SB 44
Establishes provisions related to water and sewer infrastructure
Sponsor:
LR Number:
0809S.04P
Last Action:
4/15/2021 - H First Read
Journal Page:
Title:
SS SB 44
Calendar Position:
Effective Date:
August 28, 2021

Current Bill Summary

SS/SB 44 - This act modifies provisions relating to utilities.

UTILITY SERVICES (Section 67.309)

Under this act, no political subdivision shall adopt an ordinance, resolution, regulation, code or policy that prohibits, or has the effect of prohibiting, the connection or reconnection of a utility service based upon the type or source of energy to be delivered to an individual customer.

This provision is identical to SB 230 (2021) and SB 1048 (202).

RECLASSIFICATION OF CERTAIN PROPERTY (Section 137.010 & 137.122)

This act reclassifies stationary property used for transportation or storage of liquid and gaseous products, including, but not limited to, petroleum products, natural gas that is not propane or LP gas, water, and sewage, from real property to tangible personal property.

Beginning January 1, 2021, the provisions of current law relating to depreciable tangible personal property shall apply to all stationary property used for transportation or storage of liquid and gaseous products, including, but not limited to, petroleum products, natural gas that is not LP gas, water, and sewage that was or will be placed in service at any time.

This provision is identical to SB 196 (2021) and substantially similar to SCS/SB 785 (2020) and HCS/HB 1907 (2020).

ASSESSMENT OF CERTAIN PUBLIC UTILITY PROPERTY (Sections 153.030 & 153.034)

Beginning January 1, 2022, this act provides that any real and personal property owned by a public utility company that was constructed using chapter 100 financing shall, upon the transfer of such property to the public utility company, be assessed upon the local tax rolls. Any property consisting of land and buildings shall be assessed pursuant to current law relating to the assessment of such property in general, and all other business or personal property shall be assessed pursuant to the depreciation schedule provided under current law.

This provision is identical to SCS/SB 92 (2021) and substantially similar to HB 2680 (2020).

COMMON SEWER DISTRICTS (Section 204.569)

Under current law, when an unincorporated sewer subdistrict of a common sewer district has been formed, the board of trustees of the common sewer district shall have the power to issue bonds, and the issuance of such bonds shall require the assent of 4/7 of the voters of the subdistrict on the question. This act states that as an alternative to such vote, if the subdistrict is a part of a common sewer district located in whole or in part in certain counties, bonds may be issued for such subdistrict if the question receives the written assent of 3/4 of the customers, as such term is defined in the act, of the subdistrict.

This provision is identical to SB 558 (2021).

COMPETITIVE BIDDING (Section 393.358): Currently, water corporations with more than 1,000 customers are required to use a competitive bidding process for no less than 10% of the corporation's external expenditures for planned infrastructure projects on the water corporation's distribution system. Under this act, such competitive bidding process shall be used for 20% of the corporation's external expenditures for such projects.

WATER AND SEWER INFRASTRUCTURE RATE ADJUSTMENT (Sections 393.1500-393.1509):

The act establishes the Missouri Water and Infrastructure Act, which specifies that a water or sewer corporation that provides water or sewer service to more than 8,000 customer connections may file a petition and proposed rate schedules with the Public Service Commission to create or change a water and sewer infrastructure rate adjustment (WSIRA) that provides for the recovery of pretax revenues associated with eligible infrastructure system projects.

The WSIRA shall not produce revenues in excess of 15% of the water or corporation's base revenue requirement approved by the Commission in the corporation's most recent general rate proceeding, with certain exceptions.

The WSIRA and any future changes shall meet specific requirements set forth in the act.

The Commission shall not approve a WSIRA for a water or sewer corporation that has not had a general rate proceeding decided or dismissed in the 3 years before the filing of a WSIRA petition unless the water or sewer corporation has filed for or is the subject of a new general rate proceeding.

In the event a water or sewer corporation is collecting infrastructure system repalcement surcharge revenues that were approved before August 28, 2021, when a WSIRA is filed, the approved infrastructure system replacement surcharge revenues shall be included in the new WSIRA filing. In no event shall a customer be charged both an infrastructure system repalcement surcharge and a WSIRA.

At the time the water or sewer corporation files a petition for a WSIRA, it shall submit proposed WSIRA rate schedules and supporting documentation, and the corporation shall also serve the Office of Public Counsel with a copy of the petition, rate schedules, and documentation. Upon the filing of a petition, the Commission shall conduct an examination of the proposed WSIRA, as specified in the act.

The Commission may hold a hearing on the petition and any associated WSIRA rate schedules. If the Commission finds that a petition complies with the requirements set forth in the act, the Commission shall enter an order authorizing the water or sewer corporation to implement the WSIRA. A corporation may petition the Commission for a change in its WSIRA no more than two times in every 12-month period.

The act lists what information the Commission may consider in determining the appropriate pretax revenues and how the WSIRA is calculated. If this information is unavailable and the Commission is not provided such information on an agreed-upon basis, the Commission shall utilize the overall pretax weighted average cost of capital last authorized for the water or sewer corporation in a general rate proceeding regarding a WSIRA or an infrastructure system replacement surcharge. At the end of each 12-month calendar year that a WSIRA is in effect, the corporation shall reconcile the differences between the revenues from a WSIRA and the appropriate pretax revenues found by the Commission for that period and submit the reconciliation and proposed WSIRA to the Commission for approval to recover or credit the difference.

A water or sewer corporation that has a WSIRA shall file revised WSIRA schedules when new base rates and charges become effective following a general rate proceeding that includes the WSIRA eligible costs in the base rates. Once the eligible costs are included in the water or sewer corporation's base rates, the corporation shall reconcile any previously unreconciled WSIRA revenues to ensure that revenues resulting from the WSIRA match as closely as possible the appropriate pretax revenues.

A water or sewer corporation's filing of a petition to establish or change a WSIRA is not considered a request for a general increase in the corporation's base rates and charges.

Commission approval of a petition to establish or change a WSIRA shall in no way be binding upon the Commission in determining the ratemaking treatment to be applied to eligible infrastructure system projects during a subsequent general rate proceeding when the Commission may undertake to review the prudence of such costs. If, during a subsequent general rate proceeding, the Commission disallows recovery of costs associated with eligible infrastructure system projects previously included in a WSIRA, the water or sewer corporation shall offset its WSIRA in the future as necessary to recognize and account for any such overcollections.

Nothing in the act impairs the authority of the Commission to review the reasonableness of the rates or charges of a water or sewer corporation, including review of the prudence of eligible infrastructure system replacements made by a water or sewer corporation.

The Commission may take into account any change in business risk to the water or sewer corporation from implementation of the WSIRA in setting the corporation's allowed return in a general rate proceeding in addition to any other changes in business risk experienced by the corporation.

These provisions shall expire on December 31, 2031.

These provisions are similar to HB 397 (2021), SB 592 (2020), HCS/HB 2094 (2020), SB 377 (2019), and HCS/HB 633 (2019).

RURAL ELECTRIC COOPERATIVES (Section 394.120)

Under the act, the board of directors of a rural electric cooperative shall have the power to set the time and place of the annual meeting and also to provide for voting by proxy, electronic means, by mail, or any combination thereof, and to prescribe the conditions under which such voting shall be exercised. The meeting requirement may be satisfied through virtual means.

This provision expires on August 28, 2022.

This provision is identical to a provision contained in the perfected SS/SB 333 (2021).

JAMIE ANDREWS