SB137INTRODUCED
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SB137
MDPSWHW-1
By Senator Waggoner
RFD: State Governmental Affairs
First Read: 06-Feb-25
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5 MDPSWHW-1 01/31/2025 CMH (L)bm 2025-218
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First Read: 06-Feb-25
SYNOPSIS:
Under existing law, certain privately owned
sewer and wastewater systems are subject to the
regulatory jurisdiction of the Public Service
Commission.
This bill would allow privately owned sewer and
wastewater systems affiliated with such regulated
systems to elect to become subject to the regulatory
jurisdiction of the Public Service Commission, except
when prohibited by a local constitutional amendment.
This bill would also provide procedures for such
election.
This bill would provide for the capital
expenditures and operating expenses of affiliated
wastewater and sewer systems under Public Service
Commission jurisdiction to be combined to determine a
single rate structure and rates for all customers of
such affiliated entities, unless adjustments are
necessary due to pre-existing obligations or other
circumstances unique to a particular service area.
A BILL
TO BE ENTITLED
AN ACT
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AN ACT
Relating to privately owned sewer and wastewater
systems; to authorize and provide a procedure for certain
private sewer or wastewater systems not subject to regulation
of the Public Service Commission to elect to consolidate with
certain private systems that are currently under the
jurisdiction of the Public Service Commission.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. For the purposes of this act the following
terms have the following meanings:
(1) AFFILIATED SYSTEM. A sewer or wastewater system
that is both under common ownership and control with a
regulated sewer or wastewater entity and not subject to the
jurisdiction of the Public Service Commission as of the
effective date of this act.
(2) COMMON OWNERSHIP OR CONTROL. Ownership, directly or
through one or more affiliates, of 50 percent or more of the
shares of stock entitled to vote for the election of
directors, in the case of a corporation, or 50 percent or more
of the voting equity interests in the case of any other type
of legal entity, or status as a general partner in any
partnership, or any other arrangement whereby an entity
controls or has the right to control the selection of 50
percent or more of the board of directors, managing members,
or equivalent governing body of a legal entity. An "affiliate"
under the preceding sentence means any corporation, limited
liability company, partnership, or other legal entity that
directly or indirectly controls or is controlled by or is
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directly or indirectly controls or is controlled by or is
under common control with such entity.
(3) REGULATED SEWER OR WASTEWATER ENTITY. A privately
owned sewer or wastewater management entity subject to the
rate jurisdiction of the Public Service Commission as of the
effective date of this act. The term includes, but is not
limited to, any of the following:
a. A privately owned and operated wastewater system, as
defined in Section 22–25B–1, Code of Alabama 1975, that is
required by Chapter 25B, Title 22, Code of Alabama 1975, to be
operated and maintained by a wastewater management entity
certified by the Public Service Commission.
b. Any system subject to the jurisdiction of the Public
Service Commission pursuant to Section 58-11.21(b) of the
Constitution of Alabama of 2022.
Section 2. (a) An affiliated system may elect to become
subject to the regulatory jurisdiction of the Public Service
Commission by filing a notice with the commission.
(b) The Public Service Commission shall certify and
regulate an affiliated system making an election under this
section in accordance with Title 37, Code of Alabama 1975, and
in arriving at a valuation of the property of an affiliated
system, the Public Service Commission shall give due
consideration to the private utility's property, original cost
to the affiliated system, cost of reproduction as a going
concern when original cost is not available, and other
elements of value recognized by law for rate-making purposes
as outlined in Section 37-4-17, Code of Alabama, 1975.
(c) An affiliated system making an election under this
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(c) An affiliated system making an election under this
section shall continue to charge the rates in effect at the
time of election, and which rates shall continue force and
effect until the rates established by the Public Service
Commission are finalized and effective.
(d) In establishing prospective rates and rate
structures for an affiliated system, the Public Service
Commission shall consider both the affiliated system and
regulated systems' capital expenditures and operating expenses
together as a whole to determine a single rate structure and
rate amounts for all customers of such combined entity, except
to the extent the commission finds adjustments are necessary
due to pre-existing obligations or other circumstances unique
to a particular area served.
Section 3. An affiliated system making an election
under Section 2 shall be subject to the fees established by
the Public Service Commission for wastewater management
entities under Section 22–25B–7, Code of Alabama 1975.
Section 4.(a) Nothing in this act shall infringe upon
or replace the authority granted to the Jefferson County Board
of Health pursuant to Act No. 659 (1978).
(b) This act shall not apply in any county that has a
local constitutional amendment authorizing the regulation of
wastewater utilities, except to the extent this act would be
permitted under such constitutional amendment.
(c) Except as specifically provided, this act is
supplemental to all other laws and administrative rules and is
not intended to repeal or replace any existing statute except
to the extent that there is a direct conflict. In such case,
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to the extent that there is a direct conflict. In such case,
this act shall control.
Section 5. This act shall become effective on October
1, 2025.
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