MISSISSIPPI LEGISLATURE
2026 Regular Session
To: Energy
By: Senator(s) Hill
AN ACT TO AMEND SECTION 79-11-394, MISSISSIPPI CODE OF 1972, TO STIPULATE THAT ANY NONPROFIT, NONSHARE CORPORATION THAT FAILS TO TIMELY FILE THE REPORT REQUIRED UNDER THIS SECTION MAY BE SUBJECT TO THE PENALTIES OF DISSOLUTION OR DISALLOWANCE OF NONPROFIT STATUS, OR BOTH, AT THE DISCRETION OF THE STATE AUDITOR; TO AMEND SECTION 77-3-21, MISSISSIPPI CODE OF 1972, TO AUTHORIZE THE PUBLIC SERVICE COMMISSION TO CANCEL A RURAL WATER COMPANY'S CERTIFICATE TO PROVIDE SERVICE UPON A FINDING THAT THE COMPANY DID NOT PROVIDE REASONABLY ADEQUATE SERVICE; TO AMEND SECTION 77-3-22, MISSISSIPPI CODE OF 1972, TO INCLUDE RURAL WATER COMPANIES; TO BRING FORWARD SECTIONS 77-3-11 AND 77-3-47, MISSISSIPPI CODE OF 1972, FOR PURPOSES OF POSSIBLE AMENDMENT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 79-11-394, Mississippi Code of 1972, is amended as follows:
79-11-394. (1) (a) Any nonprofit, nonshare corporation chartered under the Mississippi Nonprofit Corporation Act, Section 79-11-101 et seq., for the purpose of owning and operating rural waterworks annually shall prepare a financial report showing the financial condition of the corporation. The financial report shall be prepared on forms provided by the State Auditor within ninety (90) days following the close of the fiscal year of that corporation. Each report shall contain a certification signed by the president of the board of directors of the corporation that the president has reviewed the information contained in the financial report and that the information is true and correct.
(b) As part of the billing statement received by the subscriber immediately before the annual meeting of the corporation, each corporation owning and operating rural waterworks shall notify each subscriber provided water service by the corporation of the availability of the most recently completed annual financial report, how that report may be obtained and where the report may be reviewed. If requested in writing, the corporation shall provide a copy of the financial report to any subscriber.
(c) Before July 1, 1999, and July 1 of each subsequent year, each corporation required to prepare a financial report under this section shall submit the most recently completed annual financial report to the State Auditor. In addition, the corporation shall provide a copy of that financial report to the public library in the county seat of the county in which the corporation's principal office is located. If no public library is located in the county seat, the corporation shall provide that report to the public library serving the largest population in the county of the corporation's principal office. If requested in writing, the State Auditor shall provide a copy of the financial report to any subscriber of a water system owned and operated by that corporation and may recover the costs of providing that report.
(2) In addition to the information required under subsection (1) of this section, each financial report shall contain the following:
(a) A statement certifying that an annual meeting was held in accordance with the corporation's bylaws, as required under Section 79-11-197, including the date of the most recent annual meeting;
(b) A list of the directors currently serving on the board of the corporation; and
(c) A list of those directors required who have failed to meet the management training requirements under Section 41-26-101.
(3) (a) Before July 15, 1999, and July 15 of each subsequent year, the State Auditor shall provide the State Department of Health a list of all corporations failing to file a report as required under subsection (1) of this section. The State Department of Health shall notify the president of the board of directors of each listed system in writing and shall require that the financial report be submitted to the State Auditor within thirty (30) days after the date of the letter.
(b) If any corporation required to prepare a financial report under this section fails to notify subscribers of the availability of the financial report, no corporate action taken after the date of the annual meeting shall be valid. If any corporation required to prepare a financial report under this section fails to submit the most recently completed annual financial report to the State Auditor, no corporate action taken after the date for submission specified in the letter from the State Department of Health, as required under paragraph (a) of this subsection, shall be valid.
(4) (a) Each nonprofit, nonshare corporation chartered under Section 79-11-101 et seq., for the purpose of owning and operating rural waterworks shall mail to each subscriber provided water service by the corporation, as part of the billing statement received by the subscriber immediately before the annual meeting of the corporation, a notice of the annual meeting of the corporation. Each corporation also shall submit, at the time the notice is provided to the subscribers, a copy of that notice to the State Department of Health.
(b) If any corporation fails to provide notice as required under this subsection, no corporate action taken after the date stated in or fixed in accordance with the corporation's bylaws for the annual meeting shall be valid.
(5) If any nonprofit, nonshare corporation chartered under Section 79-11-101 et seq., for the purpose of owning and operating rural waterworks fails to hold an annual meeting, no corporate action taken after the date stated in or fixed in accordance with the corporation's bylaws for the annual meeting shall be valid.
(6) If any nonprofit, nonshare corporation chartered under Section 79-11-101 et seq., for the purpose of owning and operating rural waterworks fails to file timely the report required under this section, the corporation may be subject to the penalties of dissolution or disallowance of nonprofit status, or both, at the discretion of the State Auditor.
SECTION 2. Section 77-3-21, Mississippi Code of 1972, is amended as follows:
77-3-21. The commission may, after a hearing had upon due notice, make such findings as may be supported by proof as to whether any utility holding a certificate under the provisions of this article, including any rural water company holding a certificate under the provisions of this article, is rendering reasonably adequate service in any area covered by such utility's certificate. In the event the commission finds that such utility is not rendering reasonably adequate service, the commission may enter an order specifying in what particulars such utility has failed to render reasonably adequate service and order that such failure be corrected within a reasonable time, such time to be fixed in such order. If the utility so ordered to correct such a failure fails to comply with such order of the commission and the commission finds that cancellation of its certificate would be in the best interest of the consuming public served by the holder of the certificate, its certificate for the area affected may be revoked and cancelled by the commission.
Prior to any municipality exercising the power of eminent domain as provided in Section 77-3-17, the commission shall determine that the certificate of public convenience and necessity granted to the utility pursuant to Section 77-3-13 for the service area wherein such facilities are located, shall be cancelled as provided in this section. Nothing in this paragraph shall be construed to include service for public water and sewage.
Notwithstanding Section 77-3-1(1), the commission shall have jurisdiction to investigate whether any municipality that holds a certificate to provide service greater than one (1) mile outside its municipal boundaries is providing reasonably adequate service. Following a hearing and upon making such a finding, the commission shall have full authority to enter any order authorized under this section, including canceling the certificate for the area that extends beyond the municipalities' boundaries.
SECTION 3. Section 77-3-22, Mississippi Code of 1972, is amended as follows:
77-3-22. Notwithstanding Section 77-3-1(1), if the commission determines that any privately owned water and/or sewer system, any rural water company or any municipally owned or operated electric utility providing service greater than one (1) mile outside its municipal boundaries and within its jurisdiction is unable or unwilling to adequately serve its customers or has been actually or effectively abandoned by its owner, or that its management is grossly inefficient, irresponsible or unresponsive to the needs of its customers, the commission or its designated representative may petition the Chancery Court of the First Judicial District of Hinds County or the chancery court of any county wherein the public utility does business for an order attaching the assets of the privately owned water and/or sewer system, rural water company or municipally owned or operated electric utility and placing such system under the sole control and responsibility of a receiver. If the court determines that the petition is proper in all respects and finds, after a hearing thereon, the allegations contained in the petition are true, it shall order that the system be placed in receivership. The court, in its discretion and in consideration of the recommendation of the commission or its designated representative, may appoint a receiver who shall be a responsible individual, partnership, corporation or political subdivision knowledgeable in water, sewer or electric service affairs and who shall maintain control and responsibility for the operation and management of the affairs of such system. The receiver shall operate the system so as to preserve the assets of the system and to serve the best interests of its customers. The receiver shall be compensated from the assets of the system in an amount to be determined by the court.
Control of and responsibility for the system shall remain in the receiver until the court determines that it is in the best interests of the customers that the system be returned to the owner, transferred to another owner or assumed by another operator, system or public service corporation. If the court, after hearing, determines that control of and responsibility for the affairs of the system should not be returned to the legal owner thereof, the receiver may proceed to liquidate the assets of such system in the manner provided by law.
In any court-initiated receivership for a municipally owned or operated electric utility providing service greater than one (1) mile outside its municipal boundaries, the receiver shall assume the responsibilities and obligations of the municipality with regard to any existing wholesale power contract.
Mississippi laws and Mississippi Rules of Civil Procedure generally applicable to receivership shall govern receiverships created under this section.
This section is in addition to the provisions of Section 77-3-21.
SECTION 4. Section 77-3-11, Mississippi Code of 1972, is brought forward as follows:
77-3-11. (1) No person
shall construct, acquire, extend or operate equipment for manufacture, mixing,
generating, transmitting or distributing natural or manufactured gas, or mixed
gas, or water, for any intrastate sale to or for the public for compensation,
or for the operation of a public utility operating a business and equipment or facilities
as contemplated by * * * Section 77-3-3(d)(iii),
without first having obtained from the commission a certificate that the
present or future public convenience and necessity require or will require the
operation of such equipment or facility.
(2) No person shall construct, acquire, extend or operate equipment for manufacture, generating, transmitting or distributing electricity for any intrastate or interstate sale to or for the public for compensation without first having obtained from the commission a certificate that the present and future public convenience and necessity require or will require the operation of such equipment or facility. Provided, however, nothing herein contained shall be construed to require a joint municipal electric power agency organized in accordance with the provisions of Section 77-5-201 et seq., Mississippi Code of 1972, to obtain any permit, license, certificate or approval from the Mississippi Public Service Commission.
(3) No person shall construct, acquire, extend or operate equipment or facilities for collecting, transmitting, treating or disposing of sewage, or otherwise operating an intrastate sewage disposal service, to or for the public for compensation, without first having obtained from the commission a certificate that the present or future public convenience and necessity require or will require the operation of such equipment or facilities.
(4) However, nothing herein shall be construed to require any certificate of convenience and necessity from the commission for the production and gathering of natural gas, the sale of natural gas in or within the vicinity of the field where produced, the distribution or sale of liquefied petroleum gas, the sale of natural gas to the ultimate consumer for use as a motor vehicle fuel, or for the facilities and equipment utilized in any such operations.
(5) Upon complaints filed by not less than ten percent (10%) of the total subscribers or three thousand five hundred (3,500) subscribers of a public utility, whichever is less, then the commission shall hold a hearing on the adequacy of service as contemplated in Section 77-3-21.
(6) With respect to any facility or contract for a facility serving a customer under Section 77-3-271, nothing in this section shall supersede the provisions of Section 77-3-271.
SECTION 5. Section 77-3-47, Mississippi Code of 1972, is brought forward as follows:
77-3-47. The commission may, in addition to the hearings specifically provided for by this chapter, conduct such other hearings as may be deemed necessary in the administration of the powers and duties conferred upon it by this title.
The commission shall fix the time and place of hearings and shall serve notice thereof, not less than twenty (20) days before the time set for such hearings, unless the commission shall find that public convenience or necessity requires that such hearings be held at an earlier date. The commission may dismiss any complaint without a hearing if in its opinion a hearing is not necessary in the public interest or for the protection of substantial rights. Notice of all such hearings shall be given the persons interested therein by mailing such notice to each public utility which may be affected by any order resulting therefrom and by publication in a newspaper of general circulation published in Jackson, Mississippi, and, in a proceeding for a facility certificate or an area certificate, by publication in a newspaper of general circulation in the county or counties where the facility or area is located. In addition to any other notice requirements prescribed in this section, notice of a hearing regarding a major change in rates and schedules, as defined in Section 77-3-37(8), by a public utility of the type defined in Section 77-3-3(d)(iv) shall be published in a newspaper having general circulation in an area where service is being provided by the public utility.
At the time fixed for any hearing before the commission, or the time to which the same may have been continued, the complainant and the person complained of shall be entitled in person or by attorney to be heard and to introduce evidence.
SECTION 6. This act shall take effect and be in force from and after July 1, 2026.