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HB 2863

Clarifying the sheriff’s authority to hire within their office.

2025 Regular Session Introduced by Eric Brooks and 5 co-sponsors

Requires public notice and a 5-year rate increase cap when a large utility buys a smaller water/sewer system, based on mailed rate-change estimates.

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Bill Summary · HB 2863

Summary — HB 2863 (Utility Acquisition Notice)

Status: Introduced Feb 14, 2025; advanced in House and Senate with committee amendments; re-referred in Senate to Assignments (Senate Cmte. Amendment No. 1). Companion: SB 1464. Section amended: 220 ILCS 5/9-210.5 (scheduled to be repealed June 1, 2028).

Purpose / Intent

Require greater public notice and rate‑increase transparency when a large, investor‑owned utility acquires a smaller water or sewer utility (including municipal or special‑district systems), and to limit post‑acquisition rate increases to the estimates provided in that notice for a defined period.

Key provisions

  • Applicability and definitions

    • “Large public utility”: investor‑owned utility regulated by the Illinois Commerce Commission (ICC) that regularly provides water or sewer service to more than 15,000 customer connections.
    • “Water or sewer utility”: includes public utilities with ≤6,000 connections, water districts, township systems, municipal water/sewer systems, and other non‑public‑utility providers.

  • Public notice and meeting (new/changed requirements)

    • If the acquiring large public utility purchases a water or sewer utility owned by the State or a political subdivision, the seller must:
    • Hold a public meeting prior to the acquisition; and
    • Mail notice to the residents in the area served by the water or sewer utility (replacing the current requirement to publish notice in a general‑circulation newspaper).
    • The mailed notice must include:
    • Information about the public meeting (time, place, purpose);
    • Which public body will make the decision on the sale; and
    • An estimate of potential rate increases over the next 5 years attributable to the acquisition, including the acquiring utility’s estimate of the maximum rate increase ratepayers would incur each year for the next 5 years.

  • Post‑acquisition rate increase limit

    • For 5 years after the acquisition, the ICC must deny any proposed rate increase that exceeds the maximum annual estimated rate increase provided in the notice.

  • Continued valuation and rate‑base procedure (existing provisions retained/clarified)

    • If the large public utility elects the Section 9‑210.5 procedures, three independent appraisals are conducted and the average equals fair market value for purposes of ratemaking.
    • The rate base associated with the acquired utility is the lesser of (i) purchase price or (ii) the appraised fair market value, subject to standard adjustments and exclusions (e.g., previously disallowed investments).
    • Appraisers must be disinterested, state‑certified general real estate appraisers and must engage a disinterested, licensed engineer for tangible‑asset assessment.
    • Limits on appraiser fee inclusion in transaction/closing costs: total appraisers’ fees included may not exceed the greater of $15,000 or 5% of the appraised value.

Who is affected

  • Residents and ratepayers of municipal, special district, and small public water/sewer systems being sold to investor‑owned utilities (greater public notice and an explicit estimate of possible rate impacts).
  • Large investor‑owned water/sewer utilities acquiring smaller systems (new public notice duties; presumptive cap on allowed rate increases tied to the mailed estimate for 5 years).
  • Illinois Commerce Commission (must enforce the 5‑year denial of increases above mailed estimates and continue to administer appraisal/rate‑base procedures).
  • Local governments and political subdivisions selling systems (new public‑meeting requirement and mailed notice obligations).

Procedural/timeline notes

  • The statutory section amended (220 ILCS 5/9‑210.5) is currently scheduled for repeal on June 1, 2028 — the bill would apply during the period the section remains in force.
  • The bill has progressed through the House and Senate with committee amendments and was re‑referred in the Senate to Assignments (as of 2025‑06‑02). Further Senate floor action and final enrollment would be required for enactment.

Potential impacts / considerations

  • Increased transparency and direct notice to customers about proposed sales and projected rate effects.
  • A formal, 5‑year constraint on ICC approval of rate increases above the mailed estimate could limit utilities’ ability to recover costs sooner than projected, affecting both ratepayers (short‑term protection) and utility cost recovery/timing.
  • Use of the lesser of purchase price or appraised fair market value to set rate base may protect existing customers of the acquiring district from having acquisition premiums immediately added to rate base.
  • Administrative implications for the ICC (enforcement of the new notice content and post‑acquisition rate limits) and for utilities (pre‑closing public meeting logistics, preparing and mailing notices with 5‑year rate projections).

Compiled from official sources — confirm details with the bill’s official record.

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