1. (1) At the time that a water or sewer corporation files a petition with the commission seeking to establish or change a WSIRA, it shall submit proposed WSIRA rate schedules and supporting documentation regarding the calculation of the proposed WSIRA with the petition and shall serve the office of the public counsel with a copy of its petition, its proposed WSIRA rate schedules, and its supporting documentation.

(2) Upon the filing of a petition and any associated WSIRA rate schedules, seeking to establish or change a WSIRA, the commission shall publish notice of the filing.

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(3) Three months prior to a water or sewer corporation filing a petition to establish a WSIRA, it shall also file with the commission a five-year capital expenditure plan unless such a plan has already been submitted during the previous twelve months. Thereafter, the water or sewer corporation shall annually file with the commission a five-year capital expenditure plan by January thirty-first of each year the corporation is collecting revenues through a WSIRA. Nothing in this section shall be construed to prevent the water or sewer corporation from prioritizing eligible infrastructure projects that coincide with public works projects.

2. (1) When a petition, along with any associated proposed rate schedules, is filed pursuant to the provisions of sections 393.1503 to 393.1509, the commission shall conduct an examination of the proposed WSIRA.

(2) The staff of the commission may examine information of the water or sewer corporation to confirm that the underlying costs are in accordance with the provisions of sections 393.1503 to 393.1509, and to confirm proper calculation of the proposed WSIRA, and may submit a report regarding its examination to the commission not later than ninety days after the petition is filed. No other revenue requirement or ratemaking issues shall be examined in consideration of the petition or associated proposed WSIRA rate schedules filed pursuant to the provisions of sections 393.1503 to 393.1509.

(3) The commission may hold a hearing on the petition and any associated WSIRA rate schedule and shall issue an order to become effective not later than one hundred eighty days after the petition is filed.

(4) If the commission finds that a petition complies with the requirements of sections 393.1503 to 393.1509, the commission shall enter an order authorizing the water or sewer corporation to implement a WSIRA that is sufficient to recover appropriate pretax revenues, as determined by the commission pursuant to the provisions of sections 393.1503 to 393.1509.

3. A water or sewer corporation may effectuate a change in its WSIRA pursuant to this section no more often than two times in every twelve-month period.

4. In determining the appropriate pretax revenues, the commission shall consider only the following factors:

(1) The current state, federal, and local income or excise tax rates, including any income tax deductions;

(2) The water or sewer corporation’s actual regulatory capital structure as determined during the most recent general rate proceeding of the water or sewer corporation;

(3) The actual cost rates for the water or sewer corporation’s debt and preferred stock as determined during the most recent general rate proceeding of the water or sewer corporation;

(4) The water or sewer corporation’s cost of common equity as determined during the most recent general rate proceeding of the water or sewer corporation;

(5) The current property tax rate or rates applicable to the eligible infrastructure system projects;

(6) The current depreciation rates applicable to the eligible infrastructure system projects;

(7) In the event information described in subdivisions (2), (3), and (4) of this subsection is unavailable and the commission is not provided with such information on an agreed-upon basis, the commission shall utilize the overall pretax weighted average cost of capital last authorized for the water or sewer corporation in a general rate proceeding regarding a WSIRA or an infrastructure system replacement surcharge under sections 393.1000 to 393.1006.

5. (1) A WSIRA shall be calculated based upon the amount of infrastructure system project costs that are eligible for recovery during the period in which the WSIRA will be in effect and upon the applicable tariff rate group billing determinants utilized in designing the water or sewer corporation’s customer rates in its most recent general rate proceeding and allocated in a manner consistent with the rate design methodology utilized to develop the water or sewer corporation’s base rates resulting from its most recent general rate proceeding.

(2) At the end of each twelve-month calendar period that a WSIRA is in effect, the water or sewer corporation shall reconcile the differences between the revenues resulting from a WSIRA and the appropriate pretax revenues as found by the commission for that period and shall submit the reconciliation and a proposed WSIRA to the commission for approval to recover or credit the difference, as appropriate, through a WSIRA.

6. (1) A water or sewer corporation that has implemented a WSIRA pursuant to the provisions of sections 393.1503 to 393.1509 shall file revised WSIRA schedules to reset the WSIRA to zero when new base rates and charges become effective for the water or sewer corporation following a commission order establishing customer rates in a general rate proceeding that incorporates in the utility’s base rates, subject to subsections 8 and 9 of this section, eligible costs previously reflected in a WSIRA.

(2) Upon the inclusion in a water or sewer corporation’s base rates, subject to subsections 8 and 9 of this section, of eligible costs previously reflected in a WSIRA, the water or sewer corporation shall immediately thereafter reconcile any previously unreconciled WSIRA revenues as necessary to ensure that revenues resulting from the WSIRA match as closely as possible the appropriate pretax revenues as found by the commission for that period.

7. A water or sewer corporation’s filing of a petition to establish or change a WSIRA pursuant to the provisions of sections 393.1503 to 393.1509 shall not be considered a request for a general increase in the water or sewer corporation’s base rates and charges.

8. Commission approval of a petition, and any associated rate schedules, to establish or change a WSIRA pursuant to the provisions of sections 393.1503 to 393.1509 shall in no way be binding upon the commission in determining the ratemaking treatment to be applied to eligible infrastructure system projects during a subsequent general rate proceeding when the commission may undertake to review the prudence of such costs. In the event the commission disallows, during a subsequent general rate proceeding, recovery of costs associated with eligible infrastructure system projects previously included in a WSIRA, the water or sewer corporation shall offset its WSIRA in the future as necessary to recognize and account for any such overcollections.

9. Nothing contained in sections 393.1503 to 393.1509 shall be construed to impair in any way the authority of the commission to review the reasonableness of the rates or charges of a water or sewer corporation, including review of the prudence of eligible infrastructure system replacements made by a water or sewer corporation, pursuant to the provisions of section 386.390.

10. The commission may take into account any change in business risk to the water or sewer corporation resulting from implementation of the WSIRA in setting the corporation’s allowed return in a general rate proceeding in addition to any other changes in business risk experienced by the corporation.

11. The commission shall have authority to promulgate rules for the implementation of sections 393.1503 to 393.1509, but only to the extent such rules are consistent with, and do not delay the implementation of, the provisions of sections 393.1503 to 393.1509. Any rule or portion of a rule, as that term is defined in section 536.010, that is created under the authority delegated in this section shall become effective only if it complies with and is subject to all of the provisions of chapter 536 and, if applicable, section 536.028. This section and chapter 536 are nonseverable and if any of the powers vested with the general assembly pursuant to chapter 536 to review, to delay the effective date, or to disapprove and annul a rule are subsequently held unconstitutional, then the grant of rulemaking authority and any rule proposed or adopted after August 28, 2021, shall be invalid and void.

12. The provisions of sections 393.1500 to 393.1509 shall expire on December 31, 2031.