§ 46-30-4 - Financial responsibility.
SECTION 46-30-4
§ 46-30-4 Financial responsibility. –(a) The financial obligation for the upgrading of the public water supplysystem to be annexed and the continued management and operationalresponsibility to bring that system into compliance with the applicableregulations and on parity with the existing facilities of the governing agencymust be fairly and equitably allocated to the new customers by identifying:
(1) Capital costs;
(2) Operational expenses;
(3) Management support;
and adding the annexation fee to the governing agency'sexisting rate structure currently in effect to be applied to the customer'saccounts, to be annexed.
(b) Each year the annexation fee to be paid by the newcustomers shall be added to the rate apportioned to the existing customers ofthe governing agency and shall represent the amortized cost of the capitalexpenditures and the appropriate ongoing operational costs adjusted forinflation. The annexation fee shall in no event be less than ten percent (10%)the rate levied on the pre-annexation customer base, nor shall it be more thanone hundred percent (100%) of the pre-annexation rate. This legislation is notintended to limit the governing agency from recovering all costs of servicefrom its basic customer base. The annexation fee shall constitute a part of thecost of annexation and shall also be an allocated portion of the cost ofannexation and become a debt of each customer from the small public watersupply system to the governing agency and be collectible in the same manner andhave the benefit of any lien provided for the amounts due for water chargesfrom the small public water supply system to the governing agency. Subject tothe provisions of § 39-1.1-1 for those small public water supply systemswhich are public utilities, all governing agencies may terminate service forfailure of the customer of a small public water supply system to pay theannexation fee.
(2) It shall not be necessary for any small public watersupply system or governing agency whose rates may be regulated by the publicutilities commission, pursuant to chapter 1 of title 39, to obtain approvalfrom the commission for billing of the annexation fee. The public utilitiescommission shall not be required, in determining rates for any governing agencyor small public water supply system hereunder, to consider the annexation feesbilled hereunder when determining revenue requirements for the governing agencyor public water supply system.
(c) The annexation fee shall terminate when the contractualobligation for amortizing the upgrading of the system petitioning annexationhas been discharged or no later than thirty (30) years from the date offinancing said improvements, whichever comes first.