Washington Administrative Code › Title 458 - Revenue, Department of › Chapter 458-20 - Excise tax rules › Section 458-20-251 - Sewerage collection and other related activities

Current through Register Vol. 24-14, July 15, 2024
(1)
Introduction.
RCW
			 82.16.020 levies a public utility tax upon
			 persons engaging in the business of sewerage collection. This rule provides
			 guidance on the assessment of the public utility tax upon sewerage collection
			 businesses, including the distinction between sewerage collection and other
			 related business activities. It also describes how to determine the taxable
			 gross receipts of a sewerage collection business that also engages in other
			 related business activities. Additionally, the rule addresses a sewerage
			 collection business's business and occupation (B&O), retail sales, and use
			 tax reporting responsibilities. Municipalities and other governmental entities
			 engaging in sewerage collection business activities should also refer to WAC
			 458-20-189 for guidance on the
			 taxation of public service businesses and enterprise activities.
(2)
What is a sewerage collection
			 business?
A sewerage collection business is the activity of accepting
			 sewage to be deposited into and carried off by a system of lateral sewers,
			 drains, and pipes to a common point, or points, for transfer to treatment or
			 disposal, but does not include the actual transfer, treatment, or disposal of
			 sewage. A sewerage collection business includes only that portion of a sewer
			 system where "collection" occurs. Sewerage collection ends when the sewage
			 exits the lateral sewers in a sewer system. Collection does not include the
			 further transfer of sewage through a system of intercepting sewers or the final
			 treatment or disposal of sewage.
(a)
What is the difference between sewage and sewerage?
Sewage is the
			 waste matter carried off by sewer drains and pipes. Sewerage refers to the
			 physical facilities (e.g., pipes, lift stations, and treatment and disposal
			 facilities) through which sewage flows.
(b)
What is the difference between
			 lateral and intercepting sewers?
(i) A
			 lateral sewer is a branch sewer running laterally down a street, alley, or
			 easement that collects sewage directly from abutting properties and delivers it
			 into an intercepting sewer.
(A) The sewage
			 from abutting properties is collected through sewer pipes running from the
			 abutting properties to the lateral sewer in the street, alley, or easement. If
			 a sewerage collection business is responsible for maintaining any portion of
			 such a sewer pipe, that portion is considered to be part of the lateral
			 sewer.
(B) A lateral sewer may
			 include force mains or lift stations if such equipment is installed as part of
			 a lateral sewer line.
(ii) An intercepting sewer is a main sewer
			 that receives flow from laterals and delivers the sewage to another main sewer
			 or to a point for treatment or disposal.
The following diagram illustrates how sewer pipes in a sewerage
				system are categorized as lateral or intercepting sewers. The diagram does not
				attempt to represent any publicly maintained portions of sewer pipes that run
				from abutting properties to the lateral sewer in the street, alley, or
				easement.
Click to view
							 image
(c)
How are drainage utility charges
			 accounted for?
Certain real estate development projects (due to paving
			 and other factors) may adversely affect rainwater runoff within areas served by
			 a stormwater sewer system. Often, the stormwater system is administered by the
			 same entity that operates a sewerage collection business. In this circumstance,
			 some sewerage utilities impose a drainage utility charge on the development to
			 reflect the impact on the utility's stormwater sewer system caused by the
			 increased runoff. Other sewerage utilities charge all sewerage customers an
			 additional drainage utility charge to reflect stormwater runoff. Although the
			 same entity may be providing both stormwater and sanitary sewer collection
			 services to the customer and many of the same facilities may be used, a
			 drainage utility charge is not related to the collection of sewage for
			 treatment and disposal. Therefore, a sewerage collection business does not
			 include this activity. Utility drainage charges are, however, subject to
			 B&O taxation under the service and other activities classification, as
			 discussed in subsection (4) below.