Florida Senate - 2014 CS for CS for SB 272 By the Committees on Community Affairs; and Communications, Energy, and Public Utilities; and Senator Simpson 578-01649-14 2014272c2 1 A bill to be entitled 2 An act relating to water and wastewater utilities; 3 creating s. 367.072, F.S.; providing legislative 4 findings; authorizing the Florida Public Service 5 Commission to revoke a certificate of authorization 6 upon receipt of a petition; requiring customers to 7 file a notice of intent with the commission before 8 submitting a petition; providing criteria for such 9 petition; requiring the commission to take certain 10 steps in response to the petition; prohibiting the 11 customers from filing a petition within a specified 12 timeframe under certain circumstances; prohibiting a 13 utility from filing for a rate case under certain 14 circumstances; requiring the utility to submit a 15 response; requiring the commission to adopt rules; 16 creating s. 367.0812, F.S.; requiring the commission 17 to consider the quality of water or wastewater service 18 when fixing rates; providing criteria that the 19 commission must consider in making its determination; 20 requiring the utility to meet with its customers to 21 discuss the costs and benefits of plausible solutions 22 if the commission finds that the utility has failed to 23 meet certain water or wastewater quality standards; 24 requiring that the utility be allowed to recover the 25 costs of the solutions ordered by the commission; 26 prohibiting customers from petitioning the commission 27 to revoke the certificate of authorization of a 28 utility under certain circumstances; authorizing the 29 commission to impose penalties on a utility for 30 certain failures; requiring the commission to adopt 31 rules; requiring the Department of Environmental 32 Protection to establish secondary wastewater service 33 standards regarding the generation of odor, noise, 34 aerosol drift, and lighting; providing an effective 35 date. 36 37 Be It Enacted by the Legislature of the State of Florida: 38 39 Section 1. Section 367.072, Florida Statutes, is created to 40 read: 41 367.072 Petition to revoke certificate of authorization. 42 The Legislature finds that it is in the public interest that 43 water and wastewater service be of good quality and consistent 44 with the standards set forth in this chapter. Therefore, a 45 utility’s certificate of authorization may be revoked if, after 46 its customers file a petition in accordance with this section, 47 the commission finds that revocation is in the best interest of 48 the customers. 49 (1) Customers must file a notice of intent with the 50 commission before filing a petition. Within 10 days after 51 receipt of a notice of intent, the commission staff shall: 52 (a) Notify the applicable utility that its customers have 53 filed a notice of intent; and 54 (b) Send the customers instructions detailing the required 55 format and content of the petition and the subsequent process 56 the commission must follow. 57 (2) Within 90 days after receipt of such instructions, the 58 customers must file a petition that, for the purpose of 59 determining whether a utility is providing satisfactory water 60 quality or wastewater service, must: 61 (a) State with specificity each issue that the customers 62 have with the water quality or wastewater service, each time the 63 problem was reported to the utility, and how long each issue has 64 existed; and 65 (b) Be signed by at least 65 percent of a utility’s 66 customers within a system. The term “customer” means an 67 individual who owns or rents property that is serviced by a 68 single meter or an individual whose name appears on the bill for 69 a master meter. Only one signature for each service address may 70 be included on the petition. An individual whose name appears on 71 the bill for a master meter may sign a petition if at least 65 72 percent of the heads of the households served by the master 73 meter, such as tenants or unit owners, support the petition, in 74 which case documentation of such support must be included with 75 the petition. 76 (3) The commission shall review the petition and, within 10 77 days after receipt, notify the customers whether the petition is 78 sufficient or whether additional information is required. If 79 additional information is required, the customers must file a 80 cured petition within 30 days after receipt of the notification. 81 If the customers fail to file the petition in accordance with 82 this subsection, the commission shall dismiss the petition, and 83 the customers may not file another petition for 1 year after the 84 date of dismissal. 85 (4) If the petition is in compliance with this section and 86 the issues identified within the petition support a reasonable 87 likelihood that the water or wastewater utility is failing to 88 provide quality water or wastewater service, a docket shall be 89 opened. Once opened, the utility may not file for a rate case 90 until the docket is closed. 91 (5) A copy of the petition and written notification 92 regarding the prohibition against filing a rate case while the 93 docket remains open must be provided to the utility. The utility 94 shall submit a response to the commission addressing the issues 95 identified within the petition and explaining whether it is 96 providing quality water or wastewater service using the 97 following criteria: 98 (a) Federal and state primary water and wastewater 99 standards or secondary water quality or wastewater service 100 standards provided in s. 367.0812; and 101 (b) The relationship between the utility and its customers, 102 including each complaint received regarding service quality, the 103 length of time each customer has been complaining about service, 104 the resolution of each complaint, and the time it has taken to 105 address such complaints. 106 (6) The commission shall evaluate the issues identified 107 within the petition, the utility’s response as to whether it is 108 providing quality water or wastewater service, and any other 109 factor the commission deems relevant. 110 (7) Notwithstanding s. 367.045 and based upon its 111 evaluation, the commission shall: 112 (a) Dismiss the petition if the decision is supported by 113 clear and convincing evidence, in which case the decision is 114 subject to ss. 120.569 and 120.57; 115 (b) Place the utility’s certificate on probationary status 116 and require the utility to take the necessary steps to correct 117 the water quality or wastewater service issues identified. The 118 commission shall set benchmarks within a timeframe, not to 119 exceed 3 years, and may require the utility to provide interim 120 reports describing its progress in meeting such benchmarks. The 121 commission may extend the timeframe for compliance beyond 3 122 years if the circumstances that delay the utility, such as 123 obtaining permits or natural disaster, are not within the 124 utility’s control; or 125 (c) Revoke the utility’s certificate of authorization, in 126 which case a receiver must be appointed pursuant to s. 367.165 127 until a sale of the utility system has been approved pursuant to 128 s. 367.071. 129 (8) The commission shall adopt by rule the format of and 130 requirements for a petition and may adopt other rules to 131 administer this section. 132 Section 2. Section 367.0812, Florida Statutes, is created 133 to read: 134 367.0812 Rate fixing; quality of water or wastewater 135 service as criterion.— 136 (1) In fixing rates that are just, reasonable, 137 compensatory, and not unfairly discriminatory, the commission 138 shall consider the extent to which the utility provides water 139 service that meets secondary water quality standards for taste, 140 odor, color, or corrosiveness, as established by the Department 141 of Environmental Protection. In determining whether a utility 142 has satisfied its obligation to provide water service to its 143 customers which meets the standards for taste, odor, color, or 144 corrosiveness, the commission shall consider: 145 (a) Testimony and evidence provided by customers and the 146 utility; 147 (b) The results of past tests required by the Department of 148 Environmental Protection which measure the utility’s compliance 149 with the applicable secondary water quality standards or with a 150 county health department; 151 (c) Complaints regarding the applicable secondary water 152 quality standards filed by customers with the commission or the 153 Department of Environmental Protection, or the respective local 154 governmental entity, or a county health department during the 155 past 5 years; and 156 (d) If the commission deems necessary, the results of any 157 updated test. 158 (2) In fixing just, reasonable, compensatory, and not 159 unfairly discriminatory rates, the commission shall consider the 160 extent to which the utility provides wastewater service to its 161 customers without generating odor, noise, aerosol drift, or 162 lighting in excess of the standards established by the 163 Department of Environmental Protection. In determining the 164 extent to which the utility provides wastewater service to its 165 customers without generating odor, noise, aerosol drift, or 166 lighting in excess of the standards by the Department of 167 Environmental Protection, the commission shall consider: 168 (a) Testimony and evidence provided by customers and the 169 utility; 170 (b) The results of past tests required by the Department of 171 Environmental Protection which measure the utility’s compliance 172 with the applicable standards established by the Department of 173 Environmental Protection; and 174 (c) Complaints regarding the alleged odor, noise, aerosol 175 drift, or lighting filed with the Department of Environmental 176 Protection or the commission, or the respective local 177 governmental entity, or a county health department during the 178 past 5 years. 179 (3)(a) In determining the quality of water or wastewater 180 service, the commission shall consider a finding by the 181 department as to whether a utility: 182 1. Has failed to provide water service that meets the 183 secondary water quality standards of the department regarding 184 taste, odor, color, or corrosiveness; or 185 2. Has generated odor, noise, aerosol drift, or lighting in 186 providing wastewater service in excess of the standards 187 established by the Department of Environmental Protection, 188 189 the utility shall create an estimate of the costs and benefits 190 of a plausible solution to each quality of water or wastewater 191 service issue identified by the commission. 192 (b) The utility shall meet with its customers within a time 193 prescribed by the commission to discuss the estimated costs and 194 benefits of and time necessary for implementing a plausible 195 solution for each quality of service issue identified, and the 196 utility shall report the results of such meeting to the 197 commission. 198 (c) The utility shall inform the commission if: 199 1. The customers and the utility agree on a solution for 200 each quality of service issue identified, what the solution is, 201 and the cost of the solution; or 202 2. The customers and the utility prefer a different 203 solution to at least one of the quality of service issues 204 identified and the solution and cost of the solution preferred 205 by each. 206 (d) The commission may require the utility to implement a 207 solution that is in the best interest of the customers for each 208 quality of service issue. The utility shall be allowed to 209 recover the costs of the solutions ordered by the commission. 210 The commission may establish the necessary benchmarks that a 211 utility must meet for each solution and require the utility to 212 report periodically until each solution is completed. 213 (4) Notwithstanding s. 367.072, customers may not petition 214 the commission to revoke the certificate of authorization of a 215 utility during the proceedings under this section. 216 (5) The commission may prescribe penalties for a utility’s 217 failure to adequately resolve each quality of water or 218 wastewater service issue as required. Penalties may include 219 fines as provided in s. 367.161; a reduction of return on equity 220 of up to 100 basis points; the denial of all or part of a rate 221 increase for a utility’s system or part of a system if the 222 commission determines that the water quality is less than 223 satisfactory, until the water quality is found to be 224 satisfactory; or cancellation of the certificate of 225 authorization under s. 367.072. 226 (6) The commission shall adopt rules to assess and enforce 227 compliance with this section. The Department of Environmental 228 Protection shall establish secondary wastewater service 229 standards regarding the generation of odor, noise, aerosol 230 drift, and lighting. 231 Section 3. This act shall take effect October 1, 2014.