N.Y. PBS Law § 89-C — New York Code / Act PBS / Article 4-B / Section 89-C
General powers of commission in respect to water supply
Status: in_force

§ 89-c. General powers of commission in respect to water supply. The\ncommission: 1. Shall have general supervision of all water-works\ncorporations, as hereinbefore defined, having authority under any\ngeneral or special law or under any charter or franchise to lay down,\nconstruct or maintain pipes, conduits, ducts or other fixtures in, on or\nunder the streets, highways and public places of any municipality, for\nthe purpose of furnishing or distributing water for domestic, commercial\nor public uses, and all water systems owned, leased or operated by any\nsuch water-works corporation; provided, however, that nothing herein\ncontained shall be construed to delegate the general powers of the state\ndepartment of health or of the water power and control commission or any\nof the powers and functions of either as provided by law, nor shall\nanything herein contained be construed to impair nor to deprive such\ndepartment or commission of its powers and functions as now provided by\nlaw.\n  2. Shall have power of its own motion to examine and investigate the\nmethods employed by water-works corporations in delivering and supplying\nwater and furnishing equipment, and shall have access through its\nmembers or through an officer or employee specially authorized by it to\nmake such examinations and investigations to all parts of the systems\nowned, used or operated for the distribution of water by any such\ncorporation.\n  3. Shall have power, in its discretion, to prescribe uniform methods\nof keeping accounts, records and books to be observed by water-works\ncorporations. It may also, in its discretion, prescribe by order forms\nof accounts, records and memoranda to be kept by such corporations.\nNotice of alterations by the commission in the required method or form\nof keeping a system of accounts shall be given to such corporations by\nthe commission at least six months before the same shall take effect.\nAny other and additional forms of accounts, records and memoranda kept\nby such corporations shall be subject to examination by the commission.\n  4. Shall have power to examine all water-works corporations and keep\ninformed as to the methods, practices, regulations and property employed\nby them in the transaction of their business. Whenever the commission\nshall be of the opinion, after a hearing had upon its own motion or upon\ncomplaint, that the rates, charges or classifications or the acts or\nregulations of any such corporation are unjust, unreasonable, unjustly\ndiscriminatory, or unduly preferential, or in any wise in violation of\nany provision of law, the commission shall determine and prescribe in\nthe manner provided by and subject to the provisions of section\neighty-nine-j of this chapter, the just and reasonable rates, charges\nand classifications thereafter to be enforced for the service to be\nrendered, notwithstanding that a different rate or charge has heretofore\nbeen prescribed by general or special statute, contract, grant,\nfranchise, condition, consent or other agreement, and the just and\nreasonable acts and regulations to be done and observed; and whenever\nthe commission shall be of opinion, after a hearing had upon its own\nmotion or upon complaint, that the property, equipment or appliances of\nany such corporation are unsafe, inefficient or inadequate, the\ncommission shall determine and prescribe the safe, efficient and\nadequate property, equipment and appliances thereafter to be used,\nmaintained and operated for the security and accommodation of the public\nand in compliance with the provisions of law and of their franchises and\ncharters; provided, however, that in its determination and prescription\nof safe, efficient and adequate property, equipment and appliances as\nherein provided any such property, equipment and appliances theretofore\napproved by the water power and control commission, or its predecessor,\nshall be deemed to have been adequate, safe and efficient at the time of\nsuch approval. Nothing herein contained shall be deemed to dispense with\nany approval of work by the water power and control commission required\nby the conservation law; and if such an approval pertains to work done\npursuant to such determination or prescription of the public service\ncommission, such approval shall be conclusive that the work was done in\ncompliance with such determination or prescription.\n  5. Shall have power to require every water-works corporation, and it\nshall be the duty of every water-works corporation, as defined by this\nchapter, to file with the commission an annual report, verified by the\noath of the president, vice-president, treasurer, secretary, manager, or\nreceiver, if any, or by the person required to file the same. The\nverification shall be made by said official holding office at the time\nof filing said report, and if not made upon the knowledge of the person\nverifying the same, shall set forth the sources of his information and\nthe grounds of his belief as to any matters not stated to be verified\nupon his knowledge. The report shall show in detail (a) the amount of\nits authorized capital stock and the amount thereof issued and\noutstanding; (b) the amount of its authorized bonded indebtedness and\nthe amount of its bonds and other forms of evidence of indebtedness\nissued and outstanding; (c) its receipts and expenditures during the\npreceding year; (d) the amount paid as dividends upon its stock and as\ninterest upon its bonds; (e) the names of its officers and the aggregate\namount paid as salaries to them and the amount paid as wages to its\nemployees; (f) the location of its plant or plants and system, with a\nfull description of its property and franchises, stating in detail how\neach franchise stated to be owned was acquired; and (g) such other facts\npertinent to the operation and maintenance of the plants and system, and\nthe affairs of such person or corporation as may be required by the\ncommission. Such reports shall be in the form, cover the period, and be\nfiled at the time prescribed by the commission. The commission may, from\ntime to time, make changes and additions in such forms. When any such\nreport is defective or believed to be erroneous, the commission shall\nnotify the corporation making such report to amend the same within a\ntime prescribed by the commission. Any such corporation which shall\nneglect to make any such report or which shall fail to correct any such\nreport within the time prescribed by the commission shall be liable to a\npenalty of one hundred dollars and an additional penalty of one hundred\ndollars for each day after the prescribed time for which it shall\nneglect to file or correct the same, to be sued for in the name of the\npeople of the state of New York, if ordered by the commission. The\namount recovered in any such action to be paid to the commission shall\nbe paid into the state treasury and be credited to the general fund. The\ncommission, for cause shown, may extend the time prescribed and, by\ncompromise, may accept less than the amount of such a penalty, in\nsettlement thereof.\n  6. Shall have power, either through its members or inspectors or\nemployees duly authorized by it, to enter in or upon and to inspect the\nproperty, buildings, plants, pump houses, ducts, conduits and offices of\nany such water-works corporation.\n  7. Shall have power to examine the accounts, books, contracts,\nrecords, documents and papers of any water-works corporation, and have\npower, after a hearing, to prescribe by order the accounts in which\nparticular outlays and receipts shall be entered, charged or credited.\nAt any such hearing the burden of proof shall be on such corporation to\nestablish the correctness of the accounts in which such outlays and\nreceipts have been entered, and the commission may suspend a charge or\ncredit pending submission of proof by such corporation.\n  § 8. Shall have power to compel, by subpoena duces tecum, the\nproduction of any accounts, books, contracts, records, documents,\nmemoranda and papers. In lieu of requiring production of originals by\nsubpoena duces tecum the commission or any commissioner may require\nsworn copies of any such books, records, contracts, documents and\npapers, or any parts thereof, to be filed with it. The commission may\nrequire of all such water-works corporations specific answers to\nquestions upon which the commission may need information, and may also\nrequire such corporations to file periodic reports in the form, covering\nthe period and filed at the time prescribed by the commission. If such\ncorporation shall fail to make specific answer to any question or shall\nfail to make a periodic report when required by the commission as herein\nprovided within the time and in the form prescribed by the commission\nfor the making and filing of any such report or answer, such corporation\nshall forfeit to the state the sum of one hundred dollars for each and\nevery day it shall continue to be in default with respect to such report\nor answer. Such forfeiture may be recovered in an action brought by the\ncommission in the name of the people of the state of New York. The\namount recovered in any such action, or paid to the commission, shall be\npaid into the state treasury and be credited to the general fund. The\ncommission, for cause shown, may by compromise accept less than the\namount of such forfeiture, in settlement thereof.\n  9. Shall have power in all parts of the state, either as a commission\nor through its members, or through an officer or employee specially\nauthorized to conduct an investigation or hearing, to subpoena\nwitnesses, take testimony and administer oaths to witnesses in any\nproceeding or examination instituted before it, or conducted by it in\nreference to any matter within its jurisdiction under this article.\n  10. (a) Shall have power to require every water-works corporation to\nfile with the commission and to print and keep open to public inspection\nschedules showing all rates and charges made, established or enforced or\nto be charged or enforced, all forms of contract or agreement and all\nrules and regulations relating to rates, charges or service used or to\nbe used, and all general privileges and facilities granted or allowed by\nsuch corporation; but this subdivision shall not apply to state,\nmunicipal or federal contracts.\n  (b) No change shall be made in any rate or charge, or in any form of\ncontract or agreement or any rule or regulation relating to any rate,\ncharge or service, or in any general privilege or facility, which shall\nhave been filed by such a corporation, in compliance with an order of\nthe commission, except after thirty days' notice to the commission and\nto each county, city, town and village served by such water-works\ncorporation which had filed with such corporation, within the prior\ntwelve months, a request for such notice and which shall be affected by\nsuch change and publication of a notice to the public of such proposed\nchange once in each week for four successive weeks in a newspaper having\ngeneral circulation in the county or counties containing territory\naffected by the proposed change, which notice shall plainly state the\nchanges proposed and when the change will go into effect. The commission\nfor good cause shown may, except in the case of major changes, allow\nchanges to take effect prior to the end of such thirty-day period and\nwithout publication of notice to the public under such conditions as it\nmay prescribe. The commission may delegate to the secretary of the\ncommission its authority to approve a change to a schedule postponing\nthe effective date of such schedule previously filed with the commission\nand to allow for good cause shown the postponement to take effect prior\nto the end of such thirty-day period and without publication of notice\nto the public.\n  (c) For the purpose of this subdivision, "major changes" shall mean an\nincrease in the rates and charges which would increase the aggregate\nrevenues of the applicant more than the greater of three hundred\nthousand dollars or two and one-half percent, but shall not include\nchanges in rates, charges or rentals allowed to go into effect by the\ncommission or made by the utility pursuant to an order of the commission\nafter hearings held upon notice to the public.\n  (d) No such corporation shall charge, demand, collect or receive a\ngreater or less or different compensation for any service rendered or to\nbe rendered than the rates and charges specified in its schedule filed\nand in effect; nor shall any such corporation refund or remit in any\nmanner or by any device any portion of the rates or charges so\nspecified, nor extend to any person any form of contract or agreement,\nor any rule or regulation, or any privilege or facility, except such as\nare regularly and uniformly extended to all persons under like\ncircumstances.\n  (e) The commission shall have power to prescribe the form of every\nsuch schedule and from time to time prescribe by order such changes in\nthe form thereof as may be deemed wise. The commission shall also have\npower to establish such rules and regulations to carry into effect this\nsubdivision as it may deem necessary, and to modify or amend such rules\nor regulations from time to time.\n  (f) Whenever there shall be filed with the commission by any\nwater-works corporation any schedule stating a new rate or charge, or\nany change in any form of contract or agreement or any rule or\nregulation relating to any rate, charge or service, or in any general\nprivilege or facility, the commission may, at any time within sixty days\nfrom the date when such schedule would or has become effective, either\nupon complaint or upon its own initiative, and, if it so orders, without\nanswer or other formal pleading by the interested corporation, but upon\nreasonable notice, hold a hearing concerning the propriety of a change\nproposed by the filing. If such change is a major change, the commission\nshall hold such a hearing. Pending such hearing and decision thereon,\nthe commission, upon filing with such schedule and delivering to the\ncorporation affected thereby a statement in writing of its reasons\ntherefor, may suspend the operation of such schedule, but not for a\nlonger period than one hundred and twenty days beyond the time when it\nwould otherwise go into effect. After a full hearing, whether completed\nbefore or after the schedule goes into effect, the commission may make\nsuch order in reference thereto as would be proper in a proceeding begun\nafter the rate, charge, form of contract or agreement, rule, regulation,\nservice, general privilege or facility had become effective. If any such\nhearing cannot be concluded within the period of suspension as above\nstated, the commission may extend the suspension for a further period\nnot exceeding six months.\n  (g) The commission may, as authorized by section eighty-nine-j of this\narticle, establish temporary rates or charges for any period of\nsuspension under this section.\n  (h) At any hearing involving a rate, the burden of proof to show that\nthe change or proposed change if proposed by the corporation, or that\nthe existing rate, if it is proposed to reduce the rate, is just and\nreasonable shall be upon the corporation; and the commission may give to\nthe hearing and decision of such questions preference over all other\nquestions pending before it.\n  (i) The schedule, rates, charges, form of contract or agreement, rule,\nregulation, service, general privilege or facility in force when the new\nschedule, rate, charge, form of contract, rule, regulation, service,\ngeneral privilege or facility was filed shall continue in force during\nthe period of the suspension unless the commission shall establish a\ntemporary rate or charge as authorized by section eighty-nine-j of this\narticle.\n  * (j) (i) The commission shall require each application for a major\nchange in rates filed by a water-works corporation to include an\nexecutive compensation disclosure. Such executive compensation\ndisclosure shall include: (A) the median of the annual total\ncompensation of all employees of the water-works corporation, except for\nsenior management positions; (B) the annual total compensation of the\nchief executive officer; (C) the annual total compensation for each\nother senior management position; and (D) the ratio of the amount\ndescribed in clause (A) of this subparagraph to the amount described in\nclause (B) of this subparagraph.\n  (ii) For purposes of this paragraph, "senior management positions"\nshall include a chief executive officer, chief operations officer, chief\nfinancial officer, chief information officer, chief information\ntechnology officer, officer responsible for regulatory affairs, general\ncounsel, and any other positions considered to be senior executive\nmanagement by the corporation.\n  * NB Effective January 1, 2027\n  * (k) (i) The commission shall require each application for a major\nchange in rates filed by a water-works corporation to include, in\naddition to the corporation's recommended proposal, a budget constrained\nproposal that separately addresses operating expenses, capital\nexpenditures, and programmatic or policy expenditures, commodity supply\ncosts, taxes, and other costs not within the control of the corporation.\nSuch budget constrained proposal shall not increase the applicant's\naggregate revenues by more than the average annual consumer price index\nincreases over the prior three years.\n  (ii) In each application for a major change in rates, the corporation\nshall demonstrate how any increase in the applicant's aggregate revenues\nby more than the increase set forth in the budget constrained proposal\nis necessary to ensure safety, reliability, or the continuation of\naffordability programs.\n  (iii) The commission shall require the corporation to track\nexpenditures and outcomes and explain all material deviations from the\napproved rate plan no less frequently than on a biennial basis.\n  * NB Effective January 1, 2027\n  11. In case any water-works corporation is engaged in carrying on any\nbusiness other than owning, operating or managing a water system, which\nother business is not otherwise subject to the jurisdiction of the\ncommission, and is so conducted that its operations are to be\nsubstantially kept separate and apart from the owning, operating,\nmanaging or controlling of such water system, said corporation in\nrespect of such other business shall not be subject to any of the\nprovisions of this chapter and shall not be required to procure the\nassent or authorization of the commission to any act in such other\nbusiness or to make any report in respect thereof. But this subdivision\nshall not restrict or limit the powers of the commission in respect to\nthe owning, operating, managing or controlling by such corporation of\nsuch water system, and said powers shall include also the right to\ninquire as to, and prescribe the apportionment of, capitalization,\nearnings, debts and expenses fairly and justly to be awarded to or borne\nby the ownership, operation, management or control of such water system\nas distinguished from such other business. In any such case, if the\nowning, operating, managing or controlling of such water system by any\nsuch corporation is wholly subsidiary and incidental to the other\nbusiness carried on by it and is inconsiderable in amount and not\ngeneral in its character, the commission may by general rules exempt\nsuch corporation from making full reports and from keeping of accounts\nas to such subsidiary and incidental business.\n  12. The commission shall have power to require each water-works\ncorporation to establish classifications of service based upon the\nquantity used, the time when used, the purpose for which used, the\nduration of use and upon any other reasonable consideration, and to\nestablish in connection therewith just and reasonable graduated rates\nand charges; and it shall have power, either upon complaint or upon its\nown motion, to require such changes in such classifications, rates and\ncharges as it shall determine to be just and reasonable.\n  13. The commission, of its own motion or upon complaint of any person\nor corporation aggrieved, may investigate and determine whether the\nproperty of any corporation or person actually used within the state in\nthe business of the distribution, sale or furnishing of water for\ndomestic, commercial or public uses, exclusive of property used solely\nfor or in connection with the business of bottling, or selling,\ndistributing or furnishing bottled water, is of a value exceeding ten\nthousand dollars. Where such value is ten thousand dollars or less, the\ncommission may require such persons and corporations to file with the\ncommission simplified annual reports, in a form and containing such\nmatters as the commission shall prescribe, and may prescribe simplified\nforms of accounts to be kept by them.\n  14. (a) Notwithstanding any other provision of law to the contrary,\nwhenever real property owned by a water-works corporation is exempted\nfrom taxation pursuant to the provisions of section four hundred\neighty-five-d of the real property tax law the rate or charge imposed by\nsuch corporation within the taxing jurisdiction providing for such\nexemption shall be set by the commission so as to reflect fully the\nreduction in cost of service resulting therefrom.\n  (b) Notwithstanding any other provision of law to the contrary,\nwhenever a water-works corporation is the recipient of operating\nassistance provided by a city pursuant to the provisions of section\ntwenty-one-e of the general city law, the rate or charge imposed by such\ncorporation within such city shall be set by the commission so as to\nreflect fully the revenues to such corporation resulting therefrom.\n  15. The commission shall provide for management and operations audits\nof water-works corporations having annual gross revenues in excess of\nten million dollars. Such audits shall include, but not be limited to,\nan investigation of the corporation's construction program planning in\nrelation to the needs of its customers for reliable service and an\nevaluation of the efficiency of the company's operations. The commission\nshall have discretion to have such audits performed by its staff, or by\nindependent auditors.\n  In every case in which the commission chooses to have the audit\nprovided for in this subdivision performed by independent auditors, it\nshall have authority to select the auditors and to require the\ncorporation being audited to enter into a contract with the auditors\nproviding for their payment by such corporation. Such contract shall\nprovide further that the auditors shall work for and under the direction\nof the commission according to such terms as the commission may\ndetermine are necessary and reasonable.\n  The commission shall have authority to direct the corporation to\nimplement any recommendations resulting from such audits that it finds\nto be necessary and reasonable.\n  Upon the application of a water-works corporation for a major change\nin rates as defined in subdivision ten of this section, the commission\nshall review the corporation's compliance with the directions and\nrecommendations made previously by the commission, as a result of the\nmost recently completed management and operations audit undertaken\npursuant to the provisions of this subdivision. The commission shall\nincorporate the findings of such review in its opinion or order.\n  16. Notwithstanding any general or special law, rule or regulation,\nthe commission shall have the power to provide for the refund of any\nrevenues received by any water-works corporation which cause the\ncorporation to have revenues in the aggregate in excess of its\nauthorized rate of return for a period of twelve months. The commission\nmay initiate a proceeding with respect to such a refund after the\nconclusion of any such twelve month period.\n  17. The commission shall have power to require each water-works\ncorporation to establish a process for residents of any cooperative,\ncondominium or multi-family dwelling with five or more residential\nunits, which uses a master meter to distribute water to such residents,\nto obtain non-billing related information regarding the delivery of\nwater including but not limited to service updates, water quality\nnotices and other information deemed essential to water consumers.\n