The Senate and House each put forwarded a bill requiring organizations that operate certain utilities to disclose taxes or fees on billing statements to customers.
HB 2889 focuses on cities operating their own water, sewer, wastewater, or stormwater utility. If a city imposes a fee or tax on the gross revenue of the utility, the disclosure must be made using one of the following methods:
- On regular billing statements provided electronically or in written form;
- On the district’s website as long as the organization provides written notice to customers that the information is available on its website; or
- Through a billing insert, mailer, or other written or electronic communication as long as the information is provided annually or within thirty days of any tax rate changes.
The disclosure must include the following language:
“The amount billed includes a fee or tax up to (dollar amount or percentage) calculated on the gross revenue of the [specific type of] utility.”
For example, a city could write: “The amount billed includes a fee or tax up to 10% calculated on the gross revenue of the water utility.”
AWC helped to amend this bill to provide cities flexibility in sharing the information.
SB 5024 focuses on a much wider set of organizations that collect taxes on behalf of the state or political subdivision, including:
- Metropolitan municipal corporations;
- Public utility districts;
- Diking, drainage, and sewerage improvement districts;
- Solid waste collection districts;
- Water-sewer districts;
- Municipal utilities; and
- Electric utilities.
These organizations must disclose to customers the method by which the tax rates are applied to the relevant services. The disclosure must be made using one of the following methods:
- On regular billing statements provided electronically or in written form;
- On the district’s website as long as the organization provides written notice to customers that the information is available on its website; or
- Through a billing insert, mailer, or other written or electronic communication as long as the information is provided annually or within thirty days of any tax rate changes.
Dates to remember
HB 2889 is scheduled for public hearing in the Senate Local Government Committee at 8 am on Thursday, February 27.
SB 5024 is scheduled for public hearing in the House Local Government Committee at 10 am on Tuesday, February 25.