LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
200 W. Washington St., Suite 301
Indianapolis, IN 46204
(317) 233-0696
iga.in.gov
FISCAL IMPACT STATEMENT
LS 7160 NOTE PREPARED: Feb 28, 2022
BILL NUMBER: SB 272 BILL AMENDED: Feb 15, 2022
SUBJECT: Wastewater Infrastructure.
FIRST AUTHOR: Sen. Koch BILL STATUS: Enrolled
FIRST SPONSOR: Rep. Soliday
FUNDS AFFECTED:XGENERAL IMPACT: State
XDEDICATED
FEDERAL
Summary of Legislation: The bill provides that the Indiana Finance Authority (IFA) shall serve as the
executive branch coordinator for funds allocated or made available to the state or local communities from
federal, state, and other sources for purposes related to drinking water, wastewater, or storm water
infrastructure and systems. It sets forth the duties of the IFA with respect to this role.
It specifies that the IFA shall coordinate the executive branch activities related to the state's drinking water
and wastewater programs. (Current law provides that the IFA shall serve such a role with respect to the state's
water programs.)
The bill authorizes the establishment of a Drinking Water and Wastewater Infrastructure Research and
Extension Program to provide data collection and information, training, and technical assistance concerning:
(1) drinking water infrastructure; (2) wastewater infrastructure; and (3) storm water infrastructure; in Indiana.
It provides that the IFA may: (1) contract with a state supported college or university in Indiana to provide
the program; and (2) financially support the program from existing funds appropriated to the IFA. It also
provides that the program may be housed within, or share staff with, the existing research and highway
extension program at Purdue University.
The bill provides that the program may provide the following services and programs to, or for the
benefit of, utilities providing drinking water, wastewater, or storm water service in Indiana: (1)
Assisting utilities in the development of asset management programs.
(2) Serving as a central repository for data concerning infrastructure used to provide drinking water,
wastewater, or storm water service in Indiana.
(3) Providing training and technical assistance to utilities and Indiana's drinking water, wastewater,
SB 272 1 and storm water utility industry workforces.
The bill requires the IFA to make, not later than July 1, 2023, all: (1) utility asset management programs; and
(2) information concerning utility asset lifecycle management costs; submitted to or reviewed by the IFA
available on an Internet web site maintained by the IFA or the program.
It requires that in carrying out all information gathering and reporting duties under the bill's provisions, the
IFA and the program shall use any data the IFA or the program acquires in a manner that: (1) protects the
confidential information of individual utilities and customers; and (2) is consistent with applicable statutory
exclusions from disclosure under the state's Public Records Act.
The bill provides that as a condition for receiving a loan, grant, or other financial assistance after June 30,
2023, through the Wastewater Revolving Loan Program, the Drinking Water Revolving Loan Program, the
Water Infrastructure Assistance Program, or the Water Infrastructure Grant Program, a participant must do
the following:
(1) Submit the participant's required asset management program to the IFA not later than the time
of submission of the participant's preliminary engineering report for any project for which the loan,
grant, or other financial assistance will be provided. (Current law does not specify when the asset
management program must be submitted.)
(2) Submit to the IFA information on the estimated and actual life cycle management costs over the
useful life of the asset financed.
(3) In the case of a participant that is not under the jurisdiction of the Indiana Utility Regulatory
Commission (IURC), regularly report to all: (A) customers; (B) counties; and (C) municipalities;
within the participant's service territory information concerning the participant's asset management
program.
The bill provides that money in the: (1) Supplemental Drinking Water and Wastewater Assistance Fund; (2)
Water Infrastructure Assistance Fund; and (3) Water Infrastructure Grant Fund; may be used to provide
grants, loans, or other financial assistance for the planning, designing, acquisition, construction, renovation,
improvement, or expansion of septic relief systems, in accordance with guidelines of the IFA.
It provides that the IFA's project prioritization system for awarding assistance from the Water Infrastructure
Assistance Fund and the Water Infrastructure Grant Fund must include as a variable the effect of a project
on the environment.
The bill provides for the following with respect to a wastewater utility that is not subject to the jurisdiction
of the IURC for the approval of rates and charges and that has been issued one or more enforcement orders
relating to environmental or health and human safety issues by the Indiana Department of Environmental
Management (IDEM) after June 30, 2022:
(1) For the first order, the utility is subject to an informal review of its: (A) rate and charges; and (B)
asset management program; by the IURC, in accordance with procedures determined by the IURC.
(2) For a second order that is issued within two years of the first order, the utility is subject to rate
regulation, following two base rate cases, by the IURC for a minimum period of: (A) five years from
the IURC's order in the first base rate case; and (B) one year from the IURC's order in the second
base rate case.
(3) For any order issued during the required rate regulation period, the IURC may, in consultation
with the IDEM, initiate a receivership proceeding with respect to the utility.
SB 272 2 The bill requires the State Board of Education to approve, for purposes of the State's Career and Technical
Education Graduation Pathway, a utility career cluster that allows students to acquire knowledge and skills
related to employment in the electric, natural gas, communications, water, and wastewater utility industries.
It also requires the Governor's Workforce Cabinet, in consultation with the State Board of Education, the
Department of Education, and the Department of Workforce Development, to create course sequences for
the utility career cluster.
Effective Date: Upon passage; July 1, 2022.
Explanation of State Expenditures: Indiana Finance Authority (IFA): The bill designates the IFA as the
executive branch coordinator for funding allocated or made available to the state or local communities from
federal, state, and other sources for purposes related to water, wastewater, or storm water infrastructure and
systems, and sets forth the duties of the IFA with respect to this role. The bill requires the IFA to make all
utility asset management programs and information concerning utility asset lifecycle management costs that
have been submitted to or reviewed by the IFA available on an Internet website no later than FY 2023. It also
adds a new criteria to be used in the IFA’s project prioritization system for certain funds. Additionally, the
IFA may contract with a state supported college or university in Indiana to establish a Drinking Water and
Wastewater Infrastructure Research and Extension Program and to financially support the program from
funds appropriated to the IFA.
The bill’s requirements represent an additional workload and expenditures on the IFA, and existing staffing
and resource levels, if currently being used to capacity, may be insufficient for full implementation. The
additional funds and resources required could be supplied through existing staff and resources currently
being used in another program or with new appropriations. Ultimately, the source of funds and resources
required to satisfy the requirements of this bill will depend on legislative and administrative actions.
Governor's Workforce Cabinet, State Board of Education, Department of Education, and Department of
Workforce Development: The bill would result in additional workload for these entities to collaborate and
create course sequences for utility career clusters. These agencies should be able to implement the provisions
of the bill within existing resources.
Indiana Utility Regulatory Commission (IURC) and Indiana Department of Environmental Management
(IDEM): The bill establishes new procedures for the IURC and the IDEM to implement when
nonjurisdictional wastewater utilities have been issued one or more enforcement orders, beginning in FY
2023. This could result in additional workload on the IURC and the IDEM, but the agencies should be able
to meet the requirements of the bill without additional appropraitions.
Additional Information - IURC: The operating budget of the IURC and the Office of Utility Consumer
Counselor (OUCC) is funded by regulated utilities operating in Indiana. The rate at which to bill the utilities
is based on the agencies' budgets, less reversions, divided by the total amount of gross intrastate operating
revenue received by the regulated utilities for the previous fiscal year. Based on this formula, utilities are
currently billed approximately 0.12% of their gross intrastate operating revenues to fund the IURC and
OUCC.
Explanation of State Revenues:
Explanation of Local Expenditures:
SB 272 3 Explanation of Local Revenues:
State Agencies Affected: Indiana Finance Authority; Governor's Workforce Cabinet; State Board of
Education; Department of Education; Department of Workforce Development; Indiana Utility Regulatory
Commission; Indiana Department of Environmental Management.
Local Agencies Affected:
Information Sources:
Fiscal Analyst: Corrin Harvey, 317-234-9438; Olivia Smith, 317-232-9869.
SB 272 4