Utility system improvement charges.
Introduced Version
SENATE BILL No. 479
_____
DIGEST OF INTRODUCED BILL
Citations Affected: IC 8-1-31.
Synopsis: Utility system improvement charges. Provides that a public
utility that provides water or wastewater service may establish a utility
system improvement charge (USIC). (Current law provides that only a
public utility that provides water service may apply for a distribution
system improvement charge (DSIC).) Provides that a public utility may
petition for a change in its USIC every three months. (Current law
provides that a public utility may file a petition not more than once
every 12 months.) Provides that a USIC may produce USIC revenues
totaling up to 10% of a public utility's base revenue level. (Current law
limits revenues to 5% of base revenue.) Requires a public utility to
annually reconcile the difference between its USIC revenues and costs.
Repeals definitions related to DSICs. Makes conforming amendments.
Effective: July 1, 2011.
Merritt
January 13, 2011, read first time and referred to Committee on Utilities & Technology.
Introduced
First Regular Session 117th General Assembly (2011)
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SENATE BILL No. 479
A BILL FOR AN ACT to amend the Indiana Code concerning
utilities.
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 8-1-31-5; (11)IN0479.1.1. -->
SECTION 1. IC 8-1-31-5 IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2011]: Sec. 5. As used in this chapter, "eligible
distribution utility system improvements" means new used and useful
water utility distribution or wastewater collection plant projects that:
(1) do not increase revenues by connecting the distribution utility
system to new customers;
(2) are in service; and
(3) were not included in the public utility's rate base in its most
recent general rate case.
SOURCE: IC 8-1-31-6; (11)IN0479.1.2. -->
SECTION 2. IC 8-1-31-6 IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2011]: Sec. 6. As used in this chapter, "pretax
return" means the revenues necessary to:
(1) produce net operating income equal to the public utility's
weighted cost of capital multiplied by the net original cost of
eligible distribution utility system improvements; and
(2) pay state and federal income taxes applicable to such income.
SOURCE: IC 8-1-31-7.5; (11)IN0479.1.3. -->
SECTION 3. IC 8-1-31-7.5 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2011]: Sec. 7.5. As used in this chapter, "USIC" refers to a utility
system improvement charge.
SOURCE: IC 8-1-31-7.6; (11)IN0479.1.4. -->
SECTION 4. IC 8-1-31-7.6 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2011]: Sec. 7.6. As used in this chapter, "USIC costs" means
depreciation expenses and pretax return associated with eligible
utility system improvements.
SOURCE: IC 8-1-31-7.7; (11)IN0479.1.5. -->
SECTION 5. IC 8-1-31-7.7 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2011]: Sec. 7.7. As used in this chapter, "USIC revenues" means
revenues produced through a USIC exclusive of revenues from all
other rates and charges.
SOURCE: IC 8-1-31-8; (11)IN0479.1.6. -->
SECTION 6. IC 8-1-31-8 IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2011]: Sec. 8. (a) Except as provided in
subsection (d), a public utility providing water or wastewater utility
service may file with the commission rate schedules establishing a
DSIC USIC that will allow the automatic adjustment of the public
utility's basic rates and charges to provide for recovery of DSIC USIC
costs.
(b) The public utility shall serve the office of the utility consumer
counselor a copy of its filing at the time of its filing with the
commission.
(c) Publication of notice of the filing is not required.
(d) A public utility may not file a petition under this section in the
same calendar year in which the public utility has filed a request for a
general increase in the basic rates and charges of the public utility.
SOURCE: IC 8-1-31-9; (11)IN0479.1.7. -->
SECTION 7. IC 8-1-31-9 IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2011]: Sec. 9. (a) When a petition is filed under
section 8 of this chapter, the commission shall conduct a hearing.
(b) The office of the utility consumer counselor may examine
information of the public utility to confirm that the utility system
improvements are in accordance with section 5 of this chapter, to
confirm proper calculation of the proposed charge, and submit a report
to the commission not later than thirty (30) days after the petition is
filed.
(c) The commission shall hold the hearing and issue its order not
later than sixty (60) days after the petition is filed.
(d) If the commission finds that a DSIC USIC petition complies
with the requirements of this chapter, the commission shall enter an
order approving the petition.
SOURCE: IC 8-1-31-10; (11)IN0479.1.8. -->
SECTION 8. IC 8-1-31-10 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2011]: Sec. 10. (a) Except as
provided in subsection (b), a public utility may, but is not required to,
file a petition for a change in its DSIC USIC not more often than one
(1) time every twelve (12) three (3) months.
(b) Except as provided in section 15 of this chapter, a public utility
may not file a petition for a change in its DSIC USIC in the same
calendar year in which the public utility has filed a request for a
general increase in the basic rates and charges of the public utility.
SOURCE: IC 8-1-31-13; (11)IN0479.1.9. -->
SECTION 9. IC 8-1-31-13 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2011]: Sec. 13. The commission
may not approve a DSIC USIC to the extent it would produce total
DSIC USIC revenues exceeding five ten percent (5%) (10%) of the
public utility's base revenue level approved by the commission in the
public utility's most recent general rate proceeding.
SOURCE: IC 8-1-31-14; (11)IN0479.1.10. -->
SECTION 10. IC 8-1-31-14 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2011]: Sec. 14. The DSIC USIC
may be calculated based on a reasonable estimate of sales in the period
in which the charge will be in effect. At the end of each twelve (12)
month period the charge is in effect, following the date on which the
commission initially approves a USIC for a public utility following
the public utility's most recent general rate case, and using
procedures approved by the commission, the public utility shall
reconcile the difference between DSIC USIC revenues and DSIC
USIC costs during that the twelve (12) month period and recover or
refund the difference, as appropriate, through adjustment of the charge.
SOURCE: IC 8-1-31-15; (11)IN0479.1.11. -->
SECTION 11. IC 8-1-31-15 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2011]: Sec. 15. A public utility that
has implemented a DSIC USIC under this chapter shall file revised rate
schedules resetting the charge if new basic rates and charges become
effective for the public utility following a commission order
authorizing a general increase in rates and charges that includes in the
utility's rate base eligible distribution utility system improvements
reflected in the DSIC. USIC.
SOURCE: IC 8-1-31-16; (11)IN0479.1.12. -->
SECTION 12. IC 8-1-31-16 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2011]: Sec. 16. For purposes of
IC 8-1-2-42(a), the filing of a DSIC USIC and a change in a DSIC
USIC is not a general increase in basic rates and charges.
SOURCE: IC 8-1-31-17; (11)IN0479.1.13. -->
SECTION 13. IC 8-1-31-17 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2011]: Sec. 17. The commission
may adopt by rule under IC 4-22-2 or by order other procedures not
inconsistent with this chapter that the commission finds reasonable or
necessary to administer a
DSIC. USIC.
SECTION 14. THE FOLLOWING ARE REPEALED [EFFECTIVE
JULY 1, 2011]: IC 8-1-31-2; IC 8-1-31-3; IC 8-1-31-4.
