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Senate Bill 700 |
Senate Author: Nichols et al. |
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Effective: 9-1-19 |
House Sponsor: Geren |
Senate Bill 700 amends the Water Code to revise provisions relating to water rates and services. Among other provisions, the bill changes the number of taps or connections that constitute a Class B or Class C utility, provides for a Class D utility, and makes other changes regarding utilities and their operation and classes, including the removal of the specification that the annual rate adjustment to which certain utilities are entitled to receive without a hearing be based on changes in an appropriate price index. The bill authorizes the Texas Commission on Environmental Quality to issue certain emergency orders with or without a hearing.
Senate Bill 700 requires the Public Utility Commission of Texas (PUC), at the time the PUC approves the acquisition of a nonfunctioning retail water or sewer utility service provider under applicable provisions, to determine the duration of the temporary rates for the acquiring retail public utility and to rule on the reasonableness of the temporary rates if the PUC did not make a ruling before the application for the acquisition was filed.
Senate Bill 700 removes the specification that the specific alternative ratemaking methodologies for water or sewer rates that a regulatory authority may adopt for certain purposes be based on factors other than rate of return and those specified in provisions relating to components of invested capital and net income. The bill authorizes a regulatory authority instead to adopt such methodologies to allow for more timely and efficient cost recovery and sets out the appropriate methodologies. The bill authorizes a regulatory authority to also adopt system improvement charges that may be periodically adjusted to ensure timely recovery of infrastructure investment. The bill requires the PUC by rule to establish a schedule that requires all utilities that have implemented a system improvement charge approved by the PUC to make periodic filings with the PUC to modify or review base rates charged by the utility.