TITLE: Relating to expenses considered to determine net income for purposes of a rate proceeding for an investor-owned water and sewer utility.

SUMMARY: Relating to expenses considered to determine net income for purposes of a rate proceeding for an investor-owned water and sewer utility.

FULL TEXT:
AN ACT relating to expenses considered to determine net income for purposes of a rate proceeding for an investor-owned water and sewer utility. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Section 13.185, Water Code, is amended by amending Subsection (d) and adding Subsection (h-1) to read as follows: (d) Except as provided by Subsection (h-1), net [Net] income is the total revenues of the utility less all reasonable and necessary expenses as determined by the regulatory authority. The regulatory authority shall determine expenses and revenues in a manner consistent with Subsections (e) through (h-1) [(h) of this section].(h-1) The regulatory authority may include for ratemaking purposes only 50 percent of the reasonable and necessary rate case expenses of an investor-owned utility. SECTION 2. The changes in law made by this Act apply only to a rate proceeding before the Texas Commission on Environmental Quality that commences on or after the effective date of this Act. A rate proceeding before the Texas Commission on Environmental Quality that commenced before the effective date of this Act is governed by the law in effect on the date the proceeding commenced, and that law is continued in effect for that purpose. SECTION 3. This Act takes effect September 1, 2013.