OAR 123-049-0050
Private Ownership and Regulation of Subsidies for Public Benefit
(1)
Only if a privately owned public water system is regulated under the jurisdiction of the State of Oregon Public Utility Commission (PUC) may it enjoy the benefits of a “disadvantaged community,” pursuant to section 1452(d) of the Act, in receiving financial assistance through the fund, including but not limited to principal forgiveness.(2)
The amount of subsidy shall not be treated as equity, but rather in all cases as a contingent liability on the balance sheet of the public water system receiving the financing and on the balance sheet of any entity that acquires that system or the assets financed by the Fund.(3)
If a water system is sold that was awarded subsidy by the fund, the value of the subsidy shall be effectively excluded from the purchase price, consistent with section (2) of this rule, such that the benefit of the principal forgiveness continues to accrue to the ratepayers or users of the system rather than to the seller. (This section also applies to the sale or lease of system assets financed by the loan, and it pertains but is not limited to the privatization of a publicly owned system)(4)
If section (2) or (3) of this rule is violated, then the water system shall repay the full amount of the subsidy into the fund. The Authority shall determine the schedule of such repayment, as it deems appropriate under the circumstances.(5)
The Oregon Public Utility Commission (PUC) has full authority to enforce the effects of this rule through applicable regulation of an affected water system.(6)
For non-PUC regulated privately-owned public water systems receiving financial assistance through the Fund under OAR 123-049-0005 (Purpose, Scope and Incorporated Documents)(3)(e), including but not limited to principle forgiveness, the amount of subsidy shall not be treated as equity, but rather in all cases as a contingent liability on the balance sheet of the public water system receiving the financing and on the balance sheet of any entity that acquires that system or the assets financed by the Fund. If the water system is sold that was awarded subsidy by the Fund, the value of the subsidy shall be effectively excluded from the purchase price, such that the benefit of the subsidy continues to accrue to the ratepayers or users of the system rather than to the seller. (This section also applies to the sale or lease of system assets financed by the Fund, and it pertains but is not limited to the privatization of a publicly owned system.) If this rule is violated, then the water system shall repay the full amount of the subsidy into the Fund. The Authority shall determine the schedule of such repayment, as it deems appropriate under the circumstances.
Source:
Rule 123-049-0050 — Private Ownership and Regulation of Subsidies for Public Benefit, https://secure.sos.state.or.us/oard/view.action?ruleNumber=123-049-0050.