1. (1)

   1. (a) The department shall establish a fee schedule for the regulation of public water systems in the state in accordance with Section 63J-1-504.

   2. (b) To create the fee schedule described in Subsection (1)(a), the department shall:

      1. (i) complete a review of program costs and indirect costs of regulating public water systems in the state, after consulting with industry, local governments, special districts, and special service districts;
      2. (ii) use the findings from the review described in Subsection (1)(b)(i); and
      3. (iii) evaluate other sources of funding to support the regulation of public water systems in the state.

   3. (c) The fee schedule described in Subsection (1)(a) may:

      1. (i) implement an annual fee on a public water system in the state, on the basis of consumption, for the direct delivery of water to an end user for human consumption and other domestic uses;
      2. (ii) implement a reasonable fee for plan review;
      3. (iii) implement a reasonable fee for a public water system sanitary survey;
      4. (iv) provide for reasonable and timely oversight of the fee schedule by the department; and

      5. (v) be in an amount needed to reasonably enable the department and public water systems to:

         1. (A) employ qualified personnel to appropriately oversee public drinking water regulation; and
         2. (B) beginning on July 1, 2026, fund water infrastructure projects ranked and prioritized in the unified water infrastructure plan under Section 73-10g-603.

   4. (d) The fee schedule described in Subsection (1)(a) may include fees that provide financial incentives:

      1. (i) to a public water system that is not a community water system if the public water system complies with Section 19-4-114; and

      2. (ii) to a community water system if the community water system:

         1. (A) installs water meters on each residential connection in the community water system;
         2. (B) adopts tiered water rates;
         3. (C) creates a drinking water master plan report within 10 years before the day on which the fee is imposed; and
         4. (D) complies with Section 19-4-114.
2. (2) Except for water delivered by a wholesale water supplier directly to an end user for human consumption and other domestic uses, a public water system that is a wholesale water supplier is exempt from the fee established under Subsection (1)(c)(i).
3. (3) Agricultural water, as that term is defined in Section 73-10g-601, is exempt from the fee established under Subsection (1).

4. (4) A public water system shall submit payment of the fee established by Subsection (1) to the department:

   1. (a) in accordance with a schedule provided by the department; and
   2. (b) using a form provided by the department.

5. (5)

   1. (a) Except as provided in Subsection (5)(b), the department shall deposit fees collected under this section into the Water Infrastructure Fund created in Section 73-10g-107.
   2. (b) The department shall retain a portion of the fees collected under Subsection (1)(c) to offset the department's costs in regulating public water systems.
6. (6) The Office of the Legislative Fiscal Analyst shall monitor fees collected under this section.

Enacted by Chapter 124, 2025 General Session