North Carolina General Statutes 62-110.3. Bond required for water and sewer companies
(a) No franchise may be granted to any water or sewer utility company until the applicant furnishes a bond, secured with sufficient surety as approved by the Commission, in an amount not less than ten thousand dollars ($10,000). The bond shall be conditioned upon providing adequate and sufficient service within all the applicant’s service areas, including those for which franchises have previously been granted, shall be payable to the Commission, and shall be in a form acceptable to the Commission. In setting the amount of a bond, the Commission shall consider and make appropriate findings as to the following:
(1) Whether the applicant holds other water or sewer franchises in this State, and if so its record of operation,
Terms Used In North Carolina General Statutes 62-110.3
- Commission: means the North Carolina Utilities Commission. See North Carolina General Statutes 62-3
- following: when used by way of reference to any section of a statute, shall be construed to mean the section next preceding or next following that in which such reference is made; unless when some other section is expressly designated in such reference. See North Carolina General Statutes 12-3
- Franchise: means the grant of authority by the Commission to any person to engage in business as a public utility, whether or not exclusive or shared with others or restricted as to terms and conditions and whether described by area or territory or not, and includes certificates, and all other forms of licenses or orders and decisions granting such authority. See North Carolina General Statutes 62-3
- Person: means a corporation, individual, copartnership, company, association, or any combination of individuals or organizations doing business as a unit, and includes any trustee, receiver, assignee, lessee, or personal representative thereof. See North Carolina General Statutes 62-3
- Service: means any service furnished by a public utility, including any commodity furnished as a part of such service and any ancillary service or facility used in connection with such service. See North Carolina General Statutes 62-3
- State: means the State of North Carolina; "state" means any state. See North Carolina General Statutes 62-3
- Trustee: A person or institution holding and administering property in trust.
(2) The number of customers the applicant now serves and proposes to serve,
(3) The likelihood of future expansion needs of the service,
(4) If the applicant is acquiring an existing company, the age, condition, and type of the equipment, and
(5) Any other relevant factors, including the design of the system.
Any interest earned on a bond shall be payable to the water or sewer company that posted the bond.
(b) Notwithstanding the provisions of N.C. Gen. Stat. § 62-110(a) and subsection (a) of this section, no water or sewer utility shall extend service into territory contiguous to that already occupied without first having advised the Commission of such proposed extension. Upon notification, the Commission shall require the utility to furnish an appropriate bond, taking into consideration both the original service area and the proposed extension. This subsection shall apply to all service areas of water and sewer utilities without regard to the date of the issuance of the franchise.
(c) The utility, the Public Staff, the Attorney General, and any other party may, at any time after the amount of a bond is set, apply to the Commission to raise or lower the amount based on changed circumstances.
(d) The appointment of an emergency operator, either by the superior court in accordance with N.C. Gen. Stat. § 62-118(b) or by the Commission with the consent of the owner or operator, operates to forfeit the bond required by this section. The court or Commission, as appropriate, shall determine the amount of money needed to alleviate the emergency and shall order that amount of the bond to be paid to the Commission as trustee for the water or sewer system.
(e) If the person who operated the system before the emergency was declared desires to resume operation of the system upon a finding that the emergency no longer exists, the Commission shall require him to post a new bond, the amount of which may be different from the previous bond. (1987, c. 490, s. 2; 1995, c. 28, s. 1.)