FINAL BILL REPORT

                                   SSB 5762

                                  C 150 L 91

                              SYNOPSIS AS ENACTED

Brief Description:  Financing water company safety improvements.

SPONSORS:Senate Committee on Energy & Utilities (originally sponsored by Senators Hayner, Cantu and Thorsness).

SENATE COMMITTEE ON ENERGY & UTILITIES

HOUSE COMMITTEE ON ENERGY & UTILITIES

BACKGROUND:

The Utilities and Transportation Commission regulates the rates of privately-owned water companies with 100 or more connections or with average annual gross revenues of $300 per customer or more.  State law generally permits a regulated water company to recover capital construction costs only after the capital improvement is in service.  The UTC may, however, permit a regulated water company to fund a capital reserve account out of its rates exclusively for the purpose of making capital improvements approved by the Department of Health as part of a long-range plan, or required by the department to assure compliance with state or federal drinking water regulations.  Expenditures from this fund are subject to prior approval by the UTC.   Other health and safety expenditures, such as those required by the Department of Ecology to maintain dam safety, may not be funded under this mechanism because of the narrow language in the statute.  This limits the ability of small water companies to finance required improvements.

SUMMARY:

The Utilities and Transportation Commission may provide for the funding of a reserve account by a regulated water company to perform construction or maintenance required by the Department of Ecology under the director's statutory authority to secure safety to life and property.

VOTES ON FINAL PASSAGE:

Senate      43    0

House 94    1

EFFECTIVE:July 28, 1991