Indiana water utilities can't charge tap fees on certain workforce housing

Indiana water and wastewater utilities will be barred from charging capacity or tap fees on workforce housing built by qualifying nonprofits, under a measure (SB0241) signed into law on March 4 as Public Law 127. The exemption applies to nonprofits that have an agreement with the Indiana Housing and Community Development Authority to build the housing and that connect under a special contract with the utility.

The bill carves out a partial fee if a utility determines that hooking up a development won't pay for itself over a 20 year horizon. In that case the utility can collect the gap between the standard fee and the project's projected contribution to its cost of service.

SB0241 also raises the customer threshold at which conservancy district water systems can exit Indiana Utility Regulatory Commission jurisdiction from 2,000 customers to 3,000, and it lets eligible utilities pass through more than 3% swings in chemical and power costs through an adjustment rider without first getting IURC preapproval.

Sen. Koch carried the bill. The Senate cleared the original version 42-2 on January 22 and concurred with House amendments 44-3 on February 25. The House voted 91-3 on February 9. The bill drew seven additional sponsors across both chambers.