On February 12, 2019, Representative Tina Davis introduced a bill proposing to establish a new regulatory commission with oversight over municipal water and wastewater authorities.   H.B. 494 would establish a Municipal Water and Wastewater Authority Oversight Commission (“Authority Commission”).  Representative Davis previously sponsored H.B. 798, which would have amended the Public Utility Code to subject municipal water and wastewater authorities to regulation by the Pennsylvania Public Utility Commission (“PUC”).  Introduced in 2017, H.B. 798 failed to move out of the Consumer Affairs Committee.

H.B. 494 similarly seeks to impose regulatory oversight over municipal water and wastewater authorities, but through a new and independent five-member Authority Commission appointed by the Governor.  The bill also codifies specific salaries for the appointed officials, with Commissioners earning $55,000 per year and the Chairman earning $60,000 per year.

The powers granted to the Authority Commission under H.B. 494 are broad but largely undefined.  The bill confers “general administrative power and authority to supervise and regulate all municipal water/wastewater authorities doing business in this Commonwealth” and vests the Authority Commission with discretion to adopt regulations for the exercise of such powers.  In addition to the broad grant of power, H.B. 494 directs the Authority Commission to address and resolve informal consumer complaints against municipal water and wastewater authorities.  Interestingly, informal complaints would be filed with the PUC and then redirected to the Authority Commission for resolution.

To carry out its duties, H.B. 494 establishes a funding stream requiring all municipal water and wastewater authorities operating in Pennsylvania to pay a fee equal to 1% of operating revenues to the State Treasurer for appropriation to the Authority Commission.  This fee would presumably be passed on to customers served by the authorities, along with costs for legal counsel, engineering consultants, and other costs of compliance with rules and regulations promulgated by the Authority Commission.

Currently, H.B. 494 is under review by the House Local Government Committee.  While the future of the bill remains uncertain, passing the current form of this bill into law would impose a new regulatory burden on municipal water and wastewater authorities with the potential to fundamentally alter their operations across the Commonwealth.