Florida Senate - 2014                CS for CS for CS for SB 272
       By the Committees on Appropriations; Community Affairs; and
       Communications, Energy, and Public Utilities; and Senator
       576-02573-14                                           2014272c3
    1                        A bill to be entitled                      
    2         An act relating to water utilities; creating s.
    3         367.072, F.S.; providing legislative findings;
    4         defining the term “customer”; authorizing the Florida
    5         Public Service Commission to revoke a certificate of
    6         authorization upon receipt of a petition; providing
    7         criteria for such petition; authorizing the commission
    8         to adopt rules; creating s. 367.0812, F.S.; requiring
    9         the commission to consider the quality of water
   10         service when fixing rates; providing criteria that the
   11         commission must consider in making its determination;
   12         requiring the utility to meet with its customers to
   13         discuss the costs and benefits of plausible solutions
   14         if the commission finds that the utility has failed to
   15         meet certain quality of water standards; prohibiting a
   16         customer from petitioning the commission to revoke the
   17         certificate of authorization of a utility under
   18         certain circumstances; authorizing the commission to
   19         prescribe penalties for certain failures of the
   20         utility; requiring the commission to adopt rules;
   21         providing an appropriation; providing an effective
   22         date.
   24  Be It Enacted by the Legislature of the State of Florida:
   26         Section 1. Section 367.072, Florida Statutes, is created to
   27  read:
   28         367.072Petition to revoke certificate of authorization.
   29  The Legislature finds that it is in the public interest that
   30  water service be of good quality and consistent with the
   31  standards set forth in this chapter. Therefore, a utility’s
   32  certificate of authorization to provide water service may be
   33  revoked if, after its customers file a petition with the
   34  commission, the commission finds that revocation is in the best
   35  interest of the customers in accordance with this section. As
   36  used in this section, the term “customer” means an individual
   37  whose property is serviced by a single meter or a person whose
   38  name appears on the bill for a master meter.
   39         (1)If the commission receives a letter from the customers
   40  of a utility stating their intent to file a petition, the
   41  utility is prohibited from filing a rate case until the petition
   42  is acted upon by the commission.
   43         (a) Within 10 days after receipt of the letter, commission
   44  staff shall notify the utility of the customers’ intent to file
   45  a petition and that the utility may not file for a rate increase
   46  until the petition is acted upon by the commission.
   47         (b) Commission staff shall send to the customers
   48  instructions regarding the information required on the petition
   49  and the subsequent process the commission will follow. The
   50  petition must be filed within 90 days after the receipt of the
   51  instruction. Commission staff shall review the petition and
   52  notify the customers within 10 days after receipt of the
   53  petition that the petition is sufficient for the commission to
   54  act or that additional information is necessary. The customers
   55  must file a cured petition within 30 days after receipt of the
   56  notice to cure and provide a copy of the petition to the
   57  utility. If the customers fail to file or refile a petition
   58  within the allotted time, the commission shall dismiss the
   59  petition with prejudice, and the customers may not file another
   60  petition for 1 year after the dismissal.
   61         (2)A petition must:
   62         (a)State with specificity each issue that customers have
   63  with the quality of water service, each time the problem was
   64  reported to the utility, and how long each issue has existed;
   65  and
   66         (b)Be signed by at least 65 percent of the customers of
   67  the service area covered under the certificate of authorization.
   68  A person whose name appears on the bill for a master meter may
   69  sign a petition if at least 65 percent of the customers,
   70  tenants, or unit owners served by the master meter support the
   71  petition, in which case documentation of such support must be
   72  included with the petition.
   73         (3) If the petition is in compliance with this section and
   74  the issues identified within the petition support a reasonable
   75  likelihood that the utility is failing to provide quality of
   76  water service, a docket shall be opened. The utility shall use
   77  the following criteria in preparing a response to the
   78  commission, addressing the issues identified within the petition
   79  and defending the quality of its water service:
   80         (a)Federal and state primary water quality standards or
   81  secondary water quality standards pursuant to s. 367.0812; and
   82         (b)The relationship between the utility and its customers,
   83  including each complaint received regarding the quality of water
   84  service, the length of time each customer has been complaining
   85  about the service, the resolution of each complaint, and the
   86  time it has taken to address such complaints.
   87         (4)The commission shall evaluate the issues identified in
   88  the petition, the utility’s response as to whether it is
   89  providing quality of water service, and any other factor the
   90  commission deems relevant.
   91         (5)Based upon its evaluation, the commission shall:
   92         (a)Dismiss the petition, in which case the decision must
   93  be supported by clear and convincing evidence and is subject to
   94  ss. 120.569 and 120.57;
   95         (b)Require the utility to take the necessary steps to
   96  correct the quality of water service issues identified in the
   97  petition. The commission shall set benchmarks within a
   98  timeframe, not to exceed 3 years, and may require the utility to
   99  provide interim reports describing its progress in meeting such
  100  benchmarks. The commission may extend the term 3 years for
  101  circumstances that delay the project which are not in the
  102  control of the utility, such as natural disasters and obtaining
  103  permits necessary for meeting such benchmarks; or
  104         (c)Notwithstanding s. 367.045, revoke the utility’s
  105  certificate of authorization, in which case a receiver must be
  106  appointed pursuant to s. 367.165 until a sale of the utility
  107  system has been approved pursuant to s. 367.071.
  108         (6)The commission shall adopt by rule the format of and
  109  requirements for a petition and may adopt other rules to
  110  administer this section.
  111         Section 2. Section 367.0812, Florida Statutes, is created
  112  to read:
  113         367.0812 Rate fixing; quality of water service as
  114  criterion.—
  115         (1) In fixing rates that are just, reasonable,
  116  compensatory, and not unfairly discriminatory, the commission
  117  shall consider the extent to which the utility provides water
  118  service that meets secondary water quality standards as
  119  established by the Department of Environmental Protection. In
  120  determining whether a utility has satisfied its obligation to
  121  provide quality of water service that meets these standards, the
  122  commission shall consider:
  123         (a) Testimony and evidence provided by customers and the
  124  utility;
  125         (b) The results of past tests required by a county health
  126  department or the Department of Environmental Protection which
  127  measure the utility’s compliance with the applicable secondary
  128  water quality standards;
  129         (c) Complaints regarding the applicable secondary water
  130  quality standards filed by customers with the commission, the
  131  Department of Environmental Protection, the respective local
  132  governmental entity, or a county health department during the
  133  past 5 years; and
  134         (d) If the commission deems necessary, the results of any
  135  updated test.
  136         (2)(a) In determining the quality of water service, the
  137  commission shall consider a finding by the Department of
  138  Environmental Protection as to whether the utility has failed to
  139  provide water service that meets the secondary water quality
  140  standards of the department.
  141         (b) The utility shall create an estimate of the costs and
  142  benefits of a plausible solution to each issue identified by the
  143  commission.
  144         (c)The utility shall meet with its customers within a time
  145  prescribed by the commission to discuss the estimated costs and
  146  benefits of and time necessary for implementing a plausible
  147  solution for each quality of water service issue identified, and
  148  the utility shall report the results of such meetings to the
  149  commission.
  150         (d)The utility shall inform the commission, if:
  151         1.The customers and the utility agree on a solution for
  152  each quality of water service issue identified, of each agreed
  153  on solution and the cost of each solution; or
  154         2.The customers and the utility prefer a different
  155  solution to at least one of the quality of water service issues
  156  identified, of the preferred solutions by each and the cost of
  157  each solution.
  158         (e)The commission may require the utility to implement a
  159  solution that is in the best interest of the customers for each
  160  quality of water service issue. The utility may recover its
  161  costs in implementing the solutions ordered by the commission.
  162  The commission may establish the necessary benchmarks that a
  163  utility must meet for each solution and require the utility to
  164  report periodically until each solution is completed.
  165         (3) Notwithstanding s. 367.072, customers may not petition
  166  the commission to revoke the certificate of authorization of a
  167  utility if it is the subject of a proceeding under this chapter.
  168         (4) The commission may prescribe penalties for a utility’s
  169  failure to adequately resolve each quality of water service
  170  issue as required. Penalties may include penalties as provided
  171  in s. 367.161, a reduction of return on equity of up to 100
  172  basis points, the denial of all or part of a rate increase for a
  173  utility’s system or part of a system if it determines that the
  174  quality of water service is less than satisfactory until the
  175  quality of water is found to be satisfactory, or revocation of
  176  the certificate of authorization pursuant to s. 367.072.
  177         (5)The commission shall adopt rules to assess and enforce
  178  compliance with this section.
  179         Section 3. For the 2014-2015 fiscal year, the sums of
  180  $212,521 in recurring funds and $12,012 in nonrecurring funds
  181  from the General Revenue Fund and three full-time equivalent
  182  positions with an associated salary rate of 131,235 are
  183  appropriated to the Florida Public Service Commission to
  184  implement the provisions of this act related to the regulation
  185  of the quality of water service.
  186         Section 4. This act shall take effect July 1, 2014.