CS/HB 1331 2023
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
A bill to be entitled 1
An act relating to municipal utilities; amending s. 2
166.201, F.S.; authorizing a municipality to fund or 3
finance general government functions with a portion of 4
revenues from utility operations; establishing limits 5
on utility revenue transfers for municipal utilities; 6
amending s. 180.191, F.S.; modifying provisions 7
relating to permissible rates, fees, and charges 8
imposed by municipal water and sewer utilities on 9
customers located outside the municipal boundaries; 10
providing an effective date. 11
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Be It Enacted by the Legislature of the State of Florida: 13
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Section 1. Section 166.201, Florida Statutes, is amended 15
to read: 16
166.201 Taxes and charges. — 17
(1) A municipality may raise, by taxation and licenses 18
authorized by the constitution or general law, or by user 19
charges or fees authorized by ordinance, amounts of money which 20
are necessary for the conduct of municipal government and may 21
enforce their receipt and c ollection in the manner prescribed by 22
ordinance not inconsistent with law. 23
(2)(a) A municipality that owns and operates an electric, 24
natural gas, water, or wastewater utility may fund or finance 25
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
general government functions using a portion of the revenue s 26
generated from rates, fees, and charges for the provision of 27
such utility service. The portion of utility revenues that may 28
be used during a fiscal year to fund or finance general 29
government functions, after payment of all utility expenses, may 30
not exceed: 31
1. For revenues generated from electric utility 32
operations, a transfer rate equal to the amount derived by 33
applying the average of the midpoints of the rates of return on 34
equity approved by the Public Service Commission for each 35
investor-owned electric utility in the state to the municipal 36
electric utility's revenues. 37
2. For revenues generated from natural gas utility 38
operations, a transfer rate equal to the amount derived by 39
applying the average of the midpoints of the rates of return on 40
equity approved by the Public Service Commission for each 41
investor-owned natural gas utility in the state to the municipal 42
natural gas utility's revenues. 43
3. For revenues generated from water or wastewater 44
operations, a transfer rate equal to the amount derived by 45
applying the rate of return on equity established by the Public 46
Service Commission under s. 367.081(4)(f) to the revenues of the 47
municipal water or wastewater utility. 48
(b) Except as provided in paragraph (c), the transfer rate 49
applied to municipal utilit y revenues under subparagraphs (a)1. -50
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
3. shall be reduced as follows: 51
1. If more than 15 percent of a municipal utility's retail 52
customers, as measured by total meters served, are located 53
outside the municipal boundaries, the transfer rate applied to 54
utility revenues shall be reduced by 150 basis points. 55
2. If more than 30 percent of a municipal utility's retail 56
customers, as measured by total meters served, are located 57
outside the municipal boundaries, the transfer rate applied to 58
utility revenues shall be reduced by 300 basis points. 59
3. If more than 45 percent of a municipal utility's retail 60
customers, as measured by total meters served, are located 61
outside the municipal boundaries, the transfer rate applied to 62
utility revenues shall be reduced by 450 basis points. 63
(c) The reductions specified in paragraph (b) shall not 64
apply to a municipal utility service if the utility service is 65
governed by a utility authority board that, through the election 66
of voting members from outside the municipal boundaries , 67
provides for representation of retail customers located outside 68
the municipal boundaries approximately proportionate to the 69
percentage of such customers, as measured by total meters 70
served, that receive service from the utility. 71
Section 2. Subsection (1) of section 180.191, Florida 72
Statutes, is amended to read: 73
180.191 Limitation on rates charged consumer outside city 74
limits.— 75
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
(1) Any municipality within the state operating a water or 76
sewer utility outside of the boundaries of such municipality 77
shall charge consumers outside the boundaries rates, fees, and 78
charges determined in one of the following manners: 79
(a) It may charge the same rates, fees, and charges as 80
consumers inside the municipal boundaries. However, in addition 81
thereto, the municipal ity may add a surcharge of not more than 82
25 percent of such rates, fees, and charges to consumers outside 83
the boundaries. Fixing of such rates, fees, and charges in this 84
manner shall not require a public hearing except as may be 85
provided for service to con sumers inside the municipality. 86
(b)1. It may charge rates, fees, and charges that are just 87
and equitable and which are based on the same factors used in 88
fixing the rates, fees, and charges for consumers inside the 89
municipal boundaries. In addition thereto, the municipality may 90
add a surcharge not to exceed 25 percent of such rates, fees, 91
and charges for said services to consumers outside the 92
boundaries. However, the total of all Such rates, fees, and 93
charges for the services to consumers outside the bound aries 94
shall not be more than 25 50 percent greater than in excess of 95
the total amount the municipality charges consumers served 96
within the municipality for corresponding service. No such 97
rates, fees, and charges shall be fixed until after a public 98
hearing at which all of the users of the water or sewer systems; 99
owners, tenants, or occupants of property served or to be served 100
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
thereby; and all others interested shall have an opportunity to 101
be heard concerning the proposed rates, fees, and charges. Any 102
change or revision of such rates, fees, or charges may be made 103
in the same manner as such rates, fees, or charges were 104
originally established, but if such change or revision is to be 105
made substantially pro rata as to all classes of service, both 106
inside and outside the municipality, no hearing or notice shall 107
be required. 108
2. Any municipality within the state operating a water or 109
sewer utility that provides service to consumers within the 110
boundaries of a separate municipality through the use of a water 111
treatment plant or sewer treatment plant located within the 112
boundaries of that separate municipality may charge consumers in 113
the separate municipality no more than the rates, fees, and 114
charges imposed on consumers inside its own municipal 115
boundaries. 116
Section 3. This act shall take effect July 1, 2024. 117