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 6951 NOTE PREPARED: Jan 30, 2024
BILL NUMBER: SB 247 BILL AMENDED: Jan 29, 2024
SUBJECT: Water and Wastewater Utility Infrastructure.
FIRST AUTHOR: Sen. Koch BILL STATUS: As Passed Senate
FIRST SPONSOR: Rep. Soliday
FUNDS AFFECTED: GENERAL IMPACT: State & Local
XDEDICATED
FEDERAL
Summary of Legislation: The bill amends the statute concerning the acquisition of a water or wastewater
utility to provide that if:
(1) the appraised value of the utility property to be acquired does not exceed $3 M; and
(2) the purchase price for the utility property is less than the appraised value; the utility company
seeking to acquire the utility property of an offered utility:
the acquiring utility company may submit to the Indiana Utility Regulatory Agency (IURC) a filing to include
in the acquiring utility company's rate base specified costs associated with the acquisition.
The bill sets forth certain information that must be included in an acquiring utility company's 30 day
administrative filing.
It provides that if the IURC approves an acquiring utility company's filing, the IURC: (1) may only authorize
that: (A) the full purchase price; and (B) estimated: (i) incidental expenses; and (ii) other costs of acquisition;
be recorded as the acquiring utility company's net original cost of acquisition; and (2) shall provide that any
estimated: (i) incidental expenses; and (ii) other costs of the acquisition; are subject to a reasonableness
review as part of the acquiring utility company's next base rate case.
The bill also adds language specifying that the Indiana Code chapter that governs the transfer, acquisition,
and improvement of utilities by municipalities applies to a municipally owned natural gas utility (in addition
to a municipally owned electric, water, wastewater, or combined water and wastewater utility).
Effective Date: July 1, 2024.
SB 247 1 Explanation of State Expenditures: The bill provides exemptions to sale filing requirements for sale of a
distressed water or wastewater utility. Instead, if the sale of a distressed utility meets the requirements in the
bill, a purchasing utility would file a 30-day administrative filing with the IURC concerning the sale. This
change could decrease IURC workload to review distressed water and wastewater utility sale filings and
instead review administrative filings, if the filings are not contested. To the extent these filings are contested
and would require a hearing, there would be no workload savings to the IURC.
Additional Information - Since CY 2015, the IURC received a total of 29 requests for mergers and
acquisitions of water and wastewater treatment facilities.
Explanation of State Revenues:
Explanation of Local Expenditures: The bill would increase municipality workload to comply with the
requirements in statute if a municipality intends to transfer, acquire, or improve a natural gas utility the entity
owns.
Additional Information - Currently, the statutory requirements for the transfer, acquisition, and improvement
of a municipally-owned utility do not apply to Indianapolis and natural gas utilities owned by municipalities.
The requirements currently apply to all electric, water, wastewater, or combined water and wastewater
utilities owned by municipalities, except those owned by Indianapolis.
The bill would expand these requirements to include natural gas utilities owned by municipalities. There
are currently 19 municipally-owned natural gas utilities in the state, of which only one is currently under
IURC authority.
Explanation of Local Revenues:
State Agencies Affected: IURC.
Local Agencies Affected: Municipally-owned natural gas utilities.
Information Sources: Luke Wilson, IURC;
https://www.in.gov/oucc/watersewer/tips-and-publications/municipal-utilities-a-brief-regulatory-overvie
w/
Fiscal Analyst: Bill Brumbach, 317-232-9559.
SB 247 2