First Regular Session of the 124th General Assembly (2025)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
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between statutes enacted by the 2024 Regular Session of the General Assembly.
SENATE ENROLLED ACT No. 4
AN ACT to amend the Indiana Code concerning natural and cultural
resources.
Be it enacted by the General Assembly of the State of Indiana:
SECTION 1. IC 8-1-30.9 IS ADDED TO THE INDIANA CODE
AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2025]:
Chapter 30.9. Long Haul Water Pipelines
Sec. 1. As used in this chapter, "commission" refers to the
Indiana utility regulatory commission created by IC 8-1-1-2.
Sec. 2. (a) As used in this chapter, "long haul water pipeline"
means a newly constructed, continuous pipeline that has the ability
to transport water:
(1) at a capacity of at least ten million (10,000,000) gallons per
day; and
(2) to a destination located at least thirty (30) miles from the
withdrawal source.
(b) The term does not include:
(1) a project that will return at least fifty percent (50%) of the
transported water after utilization back to the withdrawal
source; or
(2) a pipeline project located, in whole or in part, inside the
Great Lakes-St. Lawrence River basin (as defined in
IC 14-25-15-1).
Sec. 3. As used in this chapter, "water utility" means:
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(1) a public utility (as defined in IC 8-1-2-1(a));
(2) a municipally owned utility (as defined in IC 8-1-2-1(h));
(3) a not-for-profit utility (as defined in IC 8-1-2-125(a));
(4) a cooperatively owned corporation;
(5) a conservancy district established under IC 14-33; or
(6) a regional water district established under IC 13-26;
that provides water service to the public in Indiana for
compensation.
Sec. 4. As used in this chapter, "withdrawal source" means:
(1) a river, lake, reservoir, spring, or ground water aquifer;
or
(2) the connection point with a water utility.
Sec. 5. (a) Except as provided in this chapter, the construction
of a long haul water pipeline after June 30, 2025, is prohibited.
(b) After June 30, 2025, a water utility may construct a long
haul water pipeline if the water utility first obtains from the
commission a certificate that the public convenience and necessity
requires, or will require, the construction of the long haul water
pipeline.
(c) A certificate of public convenience and necessity under this
chapter is not required for the transfer, purchase, sale, or lease of
a long haul water pipeline that has been constructed in accordance
with a certificate issued under this chapter. However, a person that
transfers, sells, or leases a long haul water pipeline must provide
written notice to the commission of the transfer, sale, or lease not
later than sixty (60) days after the transfer, sale, or lease is
finalized. Notice under this subsection shall be submitted in the
form and manner prescribed by the commission and must include
the name and contact information for the transferee, purchaser, or
lessee. The commission may issue a general administrative order
regarding the information to be included in a notice required
under this subsection.
Sec. 6. A water utility that seeks to construct a long haul water
pipeline must submit an application to the commission for a
certificate of public convenience and necessity. The application
must include the following:
(1) The purpose and necessity of the long haul water pipeline,
including a description of how the water being transported
will be used and discharged.
(2) The volume of water to be transported via the long haul
water pipeline.
(3) The location of the source water, transfer points, and
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destination of the water being transported via the long haul
water pipeline.
(4) An assessment of the hydraulic carrying capacity of, and
the environmental impact on, the receiving waters in the
specific areas that will receive and eventually discharge the
water resources.
(5) An assessment of the hydraulic and environmental impacts
of the proposed water withdrawals on the source area.
(6) A feasibility assessment that includes a consideration of
whether alternate water sources could be used instead of the
proposed transfer, including engineering, geological,
environmental, and economic analyses.
(7) A list of conservation programs or practices conducted or
proposed by the water utility with respect to the area to which
water is proposed to be transferred.
(8) The date the water utility intends to begin transferring
water.
(9) An estimate of costs associated with the construction of the
long haul water pipeline.
(10) The impact of the long haul water pipeline on customer
rates.
(11) Any other information required by the commission.
Sec. 7. (a) The commission shall hold a public hearing on each
application.
(b) The commission may consider all relevant information
related to construction costs.
(c) The commission shall issue an order granting or denying a
certificate of public convenience and necessity not later than two
hundred forty (240) days after the date the application for the
certificate and the applicant's case in chief are filed with the
commission.
(d) The commission may issue a general administrative order
establishing guidelines regarding the information to be included in
the applicant's case in chief.
(e) The commission shall grant a certificate of public
convenience and necessity only if the commission makes a finding:
(1) as to the best estimate of the construction costs based on
the evidence of record;
(2) that the estimated costs described in subdivision (1) are
reasonable;
(3) that the public convenience and necessity requires or will
require the construction of the long haul water pipeline; and
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(4) that the construction of the long haul water pipeline is in
the public interest.
(f) The commission may approve or disapprove an application
in whole or part, including any amendments to the application. A
certificate issued by the commission under this chapter may
include any terms considered reasonably necessary by the
commission.
(g) The commission may revoke, suspend, or modify a certificate
if any of the following apply:
(1) A water utility violates the terms of the certificate.
(2) A water utility obtained the certificate by fraud,
misrepresentation, or other malfeasance.
Sec. 8. (a) Except as provided in subsection (b), the commission
shall maintain an ongoing review of the construction of a long haul
water pipeline as it proceeds. The applicant shall submit each year
during construction, or at other times agreed to by commission and
the water utility, a progress report and any revisions in the cost
estimates for the construction.
(b) A water utility may elect to forego ongoing review under
subsection (a) and defer the review of the construction and cost
until completion or cancellation of the long haul water pipeline.
(c) If the commission approves the construction and the cost of
the portion of the long haul water pipeline under review under this
section, the certificate remains in full force and effect.
(d) If the commission disapproves of all or part of the
construction or cost of the portion of the long haul water pipeline
under review under this section, the commission may modify or
revoke the certificate, subject to section 9 of this chapter.
Sec. 9. Absent fraud, concealment, or gross mismanagement, a
water utility shall recover through rates the actual costs the water
utility has incurred in reliance on a certificate issued under this
chapter as follows:
(1) If construction of a long haul water pipeline has been
subject to ongoing review under section 8(a) of this chapter
and the commission finds the construction of the long haul
water pipeline has been completed, the costs of construction
approved by the commission during the ongoing review shall
be included, without further commission review, in:
(A) the water utility's rate base, in the case of a public
utility; or
(B) the water utility's revenue requirement for extensions
and replacements expense, depreciation expense, or debt
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service expense, as applicable, in the case of a:
(i) municipally owned utility;
(ii) not-for-profit utility;
(iii) conservancy district; or
(iv) regional water district.
(2) If construction of a long haul water pipeline is subject to
subsequent review under section 8(b) of this chapter and the
commission finds the construction of the long haul water
pipeline to be completed, the costs of construction that do not
exceed the estimate under section 7(e)(1) of this chapter, and
that are not shown to result from inadequate quality controls,
shall be included in:
(A) the water utility's rate base, in the case of a public
utility; or
(B) the water utility's revenue requirement for extensions
and replacements expense, depreciation expense, or debt
service expense, as applicable, in the case of a:
(i) municipally owned utility;
(ii) not-for-profit utility;
(iii) conservancy district; or
(iv) regional water district.
However, inclusion of costs in excess of the estimate under
section 7(e)(1) of this chapter in the water utility's rate base
or revenue requirement is not permitted unless shown by the
water utility to be necessary and prudent in the construction
of the long haul water pipeline.
(3) If a long haul water pipeline has been canceled as a result
of:
(A) the modification or revocation of the certificate under
this chapter; or
(B) local permitting or other issues beyond the water
utility's control;
and the long haul water pipeline's construction has been
subject to ongoing review under section 8(a) of this chapter
(including reviews after cancellation), the costs of
construction approved by the commission during the review
shall be recovered by the water utility by inclusion in rates
and amortization over a reasonable time to be determined by
the commission. A water utility that is a public utility shall be
permitted to earn a return, computed using the water utility's
authorized rate of return, on the unamortized balance.
(4) If a long haul water pipeline has been canceled as a result
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of:
(A) the modification or revocation of the certificate under
this chapter; or
(B) local permitting or other issues beyond the water
utility's control;
and the long haul water pipeline's construction is subject to
subsequent review under section 8(b) of this chapter, the costs
of construction incurred before cancellation that were
included in the estimate under section 7(e)(1) of this chapter
and that have not been shown to result from inadequate
quality controls shall be recovered by the water utility by
inclusion in rates and amortization over a reasonable time to
be determined by the commission. A water utility that is a
public utility shall be permitted to earn a return, computed
using the water utility's authorized rate of return, on the
unamortized balance. However, costs that were not included
in the estimate under section 7(e)(1) of this chapter may not
be included in rates unless shown by the water utility to be
necessary and prudent in the construction of the long haul
water pipeline.
SECTION 2. IC 14-8-2-20, AS AMENDED BY P.L.282-2019,
SECTION 4, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2025]: Sec. 20. "Basin" has the following meaning:
(1) For purposes of IC 14-13-9, the meaning set forth in
IC 14-13-9-1.
(2) For purposes of IC 14-25-1, the meaning set forth in section
1.2 of IC 14-25-15-1.
(3) For purposes of IC 14-25-17, the meaning set forth in
IC 14-25-17-3.
(3) (4) For purposes of IC 14-30-2, the meaning set forth in
IC 14-30-2-1.
(4) (5) For purposes of IC 14-30-3, the meaning set forth in
IC 14-30-3-1.
(5) (6) For purposes of IC 14-30-4, the meaning set forth in
IC 14-30-4-1.
SECTION 3. IC 14-8-2-181.5 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2025]: Sec. 181.5. "Notable user", for
purposes of IC 14-25-17, has the meaning set forth in
IC 14-25-17-4.
SECTION 4. IC 14-25-17 IS ADDED TO THE INDIANA CODE
AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
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JULY 1, 2025]:
Chapter 17. Interbasin Water Transfers
Sec. 1. This chapter does not apply to an interbasin water
transfer that is:
(1) made by a water utility:
(A) from or downstream from a reservoir:
(i) owned, operated, or managed by the water utility; or
(ii) with respect to which the water utility has
withdrawal rights;
(B) within the water utility's own service area in which
more than one (1) basin is present;
(C) under an agreement made before January 1, 2025,
concerning the limitless exploration advanced pace district
and any related development;
(D) to an existing wholesale customer of the water utility as
of July 1, 2025; or
(E) to an affiliate of the water utility or, in the case of a
water utility that is:
(i) owned, operated, or held in trust by a consolidated
city; or
(ii) controlled by the board of directors for utilities of a
consolidated city;
to another water utility held in trust by the consolidated
city or controlled by the board of directors for utilities of
the consolidated city; or
(2) subject to the Great Lakes-St. Lawrence River Basin
Water Resources Compact (IC 14-25-15).
Sec. 2. The general assembly finds that it is prudent to engage
in planning for the future and to have an explicit mechanism in
place to regulate proposals for the diversion of water from one
basin to another, consistent with IC 14-25-3-3.
Sec. 3. As used in this chapter, "basin" means the following:
(1) The Lake Michigan basin, which shall consist of all waters
that are classified by the following eight (8) digit United States
Geological Survey hydrologic unit codes:
(A) 04040001 (the Little Calumet-Galien subbasin).
(B) 07120003 (the Chicago subbasin).
(2) The Kankakee basin, which shall consist of all waters that
are classified by the following eight (8) digit United States
Geological Survey hydrologic unit codes:
(A) 07120001 (the Kankakee subbasin).
(B) 07120002 (the Iroquois subbasin).
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(3) The Northeast basin, which shall consist of all waters that
are classified by the following eight (8) digit United States
Geological Survey hydrologic unit codes:
(A) 04050001 (the St. Joseph subbasin).
(B) 04100003 (the St. Joseph subbasin).
(C) 04100004 (the St. Marys subbasin).
(D) 04100005 (the Upper Maumee subbasin).
(E) 04100007 (the Auglaize subbasin).
(4) The Wabash Headwaters basin, which shall consist of all
waters that are classified by the following eight (8) digit
United States Geological Survey hydrologic unit codes:
(A) 05120101 (the Upper Wabash subbasin).
(B) 05120102 (the Salamonie subbasin).
(C) 05120103 (the Mississinewa subbasin).
(D) 05120104 (the Eel subbasin).
(E) 05120105 (the Middle Wabash-Deer subbasin).
(5) The North Central basin, which shall consist of all waters
that are classified by the following eight (8) digit United States
Geological Survey hydrologic unit codes:
(A) 05120106 (the Tippecanoe subbasin).
(B) 05120107 (the Wildcat subbasin).
(C) 05120108 (the Middle Wabash-Little Vermilion
subbasin).
(D) 05120109 (the Vermilion subbasin).
(E) 05120110 (the Sugar subbasin).
(6) The Central basin, which shall consist of all waters that
are classified by the following eight (8) digit United States
Geological Survey hydrologic unit code:
(A) 05120201 (the Upper White subbasin).
(7) The Southeast Central basin, which shall consist of all
waters that are classified by the following eight (8) digit
United States Geological Survey hydrologic unit codes:
(A) 05120204 (the Driftwood subbasin).
(B) 05120205 (the Flatrock-Haw subbasin).
(C) 05120206 (the Upper East Fork White subbasin).
(8) The Southeast basin, which shall consist of all waters that
are classified by the following eight (8) digit United States
Geological Survey hydrologic unit codes:
(A) 05080002 (the Lower Great Miami subbasin).
(B) 05080003 (the Whitewater subbasin).
(C) 05090203 (the Middle Ohio-Laughery subbasin).
(D) 05120207 (the Muscatatuck subbasin).
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(E) 05140101 (the Silver-Little Kentucky subbasin).
(F) 05140104 (the Blue-Sinking subbasin).
(9) The Southwest basin, which shall consist of all waters that
are classified by the following eight (8) digit United States
Geological Survey hydrologic unit codes:
(A) 05120111 (the Middle Wabash-Busseron subbasin).
(B) 05120202 (the Lower White subbasin).
(C) 05120203 (the Eel subbasin).
(D) 05120208 (the Lower East Fork White subbasin).
(E) 05120209 (the Patoka subbasin).
(10) The Ohio River basin, which shall consist of all waters
that are classified by the following eight (8) digit United States
Geological Survey hydrologic unit codes:
(A) 05120113 (the Lower Wabash subbasin).
(B) 05140201 (the Lower Ohio-Little Pigeon subbasin).
(C) 05140202 (the Highland Pigeon subbasin).
Sec. 4. As used in this chapter, "notable user" means a person
that transfers or proposes to transfer:
(1) more than an annual average of thirty million (30,000,000)
gallons of water per day; or
(2) water from an area determined by the department under
IC 14-25-3 to be a restricted use area.
Sec. 5. (a) Except as provided in subsection (b), a notable user
may not:
(1) transfer water out of a basin; or
(2) supply water to another person that the notable user
knows will transfer more than one hundred thousand
(100,000) gallons of water per day out of a basin;
without a transfer permit from the department.
(b) A transfer permit is not required for:
(1) the transfer of ground water, unless the transfer is
determined by the department to result in perennial stream
flow depletion;
(2) subject to subsection (c), an existing or ongoing interbasin
transfer as of July 1, 2025;
(3) an interbasin transfer to an area of need during a
temporary water emergency as described in section 11 of this
chapter; or
(4) an interbasin transfer if the destination of the transfer is
situated upstream or downstream of the withdrawal point
such that the natural flow of water is not disturbed.
(c) A notable user must receive a transfer permit if an existing
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or ongoing interbasin transfer described in subsection (b)(2)
exceeds the capacity of any system engaged in the interbasin
transfer in any ninety (90) day period. For purposes of this
subsection, the capacity of an existing system refers to:
(1) withdrawal capacity;
(2) treatment capacity;
(3) distribution capacity; or
(4) any other capacity limiting factor;
as appropriate in the circumstances.
Sec. 6. A notable user may submit an application for a transfer
permit to the department. An application must contain the
following:
(1) The beneficial use (as defined in IC 14-25-7-2), purpose,
and necessity of the proposed transfer.
(2) The volume of the proposed transfer.
(3) The location of all withdrawal, return, and transfer points
related to the proposed transfer.
(4) The volume of water that will be returned to the basin in
connection with the proposed transfer.
(5) The peak capacity of each transfer facility that would be
involved in the proposed transfer, including evidence
supporting the peak capacity.
(6) An assessment of the hydraulic and environmental impact
of the proposed transfer on the basin.
(7) A feasibility assessment that considers whether alternate
water sources not subject to this chapter could be used in
place of the proposed transfer, including engineering,
geological, environmental, and economic analyses.
(8) A list of conservation programs or practices conducted or
proposed by the notable user in the area where water is
proposed to be transferred to.
(9) The date the notable user intends to begin transferring
water outside the basin.
(10) A filing fee set by the department.
(11) Any other information required by the department.
Sec. 7. (a) The department shall review an application submitted
under section 6 of this chapter. If the department determines that
the application submitted under section 6 of this chapter is
complete, the department shall notify the applicant.
(b) The department shall return an application to the applicant
if the department determines that the application is incomplete,
inaccurate, or both.
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(c) If the department returns an application to an applicant
under subsection (b), the department shall include with the
returned application a written notice that:
(1) identifies the deficiency in the application; and
(2) informs the applicant that the applicant may file a
corrected application not later than sixty (60) days after the
applicant's receipt of the returned application.
(d) Upon receiving a corrected application under this section,
the department shall review the application.
(e) Not later than ninety (90) days after receiving a complete
application, the department shall notify the applicant in writing as
to whether the department has approved or denied the application.
The department shall approve an application if the department
determines that the transfer:
(1) will not result in a perennial overdraft of a ground water
resource or in a perennial stream flow depletion; and
(2) is in the public interest, as described in IC 14-25-1-1 and
IC 14-25-1-2.
Sec. 8. (a) If the department approves an application under
section 7 of this chapter, the department shall issue to the applicant
a transfer permit.
(b) A transfer permit may include any terms deemed reasonably
necessary by the department.
(c) A permittee shall file with the department at least once every
five (5) years a certification of compliance with the terms of a
transfer permit.
Sec. 9. Except as provided in section 10 of this chapter, a
transfer permit does not expire.
Sec. 10. The department may revoke, suspend, or modify a
transfer permit if any of the following apply:
(1) A permittee violates the terms of the transfer permit.
(2) A permittee obtained the transfer permit by fraud,
misrepresentation, or other malfeasance.
(3) A permittee fails to file a certification of compliance as
described in section 8 of this chapter.
(4) The public interest requires revocation, suspension, or
modification.
Sec. 11. The department may declare a temporary water
emergency during periods of extended drought, natural disasters,
significant utility outages, or other similar events.
Sec. 12. (a) The department may assess a civil penalty against a
notable user that knowingly violates this chapter of not more than
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ten thousand dollars ($10,000) per day per violation.
(b) All civil penalties collected under this chapter shall be
deposited in the state general fund.
Sec. 13. The department may adopt rules under IC 4-22-2 to
implement this chapter.
SEA 4 — Concur President of the Senate
President Pro Tempore
Speaker of the House of Representatives
Governor of the State of Indiana
Date: Time:
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