Texas 2019 - 86th Regular

Texas Senate Bill SB700 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	S.B. No. 700
	1	+	By: Nichols, et al. S.B. No. 700
	2	+	(Geren)
2	3
3	4
	5	+	A BILL TO BE ENTITLED
4	6		AN ACT
5	7		relating to retail public utilities that provide water or sewer
6	8		service.
7	9		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8	10		SECTION 1. Section 13.002, Water Code, is amended by
9	11		amending Subdivisions (4-b) and (4-c) and adding Subdivision (4-d)
10	12		to read as follows:
11	13		(4-b) "Class B utility" means a public utility that
12	14		provides retail water or sewer utility service through 2,300 [500]
13	15		or more taps or connections but fewer than 10,000 taps or
14	16		connections.
15	17		(4-c) "Class C utility" means a public utility that
16	18		provides retail water or sewer utility service through 500 or more
17	19		taps or connections but fewer than 2,300 [500] taps or connections.
18	20		(4-d) "Class D utility" means a public utility that
19	21		provides retail water or sewer utility service through fewer than
20	22		500 taps or connections.
21	23		SECTION 2. Section 13.041, Water Code, is amended by
22	24		amending Subsection (d) and adding Subsections (h), (i), and (j) to
23	25		read as follows:
24	26		(d) In accordance with Subchapter K-1, the utility
25	27		commission may issue emergency orders, with or without a hearing:
26	28		(1) to compel a retail public utility [water or sewer
27	29		service provider] that has obtained or is required to obtain a
28	30		certificate of public convenience and necessity to provide
29	31		continuous and adequate water service, sewer service, or both, if
30	32		the discontinuance of the service is imminent or has occurred
31	33		because of the retail public utility's [service provider's] actions
32	34		or failure to act; and
33	35		(2) to compel a retail public utility to provide an
34	36		emergency interconnection with a neighboring retail public utility
35	37		for the provision of temporary water or sewer service, or both, for
36	38		not more than 90 days if service discontinuance or serious
37	39		impairment in service is imminent or has occurred.
38	40		(h) In accordance with Subchapter L, Chapter 5, the
39	41		commission may issue emergency orders, with or without a hearing:
40	42		(1) to compel a retail public utility that has
41	43		obtained a certificate of public convenience and necessity to
42	44		provide water or sewer service, or both, that complies with all
43	45		statutory and regulatory requirements of the commission if
44	46		necessary to ensure safe drinking water or environmental
45	47		protection; and
46	48		(2) to compel a retail public utility to provide an
47	49		emergency interconnection with a neighboring retail public utility
48	50		for the provision of temporary water or sewer service, or both, for
49	51		not more than 90 days if necessary to ensure safe drinking water or
50	52		environmental protection.
51	53		(i) On request by the commission, the utility commission
52	54		may, on an expedited basis, establish reasonable compensation for
53	55		the temporary service required under Subsection (h)(2) and may
54	56		allow the retail public utility receiving the service to make a
55	57		temporary adjustment to its rate structure to ensure proper
56	58		payment.
57	59		(j) If an order is issued under Subsection (h) without a
58	60		hearing, notice of a hearing under Section 5.504 to affirm, modify,
59	61		or set aside the order is adequate if the notice is mailed or hand
60	62		delivered to the last known address of the retail public utility's
61	63		headquarters.
62	64		SECTION 3. Section 13.046, Water Code, is amended by adding
63	65		Subsection (d) to read as follows:
64	66		(d) At the time the utility commission approves the
65	67		acquisition of a nonfunctioning retail water or sewer utility
66	68		service provider under Section 13.301, the utility commission
67	69		shall:
68	70		(1) determine the duration of the temporary rates for
69	71		the retail public utility, which must be for a reasonable period;
70	72		and
71	73		(2) rule on the reasonableness of the temporary rates
72	74		under Subsection (b) if the utility commission did not make a ruling
73	75		before the application was filed under Section 13.301.
74	76		SECTION 4. Section 13.183(c), Water Code, is amended to
75	77		read as follows:
76	78		(c) To ensure that retail customers receive a higher
77	79		quality, more affordable, or more reliable water or sewer service,
78	80		to encourage regionalization, or to maintain financially stable and
79	81		technically sound utilities, the regulatory authority, by rule or
80	82		ordinance, as appropriate, may adopt specific alternative
81	83		ratemaking methodologies for water or sewer rates to allow for more
82	84		timely and efficient cost recovery. Appropriate alternative
83	85		ratemaking methodologies are the introduction of new customer
84	86		classes, the cash needs method, and phased and multi-step rate
85	87		changes. The regulatory authority may also adopt system
86	88		improvement charges that may be periodically adjusted to ensure
87	89		timely recovery of infrastructure investment. The utility
88	90		commission by rule shall establish a schedule that requires all
89	91		utilities that have implemented a system improvement charge
90	92		approved by the utility commission to make periodic filings with
91	93		the utility commission to modify or review base rates charged by the
92	94		utility [based on factors other than rate of return and those
93	95		specified in Section 13.185]. Overall revenues determined
94	96		according to an alternative ratemaking methodology adopted under
95	97		this section must provide revenues to the utility that satisfy the
96	98		requirements of Subsection (a). The regulatory authority may not
97	99		approve rates under an alternative ratemaking methodology unless
98	100		the regulatory authority adopts the methodology before the date the
99	101		rate application was administratively complete.
100	102		SECTION 5. Section 13.187(a-1), Water Code, is amended to
101	103		read as follows:
102	104		(a-1) A utility may not make changes in its rates except by
103	105		sending by mail or e-mail a statement of intent to each ratepayer
104	106		and to the regulatory authority having original jurisdiction at
105	107		least 35 days before the effective date of the proposed change. The
106	108		utility may send the statement of intent to a ratepayer by e-mail
107	109		only if the ratepayer has agreed to receive communications
108	110		electronically. The effective date of the new rates must be the
109	111		first day of a billing period, and the new rates may not apply to
110	112		service received before the effective date of the new rates. The
111	113		statement of intent must include:
112	114		(1) the information required by the regulatory
113	115		authority's rules;
114	116		(2) a billing comparison regarding the existing water
115	117		rate and the new water rate computed for the use of:
116	118		(A) 5,000 [10,000] gallons of water; and
117	119		(B) 10,000 [30,000] gallons of water;
118	120		(3) a billing comparison regarding the existing sewer
119	121		rate and the new sewer rate computed for the use of 5,000 [10,000]
120	122		gallons, unless the utility proposes a flat rate for sewer
121	123		services; and
122	124		(4) a description of the process by which a ratepayer
123	125		may intervene in the ratemaking proceeding.
124	126		SECTION 6. Sections 13.1871(a), (b), and (d), Water Code,
125	127		are amended to read as follows:
126	128		(a) Except as provided by Sections 13.18715 and [Section]
127	129		13.1872, this section applies only to a Class B utility.
128	130		(b) A utility may not make changes in its rates except by
129	131		sending by mail or e-mail a statement of intent to each ratepayer
130	132		and to the regulatory authority having original jurisdiction at
131	133		least 35 days before the effective date of the proposed change. The
132	134		utility may send the statement of intent to a ratepayer by e-mail
133	135		only if the ratepayer has agreed to receive communications
134	136		electronically. The effective date of the new rates must be the
135	137		first day of a billing period, and the new rates may not apply to
136	138		service received before the effective date of the new rates. The
137	139		statement of intent must include:
138	140		(1) the information required by the regulatory
139	141		authority's rules;
140	142		(2) a billing comparison regarding the existing water
141	143		rate and the new water rate computed for the use of:
142	144		(A) 5,000 [10,000] gallons of water; and
143	145		(B) 10,000 [30,000] gallons of water;
144	146		(3) a billing comparison regarding the existing sewer
145	147		rate and the new sewer rate computed for the use of 5,000 [10,000]
146	148		gallons, unless the utility proposes a flat rate for sewer
147	149		services; and
148	150		(4) a description of the process by which a ratepayer
149	151		may file a complaint under Subsection (i).
150	152		(d) When the statement of intent is delivered, the utility
151	153		shall file with the regulatory authority an application to change
152	154		rates. The application must include information the regulatory
153	155		authority requires by rule and any appropriate cost and rate
154	156		schedules supporting the requested rate increase. [In adopting
155	157		rules relating to the information required in the application, the
156	158		utility commission shall ensure that a utility can file a less
157	159		burdensome and complex application than is required of a Class A
158	160		utility.] If the utility fails to provide within a reasonable time
159	161		after the application is filed the necessary documentation or other
160	162		evidence that supports the costs and expenses that are shown in the
161	163		application, the regulatory authority may disallow the
162	164		nonsupported costs or expenses.
163	165		SECTION 7. Subchapter F, Chapter 13, Water Code, is amended
164	166		by adding Section 13.18715 to read as follows:
165	167		Sec. 13.18715. CLASS C UTILITIES: STATEMENT OF INTENT TO
166	168		CHANGE RATES; HEARING; DETERMINATION OF RATE LEVEL. (a) This
167	169		section applies only to a Class C utility.
168	170		(b) A utility may not make changes in its rates except by
169	171		complying with the procedures to change rates described by Section
170	172		13.1871.
171	173		(c) Notwithstanding Section 13.1871(n), the utility may
172	174		send the notice required by that subsection by mail or e-mail or may
173	175		deliver a copy of the notice to the ratepayers.
174	176		SECTION 8. The heading to Section 13.1872, Water Code, is
175	177		amended to read as follows:
176	178		Sec. 13.1872. CLASS D [C] UTILITIES: RATE ADJUSTMENT.
177	179		SECTION 9. Section 13.1872, Water Code, is amended by
178	180		amending Subsections (a) and (e) and adding Subsection (c-1) to
179	181		read as follows:
180	182		(a) This section applies only to a Class D [C] utility.
181	183		(c-1) A utility that chooses to comply with Section 13.1871
182	184		as authorized under Subsection (c)(2) of this section may send the
183	185		notice required by Section 13.1871(n) by mail or e-mail or may
184	186		deliver a copy of the notice to the ratepayers.
185	187		(e) The utility commission by rule shall adopt procedures to
186	188		allow a utility to receive without a hearing an annual rate
187	189		adjustment [based on changes in the price index]. The rules must:
188	190		(1) include standard language to be included in the
189	191		notice described by Subsection (c)(1) describing the rate
190	192		adjustment process; and
191	193		(2) provide that an annual rate adjustment described
192	194		by this section may not result in a rate increase to any class or
193	195		category of ratepayer of more than [the lesser of:
194	196		[(A)] five percent[; or
195	197		[(B) the percentage increase in the price index
196	198		between the year preceding the year in which the utility requests
197	199		the adjustment and the year in which the utility requests the
198	200		adjustment].
199	201		SECTION 10. Subchapter F, Chapter 13, Water Code, is
200	202		amended by adding Section 13.1873 to read as follows:
201	203		Sec. 13.1873. APPLICATION RULES. In adopting rules
202	204		relating to the information required in an application for a Class
203	205		B, Class C, or Class D utility to change rates, the utility
204	206		commission shall ensure that a:
205	207		(1) Class B utility can file a less burdensome and
206	208		complex application than is required of a Class A utility; and
207	209		(2) Class C or Class D utility can file a less
208	210		burdensome and complex application than is required of a Class A or
209	211		Class B utility.
210	212		SECTION 11. Section 13.258(a), Water Code, is amended to
211	213		read as follows:
212	214		(a) Notwithstanding any other provision of this chapter, a
213	215		Class A utility may apply to the utility commission for an amendment
214	216		of a certificate of convenience and necessity held by a municipal
215	217		utility district to allow the utility to have the same rights and
216	218		powers under the certificate as the municipal utility district.
217		-	SECTION 12. Section 5.501(c), Water Code, is amended to
218		-	read as follows:
219		-	(c) The commission by order or rule may delegate to the
220		-	executive director the authority to:
221		-	(1) receive applications and issue emergency orders
222		-	under this subchapter and Section 13.041(h); and
223		-	(2) authorize, in writing, a representative or
224		-	representatives to act on the executive director's behalf under
225		-	this subchapter and Section 13.041(h).
226		-	SECTION 13. The change in law made by this Act applies only
	219	+	SECTION 12. The change in law made by this Act applies only
227	220		to an application for an amendment of a certificate of public
228	221		convenience and necessity or an application for a rate change or
229	222		adjustment filed on or after the effective date of this Act. An
230	223		application filed before the effective date of this Act is governed
231	224		by the law in effect on the date the application is filed, and the
232	225		former law is continued in effect for that purpose.
233		-	SECTION 14. Section 13.1872(b), Water Code, is repealed.
234		-	SECTION 15. This Act takes effect September 1, 2019.
235		-	______________________________ ______________________________
236		-	President of the Senate Speaker of the House
237		-	I hereby certify that S.B. No. 700 passed the Senate on
238		-	April 9, 2019, by the following vote: Yeas 31, Nays 0; and that
239		-	the Senate concurred in House amendment on May 21, 2019, by the
240		-	following vote: Yeas 31, Nays 0.
241		-	______________________________
242		-	Secretary of the Senate
243		-	I hereby certify that S.B. No. 700 passed the House, with
244		-	amendment, on May 17, 2019, by the following vote: Yeas 141,
245		-	Nays 1, two present not voting.
246		-	______________________________
247		-	Chief Clerk of the House
248		-	Approved:
249		-	______________________________
250		-	Date
251		-	______________________________
252		-	Governor
	226	+	SECTION 13. Section 13.1872(b), Water Code, is repealed.
	227	+	SECTION 14. This Act takes effect September 1, 2019.