Restores parity among public utilities with regard to formula used to calculate amount of refund given to developers for extension of public utility infrastructure.
This bill amends R.S.48:2-27, seeking to better regulate the responsibilities and financial practices of public utilities regarding infrastructure extensions. By restoring the former regulatory practices prior to the 'Centex decision' in 2009, which had previously altered the refunding criteria, A2728 aims to ensure that all utilities are treated equally in terms of refund obligations to developers. This could have significant implications for infrastructure investment and development, as equal refund ratios may encourage more developers to initiate construction projects linked to utility extensions.
Assembly Bill A2728 aims to restore and standardize the refund formula that public utilities must provide to developers for the construction of utility infrastructure extensions. Specifically, it mandates that public utilities grant an annual refund to developers for a period of ten years, where each refund amount is calculated as ten times the annual revenue derived by the utility from the extension. The first of these annual refunds is to be issued one year after the utility receives a deposit from the developer. This restoration of parity is crucial because it addresses discrepancies in refund amounts across different utility sectors, providing equal terms for developers irrespective of which utility they engage with.
A notable point of contention surrounding A2728 is its relationship with the earlier Centex ruling, which determined the bounds of regulatory authority for utility extensions. Critics may argue that reverting to the previous regulations could lead to unwarranted financial burdens on public utilities. Supporters, on the other hand, contend that this bill facilitates fair treatment and encourages development, especially in areas seeking to enhance their utility infrastructure. As it stands, the balance between adequate regulation and facilitating development is at the core of discussions surrounding the bill's support and opposition.