Water utility's recovery of costs incurred; inclusion in rate base or revenue requirement; completed construction; cancellation of project; construction subject to subsequent review; limitation on recovery of costs exceeding estimate
Ind. Code § 8-1-30.9-9
in effectSec. 9. Absent fraud, concealment, or gross mismanagement, a water utility shall recover through rates the actual costs the water utility has incurred in reliance on a certificate issued under this chapter as follows:
(1) If construction of a long haul water pipeline has been subject to ongoing review under section 8(a) of this chapter and the commission finds the construction of the long haul water pipeline has been completed, the costs of construction approved by the commission during the ongoing review shall be included, without further commission review, in:
(A) the water utility's rate base, in the case of a public utility; or
(B) the water utility's revenue requirement for extensions and replacements expense, depreciation expense, or debt service expense, as applicable, in the case of a:
(i) municipally owned utility;
(ii) not-for-profit utility;
(iii) conservancy district; or
(iv) regional water district.
(2) If construction of a long haul water pipeline is subject to subsequent review under section 8(b) of this chapter and the commission finds the construction of the long haul water pipeline to be completed, the costs of construction that do not exceed the estimate under section 7(e)(1) of this chapter, and that are not shown to result from inadequate quality controls, shall be included in:
(A) the water utility's rate base, in the case of a public utility; or
(B) the water utility's revenue requirement for extensions and replacements expense, depreciation expense, or debt service expense, as applicable, in the case of a:
(i) municipally owned utility;
(ii) not-for-profit utility;
(iii) conservancy district; or
(iv) regional water district.
However, inclusion of costs in excess of the estimate under section 7(e)(1) of this chapter in the water utility's rate base or revenue requirement is not permitted unless shown by the water utility to be necessary and prudent in the construction of the long haul water pipeline.
(3) If a long haul water pipeline has been canceled as a result of:
(A) the modification or revocation of the certificate under this chapter; or
(B) local permitting or other issues beyond the water utility's control;
and the long haul water pipeline's construction has been subject to ongoing review under section 8(a) of this chapter (including reviews after cancellation), the costs of construction approved by the commission during the review shall be recovered by the water utility by inclusion in rates and amortization over a reasonable time to be determined by the commission. A water utility that is a public utility shall be permitted to earn a return, computed using the water utility's authorized rate of return, on the unamortized balance.
(4) If a long haul water pipeline has been canceled as a result of:
(A) the modification or revocation of the certificate under this chapter; or
(B) local permitting or other issues beyond the water utility's control;
and the long haul water pipeline's construction is subject to subsequent review under section 8(b) of this chapter, the costs of construction incurred before cancellation that were included in the estimate under section 7(e)(1) of this chapter and that have not been shown to result from inadequate quality controls shall be recovered by the water utility by inclusion in rates and amortization over a reasonable time to be determined by the commission. A water utility that is a public utility shall be permitted to earn a return, computed using the water utility's authorized rate of return, on the unamortized balance. However, costs that were not included in the estimate under section 7(e)(1) of this chapter may not be included in rates unless shown by the water utility to be necessary and prudent in the construction of the long haul water pipeline.
As added by P.L.99-2025, SEC.1.
Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://iga.in.gov/laws/2026/ic/titles/8Fetched: 10/17/2026