The bill aims to enhance transparency and consumer protection in water system rates in Washington State. It establishes a new section that emphasizes the importance of public water systems and the need for regional solutions to maintain affordable water supply. The legislation recognizes the lack of specific statutory standards for the Utilities and Transportation Commission (UTC) in reviewing water system rate changes, which can lead to sudden and significant rate increases for consumers. To address this, the bill mandates that water companies provide advance notice of ownership changes and planned capital improvements, along with good faith estimates of future rate changes to customers.

Additionally, the bill amends existing laws to require the UTC to adopt rules that incorporate allowable costs of capital in rate determinations, promote rate smoothing, and ensure that water companies follow their approved water system plans. It also introduces provisions for multiyear rate plans, allowing water companies to propose such plans starting January 1, 2027, subject to UTC approval. The legislation emphasizes the need for consolidation of failing water systems into well-managed public systems to improve efficiency and protect public health, while also providing state support for these consolidation efforts.

Statutes affected:
Original Bill: 43.20.050, 43.20.260, 80.12.020, 36.96.010
Substitute Bill: 43.20.050, 43.20.260, 80.12.020, 36.96.010
Second substitute: 70A.125.060, 80.12.020, 36.96.010
Bill as passed Legislature: 70A.125.060, 80.12.020, 36.96.010