SB 1321 - Currently, the Public Service Commission may use procedures related to the acquisition of a small water utility by a large water public utility if such procedures are chosen to be used by a large water public utility. Under the act, the Commission must use such procedures, provided that the Commission independently concludes that a certificate of convenience and necessity should be granted, unless the Commission finds that application of the current law results in rates that are unjust and unreasonable. The three appraisers shall jointly prepare a fair and independent appraisal of the fair market value of the water system/or sewer system, along with supporting rationale. The third appraiser shall be appointed by the Commission or the staff of the Commission upon delegation, instead of by the two appraisers so appointed. The appraisers shall return only their final appraisal in writing and at the same time to both utilities.
Currently, the lesser of the purchase price or the appraised value shall constitute the ratemaking rate base for the small water utility as acquired by the acquiring large water public utility. Under the act, such purchase price or the appraised value may constitute the ratemaking rate base for the small water utility.
A large water public utility's choice to comply with the provisions of the current law does not automatically ensure that the transaction is in the public interest. The Commission shall independently determine whether the acquisition is in the public interest, regardless of whether the matter has been put to a vote of the small water utility's ratepayers.
JULIA SHEVELEVA