15-7-602. Extension of system; outside corporate limits; rates; existing contracts; controversies; appeal.

(a) All cities and towns owning their municipal water system or plant may enter into agreements with customers whose lands lie outside the corporate limits to supply water for their use and needs. The water system may be extended and maintained beyond the corporate limits only if it is economically feasible in the opinion of the governing body. The governing body may finance the extension and maintenance of the water system through revenue bonds or other means granted by law for financing of its water system and improvements. A one-time connection fee reasonably calculated to permit recovery of a proportionate share of the municipality's infrastructure cost necessary to treat and convey the water may be charged. A one-time fee may also be charged to recover reasonable expenses incurred by the public entity in determining the actual costs of treating and delivering water to the point of connection. Any charges for special services such as customer's line maintenance shall be in addition to the water rate. The rate established for use of water pursuant to this section is as follows:

(i) Notwithstanding any other provision of this section, a city or town whose water supply system is funded in whole or in part by state grants or loans which at any time after April 1, 1999 or later, enters into a new contract or extends an existing contract to supply water to customers outside its corporate limits shall in establishing rates be limited to the actual costs of providing and delivering water as defined by paragraph (ii) of this subsection, except as otherwise provided by W.S. 15-7-407;

(ii) For customers outside their corporate limits beginning April 1, 1999, where the city or town is a recipient of state grants or loans, and except as otherwise provided in W.S. 15-7-407, the established water rate shall not exceed the actual costs of providing and delivering water to the point of connection to the city's or town's water system. Prior to December 1, 1998, or where the city or town is not a recipient of state grants or loans and except as otherwise provided in W.S. 15-7-407, the established rate shall be applied uniformly and shall not exceed two (2) times the established rate within the corporate limits. The governing body of the city or town may establish one (1) or more unincorporated service areas in each of which an average water rate may be used for all customers. As used in this paragraph, "actual costs of providing and delivering water" shall include a proportionate share of the following costs related to the water system:

(A) Fees, interest charges and principal payments on all bonds issued and other indebtedness incurred to construct, purchase or improve the utility;

(B) Salaries and wages of employees;

(C) The cost of materials, supplies, utilities and outside services;

(D) Other costs directly related to the delivery system;

(E) The cost for providing and maintaining a depreciation fund, a fund for emergencies and a fund for acquisition and development of new water rights and water sources;

(F) Administrative and overhead expenses; and

(G) The cost of acquiring, transporting, processing and treating water.

(b) If requested by the party seeking water service from the city or town and upon approval of the city or town, subsection (a) of this section shall not apply if the ratio of the rate charged to customers outside the corporate limits of the city or town to the established rate within the corporate limits are less than one and one-quarter (1.25) to one (1).

(c) The provisions of this section are not subject to certificates of public convenience and necessity of the public service commission. However, if there is a controversy between the municipality and a consumer outside the corporate limits of the municipality with regard to the establishment of rates, maintenance or servicing in a manner other than as contracted for or as provided in this article, the public service commission may review the matter in controversy, hold hearings, take testimony and make recommendations. The commission's recommendations may be appealed to the district court pursuant to the provisions of the Wyoming Administrative Procedure Act. The ultimate prevailing party shall be awarded a just and reasonable attorneys fee.