SB 110
Water & Wastewater Systems/Rates

 
By Senator Bennett
 21-249-04

CODING: Words stricken are deletions; words underlined are additions. 
  1                      A bill to be entitled
  2         An act relating to water and wastewater
  3         systems; amending s. 367.081, F.S.; authorizing
  4         the Florida Public Service Commission to
  5         approve rates allowing utilities to recover the
  6         full costs of alternative water supply
  7         facilities; amending s. 367.0814, F.S.;
  8         increasing the limitation on gross annual
  9         revenues under which a water or wastewater
10         utility may qualify to obtain staff assistance
11         from the Florida Public Service Commission in
12         changing rates and charges; providing an
13         effective date.
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15  Be It Enacted by the Legislature of the State of Florida:
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17         Section 1.  Subsection (2) of section 367.081, Florida
18  Statutes, is amended to read:
19         367.081  Rates; procedure for fixing and changing.--
20         (2)(a)1.  The commission shall, either upon request or
21  upon its own motion, fix rates which are just, reasonable,
22  compensatory, and not unfairly discriminatory.  In every such
23  proceeding, the commission shall consider the value and
24  quality of the service and the cost of providing the service,
25  which shall include, but not be limited to, debt interest; the
26  requirements of the utility for working capital; maintenance,
27  depreciation, tax, and operating expenses incurred in the
28  operation of all property used and useful in the public
29  service; and a fair return on the investment of the utility in
30  property used and useful in the public service. Pursuant to s.
31  373.1961(2)(k), the commission shall allow recovery for the
   
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 1  full, prudently incurred costs of alternative water supply
 2  facilities. However, the commission shall not allow the
 3  inclusion of contributions-in-aid-of-construction in the rate
 4  base of any utility during a rate proceeding, nor shall the
 5  commission impute prospective future
 6  contributions-in-aid-of-construction against the utility's
 7  investment in property used and useful in the public service.;
 8  and Accumulated depreciation on such
 9  contributions-in-aid-of-construction shall not be used to
10  reduce the rate base, nor shall depreciation on such
11  contributed assets be considered a cost of providing utility
12  service.
13         2.  For purposes of such proceedings, the commission
14  shall consider utility property, including land acquired or
15  facilities constructed or to be constructed within a
16  reasonable time in the future, not to exceed 24 months after
17  the end of the historic base year used to set final rates
18  unless a longer period is approved by the commission, to be
19  used and useful in the public service, if:
20         a.  Such property is needed to serve current customers;
21         b.  Such property is needed to serve customers 5 years
22  after the end of the test year used in the commission's final
23  order on a rate request as provided in subsection (6) at a
24  growth rate for equivalent residential connections not to
25  exceed 5 percent per year; or
26         c.  Such property is needed to serve customers more
27  than 5 full years after the end of the test year used in the
28  commission's final order on a rate request as provided in
29  subsection (6) only to the extent that the utility presents
30  clear and convincing evidence to justify such consideration.
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 1  Notwithstanding the provisions of this paragraph, the
 2  commission shall approve rates for service which allow a
 3  utility to recover from customers the full amount of
 4  environmental compliance costs. Such rates may not include
 5  charges for allowances for funds prudently invested or similar
 6  charges. For purposes of this requirement, the term
 7  "environmental compliance costs" includes all reasonable
 8  expenses and fair return on any prudent investment incurred by
 9  a utility in complying with the requirements or conditions
10  contained in any permitting, enforcement, or similar decisions
11  of the United States Environmental Protection Agency, the
12  Department of Environmental Protection, a water management
13  district, or any other governmental entity with similar
14  regulatory jurisdiction.
15         (b)  In establishing initial rates for a utility, the
16  commission may project the financial and operational data as
17  set out in paragraph (a) to a point in time when the utility
18  is expected to be operating at a reasonable level of capacity.
19         Section 2.  Subsection (1) of section 367.0814, Florida
20  Statutes, is amended to read:
21         367.0814  Staff assistance in changing rates an
22  charges; interim rates.--
23         (1)  The commission may establish rules by which a
24  water or wastewater utility whose gross annual revenues are
25  $200,000 $150,000 or less may request and obtain staff
26  assistance for the purpose of changing its rates and charges.
27  A utility may request staff assistance by filing an
28  application with the commission.
29         Section 3.  This act shall take effect upon becoming a
30  law.
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 1            *****************************************
 2                          SENATE SUMMARY
 3    Provides for rates approved by the Florida Public Service
       Commission to allow for the recovery of the full,
 4    prudently incurred costs of alternative water supply
       facilities. Provides that a water or wastewater utility
 5    may obtain staff assistance for changing its rates and
       charges from the Florida Public Service Commission if the
 6    gross annual revenues of the utility are $200,000 or less
       rather than $150,000 or less.
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CODING: Words stricken are deletions; words underlined are additions. 


 
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