Bill Text: FL S0534 | 2016 | Regular Session | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Water and Wastewater

Spectrum: Slight Partisan Bill (? 3-1)

Status: (Introduced - Dead) 2016-03-09 - Laid on Table, companion bill(s) passed, see CS/CS/CS/HB 491 (Ch. 2016-226) [S0534 Detail]

Download: Florida-2016-S0534-Introduced.html

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       Florida Senate - 2016                                     SB 534
       
       
        
       By Senator Hays
       
       
       
       
       
       11-00270-16                                            2016534__
    1                        A bill to be entitled                      
    2         An act relating to water and wastewater; creating s.
    3         159.8105, F.S.; requiring the Division of Bond Finance
    4         of the State Board of Administration to review the
    5         allocation of private activity bonds to determine the
    6         availability of additional allocation and reallocation
    7         of bonds for water and wastewater infrastructure
    8         projects; amending s. 212.08, F.S.; extending
    9         specified tax exemptions to certain investor-owned
   10         water and wastewater utilities; amending s. 367.022,
   11         F.S.; exempting from regulation by the Florida Public
   12         Service Commission a person who resells water service
   13         to certain tenants or residents up to a specified
   14         percentage or cost; amending s. 367.081, F.S.;
   15         authorizing the commission to create a utility reserve
   16         fund; requiring the commission to adopt rules to
   17         govern the implementation, management, and use of the
   18         fund; establishing criteria for adjusted rates;
   19         specifying expense items that may be the basis for an
   20         automatic increase or decrease of a utility’s rates;
   21         authorizing the commission to establish by rule
   22         additional specified expense items; restricting a
   23         utility from recovering more than a certain percentage
   24         of reasonable rate case expenses; amending s.
   25         367.0814, F.S.; authorizing the commission to award
   26         rate case expenses to recover attorney fees or fees of
   27         other outside consultants in certain circumstances;
   28         requiring the commission to adopt rules by a certain
   29         date; amending s. 367.0816, F.S.; prohibiting a
   30         utility from recovering certain expenses for more than
   31         one rate case at a time; amending s. 367.111, F.S.;
   32         authorizing the commission to review water quality and
   33         wastewater service under certain circumstances;
   34         amending s. 403.8532, F.S.; authorizing the Department
   35         of Environmental Protection to require or request that
   36         the Florida Water Pollution Control Financing
   37         Corporation make loans, grants, and deposits to for
   38         profit, privately owned, or investor-owned water
   39         systems; removing current restrictions on such
   40         activities; amending s. 367.171, F.S.; making
   41         technical changes; providing an effective date.
   42          
   43  Be It Enacted by the Legislature of the State of Florida:
   44  
   45         Section 1. Section 159.8105, Florida Statutes, is created
   46  to read:
   47         159.8105 Allocation of bonds for water and wastewater
   48  infrastructure projects.—The division shall review the
   49  allocation of private activity bonds to determine the
   50  availability of additional allocation and reallocation of bonds
   51  for water and wastewater infrastructure projects.
   52         Section 2. Paragraph (ooo) is added to subsection (7) of
   53  section 212.08, Florida Statutes, to read:
   54         212.08 Sales, rental, use, consumption, distribution, and
   55  storage tax; specified exemptions.—The sale at retail, the
   56  rental, the use, the consumption, the distribution, and the
   57  storage to be used or consumed in this state of the following
   58  are hereby specifically exempt from the tax imposed by this
   59  chapter.
   60         (7) MISCELLANEOUS EXEMPTIONS.—Exemptions provided to any
   61  entity by this chapter do not inure to any transaction that is
   62  otherwise taxable under this chapter when payment is made by a
   63  representative or employee of the entity by any means,
   64  including, but not limited to, cash, check, or credit card, even
   65  when that representative or employee is subsequently reimbursed
   66  by the entity. In addition, exemptions provided to any entity by
   67  this subsection do not inure to any transaction that is
   68  otherwise taxable under this chapter unless the entity has
   69  obtained a sales tax exemption certificate from the department
   70  or the entity obtains or provides other documentation as
   71  required by the department. Eligible purchases or leases made
   72  with such a certificate must be in strict compliance with this
   73  subsection and departmental rules, and any person who makes an
   74  exempt purchase with a certificate that is not in strict
   75  compliance with this subsection and the rules is liable for and
   76  shall pay the tax. The department may adopt rules to administer
   77  this subsection.
   78         (ooo) Investor-owned water and wastewater utilities.—Sales
   79  or leases to an investor-owned water or wastewater utility owned
   80  or operated by a Florida corporation are exempt from the tax
   81  imposed by this chapter if the sole or primary function of the
   82  corporation is to construct, maintain, or operate a water or
   83  wastewater system in this state and if the goods or services
   84  purchased or leased are used in this state.
   85         Section 3. Present subsections (9) through (12) of section
   86  367.022, Florida Statutes, are redesignated as subsections (10)
   87  through (13), respectively, and a new subsection (9) is added to
   88  that section, to read:
   89         367.022 Exemptions.—The following are not subject to
   90  regulation by the commission as a utility nor are they subject
   91  to the provisions of this chapter, except as expressly provided:
   92         (9) Any person who resells water service to his or her
   93  tenants or to individually metered residents for a fee that does
   94  not exceed the actual purchase price of the water plus the
   95  actual cost of meter reading and billing, not to exceed 9
   96  percent of the actual cost of service.
   97         Section 4. Paragraph (c) is added to subsection (2) of
   98  section 367.081, Florida Statutes, and paragraph (b) of
   99  subsection (4) and subsection (7) of that section are amended,
  100  to read:
  101         367.081 Rates; procedure for fixing and changing.—
  102         (2)
  103         (c) In establishing rates for a utility, the commission may
  104  create a utility reserve fund for infrastructure repair and
  105  replacement for a utility for existing distribution and
  106  collection infrastructure that is nearing the end of its useful
  107  life or is detrimental to water quality or reliability of
  108  service, to be funded by a portion of the rates charged by the
  109  utility, by a secured escrow account, or through a letter of
  110  credit. The commission shall adopt rules to govern the
  111  implementation, management, and use of the fund, including, but
  112  not limited to, rules related to expenses for which the fund may
  113  be used, segregation of reserve account funds, requirements for
  114  a capital improvement plan, and requirements for commission
  115  authorization before disbursements are made from the fund.
  116         (4)
  117         (b) The approved rates of any utility which receives all or
  118  any portion of its utility service from a governmental authority
  119  or from a water or wastewater utility regulated by the
  120  commission and which redistributes that service to its utility
  121  customers shall be automatically increased or decreased without
  122  hearing, upon verified notice to the commission 45 days prior to
  123  its implementation of the increase or decrease that the
  124  utility’s costs for any specified expense item the rates charged
  125  by the governmental authority or other utility have changed. The
  126  approved rates of any utility which is subject to an increase or
  127  decrease in the rates or fees that it is charged for electric
  128  power, the amount of ad valorem taxes assessed against its used
  129  and useful property, the fees charged by the Department of
  130  Environmental Protection in connection with the National
  131  Pollutant Discharge Elimination System Program, or the
  132  regulatory assessment fees imposed upon it by the commission
  133  shall be increased or decreased by the utility, without action
  134  by the commission, upon verified notice to the commission 45
  135  days prior to its implementation of the increase or decrease
  136  that the rates charged by the supplier of the electric power or
  137  the taxes imposed by the governmental authority, or the
  138  regulatory assessment fees imposed upon it by the commission
  139  have changed. The new rates authorized shall reflect the amount
  140  of the change of the ad valorem taxes or rates imposed upon the
  141  utility by the governmental authority, other utility, or
  142  supplier of electric power, or the regulatory assessment fees
  143  imposed upon it by the commission. The approved rates of any
  144  utility shall be automatically increased, without hearing, upon
  145  verified notice to the commission 45 days prior to
  146  implementation of the increase that costs have been incurred for
  147  water quality or wastewater quality testing required by the
  148  Department of Environmental Protection.
  149         1. The new rates authorized shall reflect, on an amortized
  150  or annual basis, as appropriate, the cost of, or the amount of
  151  change in the cost of, the specified expense item, required
  152  water quality or wastewater quality testing performed by
  153  laboratories approved by the Department of Environmental
  154  Protection for that purpose. The new rates, however, shall not
  155  reflect the costs of any specified expense item any required
  156  water quality or wastewater quality testing already included in
  157  a utility’s rates. Specified expense items that are eligible for
  158  automatic increase or decrease of a utility’s rates include, but
  159  are not limited to:
  160         a. The rates charged by a governmental authority or other
  161  water or wastewater utility regulated by the commission which
  162  provides utility service to the utility.
  163         b. The rates or fees that the utility is charged for
  164  electric power.
  165         c. The amount of ad valorem taxes assessed against the
  166  utility’s used and useful property.
  167         d. The fees charged by the Department of Environmental
  168  Protection in connection with the National Pollutant Discharge
  169  Elimination System Program.
  170         e. The regulatory assessment fees imposed upon the utility
  171  by the commission.
  172         f. Costs incurred for water quality or wastewater quality
  173  testing required by the Department of Environmental Protection.
  174         g. The fees charged for wastewater biosolids disposal.
  175         h. Costs incurred for any tank inspection required by the
  176  Department of Environmental Protection or a local governmental
  177  authority.
  178         i. Treatment plant operator and water distribution system
  179  operator license fees required by the Department of
  180  Environmental Protection or a local governmental authority.
  181         j. Water or wastewater operating permit fees charged by the
  182  Department of Environmental Protection or a local governmental
  183  authority.
  184         k. Consumptive or water use permit fees charged by a water
  185  management district.
  186         2. A utility may not use this procedure to increase its
  187  rates as a result of an increase in a specific expense item
  188  which occurred water quality or wastewater quality testing or an
  189  increase in the cost of purchased water services, sewer
  190  services, or electric power or in assessed ad valorem taxes,
  191  which increase was initiated more than 12 months before the
  192  filing by the utility.
  193         3. The commission may establish by rule additional specific
  194  expense items that are outside the control of the utility and
  195  have been imposed upon the utility by a federal, state, or local
  196  law, rule, order, or notice. If the commission establishes such
  197  a rule, the commission shall review the rule at least once every
  198  5 years and determine if each expense item should continue to be
  199  cause for an automatic increase or decrease and whether
  200  additional items should be included.
  201         4. The provisions of This subsection does do not prevent a
  202  utility from seeking a change in rates pursuant to the
  203  provisions of subsection (2).
  204         (7) The commission shall determine the reasonableness of
  205  rate case expenses and shall disallow all rate case expenses
  206  determined to be unreasonable. No rate case expense determined
  207  to be unreasonable shall be paid by a consumer. In determining
  208  the reasonable level of rate case expense, the commission shall
  209  consider the extent to which a utility has utilized or failed to
  210  utilize the provisions of paragraph (4)(a) or paragraph (4)(b)
  211  and such other criteria as it may establish by rule. A utility
  212  may recover only up to 50 percent of rate case expenses that are
  213  determined to be reasonable.
  214         Section 5. Subsection (3) of section 367.0814, Florida
  215  Statutes, is amended to read:
  216         367.0814 Staff assistance in changing rates and charges;
  217  interim rates.—
  218         (3) The provisions of s. 367.081(1), (2)(a), and (3) shall
  219  apply in determining the utility’s rates and charges. However,
  220  the commission may not award rate case expenses to recover
  221  attorney fees or fees of other outside consultants who are
  222  engaged for the purpose of preparing or filing the case if a
  223  utility receives staff assistance in changing rates and charges
  224  pursuant to this section, unless the Office of Public Counsel or
  225  interested parties have intervened. The commission may award
  226  rate case expenses for attorney fees or fees of other outside
  227  consultants if such fees are incurred for the purpose of
  228  providing consulting or legal services to the utility after the
  229  initial staff report is made available to customers and the
  230  utility. If there is a protest or appeal by a party other than
  231  the utility, the commission may award rate case expenses to the
  232  utility for attorney fees or fees of other outside consultants
  233  for costs incurred after the protest or appeal. By December 31,
  234  2015, the commission must adopt rules to administer this
  235  subsection.
  236         Section 6. Section 367.0816, Florida Statutes, is amended
  237  to read:
  238         367.0816 Recovery of rate case expenses.—
  239         (1) The amount of rate case expense determined by the
  240  commission pursuant to the provisions of this chapter to be
  241  recovered through a public utilities rate shall be apportioned
  242  for recovery over a period of 4 years. At the conclusion of the
  243  recovery period, the rate of the public utility shall be reduced
  244  immediately by the amount of rate case expense previously
  245  included in rates.
  246         (2) A utility may not recover the 4-year amortized rate
  247  case expense for more than one rate case at any given time. If
  248  the commission approves and a utility implements a rate change
  249  from a subsequent rate case pursuant to this section, any
  250  unamortized rate case expense for a prior rate case must be
  251  discontinued. The unamortized portion of rate case expense for a
  252  prior rate case must be removed from rates before the
  253  implementation of an additional amortized rate case expense for
  254  the most recent rate proceeding.
  255         Section 7. Subsection (3) is added to section 367.111,
  256  Florida Statutes, to read:
  257         367.111 Service.—
  258         (3) The commission may, on its own motion or based on
  259  complaints of customers of a water utility subject to its
  260  jurisdiction, review water quality as it pertains to secondary
  261  drinking water standards established by the Department of
  262  Environmental Protection. The commission may, on its own motion
  263  or based on complaints of customers of a wastewater utility
  264  subject to its jurisdiction, review wastewater service as it
  265  pertains to odor, noise, aerosol drift, or lighting.
  266         Section 8. Subsection (3) of section 403.8532, Florida
  267  Statutes, is amended to read:
  268         403.8532 Drinking water state revolving loan fund; use;
  269  rules.—
  270         (3) The department may make, or request that the
  271  corporation make, loans, grants, and deposits to community water
  272  systems; for-profit, privately owned, or investor-owned water
  273  systems;, nonprofit, transient, noncommunity water systems;, and
  274  nonprofit, nontransient, noncommunity water systems to assist
  275  them in planning, designing, and constructing public water
  276  systems, unless such public water systems are for-profit
  277  privately owned or investor-owned systems that regularly serve
  278  1,500 service connections or more within a single certified or
  279  franchised area. However, a for-profit privately owned or
  280  investor-owned public water system that regularly serves 1,500
  281  service connections or more within a single certified or
  282  franchised area may qualify for a loan only if the proposed
  283  project will result in the consolidation of two or more public
  284  water systems. The department may provide loan guarantees,
  285  purchase loan insurance, and refinance local debt through the
  286  issue of new loans for projects approved by the department.
  287  Public water systems may borrow funds made available pursuant to
  288  this section and may pledge any revenues or other adequate
  289  security available to them to repay any funds borrowed.
  290         (a) The department shall administer loans so that amounts
  291  credited to the Drinking Water Revolving Loan Trust Fund in any
  292  fiscal year are reserved for the following purposes:
  293         1. At least 15 percent for qualifying small public water
  294  systems.
  295         2. Up to 15 percent for qualifying financially
  296  disadvantaged communities.
  297         (b) If an insufficient number of the projects for which
  298  funds are reserved under this subsection have been submitted to
  299  the department at the time the funding priority list authorized
  300  under this section is adopted, the reservation of these funds no
  301  longer applies. The department may award the unreserved funds as
  302  otherwise provided in this section.
  303         Section 9. Subsection (8) of section 367.171, Florida
  304  Statutes, is amended to read:
  305         367.171 Effectiveness of this chapter.—
  306         (8) Each county that which is not subject to excluded from
  307  the provisions of this chapter shall regulate the rates of all
  308  utilities in that county which would otherwise be subject to
  309  regulation by the commission pursuant to s. 367.081(1), (2),
  310  (3), and (6) and s. 367.165. The county shall not regulate the
  311  rates or charges of any system or facility that which would
  312  otherwise be exempt from commission regulation pursuant to s.
  313  367.022(2). For this purpose the county or its agency shall
  314  proceed as though the county or agency is the commission.
  315         Section 10. This act shall take effect July 1, 2016.