56-265.13:6.1 - Appointment of receiver; penalty
§ 56-265.13:6.1. Appointment of receiver; penalty.
A. The Commission may, either upon petition of two-thirds of the affectedcustomers or upon petition of its staff or upon a petition of the Board ofHealth, appoint a receiver to operate a small water or sewer utility which isunable or unwilling to provide adequate service to its customers. The utilityshall be deemed to be unable or unwilling to provide adequate service if theCommission finds, after notice to the utility and the Department of Healthand hearing, that:
1. The utility has failed to supply water or sewer service to a majority ofthe consumers for five days or more during the preceding three months forreasons within the control of the water and sewer utility; or
2. The Department of Health has certified that the utility has not metDepartment standards regarding the provision of an adequate quality andquantity of public drinking water and the Department of Health has found thatthe utility is unwilling to take action to meet these standards; or
3. The utility is grossly mismanaged; or
4. The utility has failed to comply with an order of the Commission toprovide adequate service to the customers.
Upon appointment, the receiver shall take possession of the assets of theutility and operate them in the best interests of the customers. Control ofand responsibility for the utility shall remain in the receiver until theutility can, in the best interests of customers, be returned to the originalowners, transferred to new owners, or liquidated, whichever the Commissionmay determine to be in the public interest.
B. The provisions of §§ 8.01-583 through 8.01-590 shall apply mutatismutandis. The receiver shall be empowered to make application to theCommission for temporary and permanent rate increases and changes in theutility's rules and regulations.
C. If the Commission determines that the utility's actions that caused it tobe placed under the control and responsibility of the receiver, under thissection, were due to intentional misappropriation or wrongful diversion ofthe assets or income of such utility or to other willful misconduct by anydirector, officer, or manager of the utility, it may require such director,officer, or manager to make restitution to the utility. In addition to theforegoing, any such director, officer, manager, or affiliate that commitssuch misappropriation or wrongful diversion or fails, neglects, or refuses toobey an order, rule, direction, or requirement of the Commission to makerestitution to the utility shall be subject to a civil penalty of no morethan $500 for each offense, and each day of such conduct shall constitute aseparate offense.
(1994, c. 311.)