1. (a) This section applies if:

   1. (1) a utility company acquires property from another utility company at a cost differential in a transaction involving a willing buyer and a willing seller; and
   2. (2) at least one (1) utility company described in subdivision (1) is subject to the jurisdiction of the commission under this article.
2. (b) There is a rebuttable presumption that a cost differential is reasonable.

3. (c) The utility company that acquires the utility property may petition the commission to include the cost differentials as part of its rate base. The commission shall approve the petition if the commission finds the following:

   1. (1) The utility property is used and useful in providing water service, wastewater service, or both water and wastewater service.
   2. (2) The distressed utility failed to furnish or maintain adequate, efficient, safe, and reasonable service and facilities.
   3. (3) The utility company will make reasonable and prudent improvements to ensure that customers of the distressed utility will receive adequate, efficient, safe, and reasonable service.
   4. (4) The acquisition of the utility property is the result of a mutual agreement made at arms length.
   5. (5) The actual purchase price of the utility property is reasonable.
   6. (6) The utility company and the distressed utility are not affiliated and share no ownership interests.
   7. (7) The rates charged by the utility company before acquiring the utility property of the distressed utility will not increase unreasonably as a result of acquiring the utility property.
   8. (8) The cost differential will be added to the utility company's rate base to be amortized as an addition to expense over a reasonable time with corresponding reductions in the rate base.

4. (d) A utility company may petition the commission in an independent proceeding to approve a petition under subsection (c) before the financial close of the transaction if the utility company provides for the following:

   1. (1) Notice of the proposed acquisition and any proposed changes in rates or charges to customers of the distressed utility.
   2. (2) Notice to customers of the utility company that a petition has been filed with the commission under this chapter. The notice provided under this subdivision must include the cause number assigned to the petition.
   3. (3) Notice to the office of the utility consumer counselor.
   4. (4) A plan for reasonable and prudent improvements to provide adequate, efficient, safe, and reasonable service to customers of the distressed utility.

5. (e) In a proceeding under subsection (d), the commission shall issue its final order not later than two hundred ten (210) days after the filing of the petitioner's case in chief. If the commission grants the petition, the commission's order shall authorize the acquiring utility company to make accounting entries recording the acquisition and that reflect:

   1. (1) the full purchase price;
   2. (2) incidental expenses; and

   3. (3) other costs of acquisition;

      as the original cost of the utility plant in service assets being acquired, allocated in a reasonable manner among appropriate utility plant in service accounts.

As added by P.L.189-2015, SEC.1. Amended by P.L.98-2016, SEC.4; P.L.64-2018, SEC.1.