or under IC 36-9-23-26 takes effect. A petition is automatically disapproved if the petitioner has filed a petition under section 8.2 of this chapter or under IC 36-9-23-26.1 with respect to the same rate ordinance.
    (h) For purposes of determining whether the percentage difference between rates and charges imposed on users of the works for service to property located outside the corporate boundaries of the municipality and the rates and charges imposed on users of the works for service to property located within the corporate boundaries of the municipality is nondiscriminatory, reasonable, and just under section 8 of this chapter, the commission:
        (1) may consider the benefit and expense to all users of the works of extending the works outside the corporate boundaries of the municipality; and
        (2) may not consider any connection fees or capital surcharges imposed on users of the works for service to property that is located outside the corporate boundaries of the municipality that are specifically designated to pay for the costs associated with main extensions to the users of the works.
    (i) If the commission determines that the percentage difference between the rates and charges imposed on users of the works for service to property located outside the corporate boundaries of the municipality and the rates and charges imposed on users of the works for service to property located within the corporate boundaries of the municipality is not nondiscriminatory, reasonable, and just under section 8 of this chapter, the commission may:
        (1) establish nondiscriminatory, reasonable, and just rates and charges for users of the works for service to property located outside the corporate boundaries of the municipality; and
        (2) order the municipal legislative body to adopt an ordinance imposing the nondiscriminatory, reasonable, and just rates and charges.
However, with respect to rates and charges imposed in an ordinance

that was the subject of an objecting petition filed under section 8.2 of this chapter or under IC 36-9-23-26.1 and sustained on final judgment or appeal, as applicable, by a court, the commission may not establish rates and charges such that the percentage difference between rates and charges established by the commission is less than the percentage difference between rates and charges imposed in the ordinance.
    (j) This section does not:
        (1) authorize the commission to review or revise rates and charges imposed on users of the works for service to property located within the corporate boundaries of the municipality; or
        (2) otherwise return or subject a utility to the jurisdiction of the commission for the approval of rates and charges.
    (k) The commission may adopt rules under IC 4-22-2 to implement this section.
    (l) The commission may not impose a fee with respect to proceedings under this section.
     (m) Subject to subsection (h)(2), for purposes of this section, "rates and charges" are those charges made by a municipality for a service rendered or to be rendered by the municipality's utility, either directly or in connection with that service, as described in section 8(b) of this chapter, regardless of whether the rates and charges:
        (1) are:
            (A) imposed through a compact fee or any similar arrangement; or
            (B) referred to as a compact fee or by any other term;
        by the municipality or the utility; or

         (2) are based, in whole or in part, on the assessed value of the property served by the utility.
     (n) A municipality may not require an existing user of the works to enter into an agreement that:
        (1) is for service to the user's property located outside the corporate boundaries of the municipality; and
        (2) implements a payment in lieu of taxes as a condition for the continuation of service to the property, regardless of whether the payment in lieu of taxes is based on the assessed value of the property.
".



SOURCE: Page 2, line 16; (13)MO020501.2. -->     Page 2, after line 16, begin a new paragraph and insert:
SOURCE: ; (13)MO020501.5. -->     "SECTION 5. An emergency is declared for this act.".
    Renumber all SECTIONS consecutively.
    (Reference is to ESB 205 as printed April 2, 2013.)

________________________________________

Representative Wesco


MO020501/DI 101     2013