selling public utility shall not be relevant to determining
the value of said assets.
(e) Postacquisition projects.--The following apply:
(1) Any postacquisition improvements made by the
acquiring public utility that are not eligible to be
collected through a distribution system improvement charge
shall be eligible for inclusion in allowance for funds used
during construction after the date the expense was incurred.
(2) An acquiring public utility may collect allowance
for funds used during construction, through rates, until the
improved asset has been in service for a period of four years
or until the asset is included in the acquiring public
utility's next base rate case, whichever is earlier.
(3) For ratemaking purposes, any postacquisition
improvements made to the selling utility's assets by the
acquiring public utility shall not be subject to depreciation
from the date the expense was incurred until such time as the
improved asset has been in service for a period of four years
or until the asset is included in the acquiring public
utility's next base rate case, whichever is earlier.
(f) Definitions.--The following words and phrases when used
in this section shall have the meanings given to them in this
section unless the context clearly indicates otherwise:
"Acquiring public utility." An investor-owned water or
wastewater public utility subject to regulation under this title
for a period of at least five years that is acquiring a selling
utility as the result of a voluntary arm's-length transaction
between the buyer and seller.
"Allowance of funds used during construction." An accounting
practice that recognizes the capital costs, including debt and
20150HB1326PN2396 - 5 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30