Florida Senate - 2026 SB 940
By Senator McClain
9-00462-26 2026940__
1 A bill to be entitled
2 An act relating to municipal water and sewer utility
3 rates, fees, and charges; amending s. 180.191, F.S.;
4 deleting a limitation on the amount of rates, fees,
5 and charges municipal water and sewer utilities are
6 authorized to impose on consumers for such services
7 outside the boundaries of the municipality; providing
8 for the continuance and phase out of certain bond
9 covenant surcharges; requiring municipalities
10 operating such utilities to submit a specified rate
11 study every 7 years to the Department of Environmental
12 Protection which evaluates certain information;
13 authorizing certain municipalities to apply for an
14 extension to complete such study; authorizing the
15 department to grant such extensions under certain
16 conditions; providing an effective date.
17
18 Be It Enacted by the Legislature of the State of Florida:
19
20 Section 1. Subsection (1) of section 180.191, Florida
21 Statutes, is amended, and subsection (5) is added to that
22 section, to read:
23 180.191 Limitation on rates charged consumer outside city
24 limits.—
25 (1) Any municipality within this the state which operates
26 operating a water or sewer utility outside of the boundaries of
27 the such municipality shall charge consumers outside the
28 boundaries rates, fees, and charges determined in one of the
29 following manners:
30 (a) It may charge the same rates, fees, and charges as
31 consumers inside the municipal boundaries. However, in addition
32 thereto, the municipality may add a surcharge of not more than
33 25 percent of such rates, fees, and charges to consumers outside
34 the boundaries. Fixing of such rates, fees, and charges in this
35 manner shall not require a public hearing except as may be
36 provided for service to consumers inside the municipality.
37 (b) It may charge rates, fees, and charges that are just
38 and equitable and that which are based on the same factors used
39 in fixing the rates, fees, and charges for consumers inside the
40 municipal boundaries. The In addition thereto, the municipality
41 may add a surcharge not to exceed 25 percent of such rates,
42 fees, and charges for said services to consumers outside the
43 boundaries. However, the total of all such rates, fees, and
44 charges for the services to consumers outside the boundaries
45 shall not be more than 50 percent in excess of the total amount
46 the municipality charges consumers served within the
47 municipality for corresponding service. No Such rates, fees, and
48 charges may not shall be fixed until after a public hearing at
49 which all of the users of the water or sewer systems; owners,
50 tenants, or occupants of property served or to be served
51 thereby; and all others interested shall have had an opportunity
52 to be heard concerning the proposed rates, fees, and charges.
53 Any change or revision of the such rates, fees, or charges may
54 be made in the same manner as the such rates, fees, or charges
55 were originally established, but if a such change or revision is
56 to be made substantially pro rata as to all classes of service,
57 both inside and outside the municipality, a no hearing or notice
58 is not shall be required.
59
60 Notwithstanding paragraphs (a) and (b), a municipality may
61 continue to impose a surcharge on consumers outside the
62 municipal boundaries only to the extent necessary to comply with
63 the terms of bond covenants in effect as of July 1, 2024. Such
64 surcharges must be phased out upon retirement, expiration, or
65 refinancing of the applicable debt obligation.
66 (5)(a) By January 1, 2028, and every 7 years thereafter,
67 each municipality subject to subsection (1) shall submit a rate
68 study to the Department of Environmental Protection which, at a
69 minimum, evaluates all of the following:
70 1. The utility’s future capital investment needs.
71 2. Whether the utility’s rates are expected to generate
72 sufficient revenues to cover its operating and maintenance
73 costs, to satisfy its existing debt service obligations, and to
74 support current and planned capital investments.
75 3. Whether costs are equitably distributed among all
76 customer classes.
77 (b) A municipality serving fewer than 10,000 water or sewer
78 customers may petition the department for an extension of up to
79 2 years to complete the required rate study. The department may
80 grant such extension upon a showing of undue financial or
81 administrative burden.
82 Section 2. This act shall take effect July 1, 2026.