HB563: AN ACT relating to public water and wastewater systems, making an appropriation therefor, and declaring an emergency.

Legislative Summary

Creates a new section of KRS Chapter 65 to define terms, to create a forbearance period of three years for a utility acquiring a public water or wastewater system with existing violations, to require the acquiring utility to correct past violations during the forbearance period, to defer fines and penalties during the forbearance period, to prioritize funding from the Kentucky Infrastructure Authority (KIA) for projects where the acquiring utility is making improvements to the acquired system, to allow for a waiver of accrued fines and penalties if all deficiencies have been corrected and the public water or wastewater system has been sold to the acquiring utility or if the utility adopts a management and operations agreement handled by a well-operated utility, to require the acquiring utility to make records available to ensure compliance after the expiration of the forbearance period, to allow the Energy and Environment Cabinet and the Public Service Commission to waive fines and penalties, collect fines and penalties, or grant a discretionary extension of the forbearance period not to exceed six months, and to prohibit an acquired water or wastewater system to which a forbearance period applied from being eligible for any additional forbearance periods; creates new sections of KRS Chapter 224A to define terms, to establish the Kentucky Water and Wastewater Assistance for Troubled or Economically Restrained Systems Program under the KIA to provide for a funding application and evaluation process for eligible public water and wastewater systems to seek funds from the General Assembly, to require the KIA to make applications available under the program, verify eligibility of proposed recipients, award funding as directed by the General Assembly, enforce compliance with funding conditions, and report quarterly to the General Assembly on the status of all funding awarded under the program, to allow the KIA board to contract or consult with third-party consultants, state agencies, or special purpose governmental entities in discharging its duties, to require that finalized funding applications be made available to the public, to allow eligible public water and wastewater systems to submit applications for regional projects, to provide for forfeiture and repayment of awarded funds, to require that the KIA board evaluate applications according to specified criteria and submit an annual report to the Legislative Research Commission containing the evaluations and scores of the proposed funding recipients and proposals for the structure of the funding to be awarded, to establish the Kentucky water and wastewater assistance for troubled or economically restrained systems fund, to provide that all moneys in the fund shall be allocated by the General Assembly for eligible projects, to provide that funding may be awarded in the form of grants, loans, no-interest loans, or forgivable loans, to require that interest rates for loans be set in the same manner as the interest rates for loans from the federally assisted wastewater and water supply resolving funds, except that the interest rates shall be one-half percent lower and shall not be below zero percent, to allow the authority to use up to one-half percent of the moneys deposited into the fund for administrative costs, to establish the emergency Kentucky water and wastewater assistance for troubled or economically restrained systems fund, to provide that moneys from the fund be dedicated for capital and non-capital expenses relating solely to restoring or avoiding imminent interruption of utility service provided by a public water or wastewater system after a statewide or local emergency has been declared, to allow the authority to require that a corrective action plan be submitted with a funding application, and to require that interest rates for loans be set in the same manner as the interest rates for loans from the federally assisted wastewater and water supply resolving funds; and amends KRS 224A.316 to require that the KIA prioritize funding for a utility acquiring a public water or wastewater system for the correction of deficiencies in the system identified in state and federal violations during the forbearance period; APPROPRIATION; EMERGENCY.