By: Staples S.B. No. 1064
A BILL TO BE ENTITLED
AN ACT
relating to rate changes by a water and sewer utility.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 13.182, Water Code, is amended by adding
Subsection (e) to read as follows:
(e) Except as provided by Section 13.4133, a utility may not
implement a rate change concerning which a hearing is set under
Section 13.187 until the date on which the regulatory authority
issues a final decision on the change.
SECTION 2. Section 13.187, Water Code, is amended by
amending Subsections (a), (d), (e), (f), (k), (l), (m), and (n) and
adding Subsections (e-1), (n-1), and (n-2) to read as follows:
(a) A utility may not make changes in its rates except by
delivering a statement of intent to each ratepayer and with the
regulatory authority having original jurisdiction at least 120 [60]
days before the proposed effective date of the proposed change. The
proposed effective date of the new rates must be the first day of a
billing period, and the new rates may not apply to service received
before the proposed effective date of the new rates. The statement
of intent must include:
(1) the information required by the regulatory
authority's rules;
(2) a billing comparison regarding the existing water
rate and the new water rate computed for the use of:
(A) 3,000 gallons of water;
(B) 5,000 gallons of water;
(C) 10,000 gallons of water; and
(D) [(B)] 30,000 gallons of water; and
(3) a billing comparison regarding the existing sewer
rate and the new sewer rate computed for the use of 5,000 gallons
and 10,000 gallons, unless the utility proposes a flat rate for
sewer services; and
(4) the proposed effective date and the deadline by
which customers must file any protests of the proposed rates,
provided that the protest period concludes 90 days after the
statement of intent is provided to the ratepayers.
(d) If the application or the statement of intent is not
substantially complete or does not comply with the regulatory
authority's rules, it may be rejected and the proposed effective
date of the rate change may be suspended until a properly completed
application is accepted by the regulatory authority and a proper
statement of intent is provided. The commission may also suspend
the proposed effective date of any rate change if the utility does
not have a certificate of public convenience and necessity or a
completed application for a certificate or to transfer a
certificate pending before the commission or if the utility is
delinquent in paying the assessment and any applicable penalties or
interest required by Section 5.701(n) [of this code].
(e) The regulatory authority shall set a hearing on the
proposed rate increase if [If], before the 91st day after the
[effective] date the statement of intent was provided to the
authority and each ratepayer under Subsection (a) [of the rate
change], the regulatory authority receives a complaint from any
affected municipality, or from the lesser of 1,000 or 10 percent of
the ratepayers of the utility over whose rates the regulatory
authority has original jurisdiction. A hearing under this
subsection must be set not later than the 120th day after the date
the statement of intent was provided. The[, the] regulatory
authority must provide notice to the utility and any affected
municipality that a hearing is being set on the proposed rate
increase [shall set the matter for hearing].
(e-1) If the regulatory authority receives a complaint from
any affected municipality, or from the lesser of 1,000 or 10 percent
of the ratepayers of the utility over whose rates the regulatory
authority has original jurisdiction, the regulatory authority
shall, not later than the 120th day after the date the utility files
with the regulatory authority an application to change rates and
delivers a statement of intent to each ratepayer, hold a public
meeting to receive public comments on the proposed rate increase.
The regulatory authority may hold the public meeting in any
location the regulatory authority determines is appropriate. The
regulatory authority shall require the utility to publish notice of
the public meeting at least once in the newspaper of largest
circulation in each county in which affected ratepayers are
located. The notice must state:
(1) the time, location, and nature of the public
meeting; and
(2) a description, including a telephone number, of
the manner in which a person may contact the regulatory authority
for further information.
(f) The regulatory authority may set the matter for hearing
on its own motion at any time within 120 days after the [effective]
date the statement of intent was provided to the authority and each
ratepayer under Subsection (a) [of the rate change]. If more than
half of the ratepayers of the utility receive service in a county
with a population of more than 2.5 million, the hearing must be held
at a location in that county.
(k) If the regulatory authority sets the matter for
[receives at least the number of complaints from ratepayers
required for the regulatory authority to set] a hearing under
Subsection (e), the regulatory authority shall:
(1) [may,] pending the hearing and a decision, suspend
the date the rate change would otherwise be effective until the date
the regulatory authority issues a final decision on the matter; and
(2) fix interim rates as provided by Subsection (l).
[The proposed rate may not be suspended for longer than:
[(1) 90 days by a local regulatory authority; or
[(2) 150 days by the commission.]
(l) If the regulatory authority sets the matter for a
hearing, the regulatory authority shall, not later than the 120th
day after the date the statement of intent is filed, [At any time
during the pendency of the rate proceeding the regulatory authority
may] fix interim rates to remain in effect until a final
determination is made on the proposed rate. The interim rates shall
be based on the information contained in the rate change
application and may not be lower than the rates on the utility's
approved tariff immediately before filing the notice of intent to
change the rates. If the regulatory authority is the commission,
the executive director shall set the interim rates.
(m) If the regulatory authority sets a final rate that is
lower than the interim rate, the utility shall refund or credit the
difference between the interim rate and the final rate plus
interest as determined by the regulatory authority unless otherwise
agreed to by the parties to the rate proceeding. If the regulatory
authority sets a final rate that is higher than the interim rate,
the utility shall be allowed to collect the difference between the
interim rate and final rate unless otherwise agreed to by the
parties to the rate proceeding.
(n) The [For good cause shown, the] regulatory authority
must make a final determination on the rates not later than:
(1) if the determination is made by a local regulatory
authority, 150 days after the date the interim rates are
established; or
(2) if the determination is made by the commission,
305 days after the effective date the interim rates are established
[may at any time during the proceeding require the utility to refund
money collected under a proposed rate before the rate was suspended
or an interim rate was established to the extent the proposed rate
exceeds the existing rate or the interim rate].
(n-1) If the regulatory authority does not make the
determination within the deadline provided by Subsection (n), the
proposed rates are automatically approved.
(n-2) Notwithstanding Subsection (n-1), the deadline for
making a determination under Subsection (n) may be extended by the
agreement of all parties to the rate proceeding, in which case the
commission shall make the determination. A hearing shall be
conducted in a timely manner to allow the commission to make its
final determination on the proposed rates.
SECTION 3. Subsections (i), (j), and (o), Section 13.187,
Water Code, are repealed.
SECTION 4. This Act applies only to a statement of intent
filed on or after the effective date of this Act. A rate change to
which a statement of intent filed before the effective date of this
Act applies is governed by the law in effect on the date the
statement was filed, and that law is continued in effect for that
purpose.
SECTION 5. This Act takes effect September 1, 2005.