BILL NUMBER: S597
SPONSOR: HINCHEY
 
TITLE OF BILL:
An act to amend the public service law, the environmental conservation
law and the state finance law, in relation to reporting requirements and
audits of private water companies
 
PURPOSE:
This bill will provide greater oversight of small private water compa-
nies throughout the state by granting more auditing authority to certain
state agencies and the Comptroller's office. It also gives DPS the
authority to institute and enforce a graduated penalty system for
noncompliance of health and safety standards.
 
SUMMARY OF PROVISIONS:
Section 1: This act shall be known and may be cited as the "small water
utility transparency act."
Section 2: The Public Service Commission (PSC), in coordination with the
State Comptroller, shall conduct full audits of regulated private water
companies on a three to five-year cycle.
The PSC shall require that any regulated private water company with
gross annual revenues below two hundred fifty thousand dollars which is
under investigation either by motion of the commission or an order to
show cause, shall file regular public updates on the status of compli-
ance.
The commission shall be authorized to establish and collect fines for
non-compliance including at increased rates for repeated non-compliance.
Section 3: The Department of Environmental Conservation (DEC) is given
the aforementioned auditing powers in section 2 and must coordinate
auditing efforts with the PSC.
Section 4: Requires the State Comptroller's office to audit private
water companies under the state finance taw.
Section 5: Effective Date
 
JUSTIFICATION:
The Public Service Commission (PSC) regulates the rates and services of
private water companies. As of 2024, according to the PSC there are
approximately 830,000 New Yorkers served by 230 private water companies,
around half of which serve fewer than 50 customers each.
Currently, there is a patchwork of impractical regulations surrounding
small water companies in New York State that allows many to fall through
the cracks and skirt their responsibilities to maintain their water
systems and provide clean, safe water to their customers. Several state
agencies including the PSC, Department of Environmental Conservation,
and State Comptroller's office need to play a more defined, coordinated
role in the oversight of these companies to ensure that they uphold
their responsibilities, maintain their systems, and deliver clean and
reliable water.
We've seen, time and again, small water companies ignore their responsi-
bility to provide clean water and instead focus on profit margins and
personal gain. This legislation seeks to protect consumers who rely on
private water companies by requiring clear auditing processes with
appropriate enforcement. The Small Water Utility Transparency Act will
create the first-ever state audits of private water companies.
 
LEGISLATIVE HISTORY:
2022 - S8534 Passed Senate / A10726 referred to environmental conserva-
tion
2023 - S1791 Referred to Finance / No same-as
2024- S1791 Passed Senate / No same-as
 
FISCAL IMPLICATIONS:
None
 
EFFECTIVE DATE:
This act shall take effect immediately.

Statutes affected:
S597: 8 state finance law