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Senate Bill No. 700
(Senators McCabe, Bailey and Minard, original sponsors)
[Passed April 9, 2005; in effect ninety days from passage.]
AN ACT to
amend the Code of West Virginia, 1931, as amended, by
adding thereto a new article, designated §22-28-1, §22-28-2,
§22-28-3, §22-28-4, §22-28-5, §22-28-6, §22-28-7, §22-28-8 and
§22-28-9, all relating to the creation of a Community
Infrastructure Investment Program within the Department of
Environmental Protection; legislative findings; definitions;
granting rule-making authority; authority to promulgate
emergency rules; establishing process for issuance of
certificate of appropriateness; providing for community
infrastructure investment agreements; setting minimum terms;
authority of Division of Health and Department of
Environmental Protection not affected; requiring report to
Joint Committee on Government and Finance; providing for
administrative fees; establishing exemption from authority of Public Service Commission; and setting time limits for
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new article, designated §22-28-1, §22-28-2,
§22-28-3, §22-28-4, §22-28-5, §22-28-6, §22-28-7, §22-28-8 and §22-
28-9, all to read as follows:
ARTICLE 28. COMMUNITY INFRASTRUCTURE INVESTMENT PROJECTS.
§22-28-1. Legislative findings.
The Legislature finds and declares that:
(a) There is a growing need for the extension of public water
and sewer services throughout the state and that the extension of
such services and facilities maintains the health and economic
vitality of the citizens of West Virginia. In addition, access to
such infrastructure facilities is equal essential to development in
all regions of the state.
(b) The extension of public water and sewer services promotes
public health and safety in that it enables businesses, residences,
municipalities and other entities to comply with state and federal
water quality standards.
(c) The cost of publicly owned sewer and water facilities are
normally born by the state, its subdivisions and the citizens of
West Virginia and public indebtedness incurred to construct such
facilities constitutes a financial burden on the state and its political subdivisions, as well as residential consumers.
(d) The rates for public water and sewer services charged to
customers of all service classes have risen in recent years due
primarily to the cost of utility construction and the cost of debt
service associated with such construction.
(e) There are private business entities that are in need of
water and sewer services for various residential, commercial and
industrial projects throughout the state and that those entities
are willing to pay the cost associated with constructing needed
public water and sewer services and to dedicate the facility to the
local certificated public utility after construction of such
(f) Those private business entities need a method by which to
enter into agreements with municipal utilities or public service
districts that would enable the construction of new infrastructure
as well as the expansion of existing facilities.
(g) The dedication of such infrastructure facilities to the
local certificated public utility without cost greatly benefits the
citizens of the state and promotes industrial, commercial and
For the purposes of this article, the following words or terms
defined have the meaning ascribed to them herein:
(a) "Certificate of appropriateness" shall refer to the document evidencing approval of a project and is issued by the
Secretary of the Department of Environmental Protection pursuant to
the provisions of this article. The issuance of such a certificate
shall exempt the project from the provisions of section eleven,
article two, chapter twenty-four of this code and, in the case of
a public service district, from the provisions of section twenty-
five, article thirteen-a, chapter sixteen of this code.
(b) "Community infrastructure investment agreement" shall
refer to a written agreement between a municipal utility or public
service district and a person that provides for the transfer of
legal title to a project facility from the person to the municipal
utility or public service district.
(c) "Community infrastructure investment project" shall refer
to any newly constructed or enlarged and improved project facility
that may be transferred to a municipal utility or public service
district without cost to the municipal utility or public service
district pursuant to the provisions of this article.
(d) "Person" shall refer to any individual, partnership, firm,
society, association, trust, corporation or other business entity.
(e) "Project cost" shall refer to the capital cost of proposed
community infrastructure investment project facilities to be
constructed pursuant to the provisions of this article. "Project
cost" shall also refer to newly constructed or enlarged and
improved existing project facilities. Project cost shall not refer to any of the costs or expenses of ordinary operation and
maintenance of the project facilities once they become operational.
(f) "Project facilities" shall refer to waste water treatment
plants or water treatment plants constructed pursuant to the
provisions of this article and include, but are not limited to,
related storage buildings or structures, meters, hydrants, pump
stations, force and gravity mains, transmission lines and other
such fixtures related to the construction of water or sewer
facilities. Project facilities shall not refer to the ordinary
extension of collection and distribution lines or facilities from
or to the project constructed pursuant to the provisions of this
article to the property of any user of project facilities.
(g) "Public service district" shall refer to those public
corporations and political subdivisions of the state created
pursuant to the provisions of section two, article thirteen-a,
chapter sixteen of this code.
(h) "Secretary" shall refer to the Secretary of the Department
of Environmental Protection established in section six, article one
of this chapter.
§22-28-3. Creation of community infrastructure investment project;
certificate of appropriateness; rule-making
(a) There is hereby created a Community Infrastructure
Investment Program within the Department of Environmental Protection. This Program will facilitate the construction or
expansion of project facilities for the promotion of economic
development and the protection of public health and environment in
the state. Any public service district or municipal utility that
wishes to accept a project facility constructed pursuant to a
community infrastructure investment agreement with a project cost
not to exceed ten million dollars may apply to the secretary for
approval of such project. Nothing herein shall be construed to
require a public service district or municipal utility to use this
(b) Where the Secretary shall have found that the community
infrastructure investment project shall have met the requirements
contained in this article, the Secretary shall issue a certificate
of appropriateness to the municipal utility or public service
district as evidence of such approval.
(c) Municipal utilities or public service districts may
jointly enter into agreements with persons for the purpose of
applying to the Secretary of the Department of Environmental
Protection for approval of project facilities. The minimum terms
and conditions of such agreements are established by the provisions
of section four of this article.
(d) The Secretary will, by legislative rule, establish the
criteria for the approval of such projects and shall have sole
authority to make such determination.
§22-28-4. Community infrastructure investment agreements; report
to Joint Committee on Government and Finance.
(a) Municipal utilities and public service districts have the
power and authority to enter into community infrastructure
investment agreements with any person for the purpose of
constructing new project facilities or substantially improving or
expanding project facilities.
(b) Notwithstanding any other provision in this code to the
contrary, the Secretary shall have the power and the authority to
review and approve all such community infrastructure investment
agreements pursuant to this article.
(c) Each such agreement shall contain as a minimum the
following terms and conditions to be performed by the parties
(1) The project facilities shall be engineered and constructed
in accordance with the requirements for new construction
established by the municipal utility or public service district;
(2) Proof or certification of the financial ability of the
municipal utility or public service district to maintain and
operate the public facilities;
(3) Certification that upon completion and activation of the
project facility or improvements to the project facility, the title
to the public facility shall be transferred without cost to the
municipal utility or public service district;
(4) A finding that the construction of the new public
facility, or the substantial improvement or expansion of an
existing public facility, either: (i) Fosters economic growth by
promoting commercial, industrial or residential development; and
(ii) improves water quality or otherwise enables the affected
territory to achieve compliance with any applicable state or
federal health or environmental law;
(5) The municipal utility or public service district will
receive or otherwise obtain without cost to the public all
necessary rights-of-way for the operation of the public facility;
(6) The rates charged by the municipal utility or public
service district to new customers to be served by the project
facility shall be the rates in effect at the time of transfer of
the project facility to the utility plus any additional cost of
service borne by the municipal utility or public service district
as a result of the project facility until such time as new rates
may be finally enacted by the municipal utility or proposed by the
public service district and approved by the Public Service
Commission and the rates charged by the municipal utility or the
public service district to existing customers shall not be impacted
as a result of the obligation of the public service district or
municipal utility pursuant to the community infrastructure
(7) Confirmation that the agreement does not violate any of the bond covenants imposed on the municipal utility or public
(8) Proof that necessary permits, where applicable, have been
obtained from the Division of Health and the Department of
(9) Evidence that the person responsible for the construction
of or improvements to the public facility has provided funding to
the municipal utility or public service district for the engagement
of an engineer qualified to design and certify the structural
integrity and capacity of the project facility;
(10) Proof that the person responsible for construction of or
improvements to the public facility has obtained a performance bond
payable to the municipal utility or public service district equal
to the estimated cost of construction: Provided, That the form of
the bond required by this section shall be approved by the
Secretary and may include, at the option of the Secretary, surety
bonding, collateral bonding (including cash and securities),
establishment of an escrow account, letters of credit, performance
bonding fund participation as established by the Secretary, self-
bonding or a combination of these methods; and
(11) Any other conditions that the secretary may determine to
be relevant as established.
(d) Where the Secretary has found that the community
infrastructure investment agreement meets the requirements contained in this article, the Secretary shall issue a certificate
of appropriateness to the parties as evidence of such approval.
(e) Not later than thirty days prior to the issuance of a
certificate of appropriateness for any community infrastructure
investment project, the Secretary shall first submit a report of
the same to the Joint Committee on Government and Finance.
§22-28-5. Authority of the Department of Environmental Protection
and Division of Health not affected.
Nothing contained in this article shall be construed to affect
the authority of the Department of Environmental Protection
pursuant to the provisions of this chapter, nor the authority of
the Division of Health pursuant to the provisions of chapter
sixteen of this code. Facilities discharging into the Potomac
River watershed and its tributaries shall be designed to achieve
nutrient reductions, for both Nitrogen and Phosphorus, consistent
with West Virginia's participation in the Chesapeake Bay Program
upon implementation of the Chesapeake Bay standards by the
§22-28-6. Time for approval.
The Secretary shall approve or reject all applications for a
community investment infrastructure project or agreement within
thirty days, unless, by mutual agreement, such time period is
extended. In no case shall the time period extend beyond ninety
The Secretary shall establish by legislative rule a schedule
of fees reasonably calculated to pay for the costs of the
administration of the provisions of this article.
§22-28-8. Exemption from Public Service Commission approval.
All project facilities constructed or improved pursuant to the
provisions of this article shall be exempt from the provisions of
chapter twenty-four of this code until such time as title to the
public facility shall be transferred to the municipal utility or
public service district. Nothing herein shall be construed to give
the Public Service Commission authority to regulate or intervene in
the approval and construction of any project or agreement provided
in this article. Notwithstanding any other provision of this code
to the contrary, the acquisition of a project facility by a
municipality or public service district under the provisions of
this article shall not require the issuance of a certificate of
convenience and necessity from the Public Service Commission.
§22-28-9. Rule-making authority.
The Secretary shall have the authority to propose legislative
rules for promulgation in accordance with the provisions of section
one, article three, chapter twenty-nine-a of this code to
effectuate the purposes of this article. Notwithstanding any
provision of this code to the contrary, the proposed legislative
rules for this article filed in the state register by the first day of August, two thousand five, may be filed as emergency rules.