Senate File 2308 - Introduced SENATE FILE 2308 BY WESTRICH A BILL FOR An Act relating to certain charges for utility service. 1 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 2 TLSB 6121XS (2) 91 sb/js

S.F. 2308 Section 1. Section 476.1A, subsection 1, Code 2026, is 1 amended by adding the following new paragraph: 2 NEW PARAGRAPH . f. Allowable charges to customers, as set 3 forth in section 476.6B. 4 Sec. 2. Section 476.1B, subsection 1, Code 2026, is amended 5 by adding the following new paragraph: 6 NEW PARAGRAPH . g. Allowable charges to customers, as set 7 forth in section 476.6B. 8 Sec. 3. Section 476.1C, subsection 1, paragraph a, Code 9 2026, is amended to read as follows: 10 a. Are not subject to the regulation authority of the 11 utilities commission under this chapter unless otherwise 12 specifically provided. Sections 476.6B, 476.10, 476.20 , 13 476.21 , and 476.51 apply to such gas utilities. 14 Sec. 4. NEW SECTION . 476.8A Allowable charges to customers. 15 1. The general assembly finds the following: 16 a. Water, electricity, and natural gas are essential 17 services necessary for life, health, and safety. 18 b. Public utility customers in Iowa generally have no 19 meaningful ability to choose among competing providers due to 20 the monopolistic nature of utility service territories. 21 c. Utility bills in Iowa increasingly include charges that 22 are not directly related to the actual consumption of utility 23 service, including but not limited to franchise fees, meter 24 fees, customer charges, and per-unit or per-meter surcharges. 25 d. Nonusage fees described in paragraph “c” significantly 26 increase utility bills without increasing the amount of utility 27 service received. 28 e. Iowa residents currently pay among the highest utility 29 rates in the nation, and additional nonusage fees further 30 burden households, renters, homeowners, and small businesses. 31 2. a. Notwithstanding any other provision of law, a 32 public utility shall not impose, collect, or bill any nonusage 33 fee or surcharge to a customer. A utility bill issued to a 34 customer in this state shall consist of only the following 35 -1- LSB 6121XS (2) 91 sb/js 1/ 4

S.F. 2308 charges, regardless of the number of meters serving a property 1 or the number of dwelling units or tenants served by a single 2 connection: 3 (1) Usage charges based on actual consumption. 4 (2) Late payment charges, if applicable. 5 b. A public utility shall not condition the provision or 6 continuation of service on payment of any nonusage fee. 7 3. Notwithstanding any other provision of law, a utility 8 shall not recover, pass through, itemize, or otherwise charge 9 a customer for any franchise fee, franchise assessment, or 10 similar payment made to a municipality or other governmental 11 entity. Any franchise fee obligation shall be borne by the 12 utility as a cost of doing business and shall not be recovered 13 directly or indirectly from customers. 14 4. a. The commission shall adopt rules as necessary to 15 implement and enforce this section. 16 b. The commission shall review all existing tariffs, rate 17 schedules, and billing practices to ensure compliance with this 18 section. 19 c. Any tariff, rule, or billing practice inconsistent with 20 this section is void. 21 5. a. A public utility that violates this section is 22 subject to all the following: 23 (1) Administrative penalties as determined by the 24 commission. 25 (2) Refunds or bill credits to affected customers. 26 (3) Enforcement action by the attorney general under 27 applicable consumer protection laws. 28 b. Each billing statement containing a prohibited fee 29 constitutes a separate violation. 30 6. Notwithstanding section 476.1, subsection 3, this 31 section applies to all municipally owned waterworks, waterworks 32 having less than two thousand customers, joint water utilities 33 established pursuant to chapter 389, rural water districts 34 incorporated and organized pursuant to chapters 357A and 504, 35 -2- LSB 6121XS (2) 91 sb/js 2/ 4

S.F. 2308 and cooperative water associations incorporated and organized 1 pursuant to chapter 499 in addition to other public utilities 2 providing gas or electric service. 3 EXPLANATION 4 The inclusion of this explanation does not constitute agreement with 5 the explanation’s substance by the members of the general assembly. 6 This bill relates to certain charges for utility service. 7 The bill provides legislative findings stating that water, 8 electricity, and natural gas are essential services, that 9 utility customers generally lack choice due to the monopolistic 10 nature of service territories, that utility bills increasingly 11 include nonusage fees that significantly increase costs without 12 increasing service, and that such nonusage fees place a burden 13 on Iowa residents. 14 The bill prohibits a public utility from imposing, 15 collecting, or billing any nonusage fee or surcharge to a 16 customer, and provides that a utility bill may include only 17 charges based on actual consumption and late payment charges. 18 The bill prohibits a public utility from conditioning the 19 provision or continuation of service on the payment of a 20 nonusage fee. 21 The bill prohibits utilities from charging customers, 22 through any method, for franchise fees or similar payments made 23 to a municipality or governmental entity. 24 The bill directs the Iowa utilities commission to adopt 25 rules to implement and enforce the new bill and to review all 26 existing tariffs, rate schedules, and billing practices for 27 compliance. Any tariff, rule, or billing practice inconsistent 28 with the bill is void. 29 The bill provides enforcement mechanisms for violations, 30 including administrative penalties determined by the 31 commission, refunds or bill credits to affected customers, and 32 enforcement actions by the attorney general. Each billing 33 statement containing a prohibited fee constitutes a separate 34 violation. 35 -3- LSB 6121XS (2) 91 sb/js 3/ 4

S.F. 2308 The bill applies to certain public utilities, including 1 those that are otherwise not subject to full rate regulation by 2 the utilities commission. 3 -4- LSB 6121XS (2) 91 sb/js 4/ 4