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H.B. 56 Enrolled
LONG TITLE
General Description:
This bill modifies provisions related to municipal and special and local district charges
for water and sewer services.
Highlighted Provisions:
This bill:
. prohibits special districts and local districts from:
. refusing to furnish water or sewer service to property based on an arrearage
from a previous owner, absent a valid lien; and
. collecting from the current owner a previous owner's arrearage for water or
sewer service provided to the property before the current owner's ownership,
absent a valid lien;
. authorizes municipalities, special districts, and local districts providing sewer service
to:
. required a written application for service; and
. discontinue providing service if the property owner fails to pay for the service;
. authorizes special districts and local districts to:
. certify amounts owing for water or sewer service as a lien on the property of the
customer who received the service, with certain limitations;
. file a civil action to recover past due fees for water or sewer service and related
charges and to offer not to file a civil action if the customer pays past due fees,
collection costs, certain damages, and an attorney fee; and
. impose collection costs on a customer who has not paid water or sewer service
fees; and
. authorizes a municipality to discontinue sewer service to a property whose owner fails
to pay for the service;
. prohibits a municipality from:
. refusing sewer service to property based on an arrearage from a previous owner;
and
. collecting from the current owner a previous owner's arrearage for sewer service
provided to the property before the current owner's ownership.
Monies Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
10-7-10.5, as enacted by Chapter 161, Laws of Utah 2003
10-8-38, as last amended by Chapter 161, Laws of Utah 2003
17A-2-310, as last amended by Chapter 227, Laws of Utah 1993
17A-2-416, as renumbered and amended by Chapter 186, Laws of Utah 1990
17A-2-1321, as last amended by Chapter 228, Laws of Utah 1999
ENACTS:
17A-1-205, Utah Code Annotated 1953
17B-2-801, Utah Code Annotated 1953
17B-2-802, Utah Code Annotated 1953
17B-2-803, Utah Code Annotated 1953
17B-2-804, Utah Code Annotated 1953
17B-2-805, Utah Code Annotated 1953
REPEALS:
17A-1-103, as enacted by Chapter 161, Laws of Utah 2003
17B-2-103, as enacted by Chapter 161, Laws of Utah 2003
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 10-7-10.5 is amended to read:
10-7-10.5. Authority to require written application for water or sewer service and
to terminate service for failure to pay -- Limitations.
(1) A municipality that owns or controls a system for furnishing water or for providing
sewer service may:
(a) before furnishing water or providing sewer service to a property, require the property
owner or an authorized agent to submit a written application, signed by the owner or an
authorized agent, agreeing to pay for all water furnished or sewer service provided to the
property, respectively, whether occupied by the owner or by a tenant or other occupant,
according to the ordinances, rules, and regulations adopted by the municipality; and
(b) if an owner fails to pay for water furnished or sewer service provided to the owner's
property, discontinue furnishing water or providing sewer service to the property, respectively,
until all amounts for water furnished or sewer service provided, respectively, are paid, subject to
Subsection (2).
(2) (a) A municipality may not use an owner's failure to pay for water furnished or sewer
service provided to the owner's property as a basis for not furnishing water or providing sewer
service to the property after ownership of the property is transferred to a subsequent owner.
(b) A municipality may not require an owner to pay for water that was furnished or sewer
service that was provided to the property before the owner's ownership.
Section 2. Section 10-8-38 is amended to read:
10-8-38. Drainage and sewage systems -- Construction regulation and control --
Retainage -- Mandatory hookup -- Charges for use -- Collection of charges -- Service to
tenants -- Failure to pay for service -- Service outside municipality.
(1) (a) Boards of commissioners, city councils, and boards of trustees of cities and towns
may construct, reconstruct, maintain, and operate, sewer systems, sewage treatment plants,
culverts, drains, sewers, catch basins, manholes, cesspools, and all systems, equipment, and
facilities necessary to the proper drainage, sewage, and sanitary sewage disposal requirements of
the city or town and regulate the construction and use thereof.
(b) If any payment on a contract with a private person, firm, or corporation to construct
or reconstruct sewer systems, sewage treatment plants, culverts, drains, sewers, catch basins,
manholes, cesspools, and other drainage and sewage systems is retained or withheld, it shall be
retained or withheld and released as provided in Section 13-8-5 .
(2) (a) In order to defray the cost of constructing, reconstructing, maintaining, or
operating a sewer system or sewage treatment plant, a municipality may:
(i) require connection to the sewer system if the sewer is available and within 300 feet of
the property line of a property with a building used for human occupancy; and
(ii) make a reasonable charge for the use of the sewer system.
(b) A municipality operating a waterworks system and a sewer system or sewage
treatment plant may:
(i) make one charge for the combined use of water and the services of the sewer system
or sewage treatment plant; and
(ii) adopt an ordinance requiring a property owner desiring water and sewer service to
submit a written application, signed by the owner or the owner's authorized agent, agreeing to
pay, according to the ordinance enacted by the municipality, for the water and sewer service
furnished the owner.
(c) (i) If a person fails to connect to the sewer when connection is required under
Subsection (2)(a)(i) or fails to pay for the sewer service as required under applicable municipal
ordinances, then the municipality may cause the water to be shut off from the premises until the
person has:
(A) hooked up to the sewer at the person's own expense; or
(B) paid in full for all sewer service.
(ii) A municipality may not use an owner's failure to pay for sewer service furnished to the
owner's property as a basis for not furnishing water to the property after ownership of the
property is transferred to a subsequent owner.
[
(d) A municipality may sell and deliver water or sewer services to others beyond the limits
of the municipality from the surplus capacity of the municipality's waterworks or sewer system.
Section 3. Section 17A-1-205 is enacted to read:
17A-1-205. Special districts subject to local district provisions relating to collection
of water and sewer service fees.
Each special district under this title is subject to the provisions of Title 17B, Chapter 2,
Part 8, Collection of Water and Sewer Service Fees, to the same extent as if the special district
were a local district under Title 17B, Chapter 2, Local Districts.
Section 4. Section 17A-2-310 is amended to read:
17A-2-310. Certification of bond issue to county legislative body -- Tax levy --
Payment of revenue bonds -- Election on general obligation bonds and revenue bonds --
Bonds for sewer purposes -- Collection of charges.
(1) Except as to bonds issued payable solely from revenues derived from the district's
facilities, it is the duty of each board of trustees which has issued bonds under this part to certify
annually to each appropriate county legislative body as provided in Section 17A-2-308 , and it is
the duty of the county legislative body to levy annually until principal and interest shall have been
fully paid, taxes on all taxable property in the district, sufficient to assure the prompt payment of
principal and interest as each falls due, all as provided in Section 17A-2-309 .
(2) If any bonds issued under this part are issued in a manner as not to be payable from
taxes but to be payable solely from the revenues to be derived by the district from the operation of
its facilities, the bonds so issued shall be payable from and secured by the pledge of all or any
specified part of the revenues to be derived by the district from the operation of its facilities; and
where the bonds are so issued, it is the duty of the board of trustees to impose for all services
rendered thereby rates fully sufficient to pay principal of and interest on the bonds and to carry
out all commitments made in the resolution authorizing the bonds. The board may in the
resolution enter into such covenants with the future holders of the bonds as to the management
and operation of the facilities, the imposition and collection of fees and charges for water and
services furnished by these facilities, the disposition of these fees and revenues, the issuance of
future bonds and the creation of future liens and encumbrances against these facilities and the
revenue from them, and carrying of insurance on the facilities, the keeping of books and records,
and other pertinent matters, as considered proper by the board of trustees to assure the
marketability of the bonds. The board may undertake in the resolution to make the revenues of the
facilities sufficient to pay the expense of their operation and maintenance and may undertake to
make the revenues or net revenues of the facilities sufficient to produce in each year an amount in
such specified excess of actual requirements for principal of and interest on the bonds in that year
as the board may consider necessary to assure the highest marketability of the bonds. If the board
provides in the resolution authorizing the revenue bonds for the creation of a reserve fund to
assure the prompt payment of principal and interest, the board may provide for the accumulation
of this fund not only from the revenues of the facilities but also through the paying into it of such
part of the bond proceeds as it may consider advisable. A proposition of issuing general obligation
bonds and a proposition of the issuance of revenue bonds, or any combination of them, may be
voted upon at the same election.
(3) When bonds are issued under this part in whole or in part for sewer purposes and the
district operates a waterworks system, provision may be made in the bond resolution under which
charges for sewer service and water are to be billed in a single bill to each customer and payment
of the charge for water accepted only when the charge for sewer service is paid at the same time.
The board may agree to suspend water or sewer service, or both, to any customer who shall
become delinquent in the payment of any charges due the district. [
Section 5. Section 17A-2-416 is amended to read:
17A-2-416. Delinquent fees and charges to become lien when certified.
The governing authority of a service area may, by ordinance or resolution, provide that
fees and charges for commodities, services, and facilities supplied by the service area, except
water furnished or sewer service provided by the county service area, shall, if not paid when due,
be certified to the treasurer and assessor of the county in which the delinquent premises are
located. These delinquent fees and charges, together with applicable penalties and applicable
interest established in Section 59-2-1331 shall, immediately upon this certification, become a lien
on the delinquent premises on a parity with and collected at the same time and in the same manner
as general county taxes that are a lien on the premises as provided in Title 59, Chapter 2, Part 13,
Collection of Taxes.
Section 6. Section 17A-2-1321 is amended to read:
17A-2-1321. Delinquent fees and charges.
(1) Except as provided in Subsection (3), the governing authority of a special service
district may, by ordinance or resolution, provide that fees and charges for [
garbage[
due, be certified to the treasurer and assessor of the county in which the delinquent premises are
located.
(2) These delinquent fees and charges, together with penalties and applicable interest
shall, immediately upon this certification, become a lien on the delinquent premises on a parity
with and collected at the same time and in the same manner as general county taxes that are a lien
on the premises.
(3) This section does not apply to a special service district's fees and charges if the
governing authority of the county or municipality that established the special service district levies
a tax for district purposes on taxable property within the special service district under Section
17A-2-1322 .
Section 7. Section 17B-2-801 is enacted to read:
17B-2-801. Definitions.
As used in this part:
(1) "Collection costs" means an amount, not to exceed $20, to reimburse a local district
for expenses associated with its efforts to collect past due service fees from a customer.
(2) "Customer" means the owner of real property to which a local district has furnished
water or provided sewer service.
(3) "Damages" means an amount equal to the greater of:
(a) $100; and
(b) triple the past due service fees.
(4) "Default date" means the date on which payment for service fees becomes past due.
(5) "Past due service fees" means service fees that on or after the default date have not
been paid.
(6) "Prelitigation damages" means an amount that is equal to the greater of:
(a) $50; and
(b) triple the past due service fees.
(7) "Service fees" means the amount charged by a local district to a customer for water
furnished or sewer service provided to the customer's property.
Section 8. Section 17B-2-802 is enacted to read:
17B-2-802. Authority to require written application for water or sewer service and
to terminate for failure to pay -- Limitations.
(1) A local district that owns or controls a system for furnishing water or providing sewer
service may:
(a) before furnishing water or providing sewer service to a property, require the property
owner or an authorized agent to submit a written application, signed by the owner or an
authorized agent, agreeing to pay for all water furnished or sewer service provided to the
property, whether occupied by the owner or by a tenant or other occupant, according to the rules
and regulations adopted by the local district; and
(b) if a customer fails to pay for water furnished or sewer service provided to the
customer's property, discontinue furnishing water or providing sewer service to the property,
respectively, until all amounts for water furnished or sewer service provided, respectively, are
paid, subject to Subsection (2).
(2) Unless a valid lien has been established as provided in Section 17B-2-803 , has not
been satisfied, and has not been terminated by a sale as provided in Subsection 17B-2-803 (2), a
local district may not:
(a) use a customer's failure to pay for water furnished or sewer service provided to the
customer's property as a basis for not furnishing water or providing sewer service to the property
after ownership of the property is transferred to a subsequent owner; or
(b) require an owner to pay for water that was furnished or sewer service that was
provided to the property before the owner's ownership.
Section 9. Section 17B-2-803 is enacted to read:
17B-2-803. Lien for past due fees for water or sewer service -- Limitations.
(1) (a) A local district may certify past due service fees and other amounts for which the
customer is liable under this chapter to the treasurer or assessor of the county in which the
customer's property is located.
(b) Subject to Subsection (2), the past due service fees and other amounts for which the
customer is liable under this chapter, upon their certification under Subsection (1)(a), become a
lien on the customer's property to which the water was furnished or sewer service provided, on a
parity with and collectible at the same time and in the same manner as general county taxes that
are a lien on the property.
(2) A lien under Subsection (1) is not valid if certification under Subsection (1) is made
after the filing for record of a document conveying title of the customer's property to a new
owner.
(3) Nothing in this section may be construed to:
(a) waive or release the customer's obligation to pay service fees;
(b) preclude the certification of a lien under Subsection (1) with respect to past due
service fees for water furnished or sewer service provided after the date that title to the property
is transferred to a new owner; or
(c) nullify or terminate a valid lien.
(5) After all amounts owing under a lien established as provided in this section have been
paid, the local district shall file for record in the county recorder's office a release of the lien.
Section 10. Section 17B-2-804 is enacted to read:
17B-2-804. Collection of past due fees for water or sewer service -- Civil action
authorized.
(1) A customer is liable to a local district for past due service fees and collection costs if:
(a) the customer has not paid service fees before the default date;
(b) the local district mails the customer notice as provided in Section 17B-2-805 ; and
(c) the past due service fees remain unpaid 15 days after the local district has mailed
notice.
(2) If a customer has not paid the local district the past due service fees and collection
costs within 30 days after the local district mails notice, the local district may make an offer to the
customer that the local district will forego filing a civil action under Subsection (3) if the customer
pays the local district an amount that:
(a) consists of the past due service fees, collection costs, prelitigation damages, and, if the
local district retains an attorney to recover the past due service fees, a reasonable attorney's fee
not to exceed $50; and
(b) if the customer's property is residential, may not exceed $100.
(3) (a) A local district may file a civil action against the customer if the customer fails to
pay the past due service fees and collection costs within 30 calendar days from the date on which
the local district mailed notice under Subsection (1)(b).
(b) (i) In a civil action under this Subsection (3), a customer is liable to the local district
for an amount that:
(A) consists of past due service fees, collection costs, interest, court costs, a reasonable
attorney's fee, and damages; and
(B) if the customer's property is residential, may not exceed $200.
(ii) Notwithstanding Subsection (3)(b)(i), a court may, upon a finding of good cause,
waive interest, court costs, the attorney's fee, and damages, or any combination of them.
(c) If a local district files a civil action under this Subsection (3) before 31 calendar days
after the day on which the local district mailed notice under Subsection (1)(b), a customer may
not be held liable for an amount in excess of past due service fees.
(d) A local district may not file a civil action under this Subsection (3) unless the
customer has failed to pay the past due service fees and collection costs within 30 days from the
day on which the local district mailed notice under Subsection (1)(b).
(4) (a) All amounts charged or collected as prelitigation damages or as damages shall be
paid to and be the property of the local district that furnished water or provided sewer service and
may not be retained by a person who is not that local district.
(b) A local district may not contract for a person to retain any amounts charged or
collected as prelitigation damages or as damages.
(5) This chapter may not be construed to limit a local district that furnishes water or
provides sewer service from obtaining relief to which it may be entitled under other applicable
statute or cause of action.
Section 11. Section 17B-2-805 is enacted to read:
17B-2-805. Notice.
(1) Each notice under Subsection 17B-2-804 (1)(b) shall:
(a) be in writing;
(b) be mailed to the customer by the United States mail, postage prepaid;
(c) notify the customer that:
(i) if the past due service fees are not paid within 15 days after the day on which the local
district mailed notice, the customer is liable for the past due service fees and collection costs; and
(ii) the local district may file civil action if the customer does not pay to the local district
the past due service fees and collection costs within 30 calendar days from the day on which the
local district mailed notice; and
(d) be in substantially the following form:
Date:_____________________________________
To: ______________________________________
Service address: ____________________________
Account or invoice number(s): _________________
Date(s) of service: ___________________________
Amount past due: ____________________________
You are hereby notified that water or sewer service fees (or both) owed by you are in
default. In accordance with Section 17B-2-804 , Utah Code Annotated, if you do not pay the past
due amount within 15 days from the day on which this notice was mailed to you, you are liable for
the past due amount together with collection costs of $20.
You are further notified that if you do not pay the past due amount and the $20 collection
costs within 30 calendar days from the day on which this notice was mailed to you, an appropriate
civil legal action may be filed against you for the past due amount, interest, court costs, attorney's
fees, and damages in an amount equal to the greater of $100 or triple the past due amounts, but
the combined total of all these amounts may not exceed $200 if your property is residential.
(Signed) _______________________________________
Name of local district _____________________________
Address of local district ___________________________
Telephone number of local district ___________________
(2) Written notice under this section is conclusively presumed to have been given if the
notice is:
(a) properly deposited in the United States mail, postage prepaid, by certified or
registered mail, return receipt requested; and
(b) addressed to the customer at the customer's:
(i) address as it appears in the records of the local district; or
(ii) last known address.
Section 12. Repealer.
This bill repeals:
Section 17A-1-103, Authority to require written application for water service and to
terminate service for failure to pay -- Limitations.
Section 17B-2-103, Authority to require written application for water service and to
terminate service for failure to pay -- Limitations.
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